The Justice Department is on the ball.

Justice does it the right way

A Texas businessman, along with a Bulgarian and a British citizen, were indicted in a scheme to pay millions of dollars in kickbacks to Saddam Hussein's regime as part of the United Nations' scandal-ridden oil-for-food program, federal prosecutors said Thursday.

David B. Chalmers, the businessman, and Ludmil Dionissiev, a Bulgarian citizen and permanent U.S. resident, were arrested Thursday morning at their homes in Houston. U.S. Attorney David N. Kelley said he will seek the extradition from England of a third defendant, John Irving.

In an indictment unsealed Thursday in U.S. District Court, the defendants were accused of participating in a scheme to pay millions of dollars in secret kickbacks so that oil companies owned by Chalmers could continue to sell Iraqi oil under the oil-for-food program

.Among those who have come under fire in recent months over the handling of the program is U.N. Secretary General Kofi Annan. Investigators last month criticized Annan for not pressing to learn details of his son Kojo's employment by a Swiss company that won a contract under the oil-for-food program.

In the preceding story dated April 13th, we found out how Mr. Volcker was flim flamed. "The lawyer for a key witness who cooperated with the U.N. committee investigating the oil-for-food scandal says the panel allowed itself to be manipulated into discrediting his client by Secretary-General Annan's attorney, Greg Craig, a former aide to President Clinton. " Volcker lost his best witness through incompetents, what a difference between the IG and Volcker's 'investigative' staff. Ron

More on Chalmers and Bay Oil

Let's not forget these folks

Sec. Rice says's John Bolton to lead U.N. shake up

Bolton is the man for a shake up!

Secretary of State Condoleezza Rice said yesterday she expects John R. Bolton, Washington's ambassador-designate to the United Nations, to lead an overdue shake-up of that organization. "John Bolton was my first choice," Miss Rice told editors and reporters in an interview at The Washington Times. "I think John is a straightforward, tough-talking, very good diplomat, and I think that's what you need at the United Nations."

What is needed in United Nations right now is an investigation that is transparent. Mr. Volcker is not the person to lead that investigation. " As Canada Free Press (CFP) revealed, Paul Volcker, who heads up the Independent Inquiry Commission into the oil-for-food scandal, held a seat on Power Corp’s international advisory board. [Read the two previous articles on Power Corporation and which companies it controls]" This should have been enough to disqualify him from leading an 'independent inquiry' of the United Nations but there is something else. "In addition to his connections to Power Corp., which he did not disclose upon being appointed head of the UN probe, Volcker has also been linked to a pro-UN lobby group, the United Nations Association of the United States (which happens to receive generous support from BNP Paribas). Critics are suggesting that the final report, expected in June, could end up being a whitewash."

There is a thread through this whole hidden non-disclosure by Mr. Volcker and its called "Power Corporation." If you have no idea who owns this entity and how Mr. Volcker is involved, read the previous two entries. Ron

Why Bolton will be good for the UN

More on Power Corp and Volcker

Mr. Volcker has to explain

When you add it all up, contemporary Canadian influence abroad has all the intrigue of a fast-moving spy novel.

Andre Desmarais also sits on the China International Trust & Investment Corp (CITIC), described as the alleged investment arm of the PLA, the Chinese military. Through its subsidiaries, the CITIC could be the largest manufacturer of weapons and arms in the world.

Maurice Strong, special ambassador to the UN, has publicly stated his belief that China is the economic and ecological future of the world, a sentiment echoed only last week by Prime Minister Martin. When it comes to global influence, Canada’s Montreal-based Power Corporation is an octopus with tentacles everywhere.

Both Prime Minister Paul Martin and his mentor Maurice Strong, senior advisor to UN Secretary General Kofi Annan, worked for Power Corp.

Martin’s immediate predecessor is former Prime Minister Jean Chretien, whose daughter, France is married to Andre Desmarais, son of Power Corp’s founding father, Paul Desmarais.

Desmarais Sr. is a major shareholder and director of TotalFinaElf, the biggest oil corporation in France, which has held tens of billions of dollars in contracts with the deposed regime of Saddam Hussein.
Continuing to join the dots on Volcker and potential conflicts of interest is Volcker’s number two man on the IIC, Reid Morden. Morden has connections to Desmarais in his role of selling nuclear plants to China and others for companies dominated by Desmarais. Although he is Canada’s former intelligence chief, Morden does not answer to the Canadian government. As CFP letter writer Peter Herberg puts it, "Can you imagine the uproar if a former CIA chief did this and took part in a UN investigation that refused to cooperate with congress?

