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July 02, 2004
U.N. Lesson: Follow the Oil-for-Food Money
Wednesday, June 30, 2004 By Claudia Rosett NEW YORK — This is the tale of a bribe linked to the U.N. Oil-for-Food program in Iraq. The bribe itself, paid to Saddam Hussein's regime, first made the news in late 2002. What got no attention at the time, however, was just how odd a response it drew from the United Nations. There, it was treated as just another modest irregularity in Oil-for-Food — worthy of polite inquiry, but not the outrage and immediate expert investigation it deserved. Certainly there was far less fury from the United Nations over this bribe than Secretary-General Kofi Annan and his aides have since expressed in rejecting criticisms that the world body ran a crooked Oil-for-Food program. But here's the charm at the center of it all (and one that various investigators now sorting through Oil-for-Food might want to keep in mind): U.N. procedure itself, even in a matter as serious as bribery, evidently entailed treating Saddam not like a totalitarian ruler under strict sanctions, but as just another esteemed head of state — albeit one with a particularly large U.N. welfare program underway. Here's the story of the bribe itself — or rather, of its discovery. As a rule, Saddam's partners-in-corruption were not eager to file official complaints, having nothing to gain from informing on themselves. Nor was the United Nations very inquisitive, despite rumors about corruption from the program's early days. When several Oil-for-Food contractors brought Iraqi kickback demands to the attention of the program's executive director, Benon V. Sevan, in 2000 — as the Secretariat finally disclosed to the Financial Times in 2004 — he effectively buried the issue at that time by telling informants to leave him alone and go file official complaints with their country missions. But in the case of this particular bribe, matters had already gone too far for a brush-off. The informant was a Russian businessman named Gazi Luguev, president of a Swiss-based trading company, Lakia S.A.R.L, which was authorized to buy Iraqi oil from Saddam under the program. Luguev was upset — not because Saddam's regime had asked him for a bribe — but because, by his own account, he had paid the bribe to no avail. He wanted his company's money back. As detailed in a fax dated Oct. 2, 2002, which Luguev sent to Iraq's State Oil Marketing Organization (SOMO) and copied to the U.N. oil overseers in Sevan's New York office, Luguev had been asked by the Iraqi regime to pay a "deposit" of $60,000 into a secret bank account in the Jordan National Bank in order to procure an Oil-for-Food shipment of underpriced Iraqi oil. Any such payment was in gross violation of both U.N. sanctions against Iraq and Oil-for-Food rules, which spelled out that all Iraq's oil-related revenues would flow strictly into a U.N.-held escrow account. To read the Lakia fax, click here — Adobe Acrobat required to view pdf. According to Luguev's fax, Lakia had paid the $60,000 to Baghdad in advance (which was by several accounts standard practice for such kickbacks on oil shipments, which were widely rumored to be commonplace). But this time, Iraq did not deliver any oil. So Luguev, in his fax to the Iraqi authorities and to Sevan's office, demanded Iraq refund to Lakia its deposit "or we will be obliged to take all necessary legal steps and apply to all concerned organizations to get our money back." A copy of this fax, and the ensuing correspondence, was obtained by private investigators John Fawcett and Christine Negroni, at the New York law firm of Kreindler & Kreindler. In reviewing these papers recently, they took a closer look at Sevan's response to Luguev's fax. What jumped out was that Sevan had fired off a letter that same day, Oct. 2 (as well he should have, this being formal documentary evidence of a kickback to Saddam's regime.) To read the Sevan letter, click here -- Adobe Acrobat required to view pdf. But did he write immediately to inform the Security Council, which oversaw the program? Did he alert any independent auditing or investigative authority? Evidently not. First, and foremost, Sevan wrote to Saddam's U.N. ambassador, Mohammed Aldouri, attaching Luguev's complaint. Sevan warned Aldouri: "I am duty bound to bring the matter to the attention of the Security Council Committee." Sevan then added a crucial sentence: "Prior to doing so, however, I should like to receive most urgently the views and comments of the Government of Iraq on the information provided by Lakia SARL." He asked for a response within one week. In other words, in the interest of what one can only suppose was routine information-gathering at the United Nations, Sevan's first move was, in effect, to give Baghdad a week's notice to bury the evidence and prepare a reply. In a purely private business setting, this might be excused as nothing worse than an attempt to gather all the facts before taking the case to the boss (though in some quarters, one might hope that documented allegations of a $60,000 payoff would warrant the immediate attention of the top brass). But Oil-for-Food was not a private business. It was an international program that existed — and was funded handsomely with 2.2 percent of Saddam's oil revenues — solely to supervise the commerce of a predatory totalitarian regime under strict U.N. sanctions. One would have thought that a fax detailing the illicit flow of money to Saddam's regime via a Jordanian bank account should have inspired loud and immediate alarms on all fronts, and an immediate heads-up to the Security Council — not just an exclusive letter to the Iraqi mission that begins with the salutation, "Excellencies," and requests "views and comments" about the Lakia charges. Any official Oil-for-Food document with Sevan's signature gets extra scrutiny these days for two reasons. First, the United Nations has persistently kept most