Global Policy Forum

By Antony Barnett, Martin Bright and Patrick Smith

The Foreign Secretary has to explain why he apparently did nothing when London was told of the alleged coup plot in Equatorial Guinea

Just before last Christmas, a cable was passed to British intelligence marked 'strictly confidential'. On its front page was a map of a tiny West African country, its name - Equitorial Guinea - in giant letters, its offshore island capital, Malabo, given similar emphasis. The 11-page report on one of the most obscure nations on Earth and its neighbour, Sao Tomé and Principé, was believed to have been followed by a second detailed report which was directed to the FCO's small but expert Equatorial Africa department. The two documents told an incredible story of an illegal military operation in the gulf of Guinea involving South African mercenaries and smuggled arms on ships disguised as trawlers. With minds further up the government food chain concentrating on the growing insurgency in Iraq, it was perhaps easy for officials to overlook rumours of yet another coup in yet another central African dictatorship. No one could have predicted how explosive that report would prove to be.

According to the document, serious trouble was brewing in the tiny oil-rich nation. Mercenaries with links to the South African 32 Buffalo Battalion - an apartheid-era special forces outfit - were preparing for a military operation to oust the country's dictator President Teodoro Obiang, who had enriched himself with oil wealth while letting his people starve. FCO analysts were well used to rumours of putsches and coups in this most corrupt and dangerous part of the world. Vast discoveries of oil in the Gulf of Guinea had turned this region into a potential treasure trove, with countries and companies battling to wield influence over who controlled access.

A year on, the story of the plot to overthrow Obiang continues to cause shockwaves as a growing band of high-profile Britons have been dragged into the scandal. The military operation was allegedly masterminded by old Etonian and former British SAS officer Simon Mann, and funded, in part, by Sir Mark Thatcher, son of the former Prime Minister. Now the spotlight is on Foreign Secretary Jack Straw, who is under mounting pressure to reveal exactly what he knew about the coup, when he knew it and - most significantly - why he did not warn the government of Equatorial Guinea. Charges that Britain knew in advance of the plot and failed to warn Obiang's government could not be graver. They suggest that Britain could have acted in contravention of international law; that the government may have provided misleading information about its knowledge; and that Western governments might be turning a blind eye to efforts by some to intervene in the affairs of nation states for commercial gain.

The top secret report received by the Foreign Office turned out to be highly prophetic. It outlined a plot that read like something out of Frederick Forsyth, whose novel The Dogs of War was set in Equatorial Guinea. When the hapless plotters were arrested in March on the runway of Zimbabwe's Harare airport, the allegations against them were precisely those outlined in the documents seen by the FCO. A second report, sent to MI6 in January, was even more specific, naming Equatorial Guinea as the prime target and telling the Foreign Office it was set for March. The documents were written by a character every bit as exotic as Forsyth's hard-bitten soldiers of fortune. Johann Smith, himself a former South African special forces soldier, is an internationally renowned security analyst. He has a fearsome reputation and a marked limp from a combat wound in Angola. Crucially, he has been an occasional adviser to Obiang, the very man the coup was intended to unseat.

In a statement by Smith given to lawyers representing the government of Equatorial Guinea - and seen by The Observer - he says he began hearing rumours of a coup in both Equatorial Guinea and Sao Tomé in November 2003 from two ex-soldiers of the 32 Buffalo Battalion who told him they had been recruited for a coup in by Nick du Toit, the South African arms dealer who on Friday was sentenced by the Equatorial Guinean authorities to 34 years in prison for his part in the plot. Smith states he felt it was his 'duty' to inform the British and American authorities of the coup plans when he found out about them to prevent bloodshed. 'Because I was continuing to work in Equatorial Guinea with government, it was not in my interest that there be a coup d'etat ,' he said. 'I therefore wanted to warn the Equatorial Guinea authorities. I also considered it my duty to war the authorities in US and England because some of their nationals might be killed. I submitted a report in December 2003 of what I had discovered to Michael Westphal of the Pentagon [in Donald Rumsfeld's department]. I expected the US government to take steps to warn Equatorial Guinea or to stop the coup. This was also my expectation as regard the British government, which I warned through two SIS [Secret Intelligence Service or MI6] people I knew, and to whom I sent the report by email, also in December 2003, to their personal email addresses.'

When Smith began to get more intelligence of the plot in January from his former military colleagues who were working for Du Toit's South African firm, he sent another report to the Pentagon and SIS. 'After preparing and sending my December report I received further information,' said Smith. 'I put this in a second report, which I sent by email to the same people as the first one: Michael Westphal of the US and to British SIS contacts'.

It seems inconceivable that this information was not the confidential material Straw finally admitted receiving in 'late January' when he was forced to answer a parliamentary question on 9 November from shadow foreign secretary Michael Ancram. Until earlier this month, the Foreign Office stuck to its line that it knew nothing of the plot until officials and ministers read about it in the newspapers after Mann's group of mercenaries had been arrested. Those same officials, and Straw himself, have now been forced to apologise to The Observer after categorically denying they had prior knowledge of the plot. Smith's statement now suggests they may have had information as earlier as December 2003. His December report named several major players arrested in March and now on trial for their involvement in the failed putsch. Smith pointed out the group had hired two trawlers to operate off the west African coast, despite the fact that all but one member of the group had no seagoing or fishing experience. The report concluded that the commercial fishing operation was a front for the movement of men and arms for a coup. Tellingly, the report also mentioned the group's connections with the Equitorial Guinea opposition leader Severo Moto and warned that any operation would pose a threat to stability in the region.

