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Annan seeks probe of Iraq oil-for-food program


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Annan seeks probe of Iraq oil-for-food program

U.N. staff members have been accused of profiting

The Associated Press

Updated: 9:29 p.m. ET March 19, 2004

UNITED NATIONS - Secretary-General Kofi Annan sought Security Council approval Friday for an independent investigation into alleged corruption in the Iraq oil-for-food program.


Annan announced his decision to expand a current internal U.N. probe Friday night in a letter sent to the Security Council. The U.N. chief said he wants "an independent, high-level inquiry to investigate the allegations relating to the administration and management of the program, including allegations of fraud and corruption."

Annan's letter didn't elaborate on how an independent probe would be handled. Annan said he would send a further letter later with more detailed information on how such an inquiry would be organized. The U.N. is now conducting an internal investigation into the allegations.

Earlier Friday, Annan told journalists that such an investigation was needed into allegations that U.N. staff may have reaped millions of dollars from the oil-for-food program that helped Iraqis cope with U.N. sanctions.

Annan told journalists that he has been talking with Security Council members about the scope of the investigation and the need for international cooperation to make it effective.

"I think we need to have an independent investigation, an investigation that can be as broad as possible to look into all these allegations which have been made and get to the bottom of this because I don't think we need to have our reputation impugned," he said.

The oil-for-food program was established by the U.N. Security Council in December 1996 to help the Iraqi population cope with U.N. sanctions imposed after Iraq's 1990 invasion of Kuwait. The program, which ended in November, allowed the former Iraqi regime to sell unlimited quantities of oil, provided the money went primarily to buy humanitarian goods and pay reparations to victims of the 1991 Gulf War.

The United Nations has already sent two letters to the Iraqi Governing Council and the U.S.-led coalition requesting evidence of corruption in the program — the latest a week ago.

In late January, the Governing Council asked the country's Oil Ministry to gather information on allegations that Saddam Hussein's regime bribed prominent foreigners with oil money to back his government.

The request followed publication in the Iraqi newspaper Al-Mada of a list of about 270 former Cabinet officials, legislators, political activists and journalists from more than 46 countries suspected of profiting from Iraqi oil sales.

The announcement comes a day after U.S. congressional investigators, in a separate set of allegations, charged that Saddam Hussein's government smuggled oil, added surcharges and collected kickbacks to rake in $10.1 billion in violation of the United Nations' oil-for-food program.

U.N. officials have said that they would not comment on the U.S. figure unless there was "a comprehensive investigation of all aspects of the oil-for-food program, not just U.N. personnel, but what governments and companies did."

"Any such investigation would require the support of the Security Council, and the secretary-general has already indicated this week he has been talking to members of the council" about expanding the inquiry, U.S. spokesman Fred Eckhard said Thursday.

During the program, Saddam's government decided on the goods it wanted, who should provide them and who could buy Iraqi oil. The Security Council committee monitoring sanctions checked the contracts, primarily for dual-use items that could be used to make weapons.

"We certainly knew there was skimming by Saddam and his cronies but with regard to U.N. officials, no," a U.S. official told The Associated Press Thursday, speaking on condition of anonymity. "We certainly hope there are no U.N. officials involved, but if there are some involved, then they should be held accountable."

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March 16, 2004 -- MANY Americans are convinced even today that the war in Iraq was all about oil. And they're right - but oil was the key for French President Jacques Chirac, not for the United States.

In documents I obtained during an investigation of the French relationship to Saddam Hussein, the French interest in maintaining Saddam Hussein in power was spelled out in excruciating detail. The price tag: close to $100 billion. That was what French oil companies stood to profit in the first seven years of their exclusive oil arrangements - had Saddam remained in power.

The French claimed their opposition to the U.S.-led war to oust Saddam Hussein was all about policy. The editor of the Paris daily Le Monde, Jean-Marie Colombani, just resuscitated those arguments in an editorial that singled out George W. Bush as "a threat to the very foundation of the historical alliance between the U.S. and Europe," and called fervently for the election of John F. Kerry. (I guess that F now stands for France.)

