Saddam's oil vouchers

Separate investigations by the UN, the US
Congress and an auditor appointed by the now-defunct
Iraqi Interim Governing Council (IGC) have unveiled
different forms of oil export scams run by the ousted
Saddam Hussein regime.
In all, the regime is said to have sold several
billion dollars worth of smuggled oil. The money has
not been accounted for, but it is unlikely that the
cash was ever sent to Iraq. The money changed hands
through carefully concealed bank transfers and in cash
outside Iraq under instructions issued by the regime.
One channel was to inflate the invoices of goods
supplied to Iraq under the UN's oil-for-food
programme. The Saddam regime had the final say about
what was to be imported under the programme —  mainly
food, medicine and related supplies — and at what cost
while the UN collected proceeds from the sale of Iraqi
oil.
The regime made secret deals with suppliers of food,
medicine and related items to inflate the costs. The
supplier submitted the invoices to the UN and
collected the money, and remitted the inflated
difference to secret accounts of the Saddam regime
outside Iraq. The regime used the money to benefit its
top leaders and to pay bribes to friendly politicians
and groups as needed.
During the seven-year oil-for-food programme that
ended in October 2003, Iraq exported $65 billion and
more than $38 billion in food and medicine had been
delivered to the Iraqi people. It is not known how
much money was involved in the inflated invoices.
The difference in the exports and imports went to a UN
fund that paid compensation to victims of the Iraqi
invasion of Kuwait in 1990.
The second scam run by the Saddam regime was through
smuggling oil in violation of the UN sanctions imposed
after the invasion of Kuwait.
The regime used to pump around 200,000 barrels of oil
through a pipeline that runs from Kirkuk in northern
Iraq to Syria's Banias port.
Oil companies took delivery of the oil from Banias
port upon producing coded slips issued by Iraq's
State Oil Marketing Company or SOMO.
The US knew about this, but could not do anything to
stop the smuggling through Syria because Damascus
refused to co-operate with Washington.One of the first
things the US military did after invading Iraq and
toppling Saddam last year was to close down the
pipeline.
The scam through Syria allegedly benefited about
270 foreign government officials, legislators,
political activists and journalists as well as
companies from more than 52 countries who are said
to have received money from Saddam for supporting him
in international and regional forums.
The Saddam regime issued "oil vouchers" to various
beneficiaries who could then sell them to oil dealers
or agents operating from Rashid Hotel in Baghdad. The
agents would then sell the vouchers to oil companies
which, in turn, would submit them to the State Oil
Marketing Company or SOMO and collected coded slips
that entitled them to collect the oil from Banias
port. Both the beneficiary and the agent collected
quick and handsome profits. More often than note,
beneficiaries sold the vouchers at an average of $3
per barrel for instant cash.
The beneficiaries of the scam allegedly included
Western, Arab and Asian politicians and groups (the
list includes the Indian Congress Party, which
allegedly received one million barrels, according to
Al Mada, an Iraqi newspaper, which released the list.
The Congress Party has issued a categorical denial of
the allegation).
Another alleged beneficiary was Benon V Sevan, the
former director of the UN oil-for-food programme. He
has denied the charge, but a secret memo based on an
inspection of documents recovered from the former
regime's offices claim that Senan collected the oil
vouchers and channelled the proceeds to a Panamanian
trading company.
The alleged beneficiaries of oil vouchers included
19 political parties, and numerous politicians and
journalists. Russia led the way among countries, with
46 recipients for a total of about 2.5 billion
barrels. Significant individual recipients include
British MP George Galloway, the president of
Indonesia, the prime minister of Libya, the former
prime minister of Yemen, a former French minister of
interior, Patrick Maugein who, according to French
sources, is a financial supporter of French President
Chirac, the sons of the former Egyptian leader Gamal
Abdul Nasser, the President of Lebanon Emil Lehoud,
the former Syrian minister of defence Mustafa Tlass,
several Jordanian politicians and others.,
Some of them have issued categorical denials, some
have said they were offered oil vouchers but turned
them down and others said they had accepted the
vouchers on behalf of someone else or for charity
projects.
Another channel adopted by the Saddam regime to beat
the UN sanctions was to smuggle oil through barges and
small ships through the Gulf. The vessels used to
collect the oil from Umm Qasr in southern Iraq and
followed a route hugging the Iranian shore before
entering Gulf waters where the oil was pumped to
larger ships bound for the Far East. Gulf-based Iraqi
agents collected the money.
The regime also sent truckloads of oil to Turkey
through Kurdish-controlled northern Iraq. Although
they were avowed enemies of the Saddam regime, Kurdish
militia groups allowed the trucks through because they
benefited in cash — they collected a "toll" from
every vehicle.
"Oil vouchers "were also distributed to companies and
individuals from Sudan, Yemen, Cyprus, Turkey,
Vietnam, Bangladesh, Malaysia, Pakistan, the UAE,
Morocco, Algeria, Tunisia, Panama, Thailand, Chad,
China, Nigeria, Kenya, Ireland, Bahrain, and the
Philippines. Two Saudi companies were also listed.
The full disclosure of the names and details of the
alleged foreign beneficiaries of Saddam's oil bribes
could be devastating to those named.
At this point in time, Ahmed Chalabi, the head of the
Iraqi National Congress, who has fallen out of favour
with the US, is believed to be in possession of the
entire files that contain all details. He has refused
to hand them over to the US.
A US-backed Iraqi police raid of Chalabi's offices and
residence last month was seen as an effort to locate
those documents.
Washington has distanced itself from its one-time pet
Chalabi, who is now accused of spying for Iran,
misappropriating tens of millions of American money
allocated for pre-war anti-Saddam campaigns and for
intelligence operations in post-war Iraq,
profiteering from reconstruction contracts in the
country and implicitly undermining American political
efforts there.