As Canada Free Press (CFP) revealed, Paul Volcker, who heads up the Independent Inquiry Commission into the oil-for-food scandal, held a seat on Power Corp’s international advisory board.

Those are some of the ties of Power Corp., oil-for-food and Fracophonie’s Land of the fleur de lis.

A blueprint for world powerMr. Volcker has to explain

Cotecna denies wrong doing.

Cotecna stonewalls Sen. Coleman

Swiss trade inspection firm Cotecna rejected Tuesday any charges of negligence or impropriety on its part in the UN oil-for-food program in Iraq.

Speaking at a tense hearing in front of a panel of US senators, Cotecna chief executive Robert Massey denied wrongdoing in the corruption scandal surrounding the largest-ever UN aid program.

A former Cotecna employee told the Senate panel, however, that the company was lackadaisical in performing its duties under the program and allowed smuggling, which strengthened Hussein's regime.
Arthur Ventham, a Cotecna inspector at Iraq's Um Qasir port for the program, told the hearing that the company's loose inspections permitted Hussein's regime to smuggle oil out.

"It was common knowledge that 'smuggling' was going on at Um Qasir, that oil was being sold on the 'black market' to augment the regime in Iraq, the UN supposedly knew of this but had decided not to do anything," he said.

A very comprehensive report indeed!

Nile Gardiner, Ph.D., lays out the scheme for Congress

The seriousness of the charges leveled against Benon Sevan by the IIC Interim Report clearly merit criminal prosecution, and the U.N.’s pledge to lift diplomatic immunity for Mr. Sevan is an important first step in the right direction.

 Mr. Sevan should also be interviewed by Congressional investigators to shed more light on his illicit activities, as well as any criminal activity by members of his staff. Besides facing justice, Sevan should additionally serve as a vitally important source of information regarding attempts by the Saddam Hussein regime to influence decision-making at the U.N. and the Security Council. Several key questions need to be answered:

-  How did Sevan manage to blatantly flout U.N. rules without any suspicions being raised?

-  Why was there no oversight of Sevan’s management of the Office of the Iraq Program?

-  To what extent was Kofi Annan aware of corrupt practices within the OIP?

-  Were other U.N. staff assisting Sevan with his illicit activities?

-  How extensive were the ties between Sevan and the Saddam Hussein regime?

-  How was Sevan picked to become Director of the OIP?

-  Were allegations of corruption leveled against Sevan when he served in previous U.N. positions?
• Boutros Boutros-Ghali, Banque Nationale de Paris and the UN Escrow Account

The UN’s decision to appoint the French company Banque Nationale de Paris (BNP) to administer the Oil-for-Food escrow account is the subject of intense scrutiny in the IIC Interim Report. Vast sums of money were handled through the escrow account. The Saddam Hussein regime sold more than $64.2 billion of oil under the Oil for Food Program between 1996 and 2003.[9] BNP was selected by then U.N. Secretary General Boutros Boutros-Ghali, even though the decision did not conform to the requirement under U.N. financial rules to accept the “lowest acceptable bidder”.[10]

The information contained in this report will be used in many newspaper stories. It is one of the most comprehensive reports to date on one of the greatest thefts in worlds history. Ron

What about Kojo Annan?

Let's not forget these guys

Fox News Update

Rape in Darfur

Network of pedophiles at the U.N. mission in Congo?

Where are the hidden audits and reports

Give the reports to the Congressional Committees, stop hiding them

As Mr Volcker wrote in Thursday’s Wall Street Journal, the findings “do not make for pleasant reading”. Not so for anti-UN conservatives in America, who are wallowing in Schadenfreude. They had feared a whitewash from the committee, and in anticipation had begun to call into question Mr Volcker’s suitability to investigate the UN. (He had served as a director of UNA-USA, a pro-UN group based in New York.)To achieve the thorough thrashing many Republicans think the UN deserves, five committees in the Republican-controlled Congress are investigating oil-for-food themselves.