But Colombani, whose paper's coverage of the war in Iraq was noteworthy for its wanton disregard for the truth, had not a word to say about his country's war for oil. Indeed, the secret deals the French state-owned oil companies negotiated in the 1990s with Saddam Hussein went widely unreported in France.

Almost as soon as the guns went silent after the first Gulf war in 1991, French oil giants Total SA and Elf Aquitaine - who have now merged and expanded to become TotalFinaElf - sought a competitive advantage over their rivals in Iraq by negotiating exclusive production-sharing contracts with Saddam's regime that were intended to give them a stranglehold on Iraq's future oil production for decades to come.

The first of two massive deals was announced in June 1994 by then-Iraqi Oil Minister Safa al-Habobi - a well-known figure whose name had surfaced in numerous procurement schemes in the 1980s in association with the Ministry of Industry and Military Industrialization, which supervised Saddam's chemical, biological, missile and nuclear-weapons programs.

Speaking in Vienna, al-Habobi confirmed that his government was awarding Total SA rights to the future production of the Nahr Umar oil field in southern Iraq, and that Elf was well-placed to be awarded similar terms in the Majnoon oil fields on the border with Iran.

Those two deals, which I detail in "The French Betrayal of America," would have been worth an estimated $100 billion over a seven-year period - but were conditioned on the lifting of U.N. sanctions on Iraq. Simply put, analyst Gerald Hillman told me, the French were saying: "We will help you get the sanctions lifted, and when we do that, you give us this."

The Total contract, a copy of which I obtained, was "very one-sided," says Hillman. (Hillman, a political economist and a managing partner at Trireme Investments in New York, did a detailed analysis of the contract.) An ordinary production agreement typically grants the foreign partner a maximum of 50 percent of the gross proceeds of the oil produced at the field they develop. But this deal gave Total 75 percent of the total production. "This is highly unusual," he said. Indeed, it was extortion.

But Saddam willingly agreed: He saw the Total deal, and a similar one with Elf, as the price he had to pay to secure French political support at the United Nations.

Much has been written in recent weeks about the corruption of the U.N. Oil-for-Food program. Documents uncovered in Iraq's oil ministry and published by the Baghdad daily al Mada list several cronies of French President Chirac among those who had received special oil allocations as a political payoff from Saddam.

But the amounts attributed to these individuals - in the tens of millions of barrels, on which they stood to earn between 25 to 40 cents per barrel - pale in comparison to the $100 billion payoff orchestrated by Chirac and Saddam.

No, oil wasn't the only reason France opposed the United States at the United Nations in the lead-up to the war. The megalomania of Foreign Minister Dominique de Villepin (who lied to Secretary of State Colin Powell repeatedly and later boasted about it to visiting U.S. congressional delegations) certainly entered into the mix. So did French pride, wounded at the realization that France is no longer the great power it once was.

But the French did not merely disagree with the United States over Iraq, as did a certain number of our allies: They actively sought to rally world leaders and public opinion to treat the United States - not Saddam Hussein - as the enemy.

The enormous difference between those two positions - legitimate dissent and active subversion of America's right to self-defense - is why America is right to treat France as a former ally. Under Chirac's stewardship, France has shown the world that it cared more about propping up a murderous dictator than it valued its 225-year alliance with America.

Kenneth R. Timmerman is a senior writer for Insight magazine. His book "The French Betrayal of America" is just out.

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Hussein's Regime Skimmed Billions From Aid Program


BAGHDAD, Iraq — In its final years in power, Saddam Hussein's government systematically extracted billions of dollars in kickbacks from companies doing business with Iraq, funneling most of the illicit funds through a network of foreign bank accounts in violation of United Nations sanctions.

Millions of Iraqis were struggling to survive on rations of food and medicine. Yet the government's hidden slush funds were being fed by suppliers and oil traders from around the world who sometimes lugged suitcases full of cash to ministry offices, said Iraqi officials who supervised the skimming operation.