of the vital paperwork concerning the program secret. Second, because there have been allegations, now under investigation, that in 1998 Sevan himself received oil allocations from Saddam. Sevan has denied he ever took anything from Saddam's regime. But even if he is officially cleared of all allegations, even if in the case of the Lakia bribe he was simply following established procedure, there remains the big question: Just what kind of crazy shop had the United Nations become that the excellencies of Baghdad — the accused bribe-takers in this dispute — were treated not as a government under sanctions, but as esteemed clients? So softly worded is Sevan's letter that it's hard to tell whether his chief concern was that Baghdad had been collecting bribes, or that Baghdad had failed to deliver on them. In a reply to Sevan, dated oddly enough a day earlier than Sevan's letter (but registered by the Oil-for-Food office six days later, on Oct. 8 — just within the deadline set by Sevan) Saddam's Ambassador Aldouri said that the fax from Lakia contained information that was "incorrect." To read the Aldouri letter, click here -- Adobe Acrobat is required to view pdf. However, according to a Newsweek story about the Lakia kickback spat, published in November 2002, Saddam's government then offered to refund Luguev's money. And while the Security Council's Sanctions Committee was eventually informed of the Lakia affair, a source close to the United Nations reports that such member states as China, Russia, France and Syria opposed any action — and none was taken. Sevan did not reply to requests for his comments on this matter. Annan's office, asked to clarify if it was U.N. procedure to relay bribe allegations to Saddam before informing the Security Council, gave a pro forma response that the Secretariat is not commenting these days on anything that is "within the purview" of the Oil-for-Food investigation led by former Federal Reserve Board Chairman Paul Volcker. Indeed, we have yet to hear any U.N. statement of condemnation, let alone contrition, for the Oil-for-Food fiasco. Over the course of the program, which ended last year, Saddam's regime by General Accounting Office estimates pocketed more than $4 billion in such "deposits" — skimmed from oil earnings meant to feed and doctor the people of Iraq. What needs investigating here is not only whether the United Nations violated its own practices, but how it slid into procedures that so comfortably let this happen.
Claudia Rosett is Journalist-in-Residence at the Foundation for the Defense of Democracies, an adjunct fellow at the Hudson Institute, and writes a column, "The Real World," on issues of tyranny and human rights, especially as these relate to the war on terror, for The Wall Street Journal’s Opinionjournal.com and The Wall Street Journal Europe. Previously, Ms. Rosett has served as a member of The Wall Street Journal’s editorial board in New York, as bureau chief in The Wall Street Journal’s Moscow Bureau and as editorial-page editor of The Asian Wall Street Journal. For her on-site coverage of China’s 1989 Tiananmen Square uprising, Ms. Rosett won an Overseas Press Club Citation for Excellence. Posted by Ruth at 09:04 PM
April 27, 2004
Thinking the Unthinkable
Publication:The New York Sun; Date:Apr 26, 2004; Section:Editorial & Opinion; Page:11
on why it’s time for America to take a deep breath and abandon the United Nations Mark Steyn ‘War without the U.N. is unthinkable,” pronounced Polly Toynbee, grande dame of Britain’s Guardian, a year ago, just before it happened. For a certain type of person, any action on the international scene without the United Nations is unthinkable. And, conversely, anything that happens under the U.N. imprimatur is mostly for the unthinking. No matter how corrupt and depraved it is in practice, the organization’s sunny utopian image somehow endures. Say the initials “U.N.” to your average member of Ms. Toynbee’s legions of the unthinking and they conjure up neither U.N. participation in the sex-slave trade in Bosnia, nor the U.N. refugee extortion racket in Kenya, nor the U.N. cover-up of the sex-for-food scandal in West Africa, nor U.N. complicity in massacres, but some misty Austin Powers–era Unesco cultural event compered by the late Audrey Hepburn and featuring photogenic children of many lands. So the question now is whether the U.N. Oil-for-Food program is just another of those things that slip down the memory hole, and we all go back to parroting the soothing lullaby that “only the U.N. can bring legitimacy to Iraq/Afghanistan/Your Basket Case Here.” Legitimacy seems to be the one thing the UN doesn’t bring, and I’m not just talking about the love children of U.N.-enriched Balkan hookers in Kosovo. The scale of the U.N. Oil-for-Fraud program is way beyond any of the corporate scandals that so excite the progressive mind. Oil-for-Food was a U.N. program designed to let the Iraqi government sell a limited amount of oil in return for food and other necessities for their people. Between 1996 and 2003, Saddam Hussein did over $100 billion of business, all of it approved by Kofi Annan’s Secretariat. In return, by their own official figures, $15 billion of food and health supplies was sent to Iraq. What proportion of this reached the sick and malnourished Iraqi children touted by the anti-war crowd before the liberation is anybody’s guess. Coalition troops discovered stockpiles of U.N. food in remote locations far from starving moppets. But let’s assume there’s an innocent explanation for that. Even so, by the U.N.’s own account, Oil-for-Food seemed to involve an awful lot of oil for not much food. Where did all the other billions go? According to Mr. Annan himself, some $31 billion went on other “humanitarian” spending for Iraq. Such as? Well, in 2002, the secretary-general personally expanded the program to cover other “humanitarian” categories such as “sport,” “information,”“justice” and “labor and