They have called for the Volcker committee to share all of its witnesses and evidence with Congressional committees and federal investigators. They complain about the committee’s lack of subpoena power. Mr Volcker has pointed out that national legal jurisdictions, including America’s, cannot penetrate the UN’s diplomatic immunity. However, the UN said on Thursday that it would take immunity away from any member of staff thought to have committed criminal acts.

But the organisation clearly feels it has been unfairly singled out. In his BBC interview, Mr Malloch Brown claimed that some $21 billion in total went missing thanks to oil-related smuggling and the like during the Saddam era, and that the oil-for-food programme accounted for only a small fraction of that. Much of the rest, he said, was dodgy dealing condoned by the governments of America and other countries. The UN's critics thus “need to look closer to home”.

Benon Sevan, helped steer oil contracts to a relative of Boutros-Ghali.

Benan Sevan to be fall guy

200 pages of smoke and mirrors

The report found that Benon Sevan (search) broke the rules by allegedly trying to obtain oil vouchers from Saddam Hussein's regime in Iraq. Sevan has been accused of receiving about $1 million worth of lucrative oil vouchers but he has denied any wrongdoing.

NBC Reporter Was on U.N. Lobby Payroll.

Legal smuggling by Turkey and Jordan?

Vincent will testify

Makes deal for shorter sentence?

According to the indictment, Vincent was among a group of Iraqi officials and agents who agreed on the scheme to reward those who co-operated with Saddam with the oil vouchers. For his part, Vincent was allegedly rewarded with five oil contracts which he sold for between $3 million and $5 million.Benon Sevan, the former head of the oil-for-food programme from which Saddam skimmed at least $1.7 billion, is already under investigation by federal prosecutors.

A CIA report published earlier this month claimed that Mr Sevan was allocated vouchers by Saddam to sell 7.3 million barrels of Iraqi oil through a Panamanian-registered company."Several million dollars in cash were sent by the Iraqi government to Iraqi government officials in New York pursuant to those agreements," Vincent said. "Several hundred thousand dollars of this money was given to me, in Manhattan, and the rest was given to others, one of whom I understood was a United Nations official."

The oil-for-food scandal has prompted fierce criticism of Kofi Annan, the UN secretary-general, who oversaw the initial negotiations with Iraq over the programme and later appointed Mr Sevan. It has also emerged that Mr Annan's son, Kojo, worked for the Swiss company, Cotecna, that was awarded the contract in 1998 to inspect shipments to Iraq under the programme.The testimony of Samir Vincent, who pleaded guilty to acting as a covert agent for Baghdad, indicates that Saddam's manipulation of the scheme began at its inception in 1996.

Possible Connection?

Vincent did business with US oil company

Vincent giving evidence while under wraps

While lobbying the U.S. government to lift economic sanctions against Iraq, Vincent received cash from Baghdad and the rights to 9 million barrels of Iraqi crude, federal prosecutors said. His firm, Phoenix International, then sold that crude to an unnamed American oil company.

A former Houston energy company executive who had worked with Vincent said he was known for being well-connected with officials in Iraq and the United States.

While Vincent clearly knew how to run a successful business using his contacts, the former executive said hedidn't believe his Iraqi oildealings were done solely for profit. "I believe he did it for real humanitarian reasons, as well," he said.

Vincent said his Phoenix International received more than 9 million barrels of oil in five allotments from Baghdad. A CIA report written by special weapons inspector Charles Duelfer indicates that Saddam's regime allocated another 4 million barrels, but Vincent's firm never lifted that crude.

Another UN Scam in the making?

Vincent could get 28 years in jail

Plea bargain will get more perps for Ashcroft and crew.

An Iraqi-American businessman, accused of pocketing millions of dollars through the U.N. oil-for-food program with Iraq, pleaded guilty Tuesday to acting as an illegal agent of Saddam Hussein's government.

Samir A. Vincent, 64, a naturalized U.S. citizen from Annandale, Va., is the first person to be charged in the Justice Department's investigation of the program, which U.N. audits have shown was badly mismanaged. Iraqi government cash was given to a person "whom I understood was a United Nations official," says Vincent.

