Over the past decade, Qatar has dramatically increased its military capabilities. Qatar’s military expenditure rose by 434%, a process of hyper-militarization which intensified after the 2017 blockade on Qatar led by Saudi Arabia and the United Arab Emirates. The promise of lucrative contracts attracted foreign arms companies, particularly US manufacturers - major weapons imports from the US grew by at least 208% between 2016-2020 relative to the previous four years.
Between 2014 and 2019, US manufacturer Raytheon pursued numerous contracts with the Qatari Armed Forces. The first, termed “Project Falcon,” was a project to acquire a Command, Control, Communications, Computers, and Intelligence (C4I) system. However, this was never finalised. Another, a contract to build an early warning radar system, was signed in February 2017. Three separate deals were concluded to supply Qatar with surface-to-air (SAM) systems, including Patriot missile defence systems in 2014 and again in 2019.
In 2013, a defense and security consultancy company, Digital Soula Systems (DSS) was incorporated in Qatar to provide advisory services to the Qatari Armed Forces (QAF). DSS was majority-owned by the brother of the Emir of Qatar, making the company very close to the royal family. Amongst other services, DSS was hired to modernise the country’s arms procurement process, and, in March 2015, it was tasked to advise on the contracting and implementation of Falcon Project.
After the negotiations for the Falcon Project fell through in mid-2017, former DSS director Tarek Fouad filed a lawsuit in the US demanding US $ 4.4 million in unpaid fees. He also alleged that Raytheon made bogus payments to DSS intended as bribes to the royal family to facilitate Qatari contacts and that his two co-directors made a deal with the QAF to avoid prosecution for bribery.
While it remains unclear if any deals signed between Raytheon and Qatar during those years were influenced by bribery, the U.S. Department of Justice (DOJ) and U.S. Securities and Exchange Commission (SEC) are currently investigating Raytheon. A 2019 subpoena from the SEC requested information relating to an investigation into improper payments made by Raytheon and Thales-Raytheon Systems (TRS) (a joint venture between Thales and Raytheon) in the Middle East between 2011 and 2014. Another, filed in 2020, investigates a separate contract signed in 2017.
While the exact deals are not specified, the Washington post reported the connection between the investigation and the case of Qatar based on individuals familiar with the details of the case.
Raytheon Technologies: Raytheon is the 4tht largest weapons producer in the world. The US-based company has an annual revenue of almost 65 billion USD, and employs over 170,000 people. Raytheon’s Missile and Defense Division has been implicated in this case in relation to a deal from 2017.
Thales Raytheon Systems: A joint venture involving French Thales and U.S.-based Raytheon arms manufacturers. The joint venture led a consortium that bid for the Qatari C4I system tender in 2016.
Digital Soula Systems (DSS): was a Qatari security consultancy firm founded in 2014. Employing both local and international military and ex-security sector personnel, the company provided consultancy services to the Qatari government, advising them on military procurement and systems.
Sheikh Joaan bin Hamad bin Khalifa Al Thani: Majority shareholder of Al Sedriah, a holding company that owned 60% of DSS. Joaan Al Thani is the brother of the Emir of Qatar and is an influential member of the royal family.
Tarek Fouad: a former director in DSS that sued the Qatari government in 2019. His lawsuit was what brought bribery allegations to light.
Mohammed Al Mannai and Abdul Salam Abu-Issa: co-directed DSS with Fouad. Al Mannai and Abdul Salam came to a settlement with the Qatari government for contracted work. Al Mannai was also an active service lieutenant colonel in the Qatari armed forces at the time.
Steve Murphy: Vice President for Contracts at Raytheon Missiles and Defense from 2010 to 2022, when he and two other executives were replaced with no official explanation. This happened three months after Raytheon was presented with a first criminal subpoena in this case.
Sean Sabin: Former senior council at Raytheon Integrated Defense Systems from 2011 and 2019. In 2022, while serving as the Vice President and General Counsel, Raytheon Space and Airborne Systems, he and two other executives were replaced with no official explanation. This happened three months after Raytheon was presented with a first criminal subpoena in this case.
Heather Asbell: Former chief financial officer at Raytheon Integrated Defense Systems until 2022 when she and two other executives were replaced with no official explanation. This happened three months after Raytheon was presented with a first criminal subpoena in this case.
Summary of Corruption Allegationscontents
Between 2014 and 2017, Raytheon made a series of payments to DSS estimated at US $ 1.9 million. Allegedly, some of these payments were intended as bribes for a member of the royal family of Qatar in order to facilitate Raytheon’s interests in different arms export deals with Qatar.
DSS is majority owned by Al Sedriah – a holding company owned by the brother of the Emir of Qatar, Sheikh Joaan bin Hamad Al Thani. In addition, one of the directors of the company, Mohammed Al Mannai, was an active service colonel in the Qatari armed forces.