social affairs.” In Iraq, “sport” meant Uday’s rape rooms, and “justice” meant a mass grave out in the desert, but that’s not to say there weren’t attendant expenses involved. So Mr. himself directly approved such “humanitarian” items as $20 million for an “Olympic sport city” (state-of-the-art rape rooms) and $50 million for Iraq’s Ministry of Information (Comical Ali’s gag writers). As America’s Defense Contract Management Agency’s subsequent report put it after the liberation, “Some items of questionable utility for the Iraqi people (e.g., Mercedes-Benz touring sedans) were identified.” The Jordanian supplier of schoolroom furniture had to be let go on the grounds that he didn’t exist. So far, all this is just U.N. business as usual — venal and wasteful, albeit on a larger scale than ever before. But even by their own revolting standards, the U.N. crossed a line. A program created to allow the world to constrain Saddam became instead the means by which Saddam constrained the world. Oilfor-Food gave him a free hand to reward wellconnected French and Russian suppliers. He ran the show by selling cut-price vouchers for Iraqi oil to politicians and bureaucrats, which they could then offload on the world markets at the going rate. Among the alleged beneficiaries were a French interior minister,a French U.N.ambassador, Russia’s “office of the president,” the Indonesian president,and the Reverend Jean-Marie Benjamin, the French priest who arranged Tariq Aziz’s disgusting photo-op with the Pope and in return for his efforts is said to have received vouchers for 4.5 million barrels of oil. According to documents found in the oil ministry in Baghdad,Saddam saw to it that the man Mr. Annan picked to run Oil-for-Food, the U.N. undersecretary-general, Benon Sevan, got enough oil to make himself a nice illegal profit of $3.5 million. In other words, “Oil-for-Fraud” is everything the left said the war was: It was all about oil — for Mr. Sevan, the U.N.,France, Russia, and the others who had every incentive to maintain Saddam in power. Every Halliburton invoice to the Pentagon is audited to the last penny, but Saddam can use Mr.Annan’s office as a front for a multibillion-dollar global kickback scheme, and, until it was brought to public attention by the tireless Claudia Rosett of the Wall Street Journal and a few other persistent types, the secretary-general apparently never noticed a thing. He hadn’t even noticed that two of the firms enriched by his program had ties to financier Ahmed Idris Nasreddin, named by the U.N. as an individual “belonging to or associated with”Al Qaeda — just another of those non-existent links between Saddam and Islamist terrorism. Mr. Sevan has now returned to New York from Australia, where he was lying low for several weeks. Not that he needed to go to a lot of trouble about it.The lethargic Aussie press made little effort to run him to ground. It seems the notion that lifelong U.N. bureaucrats are at the center of a web of massive fraud, influence-peddling, veto-securing, and torture-funding at the expense of starving Iraqi urchins is just too, too “unthinkable” for much of the press. So the conventional wisdom stays conventional — that we need to get the U.N.back into Iraq. No we don’t. Iraq deserves better than an organization that spent the last six years as Saddam’s collaborator. As Ms. Rosett put it,“We are left to contemplate a U.N. system that has engendered a secretary-general either so dishonest that he should be dismissed or so incompetent that he is truly dangerous — and should be dismissed.” He should be, but he almost certainly won’t be. After all, it’s hardly his fault. When he set up the show, who would have thought that one day there’d be American auditors in Baghdad? Why, it was, as Ms. Toynbee would say, “unthinkable.” Mr. Annan should not be in Turtle Bay, Mr. Brahimi should not be in Baghdad. The U.N. needs to fix itself before it can plausibly be entrusted to fix anywhere else. And, if it doesn’t want to fix itself, it should be abandoned by America, Britain, Australia, and others to die in irrelevance. It’s time to think the unthinkable. Posted by Ruth at 01:14 AM
April 24, 2004
UN envoy to Iraq: Israel's policy 'poisonous'
UN envoy to Iraq: Israel's policy 'poisonous' THE KOFI KLATCH
-------------------------------------------------------------------------------- "Israel's aggressiveness and the suffering condition of the Palestinians is the greatest poison in the Middle East," said United Nations special envoy to Iraq Lakhdar Brahimi, adding that many share his views, Israel Radio reported Friday. In an interview with a French radio station, Brahimi said that there is a clear connection between the situation in Iraq and Israel's policy. Brahimi criticized US President George W. Bush's support of Prime Minister Ariel Sharon and his unilateral disengagement plan. Fred Eckhard, spokesman for UN Secretary-General Kofi Annan, said that Brahimi's statements are his personal opinions and do not represent the opinion of Secretary-General Annan. Posted by Ruth at 01:00 AM
April 21, 2004
UNITED NATIONS VERSUS ISRAEL
U.N. vs. Israel Telling standards. By Anne Bayefsky April 20, 2004, 8:48 a.m. http://www.nationalreview.com/comment/bayefsky200404200848.asp
