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Blood money: How your 401k profits from bombing Yemen 

An exclusive investigation by has traced the manufacture and shipping of bomb components from the European Union to the United Arab Emirates, and also discovered the use of bombs made by the European manufacturer in attacks by the Saudi-led coalition in Yemen, where potentially unlawful civilian deaths have been documented. The Germany-based manufacturer of the bomb components, Rheinmetall AG, is a publicly traded company whose major shareholders have included a host of US financial firms, as well as the New York state pension fund, Virginia’s 529 college savings program and the sovereign pension fund of Norway.

Through their investments in Rhinemetall, these institutions are profiting off the sale of bombs currently being dropped on Yemen. And depending on your 401k, pension or college investment plan, you might be profiting as well.

The route of the Jolly Cobalto from Genoa, through Jeddah to the UAE. (

The route of the container ship Jolly Cobalto in May 2015, from Genoa through Jeddah to the UAE. (

Shipping documents and diplomatic cables leaked by the Yemen Cyber Army and sent to last week trace the recent shipment of bomb components from the Italian port of Genoa to Jeddah, Saudi Arabia, then continuing to Dubai’s Jebel Ali port and overland to a bomb assembly plant in Abu Dhabi. Manufactured by Rheinmetall subsidiary RWM Italia S.p.a. on the picturesque island of Sardinia, the munitions in question are known as MK82 and MK84 bombs. After the long trip from Genoa, components for these munitions are assembled by Burkan Munitions Systems for the UAE’s Armed Forces.  The UAE military is one of several forces that has bombed Yemen as part of a Saudi-led coalition against Houthi rebels since March.

Geo-tagged photographs of MK83 bombs with RWM Italia labelling in a building in Sa’dah, Yemen. (Ole Solvang/Human Rights Watch)

In addition to the recent shipment of MK82/MK84 bomb parts, has also confirmed the export of another RWM Italia-manufactured bomb – the MK83 – from 2012 to 2014, some of which can be also be traced directly to the bombing campaign in Yemen. Ole Solvang, a researcher with Human Rights Watch, photographed this specific model of bomb bearing RWM Italia labeling in Yemen in May of this year. GPS metadata in Solvang’s photographs show the unexploded bombs hit various points of a government compound in Sa’dah, a Houthi stronghold in northern Yemen. has independently verified the location of the attack by cross-referencing it with eyewitness video uploaded by a Sa’dah-based YouTube user of a bomb attack on the same compound in April.

Among the documents obtained by is a letter dated April 21, 2015, from Burkan Munitions. The letter requests the UAE military to arrange a transit permit for the shipment to pass through Jeddah Port in Saudi Arabia in May. The letter was passed from military headquarters to the UAE’s embassy in Riyadh, who requested “diplomatic permission to facilitate entry procedures [at Jeddah Port] for the ship, Jolly Cobalto, hired by UAE’s Armed Forces.” Marked “very urgent,” the communiqué was sent by Saudi’s Ministry of Foreign Affairs for the attention of several ministries, including King Salman, Crown Prince Abdullah and the minister of transport, who also serves as chairman of Saudi Arabia’s general port authority.

Telex from Saudi's MOFA forwarding "diplomatic permission" request from UAE embassy in Riyadh for Italian shipment

Telex from Saudi’s MOFA forwarding “diplomatic permission” request from UAE embassy in Riyadh for Italian shipment

Leaked letter from Burkan Munitions Systems asking UAE armed forces to request “transit permit” for Jeddah Port.

Leaked letter from Burkan Munitions Systems asking UAE armed forces to request “transit permit” for Jeddah Port.

Letter from Burkan Munitions Systems asking UAE armed forces to request "transit permit" for Jeddah Port.

Letter from Burkan Munitions Systems asking UAE armed forces to request “transit permit” for Jeddah Port.

The ship in question, Jolly Cobalto, is the largest roll-on, roll-off container vessel in the world. It departed Genoa on May 12 and arrived in Dubai on June 5, according to records on and shipping documents from the vessel’s Italian owner, Gruppo Messina.

The packing list for the shipment details six 40-foot containers holding the MK82/MK84 bomb components manufactured by RWM Italia. The communique notes that the shipment contains bomb components rather than explosives.