Update on Vincent story

UN gives terrorists money, from Powerline and WSJ

Powell: Kofi is accountable

Sec. Powell changes mind

The Bush administration, which earlier backed Secretary-General Kofi Annan in the U.N. oil-for-food scandal, on Tuesday demanded he be held accountable for mismanagement in the program.

"What we have heard, so far, is that there were serious problems inside the U.N. on the management of this. We're not sure if there were criminal problems, but there were certainly management problems," outgoing Secretary of State Colin Powell told Fox News.

"And the secretary-general will have to be accountable for those management problems," he added in the television interview.

U.N. internal auditors have found management lapses in the now-defunct, $64 billion program although they found no corruption among individual United Nations officials.

The spotlight on Annan has intensified this week after Paul Volcker, the former U.S. Federal Reserve chairman, who is conducting an independent probe of the program, released more than 50 internal U.N. reports.

While the Bush administration was slower than other major governments to back Annan as the scandal mushroomed last year, it has resisted echoing some calls in Washington for Annan to resign.

Powell's criticism on Tuesday was noteworthy because it came from the Cabinet official believed to be most supportive of Annan.

BBC and UN lie by ommission

Danforth predicts grand jury

Subpoena power needed

U.N. Ambassador John C. Danforth said here Tuesday that the Iraqi oil-for-food scandal was "very likely" to end up before a federal grand jury.

The soon-to-retire Danforth met Tuesday with a group of St. Louis Post-Dispatch editorial writers. He was asked about an investigation into the oil-for-food issue that is being conducted by Paul Volcker, former chairman of the Federal Reserve Commission.

The oil-for-food program was set up in 1996 to ease the hardships of sanctions against Iraq. The program let Iraq sell oil so it could buy food and medicine. But in January, an Iraqi paper said that the program had been riddled with corruption and that some U.N. officials had profited.

Full Disclosure wanted by President

President wants UN cooperation"

President Bush yesterday called for "full disclosure" of the United Nations oil-for-food scandal, although he declined to join Republican demands for the ouster of U.N. Secretary-General Kofi Annan.
    
"It's important for the integrity of the organization to have a full and open disclosure of all that took place with the oil-for-food program," Mr. Bush said during an Oval Office appearance with Nigerian President Olusegun Obasanjo.

"We share the concerns that members of Congress have," said White House press secretary Scott McClellan. "The American people want to have assurances, from their standpoint, with the taxpayer dollars that go to support multilateral organizations like the United Nations."

On Oct. 21, Mr. Annan said of the scandal: "We want to get to the bottom of it and clear it as quickly as possible." But since then, investigators have said, the United Nations has been less than fully cooperative.

President Bush wants accounting

Where's the beef, asks President

President Bush on Thursday called for a "full and open" accounting of the U.N. oil-for-food program but would not say whether he thought U.N. Secretary-General Kofi Annan should resign.

"I look forward to the full disclosure of the facts, get an honest appraisal of that which went on. And it's important for the integrity of the organization to have a full and open disclosure of all that took place with the oil-for-food program," Bush said.
Bush, asked if Annan should resign, would not say.

"On this issue, it's very important for the United Nations to understand that there ought to be a full and fair and open accounting of the oil-for-food program," he said.

"In order for the taxpayers of the United States to feel comfortable about supporting the United Nations, there has to be an open accounting," he says.

State Department takes sides

Something stinks in Turtle Bay, say's State.

The State Department on Wednesday endorsed a Senate investigation into possible fraud in the U.N. oil-for-food program while sidestepping a senator's demand that Secretary-General Kofi Annan resign.

"That is not something, frankly, that is in front of us," deputy spokesman Adam Ereli said. "What is in front of us is ensuring that if there is wrongdoing it is fully understood and that appropriate action be taken."

Sen. Norm Coleman, R-Minn., wrote in Wednesday's Wall Street Journal that Annan should quit because "the most extensive fraud in the history of the U.N. occurred on his watch. In addition, and perhaps more importantly, as long as Mr. Annan remains in charge, the world will never be able to learn the full extent of the bribes, kickbacks and under-the-table payments that took place under the U.N.'s collective nose."

Texas Oilman Subpoenaed In O.F.F. Case

IHT - Oil-for-food investigation throws spotlight on a Texas oilman

Billions of dollars of Iraqi oil had been sold under a United Nations program - and food and other goods bought with the proceeds - when Saddam Hussein decided in 2000 that he personally wanted a bigger cut of the action. Documents now suggest that at least one U.S. company acceded to that demand, paying surcharges that kept the oil flowing.