Hamas has been declared a terrorist organization by the U.S. State Department, as well as the European Union, Canada, and Australia. The 1988 Covenant of Hamas, the Islamic Resistance Movement, speaks for itself. It begins "Israel will exist and will continue to exist until Islam will obliterate it, just as it obliterated others before it." It continues: "There is no solution for the Palestinian question except through Jihad. Initiatives, proposals and international conferences are all a waste of time and vain endeavors." Its violent message is invoked in the name of defeating the "plan of World Zionism" "embodied in the Protocols of the Elders of Zion." In Rantissi's words of July 2001: "I urge all the brigades to...target the Israeli political leaders and members of parliament..."; "the Hamas political leadership has freed the hand of the brigades to do whatever they want against the brothers of monkeys and pigs." In plain language, the Hamas aim to obliterate the Jewish state is about pure, unadulterated antisemitism. Rantissi himself (and others, such as Yassin) was named by the State Department as a "specially designated global terrorist." Last month the Bank of England froze the assets of Rantissi because "the Treasury have reasonable grounds for suspecting that...Rantissi, is or may be a person, who commits, facilitates or participates in" "the commission of acts or terrorism." As soon as Rantissi took over the leadership of Hamas on March 23, 2004, after the Israeli Defense Forces (IDF) killed Yassin, he called for further bloodshed, "The doors are wide open for attacks inside the Zionist entity." Israelis keeping the grim statistics have counted at least 425 Hamas attacks killing 377 Israelis and wounding 2,076 in less than three and a half years of violence, including 52 separate suicide attacks. Hamas terrorists have blown themselves up among teenagers at a discotheque, families at a Passover seder, in restaurants, in a pedestrian mall, and on commuter buses. Only one day prior to Rantissi's death Hamas claimed responsibility for a suicide bombing which killed another Israeli. The international legal framework, therefore, could not be clearer. Rantissi was a combatant in a war. His killing was not "extrajudicial" because the legal term, by definition, applies only to individuals entitled to judicial process before being targeted. Combatants — including the unlawful combatants of Hamas who seek to make themselves indistinguishable from the civilian population — are not entitled to such prior judicial process. Furthermore, the manual on the laws of armed conflict of the International Committee of the Red Cross, states that civilians who take a direct part in hostilities forfeit their immunity from attack. Even beyond that, judicial process in these instances is not an option, since it would place both IDF and Palestinian civilians at much greater risk of harm. The overriding legal limit on the conduct of war and the targeting of combatants like Rantissi is the rule of proportionality. In the words of the Geneva Conventions, an attack on a military target "which may be expected to cause incidental loss of civilian life" is prohibited if "excessive." The likelihood of civilian casualties must be carefully considered prior to taking action. With zero civilian casualties (the only deaths being that of Rantissi and two Hamas accomplices, one a bodyguard, the other his 27-year-old son), the Israeli action could not have been more precise, and hence, proportionate. The United Nations response to the legality of the killing of Rantissi (and Yassin) is therefore enormously revealing. U.N. condemns Israel's assassination of...Yassin...UN Secretary-General Kofi Annan led the way: "The Secretary-General strongly condemns Israel's assassination of...Yassin...etc. Almost immediately following Yassin's death (along with eight others at least four of whom were also Hamas terrorists), on March 22, 2004, the U.N. Human Rights Commission convened a special sitting. This move was despite the fact that the commission was already in session, and at that very moment set to consider the only country-specific agenda item at the commission for the past 34 years — on Israel. The suffering of Yassin's victims, or the current genocidal plight of Sudanese in the Darfur region — reported by international agencies to involve 10,000 dead in the past year, and which may now have reached 1,000 dead per week — didn't move the commission to hold a special sitting. But they did see fit to schedule an extra three hours to denounce Israel over the death of one man — a man who personally instigated and authorized suicide bombing, ordered the firing of missiles at Israeli communities, and repeatedly exhorted his followers to "armed struggle" against Israelis and Jews "everywhere." Having glorified the terrorist in particular, the commission went on to sanction terrorism in general. On April 15, the commission adopted a resolution, sponsored by the Organization of the Islamic Conference, which aimed to condone suicide bombing by referring to "the legitimacy of the struggle [against] foreign occupation by all available means, including armed struggle" and the "right...to resist." The resolution passed by a large majority. Shortly thereafter, resolutions which would have criticized Zimbabwe, China, and Russia (in relation to events in Chechnya) were either blocked by procedural maneuvers or voted down. The total tally of country specific votes coming from the 2004 Commission now stands at: While those other country resolutions were being considered, the U.N. hosted a two-day meeting on Israel's security fence, April 15 and 16, directly across the hall from the commission. The juxtaposition was staggering. The same facilities were provided for a meeting on Israel as were provided for human rights on the remainder of the planet. And hours before the meeting ended on its second day, the "Final Document" — condemning Israel — was distributed to the public claiming to be based on discussions which had not yet occurred. Sooner or later one can only hope a light will go on. Whatever superficial lip service is paid to the contrary, according to the U.N., Israel has no right of self-defense. Everything the U.N. does in the context of the Arab-Israeli conflict — whether it be calls for the return to 1967's indefensible borders, declarations that Jerusalem is occupied territory, demands for the return of Palestinian refugees ending the Jewishness of the state, or efforts to isolate and demonize Israel as the worst human-rights violator in the world today — emanates from the standpoint that the Jewish side is not entitled to fight back.