The report concluded that the trawlers had been deployed 'to present a legitimate front for planned militants action against the Governments of STP [Sao Tomé and Principé] and EG [Equatorial Guinea].' By January, plans for military action were much further advanced. The second report predicted simultaneous attacks on the two states and warned these were planned for 'mid-March 2004'. It should therefore have come as no surprise to the FCO when a group of mainly South African mercenaries were arrested in Zimbabwe en route for Equatorial Guinea, swiftly followed by the seizure of a further group with Buffalo Battalion connections in the West African country itself.

Documents seen by The Observer reveal, for the first time, the full extent of UK government knowledge of the coup. By the end of January, the Foreign Office was being told: 'According to the latest planning, Carlos Cardoso [ex-South African special forces soldier] would, on his return, recruit a total of 75 ex-SADF [South African Defence Force] members, mainly from within the former 32 Bn's [battallions] and Special Forces ranks to launch simultaneous actions in STP and EG. These actions are planned to take place in mid-March 2004.' In Smith's final remark, highlighted and underlined, he does not mince his words: 'Knowing the individuals as well as I do, this timeline is very realistic and will provide for ample time to plan, mobilise, equip and deploy the force.' For the Foreign Office, the warning could not have been clearer or more accurate.

Discussions in London about the plot in fact began long before the December 2003 memo, in one of the most fashionable and exclusive streets in Chelsea. No 149 Old Church Street, a £20 million mansion, is the home of Ely Calil, a Nigerian-born millionaire middleman from a Lebanese family. Almost exactly a year before FCO mandarins were receiving reports of a potential coup, a meeting was taken place in Calil's London home that would help set in train the remarkable chain of events that would ultimately lead to the arrest of Thatcher. Mann had returned from a business trip in Gabon. He had come to Calil's attention not for his upper-class life but for his buccaneering days as a mercenary in Africa. He had help to create Executive Outcomes, which had operated in the bloody civil wars in Angola and Sierra Leone. Calil persuaded Mann to travel to Madrid in February and meet Severo Moto, the exiled opposition leader of Equatorial Guinea. Mann was impressed and agreed to provide military assistance to Moto as part of a planned coup to overthrow Obiang. He then set out to put together a team of backers who would profit from lucrative oil concessions if the coup was successful.

According to a list of alleged backers, London businessman Greg Wales, London-based property dealer Gary Hersham - a former business partner of Calil's - and a South Africa-based British businessman David Tremain all invested in the coup. Each is alleged to have raised $500,000. Tremain is alleged to have been 'fronting' for a syndicate of South African and other minor invest- ors. All four deny involvement. The list of alleged British financiers might not stop there. Bank details of Mann's Guernsey firm, Logo Logistics, reveal that a JH Archer made a payment of £80,000 into his account in the days before the failed coup attempt. This is widely believed to be disgraced Conservative peer Jeffrey Archer, a friend and financial adviser of Calil's. Archer has denied any knowledge of the coup, but has so far failed to deny that the money came from him.

Straw has told parliament that the FCO did investigate if there were any British companies involved in the plot after receiving confidential reports, but failed to find any evidence. The Equatorial Guinean government is not satisfied with this answer. They point out that the plot was largely planned and financed in Britain. While no firms registered in the UK have been directly implicated, firms in offshore territories such as the British Virgin Islands and Guernsey have. Most were run by British citizens or financiers linked to London.

Although Smith's reports made no direct mention of Mann, sources close to the plot have claimed that South African intelligence were aware of the former SAS officer's involvement by January. The small band of mercenaries which run operations like Mann's are well-known to the authorities and rumours of covert military plans normally spread like wildfire. By February the plot was an open secret in London. It was certainly talked about at an event at the Royal Institute for International Affair, organised to discuss 'revenue transparency in Equatorial Guinea'. It is alleged that at one stage an executive from an oil company operating in the region actually stood up and said: 'Everyone knows there's going to be a coup led by South African mercenaries.' A witness also claims that the names of Calil and Moto were linked to the plot.

As England cricketers have been quick to realise, Zimbabwe's president Robert Mugabe seizes on any opportunity to attack his country's former colonial power. Certainly when his officers captured Mann's group of mercenaries and military equipment in Harare, he was quick to tell the world that he believed Britain, the US and Spain had been plotting a coup in the oil-rich West African state. The suggestion was that it was an attempt to gain control over Equatorial Guinea's new-found oil wealth, which has turned the small country into Africa's third-biggest producer. These allegations were strongly denied by the Western governments. But, as more information comes to light, it appears that while there is no evidence to show involvement in the coup, there was no attempt to prevent it either. Obiang is viewed as a corrupt dictator whose human rights record is appalling.

Alex Yearsley, of human rights group Global Witness, said: 'This appears to have all the hallmarks of resource colonialism, with major powers desperate to get a stranglehold of the area's strategic resources. In this part of the world, oil has taken over from diamonds as the source of conflict. It is clear that Britain, the US and Spain knew far more about the coup than they have let on.'

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