The action by the company, Coastal, which was founded by the Texas entrepreneur and oilman Oscar Wyatt, is detailed in a formal Iraqi government tally of secret payments made from September 2000 to December 2003, when steps were taken by U.S. and British officials to stop the surcharges.

Coastal, the only publicly traded American oil company on the list, is shown as having paid $201,877 in surcharges. It is a small piece of the $228 million in surcharges on oil sales that a CIA report released last week said Saddam had collected, largely from Russian companies.

Wyatt, a former drill-bit salesman in South Texas who built a hydra-headed energy empire, said through a spokeswoman on Monday that he had no knowledge of Coastal paying any surcharges. A spokeswoman for the company El Paso, which acquired Coastal in 2001, declined to comment, citing a grand jury subpoena the company had received from federal court in New York.

The inclusion of Coastal on the list - prepared by postwar officials from the Iraq State Oil Marketing Organization - is one indication of the special relationship that Wyatt and Coastal had with Iraq, dating back three decades.

Wyatt, 80, acknowledged Monday through a spokeswoman that he had traveled to Baghdad as recently as early 2003, as the United States was preparing for war, to meet with officials in Saddam's government. He declined to disclose the purpose of the visit.

(Full article at link. Thanks to Ron Norman.)

Democratic Donor Involved in Oil-For-Food Program

Newsweek - Oil-for-Food Fiasco?

Law-enforcement sources say Americans who participated in alleged oil-for-food scams also may face further investigation. The CIA deleted from Duelfer's report names of Saddam's U.S. oil-for-food favorites. But an uncensored copy of the Duelfer report obtained by NEWSWEEK indicates Houston oil mogul Oscar Wyatt got oil allocations from Saddam which could have earned him and Coastal Corp.—a company he founded and ran until 2000—profits of more than $22 million. Wyatt and wife Lynn are major donors to political causes: since 1989 they have given nearly $700,000 in contributions, of which more than $500,000 went to Democrats. Wyatt told NEWSWEEK that his company did buy oil from Saddam but that he never did so personally, and that his company's dealings all complied with U.N. rules.

(Full article at link. Thanks to Ron Norman, Mohamed, and Becki.)

U.S. Firms In Duelfer Report

IHT- U.S. firms received oil-for-food vouchers

WASHINGTON Major American oil companies and a Texas oil investor were among those who received lucrative vouchers that enabled them to buy Iraqi oil under the UN oil-for-food program, according to a report prepared by the chief arms inspector for the CIA.

The 918-page report says that four U.S. oil companies - Chevron, Mobil, Texaco and Bay Oil - and three individuals, including Oscar Wyatt Jr. of Houston, were given vouchers and got 111 million barrels of oil between them from 1996 to 2003. The vouchers allowed them to profit by selling the oil or the right to trade it.

The other individuals, whose names appeared on a secret list maintained by the former Iraqi government, were Samir Vincent of Annandale, Virginia, and Shakir Al-Khafaji of West Bloomfield, Michigan, according to the report by the inspector, Charles Duelfer.

The fact that these companies and individuals received oil from Iraq does not mean that they did anything illegal, experts on the program said. Such allocations may have been proper if the individuals and companies received appropriate UN approval. In interviews on Friday, spokesmen for the oil companies and for El Paso Corp., which assumed control of the assets of the company once run by Wyatt, said the transactions had been legal. But each confirmed that they had received subpoenas from a U.S. grand jury in New York, which is investigating "transactions in oil of Iraqi origin" as part of the oil-for-food program, according to a U.S. financial filing by El Paso.

(Full article at link. Thanks to Ron Norman.)

Marc Rich, Former Clinton Pardonee, Tied To O.F.F.

News-Leader.com - U.N.'s oil-for-food abused, report says Saddam's oil kickbacks

The most lucrative exploitation of the program involved kickbacks from companies executing legal sales of oil. Under the terms of the U.N resolution establishing the program, Iraq maintained the right to determine who got contracts for oil being exported and the humanitarian goods being imported and to determine market prices.