Burkan markets its MK80-series bombs – including the MK82, 83 and 84 – as “perfect for situations where maximum blast and explosion is required.”  The 1,000-lb MK83 found in Yemen is “designed to inflict damage, death and injury through blast and fragmentation effect,” Human Rights Watch’s weapons expert, Mark Hiznay, told They can be dropped free-fall or fitted with a guidance package to improve accuracy. The MK84, listed on the leaked shipping document, weighs approximately 2,000 lbs, depending on fuze and fin configuration.

“In Sa’dah we documented several strikes that we believe were unlawful,” HRW’s Ole Solvang noted. Residential houses and markets were hit and “there were several dozen civilian casualties.”

“It’s quite likely [the Saudi coalition is] using similar bombs in areas where civilians were killed,” Solvang continued, “but we cannot confirm this.” HRW has also documented the illegal and fatal use of banned cluster munitions in Yemen.

Thousands of exports has reviewed Italian export licenses worth over €100 million that have been granted to RWM Italia since 2012 for exports of MK82/83/84 bombs and other munitions. Millions of euros of arms were shipped to Australia and Saudi Arabia in 2012; the documents leaked to now establish a supply line to the UAE. Italy granted export licenses in 2013 and 2014 for large quantities of MK83 bomb components – some which were ultimately found on the ground by HRW in Yemen – including one €62 million contract for 3,650 bombs. No destinations are listed on the 2013 and 2014 licenses, however.

Burkan Munitions Systems was once owned by Rheinmetall until it divested in 2012. Despite the divestment, Burkan remains “dependent on European technology” to assemble bombs, according to Pieter Wezeman, a senior arms researcher with the Stockholm International Peace Research Institute

“Burkan is very much dependent on foreign components [for bombs],” Wezeman explained. “They are assembled in the UAE and filled with explosives. Where they get their explosives, I do not know, but I doubt they are made in the UAE. I believe they are made in Europe and shipped one way or the other.”

Physical specification of MK80 series bombs (

Physical specification of MK80 series bombs (

Business as usual?

Beyond the broader moral questions raised by arms manufacturing, the UAE and Burkan appear to be operating within international norms, according to Pieter Wezeman. He describes it as “a good example of how the UAE is implementing an organized arms export/import system following international standards. Otherwise the risk is bigger that weapons would be diverted into the illegal sphere.”

Having said that, the granting of licenses by the Italian government raises important questions. EU member states are bound by specific criteria on arms exports, as explained by Patrick Wilcken, Amnesty International Researcher on Arms Control, Security Trade and Human Rights:

Under the Arms Trade Treaty and the EU Common Position on arms export control, Italy must undertake a rigorous case-by-case risk assessment of each proposed arms transfer to determine if there is a substantial risk that the arms are likely to be used by the intended recipient to commit or facilitate serious violations of international human rights and humanitarian law. If there is a substantial risk, Italy must deny the export license. [Emphasis by]

In collaboration with Giorgio Beretta, an analyst with the Permanent Observatory on Small Arms (OPAL) in Brescia, Italy, reviewed all export licenses issued to RWM Italia by the Italian government in 2012, 2013 and 2014. Only in 2012 did they issue an export license for MK82/84 parts, as part of a €8.5 million purchase by Saudi Arabia. This raises the question of whether the May 2015 shipment of MK82/84 components – not to mention the remains of MK83s found in Yemen this spring – were exported properly. It is possible that the export license for the bombs sent in May 2015 is so new that it hasn’t been released yet, or that the bombs were exported as part of a bilateral military agreement and not included in official disclosures. is awaiting a response from Italy’s Ministry of Foreign Affairs to clarify the matter.

The company behind the bombs

Rheinmetall AG, headquartered in Germany, operates the Italian subsidiary that manufactured the bomb components. After modest profits in 2013 and 2014, street estimates aggregated by Bloomberg predict the company will return to a €130m profit in 2015 – an increase of 642%. Rheinmetall’s overall business is divided in two sectors: defense and automotive. The company’s 2014 annual report documented more than €2.2 billion in defense-related sales in 2014 – nearly half of their total sales for that year. Defense also accounted for 71% of their total volume of business. According to analysis by JP Morgan, Rheinmetall also has a backlog of over €6.5 billion in defense orders; this will likely push the share price up, they concluded. JP Morgan Chase & Co was, until recently, one of the largest investors in Rheinmetall, according to Rheinmetall stockholder reports, as well as aggregate shareholding data compiled by Bloomberg.