In a lawsuit against the Qatari government, filed by the former DSS director, Tarek Fouad, several bank statements were presented that showed payments from Raytheon to DSS. Officially, these payments were for defence studies and reports regarding Qatar’s defence systems that Raytheon commissioned from DSS. However, forensic analysis of the studies themselves (commissioned by Fouad as part of his lawsuit) suggest they were actually performed by Raytheon themselves. As quoted in a Wall Street Journal article, Fouad said, “This form of bribe is often referred to as a no-work contract”.
DSS were the main consultants to the Qatari government on ‘Project Falcon’, the C4I system Raytheon was competing for. While the project itself was eventually scrapped, Qatar was considering an offer from a Raytheon-led consortium at the time.
Meanwhile, the Qatari government failed to pay DSS all payments agreed upon in its contract. In 2018, two of the three directors of DSS, Mohammed Al Mannai and Abdul Salam Abu-Issa, reached an agreement with the Qatari government in which they received US $ 2.4 of the US $ 6.8 million owed to the company. In his lawsuit, Fouad alleged that this agreement was reached after the Qatari ministry of defence suspected that the pair were involved in bribing a member of the royal family, and that they agreed to accept the settlement in order to avoid an investigation.
In 2019, the Securities and Exchange Commission (SEC) handed Raytheon a subpoena seeking documents for an investigation regarding improper payments in dealings of Thales-Raytheon Systems in a “middle eastern country”. A second SEC subpoena was submitted in 2020.
In October 2020, following these allegations, the U.S. Department of Justice started its own investigation and served Raytheon with two criminal subpoenas (in 2020 and 2021). Following these, Raytheon contracted the law firm Wilmer Cutler Pickering Hale and Dorr LLP to investigate their relationship with DSS. Raytheon has publicly denied any wrongdoing, but in their annual report of 2021, they wrote that they have also allocated 290 million USD for the “risk of liability for damages, interest and potential penalties”. Moreover, the chief financial officer, vice president of contracts, and general counsel of the Missiles & Defense Division left Raytheon in March 2022 with no official explanation. The Missiles & Defense Division is the division involved in the 2017 deal with Qatar, as well as with the earlier 2014 Patriot-3 deal.
- Qatar sets off to establish a Command, Control, Communications, Computers, and Intelligence (C4I) project under the name of “Project Falcon”.
- DecDSS is contracted by the Qatari government to consult on “Project Falcon”.
- DecRaytheon signed the first part of a 7.6 billion USD contract with Qatar for the Patriot-3 System (delivered 2014-2019).
- 2014 until 2016: Raytheon makes a series of payments to DSS for “security studies” allegedly written by Raytheon themselves.
- MarTwo consultants from DSS travelled under contract with the Qatari air force to California for a workshop about C4I solutions held by Raytheon as part of their sales pitch.
- JulDSS consultants review a first C4I proposal from Raytheon.
- An offer from a Raytheon-led consortium of companies is the only one received in the Qatari bid for the Falcon Project (a project that eventually did not move forward).
- DecRaytheon received a 163 million USD contract from the U.S. army for training services to the Qatari air force for the patriot system.
- NovDSS directors, Mohammed Al Mannai and Abdul Salam Abu-Issa, reach a settlement with the Qatari government to accept reduced fees for DSS services. In return, the Qatari government allegedly agreed to cease investigations into bribery.
- MarRaytheon receives a 1.1 billion USD contract for building an A/N FPS-132 Block 5 Early Warning Radar system in Qatar.
- The first SEC subpoena was handed to Raytheon for dealings of Thales-Raytheon Systems in a “middle eastern country”.
- OctThe first DOJ criminal subpoena is filed, seeking information on contracts signed between 2011 and 2014.
- JanThree senior executives of Raytheon’s Missiles & Defense division leave the organization. No official reason is given.
- MarThe second criminal subpoena is filed, seeking information on a contract signed in 2017.
- Also in 2021, Raytheon puts aside 290 million USD for legal defense and liabilities relating to criminal investigations.
Tokar, Dylan. U.S. Probes Examine Raytheon’s Dealings With Qatari Defense Contractor, The Wall Street Journal, 2021.
Intelligence Online, DSS/Thales Raytheon case: Joaan Al Thani exposed, Intelligence Online, 2020.
Intelligence Online, Raytheon and Thales competition affected by legal spat involving Emir's brother, Intelligence Online, 2019.
Raytheon Technologies Corporation. Form 10-K, United States Securities And Exchange Commission, Washington, D.C., 2021.
Tarek Fouad against the state of Qatar, the United States District Court, California, 2019