In what the report calls "an open secret," the Iraqi government demanded illicit surcharges of 25 to 30 cents on all barrels of oil bought, which buyers had to secretly pay before the deals were sealed. They complied because the Iraqis were selling slightly below market prices.

One of the most prolific purchasers of the oil was Swiss-based Glencore, run by one-time fugitive American financier Marc Rich, which the report alleges paid over $3.2 million in kickbacks to the Iraqi government. Rich, formerly wanted for tax evasion, was pardoned by President Clinton in his last days in office.

The report says that the company denies any inappropriate deals.

Captain Ed has more.

(Full article at link. Thanks to Ron Norman.)

More On Cut-Off Banks

Telegraph: Banks 'laundered' Iraq oil for food payments

Stuart Levey, Treasury undersecretary, said: "Today's designation alerts the global financial community of the threat posed by these entities. It also serves notice to others that there will be significant consequences for institutions that launder tainted money or engage in similar corruption: we will cut you off from the US financial system."

The US claims Infobank was central to Saddam Hussein's scheme to divert more than $10 billion from the oil-for-food deal to the Iraq government. It is not claiming that either bank was directly aware of the plot to deceive the UN, however.

The action against Infobank was widely seen as a warning to Belarus president Alexander Lukashenko, who is said to have close ties to the bank.

...

Congressional committees investigating the allegations have subpoenaed records from several institutions, including French bank BNP Paribas. The bank managed billions of dollars that came from Iraqi oil revenue, though there is no official suggestion that it was involved in wrongdoing.

A BNP Paribas spokesman said: "It is understandable given the publicity surrounding the UN oil-for-food programme, that US authorities would wish to understand details about the programme. As is customary, BNP Paribas will fully co-operate with the authorities. We are not the target of any investigation."

Good to see the banks being scrutinized. That's one potential source of info that the U.N. can't monopolize.

(Full article at link. Thanks to Ron Norman and John Jorsett.)

U.S. To Shut Off Two Banks Related To Oil-For-Food Scandal

The Guardian: U.S. Takes Action Against 2 Foreign Banks

WASHINGTON (AP) - The Treasury Department took action Tuesday against two foreign banks it suspects of money laundering, including one it accused of helping Saddam Hussein use funds from the United Nations' oil-for-food program.

The department proposed to cut the banks off from the U.S. financial system. The public and other interested parties will have a chance to weigh in before final action is taken.

The department designated the First Merchant Bank of the Turkish Republic of Northern Cyprus and Infobank of Belarus as ``primary money laundering concerns'' because they had not acted to combat the problem.

The designation - a tool available under the 2001 USA Patriot Act - alerts the global financial community about the alleged money laundering problems associated with the banks.

...

Treasury said Infobank ``laundered funds for the former Iraqi regime of Saddam Hussein that were derived from schemes to circumvent the United Nations' oil-for-food program, including illegal surcharges and inflated contracts.''

These funds were then laundered through several other foreign banks and shell corporations, which were not identified, the department said in a statement. Proceeds from the illegal surcharges and inflated contracts went either to the Iraqi government - in violation of oil-for-food program provisions - or were used to buy weapons or to finance military training. Further details, including how much money was laundered, were not provided.

(Full article at link. Thanks to Ron Norman.)

Valero Energy Subpoenaed

BBC: Iraq oil-for-food probe spreads

US oil refiner Valero Energy has become the third US company to receive a subpoena seeking information about its role in Iraq's oil-for-food programme. Oil giants Exxon Mobil and ChevronTexaco confirmed on Friday that they had also been subpoenaed, Reuters news agency reported.

All three subpoenas came from the US Attorney's office for the Southern District of New York.

All three firms have said they intend to co-operate fully with the inquiry.

A subpoena is a request for documents to aid an investigation. No charges have been brought.

Valero spokeswoman Mary Rose Brown said the request centred on the refiner's purchases of Iraqi oil under the UN-administered oil for food programme between 1995 and 2003.

(Full article at link)

Exxon & ChevronTexaco Receives Subpeona from D.A.

Reuters - Exxon Mobil Gets UN Oil-For-Food Subpoena

NEW YORK (Reuters) - Exxon Mobil Corp. has received a subpoena from a federal prosecutor regarding the UN-run oil-for-food program in Iraq, the world's No. 1 publicly-traded oil company said on Friday.