Reports from Rheinmetall’s annual general meeting in May were less auspicious. Attention focused on a  €120 million compensation claim Rheinmetall lodged with the German government for losing a contract with Russia due to Ukraine-related embargoes. Anti-arms activists criticized the company’s increasing relocation of production to countries like South Africa, Saudi Arabia and Indonesia, where they say corporate activity is increasingly difficult to regulate. Indeed, Rheinmetall was fined €37 million in December 2014 for bribes paid by one of its subsidiaries in a Greek arms deal.

Aside from Saudi Arabia, Rheinmetall is controversially linked to the government of Bahrain, where civil rights are brutally suppressed and international law flouted. Through local activists, John Horne and the monitoring group Bahrain Watch has repeatedly documented unmarked tear gas canisters and flash bangs it says were manufactured by Rheinmetall Denel, a subsidiary based in South Africa. Evidence previously verified and documented by this writer for the news agency Storyful through the course of the conflict in Bahrain shows repeated egregious and illegal use of tear gas by security forces in Bahrain. In a statement to German outlet Deutsche Welle, Rheinmetall said it has neither offered nor supplied tear gas cartridges to the government of Bahrain.

Are you profiting from the war in Yemen?

JP Morgan is by no means alone when it comes to financial institutions that have invested in Rheinmetall in recent years. Allianz, Hartford, BlackRock, Dimensional Fund Advisors LP and HSBC are among the nearly 200 financial institutions and funds that have invested in Rheinmetall this year. These investments are then bundled into publicly available funds and bonds, including retirement plans and pension funds.

One sovereign fund – Norway’s state pension fund – has also profited from Rheinmetall, owning 1.87% of the company at the end of 2014, when the value of their holding was 243.5 million kroner ($32.6m /€27m). The pension fund cast votes at Rheinmetall’s AGM in May, thus exercising their role as shareholders.

CollegeAmerica, the largest 529 plan in the US with $45 billion in assets, has also invested in Rheinmetall. So too has the $176.8 billion New York State pension fund, managed on behalf of one million members, including state and local government employees.

JP Morgan was until recently a major shareholder in Rheinmetall, but in recent weeks it reduced its shareholding in Rheinmetall significantly, according to a public filing released on June 16. Activist groups in Germany are supporting a campaign calling for other shareholders to divest and for the federal government to withdraw licenses granted for exports to Saudi Arabia, Qatar and Indonesia. Joint demonstrations at the company’s annual general meeting in Dusseldorf and its Berlin office in May called for shareholders to divest from the company.

Protesters campaigned for shareholders to divest at Rheinmetall’s AGM in May 2015 (Photos: Netzwerk Friedenskooperative)

Behind the documents

The documents obtained by were leaked by a group calling itself the Yemen Cyber Army, which has claimed it hacked Saudi’s Ministry of Foreign Affairs in May. The group supports Yemen’s Houthi rebels, who are currently being targeted by the Saudi coalition. The ministry confirmed a “limited electronic attack” to the Saudi Press Agency on May 22. The hackers uploaded a sample cache of documents to prove the action, and said that “documents and secret emails” would be published gradually. The group said it had also hacked Saudi Arabia’s interior and defense ministries and would release further information in the “near future.” As to the purpose of the hack, the group wrote, “This way [the Saudis] might slightly come to know how it feels when our innocent women and children rush into havens crying and looking for their beloved once in dark.”

Wikileaks recently published documents taken from the Saudi Ministry of Foreign Affairs, that believes to be the Yemen Cyber Army cables. At the time of writing it does not appear that the shipping documents examined here were included in that initial release by Wikileaks. The Yemen Cyber Army posted on May 28 that the documents were submitted to Wikileaks “for backup“; Wikileaks has not revealed the source of its documents. Other documents seen by match what Wikileaks published, suggesting the leaks are the same.*

Comment by company press offices

Reached for comment about our report, Rheinmetall, JP Morgan Chase, Credit Suisse, The Hartford, Capital Group and Dimensional have acknowledged receipt of our questions, but have provided no comment. also emailed and telephoned Burkan Munition Systems for comment on several occasions; they have not replied.

Norges Bank, representing Norway’s sovereign pension fund, replied: “Responsible investment is an integrated part of the management of the [retirement] fund. According to the guidelines for observation and exclusion from the Government Pension Fund Global, the Fund shall not be invested in companies which themselves, or through entities they control, produce weapons that violate fundamental humanitarian principles through their normal use.” Norges Bank then referred us to its Council of Ethics for questions related to alleged breach of these guidelines.