Posted by Ruth at 10:34 AM
April 20, 2004
Oil-for-Terror ?
Oil-for-Terror ? There appears to be much worse news to uncover in the Oil-for-Food scandal. By Claudia Rosett April 18, 2004. http://www.nationalreview.com/comment/rosett200404182336.asp
It's time to talk about Oil-for-Terror. Especially with the U.N.'s own investigation into Oil-for-Food now taking shape, and more congressional hearings in the works, it is high time to focus on the likelihood that Saddam may have fiddled Oil-for-Food contracts not only to pad his own pockets, buy pals, and acquire clandestine arms — but also to fund terrorist groups, quite possibly including al Qaeda. There are at least two links documented already. Both involve oil buyers picked by Saddam and approved by the U.N. One was a firm with close ties to a Liechtenstein trust that has since been designated by the U.N. itself as "belonging to or affiliated with Al Qaeda." The other was a Swiss-registered subsidiary of a Saudi oil firm that had close dealings with the Taliban during Osama bin Laden's 1990's heyday in Afghanistan. These cases were reported in a carefully researched story published last June by Marc Perelman of the New York-based Forward (http://www.forward.com/issues/2003/03.06.20/news2.html) , relying not only on interviews, but on corporate-registry documents and U.S. and U.N. terror-watch lists. It was an important dispatch but sank quickly from sight. At that stage, the U.N. was still busy praising its own $100-billion-plus Oil-for-Food program, even while trying quietly to strip out the huge graft overlay from the remaining $10 billion or so in contracts suddenly slated for handover to the U.S.-led Coalition Provisional Authority (CPA). That was shortly before the records kept in Baghdad by Saddam began surfacing in such damning profusion that Secretary-General Kofi Annan was finally forced last month to stop stonewalling and agree to an independent investigation — though just how independent remains to be seen. As it now appears, Oil-for-Food pretty much evolved into a BCCI (http://www.fas.org/irp/congress/1992_rpt/bcci/) with a U.N. label. The stated aim of the program, which ran from 1996-2003, was to reduce the squeeze of sanctions on ordinary Iraqis by allowing Saddam to sell oil strictly to buy food and other relief supplies. As Oil-for-Food worked in practice, however, the program gave Saddam rich opportunity not only to pad his own pockets, but to fund almost anything and anyone else he chose, while the U.N. assured the world that all was well. (For the full saga, see my article in the May issue of Commentary , "The Oil-for-Food Scam: What Did Kofi Annan Know and When Did He Know It? " : http://www.commentarymagazine.com/SpecialArticle.asp?article=A11705017_1). For a sample of the latitude enjoyed by Saddam, there's Treasury's announcement last week that the U.S., in its latest round of efforts to recover Saddam's loot, is asking U.N. member states to freeze the assets of a worldwide group of eight front companies and five individuals that were "procuring weapons, skimming funds, operating for the Iraqi Intelligence Service, and doing business in support of the fallen Saddam Hussein regime." The list includes a Dubai-based firm, Al Wasel & Babel General Trading, a major contractor under the Oil-for-Food program that turned out to be a front company set up by Saddam's regime specifically to sell goods (and procure arms) via the program — right under the U.N.'s approving eye. Indeed, Al Wasel & Babel's website boasts that the company was set up in 1999 especially to "cater to the needs of Iraq Government under 'Oil for Food Program.' "
In this context, which suggests just how easily money might also have been passed right along to terrorists, Perelman's tale of terrorist links deserves a reprise. We will get to that below. The details are complex, which in matters of terrorist financing tends to be part of the point. Complications provide cover. So before we dive into a welter of names and links, let's take a look at how Oil-for-Food was configured and run by the U.N. in ways that left the program wide open not only to the abuses and debaucheries by now well publicized, but also to the funneling of money to terrorists — if Saddam so chose. And though this avenue remains to be explored, it is at least worth noting that the explosive growth of Oil-for-Food — from a limited program for Iraqi relief introduced in 1996 to a kickback-wracked fiesta of fraud and money-laundering by the late 1990s and beyond — coincided neatly with the period in which al Qaeda really took off. It was in 1998 that Oil-for-Food began to expand and more fully accommodate Saddam's scams. If allegations detailed in a Wall Street Journal story on March 11 prove correct, 1998 was also the year that Saddam may have begun sending oil to a Panamanian front company linked to the head of the program, Benon Sevan. And it was in 1998 that Osama bin Laden issued his fatwa, specifically denouncing U.S. intervention in Iraq and urging Muslims to "Kill the Americans and plunder their money wherever and whenever they can find it." To be sure, there is no evidence of a causal connection. But there is certainly room to wonder whether Saddam, a master of manipulation, on record as sharing bin Laden's sentiments at least in regard to U.S. involvement in Iraq, would not have been tempted to involve himself in the terrorist boom of the next few years. In principle he was still under sanctions, but Oil-for-Food gave him loopholes through which billions of dollars could pass. As Oil-for-Food worked in practice, there were two glaring flaws that lent themselves to manipulation by Saddam. One was the U.N. decision to allow Saddam to choose his own buyers of oil and suppliers of goods — an arrangement that Annan himself helped set up during negotiations in Baghdad in the mid-1990s, shortly before he was promoted to Secretary-General. The other problem was the U.N.'s policy of treating Saddam's deals as highly confidential, putting deference to Saddam's privacy above the public's right to know. Even the Iraqi people were denied access to the most basic information about the deals that were in theory being done in their name. The identities of the contractors, the amounts paid, the quantity and quality of goods, the sums, fees, interest, and precise transactions involved in the BNP Paribas bank accounts — all were kept confidential between Saddam and the U.N. With Saddam allowed to assemble a secret roster of favorite business partners, the only hope of preserving any integrity under Oil-for-Food was that the U.N. would ferociously monitor every deal, and veto anything remotely suspect. Instead, the Security Council looked for weapons-related goods; the Secretariat looked for ways to expand the program (while collecting its three-percent commission on Saddam's oil sales); and Saddam looked for — and found — ways to pervert the program. To grasp just how easily the U.N. let Saddam turn Oil-for-Food to his own ends, it helps to see his lists of contractors, which the U.N. kept confidential. Luckily, some lists have leaked, and in paging through the wonderland of Saddam's U.N.-approved clientele, including many hundreds of oil buyers and goods suppliers, what one finds is a vast web of business partners that — had the U.N. followed any reasonable policy of disclosure — should have set off major alarms from beginning to end of the program. Why, for instance, was Saddam allowed to peddle oil (especially under-priced oil — yielding fat profits) to clusters of what were clearly middlemen in such financial hideouts as Cyprus, Liechtenstein, and Panama? Was it wise to let him kick off the program by including among the first 50 or so oil buyers a full dozen based in Switzerland? Did nobody at the U.N. wonder about his choice of business partners — such as a holding company in the Seychelles; the Burmese state lumber enterprise; and the Center for Joint Projects at the executive committee of the Belarus-Russia Union? On the suppliers' list, the entries are no less intriguing. To take just one typical example: On the vague and generic lists provided by the U.N. to the public, you can see that Saddam bought both milk and oil-industry equipment from Russia. Once you see the in-house spreadsheet, however, what emerges is that Saddam bought not only oil equipment, but more than $5 million worth of milk from a Russian state oil company, Zarubezhneft. What look like diverse suppliers in various countries in some cases track back to fronts elsewhere, or to parent companies that in the graft-rich environment of Oil-for-Food clearly had enough of an inside track with Saddam to garner hundreds of millions worth of business — hidden at least to some extent from both their competitors and the wider public, which was asked to trust the U.N. In other words, Saddam did pretty much what he wanted, and the U.N. role seems to have consisted largely of occupying one more slot — and not a terribly vigilant one — on his patronage payroll.