The officials' accounts were enhanced by a trove of internal Iraqi government documents and financial records provided to The New York Times by members of the Iraqi Governing Council. Among the papers was secret correspondence from Mr. Hussein's top lieutenants setting up a formal mechanism to siphon cash from Iraq's business deals, an arrangement that went unnoticed by United Nations monitors.

Under a United Nations program begun in 1997, Iraq was permitted to sell its oil only to buy food and other relief goods. The kickback order went out from Mr. Hussein's inner circle three years later, when limits on the amount of oil sales were lifted and Iraq's oil revenues reached $10 billion a year.

In an Aug. 3, 2000, letter marked "urgent and confidential," the Iraqi vice president, Taha Yassin Ramadan, informed government ministers that a high-command committee wanted "extra revenues" from the oil-for-food program. To that end, he wrote, all suppliers must be told to inflate their contracts "by the biggest percentage possible" and secretly transfer those amounts to Iraq's bank accounts in Jordan and the United Arab Emirates.

"Please acknowledge and certify that this is executed in an accurate and clear way, and under supervision of the specified minister," Mr. Ramadan wrote.

Iraq's sanctions-busting has long been an open secret. Two years ago, the General Accounting Office estimated that oil smuggling had generated nearly $900 million a year for Iraq. Oil companies had complained that Iraq was squeezing them for illegal surcharges, and Mr. Hussein's lavish spending on palaces and monuments provided more evidence of his access to unrestricted cash.

But the dimensions of the corruption have only lately become clear, from the newly available documents and from disclosures by government officials who say they were too fearful to speak out before. They show the magnitude and organization of the payoff system, the complicity of the companies involved and the way Mr. Hussein bestowed contracts and gifts on those who praised him.

Yet his policy of awarding contracts to gain political support often meant that Iraq received shoddy, even useless, goods in return.

Perhaps the best measure of the corruption comes from a review of the $8.7 billion in outstanding oil-for-food contracts by the provisional Iraqi government with United Nations help. It found that 70 percent of the suppliers had inflated their prices and agreed to pay a 10 percent kickback, in cash or by transfer to accounts in Jordanian, Lebanese and Syrian banks.

At that rate, Iraq would have collected as much as $2.3 billion of the $32.6 billion worth of contracts it signed since mid-2000, when the kickback system began. And some companies were willing to pay even more than the standard 10 percent, according to Trade and Oil Ministry employees.

Iraq's suppliers included Russian factories, Arab trade brokers, European manufacturers and state-owned companies from China and the Middle East. Iraq generally refused to buy directly from American companies, which in any case needed special licenses to trade legally with Iraq.

In one instance, the Coalition Provisional Authority, the American-led administrators in Iraq, found that Syria was prepared to kick back nearly 15 percent on its $57.5 million contract to sell wheat to Iraq. Syria has agreed to increase the amount of wheat to compensate for the inflated price, said an occupation official involved in the talks.

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The question is will the retarded left and hypocritical antiwar brigade "get it"....

Is this what the clueless mean by the "US going at it alone" or the need to "internationalize" ......

Or is the above a "success" story championed by the moronic left about how war could have been avoided because we had Hussein "boxed in" ........

Wrong side of history for the blowhards again

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Originally posted by igloo

The question is will the retarded left and hypocritical antiwar brigade "get it"....

Is this what the clueless mean by the "US going at it alone" or the need to "internationalize" ......

Or is the above a "success" story championed by the moronic left about how war could have been avoided because we had Hussein "boxed in" ........

Wrong side of history for the blowhards again

Where is DJXENO defending Sadaam?? I still can't believe he has such high regards for him, could need some help...meds anyone? :laugh:

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Originally posted by mr mahs

Where is DJXENO defending Sadaam?? I still can't believe he has such high regards for him, could need some help...meds anyone? :laugh:

These antiwar jerkoffs are once again, on the wrong side of history......as usual...

And the moronic protesters yesterday with their "No War for Oil" and "Bring the troops home now" have once again clearly displayed how detached from reality they are, and how they truly have no idea what the fuck they are talking about

Fucking laughable

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