Allianz gave a detailed response, which we have attached to the end of this article.

BlackRock said “the securities of this company are held on behalf of clients and the majority of them are in passive index funds whose holdings are determined by the index provider who sets the index and reflect benchmarks that our clients are seeking to track.”

HSBC and the New York State Comptroller’s office, which manages the NYS Retirement Fund, had not replied at the time of publication.


It will come as little surprise to many that bombs manufactured by a German company are shipped to armed forces around the world; that’s the nature of the international arms trade. What is interesting here is the peek provided by the leaked documents into an arms shipment supply chain, from the point of manufacture in Europe to specific countries engaged in conflict. For residents of the EU in particular, it’s important to know the scale of arms trade by EU countries. For people worldwide who have a stake in retirement funds and other investment plans that may include Rheinmetall in their portfolios, it’s important to know if they unwittingly benefit from the arms trade.

Meanwhile, questions remain to be answered by the Italian authorities regarding who granted export licenses to RWM Italia. Italian members of parliament may submit parliamentary questions to relevant government agencies, and we intend to lodge questions with the help of Giorgio Beretta in Italy. will continue its look into Rheinmetall, its impact on the Yemen conflict and the entities that invest in it. As noted above, Wikileaks has published an initial tranche of leaks obtained from the Yemen Cyber Army; we intend to analyze these leaks for further information that may illuminate other aspects of the story. We will also publish updates as we hear back from companies investing in Rheinmetall.

Edited by Andy Carvin.

Special thanks to John Horne, Bahrain Watch; Margot Williams, researcher at The Intercept; Ole Solvang, HRW; Mark Hiznay, HRW; Pieter Wezeman, SIPRI; Giorgio Beretta, OPAL; Patrick Wilcken, Amnesty International; anonymous financial analyst.

Additional thanks to’s Marina Petrillo,  as well as Conor Fortune and Amnesty International’s Gulf Division for translation assistance, along with Jenny Hauser and our volunteer Arabic translators who wish to remain anonymous for their own safety. Thanks also to Polish Seaman on YouTube, who provided video footage from Genoa Port.

Allianz response:

Allianz applies a group-wide exclusion policy for insurance and proprietary investments relating to banned weapons. This includes cluster munitions, anti-personnel mines, biological and chemical weapons in accordance with their international conventions.
 Alleged exposures can relate to investments on behalf of third party clients. In such cases it is our fiduciary duty to follow the investment requirements of our clients. The ability to apply this exclusion policy varies for some types of proprietary investments when:
- restricted companies are listed on major stock exchange indices, and may, therefore be part of index products (e.g. derivatives, index-funds, etc.)
- Allianz invests into existing investment funds (incl. unit-linked investments) and where investments are carried out according to the fund prospectus
- Allianz temporarily uses proprietary assets to establish a fund for third-party customers and the fund composition is based the specific requirements of these customers.
In order to further develop our ESG ambitions for index-based investments, we are in dialogue with index providers on how to integrate ESG into mainstream index-related products.

This policy is part of 13 ESG policies for sensitive areas, such as Oil & Gas, Large Infrastructure, Human Rights and others. They were developed in cooperation with NGOs in 2012 and 2013 and apply for our business since January 2014. More details are here.

Leaked documents and Italian export licenses

Leaked shipping document of Italian arms to UAE (PDF)

Export licenses for RWM ITALIA (PDF)

*Update: Wikileaks has not revealed the source of its Saudi leaks to be the Yemen Cyber Army. has contacted Wikileaks.


About the author

Malachy Browne

Malachy is Managing Editor and Europe Anchor of Based in Ireland, Malachy works with the European team to report on international stories emerging through online communities and citizen networks. Malachy has reported on the Arab Spring, conflicts in Ivory Coast, Yemen, Syria and Ukraine, humanitarian crises from Somalia’s famine to Typhoon Haiyan, and social and civil rights movements. He has written about eyewitness media and citizen networks for Al Jazeera, Open Democracy and the European Journalism Centre.

Malachy was previously News Editor with Storyful, the first social news agency. He created and edited the Irish current affairs website and magazine archive, (2009). He worked for the political magazine, Village (2006 – 2008), contributing from 2004, and freelanced with Irish Sunday editions.

Formerly a computer programmer, Malachy enjoys newsroom innovation and creating technology that powers journalism and human rights work.

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