Which brings us to back to terrorist ties, and Perelman's story of June 20, 2003, for which the reporting checks out. In brief (hang on for the ride): One link ran from a U.N.-approved buyer of Saddam's oil, Galp International Trading Corp., involved near the very start of the program, to a shell company called ASAT Trust in Liechtenstein, linked to a bank in the Bahamas, Bank Al Taqwa. Both ASAT Trust and Bank Al Taqwa were designated on the U.N.'s own terror-watch list, shortly after 9/11, as entities "belonging to or affiliated with Al Qaeda." This Liechtenstein trust and Bahamian bank were linked to two closely connected terrorist financiers, Youssef Nada and Idris Ahmed Nasreddin — both of whom were described in 2002 by Treasury as "part of an extensive financial network providing support to Al Qaeda and other terrorist related organizations," and both of whom appear on the U.N.'s list of individuals belonging to or affiliated with al Qaeda. The other tie between Oil-for-Food and al Qaeda, noted by Perelman, ran through another of Saddam's handpicked, Oil-for-Food oil buyers, Swiss-based Delta Services — which bought oil from Saddam in 2000 and 2001, at the height of Saddam's scam for grafting money out of Oil-for-Food by way of under-priced oil contracts. Now shut down, Delta Services was a subsidiary of a Saudi Arabian firm, Delta Oil, which had close ties to the Taliban during Osama bin Laden's heyday in Afghanistan in the late 1990s. In discussions of graft via Oil-for-Food, it has been assumed that the windfall profits were largely kicked back to Saddam, or perhaps used to sway prominent politicians and buy commercial lobbying clout. But that begs further inquiry. There was every opportunity here for Saddam not solely to pocket the plunder, but to send it along to whomever he chose — once he had tapped into the appropriate networks. Are there other terrorist links? Did Saddam actually send money for terrorist uses through those named by the Forward ? Given the more than $100 billion that coursed through Oil-for-Food, it would seem a very good idea to at least try to find out. And while there has been great interest so far in the stunning sums of money involved in this fraud, there has been rather less focus on the potential terrorist connections. While Treasury has been ransacking the planet for Saddam's plunder, there is, as far as I have been able to discover, no investigation so far in motion, or even in the making, focused specifically on terrorist ties in those U.N. lists of Saddam's favored partners. Indeed, the whereabouts of the full U.N. Oil-for-Food records themselves remain, to say the least, confusing. By some official U.N. accounts, they were all turned over to the Coalition Provisional Authority; by others they were not. A U.N. source explained to me last week that some of the records might be in boxes somewhere on Long Island; yet another says they were sent over to the U.S. Mission to the U.N. Especially crucial, one might suppose, would be the bank records, which should show into which accounts, and where, the Oil-for-Food funds were paid. But what is clear is that no one has so far sat down with access to the full records and begun piecing together the labyrinth of Saddam's financing with an eye, specifically, to potential terrorist ties. If there is a silver lining to all this, it is that those contract lists and bank records could be a treasure trove of information — an insider tour of what Saddam's regime knew about the dark side of global finance. There are plenty of signs that the secret U.N. lists became, in effect, Saddam's little black book (papered over with a blue U.N. label). Though perhaps "little" is not the correct word. The labyrinth was vast. The wisest move by the U.N., the U.S., or any other authority with full access to these records, would be to make them fully public — thus recruiting help from observers worldwide, not least the media, in digging through the hazardous waste left by Oil-for-Food. The issue is not simply how much Saddam pilfered, or even whether he bought up half the governments of Russia and France — but whether, under the U.N. charade of supervision, he availed himself of the huge opportunities to fund carnage under the cover of U.N. sanctions and humanitarian relief. We are way overdue to pick up that trail.
Posted by Ruth at 11:29 AM
April 06, 2004
KOFI ANNAN'S CORRUPT ENTERPRISE
KOFI ANNAN'S CORRUPT ENTERPRISE Is the clock ticking on Secretary General Kofi Annan's merry pranks at the Could be. The rank corruption of the body's Iraqi Oil-for-Food program is bubbling An upcoming audit being prepared by a firm that successfully traced stolen The list, found in Iraq's Oil Ministry, was first cited by an Iraqi Meanwhile, the General Accounting Office estimates that Saddam Hussein Among those expected to be named are the head of the U.N. program, the This, of course, may help explain Chirac's implacable opposition to the And Kofi Annan's longtime pro-Saddam bent, as well. As Andrew Apostolou notes on the preceeding page, Annan's immortal words - This much is clear: Saddam was able to turn the program into a mystery- The fog began to clear in February after the name of Benon Sevan - the According to al Mada, individuals, corporations and political parties on the Sevan apparently was given vouchers for at least 11 million barrels of oil, * Knowingly collaborated with Saddam's massive violations of the U.N.'s own * Said and did nothing about the Saddam regime's use of Oil-for-Food income * Ignored huge kickbacks, thereby making itself complicit in Saddam's * Permitted the regime to cheat Kurds in northern Iraq of billions - money, This much, too, is clear: The vast profits for foreign companies made Saddam made a point of throwing Oil-for-Food business and oil-voucher bribes * Forty-six recipients of illegal allocations of oil were Russian companies * French interests were so deeply involved in corrupt Oil-for-Food dealings And the scheme seems to have worked: France, Russia and Germany were all Is it any wonder that Russia and France now oppose independent inquiries The Iraqi Governing Council has been probing the scam since al Mada first Complicating the effort, however, is the refusal of the BNP Paribas Bank of And U.N. officials in New York have declined to send