Press Abuse

By James Farol Metcalf

Cooke at Consarc Scotland

Cooke at Consarc Scotland records visit of Royce to start the news coverage of the Russian contract

TO: Consarc USA

ATTENTION: Roberts

FROM: Cooke Consarc Scotland

DATE: 14 September 1987

SUBJECT: VISIT OF NEWS REPORTER - KNUT ROYCE

Royce arrived without appointment at about 11:00 am today and was seen by Eric Rennie and myself. Royce said he was doing a story on the whole USSR embargo episode.

He initially asked us to confirm dates of DTI approvals, visits by Customs etc., and generally to recap on the events. He was interested in documentation, but he was shown NO documents other than the Press Statement which we had prepared back in March 1985, when the story first broke.

Royce said he had spoken to Hank Rowan some two months ago, and that he intended to talk to him again when he got back to the USA. He also said he had spoken recently to people in various USA government agencies including the Pentagon and would be speaking to Richard Perle and his replacement (I cannot remember the name). In addition he said he had already spoken to the DTI but declined to say what had been said or who he had seen. And he said he had to agree to confidentially. He also said he was going to Paris to talk to CoCom.

He was particularly interested in speaking to Jim Metcalf (whom he regarded as the "key" man in the entire episode), and Tom Dick.

Royce was EXCEEDINGLY knowledgeable on the various events leading up to the embargo and in various matters arising subsequently.

Examples are as follows:

1. That Consarc had supplied a VIM, a Heat Treat furnace and a Plansee CVD unit to USSR subsequent to the embargo.
2. That Tom Dick was still working in USSR under the name Vacuatherm.
3. That Tom Dick had asked Inductotherm Europe to quote for the supply of parts for the same installation, and that Inductotherm had refused.
4. That Metcalf's company was called "BEPA" and that "BEPA" meant "Vera" in Russian, and that "Vera" was the name of Metcalf's wife.
5. He said he knew some fifteen or so of Consarc's suppliers in the embargoed order. (He rhymed-off some five or six names all of which were correct including Stansted Fluid Power).

Royce also thought Consarc had supplied a small five inch hot isostatic press subsequent to the embargo. We replied in the negative but said that Stansted may have supplied such a unit and any such unit of that size was allowed under Export legislation.

He asked if we thought Metcalf may have had any knowledge, unknown to the rest of the Consarc directors, of the ultimate use to which the equipment would be put. Our reply was that we doubted if this was the case, as meetings were attended by two Consarc directors.

He asked about our knowledge of carbon-carbon, and if we were aware how easy it is (his words) to convert the furnaces to make them usable for CVD purposes. Our reply was that at that time, we had no knowledge of carbon-carbon, nor indeed of CVD - Consarc was and is a furnace builder.

Whilst I did not ask him outright the thrust his story is going to take, my own guess from the conversations is that it is likely to be along the lines of the losers being the Western powers taking actions too late to stop the export of equipment which may be strategic; the losers being the exporting company (in this case Consarc), in terms of lost profits; with the winners being the Soviets who have got all this equipment, perhaps strategic equipment, for free.

Regards,

Cooke