AEROSPACE and defence group BAE Systems and two other companies are at the centre of an investigation following allegations of false accounting in connection with contracts in Saudi Arabia.
Two people were arrested yesterday during searches by Serious Fraud Office (SFO) investigators.
Eight locations in London and the South were searched.
Two men, one aged 73 and the other 66, were due to be questioned, the SFO said.
Service contracts held between BAE Systems and two sub-contractors, Robert Lee International Limited and Travellers World Limited, were the subject of the probe.
A spokesman for BAE Systems said: "Commentary has suggested that BAE Systems is the target of the investigation. BAE Systems believes that this is not correct and there is a possibility that BAE Systems may itself have been the victim of a fraud."
The Serious Fraud Office confirmed that none of the eight locations searched as part of its investigations were BAE Systems' premises.
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