necessary statements Yes, the U.N. says an "internal inquiry" is under way. But, given that Kofi Annan's son Kojo is linked to the scandal, it's not And though the elder Annan has admitted to the need for an outside inquiry, Remember, folks as high-ranking as the president of Indonesia, former French These are, after all, people with substantial influence at Turtle Bay. And there are others - many others - who are similarly situated. Plus, it has now become undeniable that the folks Kofi Annan had running the Indeed, for Kofi Annan to say - as he did last week - that he was agreeing His own son is part of it. Here's the bottom line: A U.N. program that was supposed to help the Iraqi people instead stole from Those responsible for this colossal theft are international criminals - and The United Nations itself stands bereft of moral authority when it comes to Kofi Annan needs to disappear, and to take his son with him. Neither Jacques Chirac nor Vladimir Putin possess a shred of decency, so But none of them - not Annan, not Chirac, not Putin - has any standing in The same goes for the entire United Nations, as well. Posted by Ruth at 04:00 PM
April 04, 2004
United Crooks
United Crooks By Jack Engelhard We have it from King Solomon that "a crooked thing cannot be made straight." I am beginning to understand. Take the United Nations. (Please?) Who knew that so many of them were crooks, those who sit plushly in security councils and general assemblies? There was always the chance (some thought) that their twice-weekly Israel trashing was motivated not so much by pure bigotry as by an honest difference of opinion. Not so. They're crooks. It's that simple. Read all about it from William Safire in the New York Times (and several other sources), how this U.N./Iraq oil for food program crookedly enriched not only Saddam, but dozens, perhaps hundreds of those scofflaw "dignitaries" who represent virtually all the nations of the world. As one scribe (not Safire) put it: Oil for U.N. Bribes. Millions of dollars, even billions, that were supposed to feed the people of Iraq went instead to feed the pockets of the people who run our world. These people, these crooks, sit in judgment over Israel, and the United States. These crooks run our world as Al Capone once ran Chicago. From these we expect justice? How far have we come? America once stood still when it was revealed that vice president Spiro Agnew had stuffed envelopes delivered to him in the White House. Of course we've had Watergate and a vicuna coat scandal, and even this minute home runs are hit by steroids; all of which should be dwarfed by U.N.GATE if the truth ever comes out. How high does this crookedness go? The name Kojo Annan keeps popping up in these reports that detail a kickback scheme that may set records. Kojo is Kofi's son. Can this be made straight? I don't think so. Do the math. (190, to one Israel.) (No surprise, then, that during the 1970s a certified Nazi ran the U.N., Kurt Waldheim.) Next time one of them wags his finger against Israel's "occupation," or America's sacrifice and selflessness in Iraq, ask yourself how much this guy bagged in kickbacks. Word is that godfather Kofi is calling for an independent investigation. The hope is that the books will be opened. Yeah, right. Already it's being noted that this scandal is the most underreported story of the 21st century. Can we trust journalism to dig in and tell the story? Maybe. But is the news media any less corrupt? We live in an age that produced Jayson Blair, Jack Kelley, Stephen Glass and who knows how many others who are accused or suspected of toying with facts and truth. As in the legend of Diogenes, we search in vain for an honest man. On my first visit to Israel, as a journalist, I was introduced to Journalism Middle-East style. All they wanted, these reporters from all over the United States and around the world, was the dirt against Israel, and they dished it all right. I saw how they provoked Arab women to weep for the cameras and cued the men to bristle. They wanted no part of Jewish Israel, and in fact they wanted no part of the Arab Israelis who were prospering. Along the bus rides they yawned and nearly mutinied when Shlomo pointed out the glory of the Jewish State, yes, the synagogues, but also the mosques and the churches, the freedom to speak, the freedom to worship. Shlomo, our guide, finally had it and quit, right there in Bethlehem. I saw him turn, call in for a substitute, and I also saw him in tears, this captain in the IDF. (When the bus stopped at the Weizmann Institute of Science, where world-class researchers were developing medicines to save Jews and Arabs and humanity in total, the reporter behind me got up and, speaking for the group, shouted: "We want the villages where Arabs are suffering. We need quotes.") These days, as in those days when I was there, reporting from the territories must first be approved by Editor in Chief, Yasser Arafat. (If this is how they twist Israel, who knows what other news is being manipulated?) So I'm the wrong guy to ask about truth in journalism, never mind the uprightness of the nations. Do they all lie? No, but a single Jayson Blair nearly brought down the entire New York Times, the House that Ochs built. Today we know that Jenin, Jenin is Lies, Lies, but meantime, what a party they had over that fabricated massacre at ABC, NPR and the BBC. The crooks at the UN joined the crooks of journalism in feasting against Israel over Jenin, as they previously tried to devour Israel over Mohammed al-Dura, another hoax. Are they in cahoots? No, but rascals cleave even in the dark. Can this be made straight? I hope so. I don't think so. No wonder Solomon first named it futility, Erasmus later named it folly, Salinger named the world of a pack of phonies. The saying has it that "truth will prevail." Starting when? Jack Engelhard is the author of the novel "Indecent Proposal" and the award-winning memoir "Escape from Mount Moriah." His novel "The Days of the Bitter End" is being prepared for movie production. His journalism is published and posted worldwide and regularly appears in AFSI's OUTPOST and weekly at www.israelnationalnews.com. He receives email at viewopinion@aol.com
Posted by Ruth at 02:48 PM
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