A former deputy prime minister of Egypt, who had a Swiss bank account and a reputed desire to receive "commissions" on the award of government contracts, was identified by the Justice Department yesterday as the recipient of $323,000 in bribes from the Westinghouse Electric Corp.
Westinghouse officials in Egypt paid the money after being "led to believe" that contract awards there "frequently involved" payments to government officials, according to a Justice Department report presented to U.S. District Court Judge Barrington Parker.
Parker fined the giant corporation $300,000 after accepting a negotiated guilty plea. He had rejected the plea a month ago because the Justice Department withheld the identities of the country involved and the recipient.
Yesterday, Justice Department attorney D. Jeffrey Hirscberg said the decision to withhold this information had been made and concurred in by the State Department as a precautionary measure amid the sensitive Israeli-Egyptian peace negotiations.
Two days later, however, The Washington Post reported the country and individual involved, prompting the government to release the information yesterday before Parker.
Ahmed Sultan Ismail, then Egyptian minister of electricity and later deputy prime minister, received the money in 1974 and 1975, according to the Justice Department. During this period, Hirschberg said, Westinghouse had learned that Ismail "would be interested in receiving a commission in connection with contracts under his jurisdiction."
Westinghouse, in return, received a $30 million contract to build a fossil fuel electric generating plant for Cairo, financed by the U.S. Export-Import Bank, and a $1.44 million contract to provide spare plants, financed by the U.S. Agency for International Development.
It was Ismail who first informed Westinghouse that the AID money was available, according to the report. He then allegedly extracted an agreement whereby he would receive 5 percent of the purchase price - in this instance $73,000 - "as a commission on any such order."
The money was paid directly to Ismail at his home, according to Justice Department.
Westinghouse officials in Egypt and Ismail reputedly agreed on a larger commission for the lower plant in late 1974. Initially, Ismail was to be paid the $250,000 in installments over the term of the contract, Hirscberg said.
He said that shortly before the award was scheduled, however, "Westinghouse employes in Egypt became concerned that the company might not receive the contract after all." Hirschberg said they promised Ismail that "if Westinghouse received the award, the $250,000 payment would be made to him in full, immediately upon the receipt by Westinghouse" of a down payment for the project.
The money then was funneled once again through the sales representative, according to Hirschberg, and the representative transferred it to a numbered Swiss bank account. Ismail later confirmed that he had received the money, Hirschberg told the court.
Hirschberg said that Westinghouse officials in the United States had no knowledge of the bribe payments when they occurred.
The company was fined $10,000 each on 30 counts of falsely declaring to the Export-Import Bank and AID that no such bribes had been paid.
The Westinghouse case is one of dozens involving payments to overseas officials by major U.S. contractors. It probably would have been little publicized but for the decision to withhold the identities when the matter was first presented to Parker.
Parker reacted angrily at that time and rejected the agreement. "It appeared to be a neatly tied bundle," he said yesterday, ". . . and the court did not feel it promoted the ends of justice. There may be those today who still feel it does not promote the end of justice," he said, without elaborating, as he accepted the plea and imposed the fine.