The office of the U.S. Attorney for the Southern District of New York declined to comment on whether it has opened a probe of the program.

...

A spokeswoman at Exxon's refining and marketing headquarters in Fairfax, Virginia, said the subpoena requested documents related to the oil-for-food program. "We are responding appropriately," she said.

She had no further comment.

San Ramon, California-based ChevronTexaco received a subpoena, which is a request for information, for the same matter and is also cooperating, according to a company spokesman.

And thus, the press became a lot more interested in the scandal...

(Full article at link.)

Feds Follow Surprising Money Trail

New York Times: Lockboxes, Iraqi Loot and a Trail to the Fed

WHEN a United States Army sergeant broke through a false wall in a small building in Baghdad on a Friday afternoon a little over a year ago, he discovered more than three dozen sealed boxes containing about $160 million in neatly bundled $100 bills.

Later that day, soldiers found more cash in other hideaways near the Tigris River, in an exclusive neighborhood that elite members of Saddam Hussein's government once called home. By the end of the evening, they had amassed 164 metal boxes, all riveted shut, that held about $650 million in shrink-wrapped greenbacks. The cash was so heavy, and so valuable, that the Army needed a C-130 Hercules cargo plane to airlift it to a secure location.

Just two days later, on Sunday, April 20, 2003, Thomas C. Baxter, head of the legal unit of the Federal Reserve Bank of New York, read a brief news account of the discovery. Most of the money that turned up in Baghdad was new, bore sequential serial numbers and was stored with documents indicating that it had once been held in Iraq's central bank. One fact particularly bothered Mr. Baxter: the money had markings from three Fed banks, including his own in New York.

Iraq, of course, had been subject to more than a decade of trade sanctions by the United States and the United Nations, so large piles of dollars, especially new bills, were not supposed to have found their way to Baghdad.

"How could that happen?" Mr. Baxter thought to himself, as he recalled later in Senate testimony. "Not only with U.S. sanctions, but with U.N. sanctions. How could that happen?"

Mr. Baxter and the New York Fed, along with the Treasury Department and the Customs Service, immediately began an investigation into Baghdad's currency stockpile. The continuing inquiry offers a rudimentary road map of illicit dealings - including lucrative oil smuggling - in Iraq and neighboring countries during the Hussein years, the federal authorities say.

(Full 4-page article at link.)

Scotsman: All OFP Companies Paid

Foreign firms paid Saddam commission in oil-for-food deals

COMPANIES from Australia, the US and other countries paid a secret commission to Saddam Hussein’s government to secure contracts under the United Nations’ oil-for-food programme, Iraqi and occupation officials said yesterday.

Iraq demanded a 10 per cent payment from suppliers who were told to put the money into Arab bank accounts set up by Saddam’s administration.

"All oil-for-food contracts from 1998 included 10 per cent in ‘after-sales services’, including some with US companies," an official from the Coalition Provisional Authority (CPA) said.

(More at link.)

While I, personally, still have my doubts about Oilexco's Arthur Millholland's innocence claims, this story seems to confirm the corruption allegations he made earlier.

Armitage: Scandalists "ought to hang"

'Hang' U.N. Oil Ra$cals

April 30, 2004 -- WASHINGTON - The State Department's No. 2 official said yesterday that those guilty of corruption in the U.N. oil-for-food program "ought to hang."

The blunt remarks by Deputy Secretary of State Richard Armitage to a House subcommittee were the strongest comments the Bush administration has made since accusations surfaced in January that Saddam Hussein ripped off $10 billion from the program.

He noted that the department has taken what he called the "extraordinary" step of turning over sensitive documents to investigators on the matter, "because we want to get to the bottom of it as much as you do."

"And if someone is found guilty they ought to hang," Armitage said.

(More at link. Hat tip to Instapundit.)

Khafaji and Scott Ritter

From Le Monde:

"For the first time, the Financial Times and the Italian newspaper *Il Sole 24 Ore* were able to establish on April 12 that Iraqi-American businessman Shakir Khafaji, whose name was on the list, received oil vouchers from Saddam Hussein amounting to 1 million barrels.

[...]

"Khafaji financed a film by Scott Ritter, former UN inspector, [which argued] against the UN sanctions. He also gave 5,000 dollars to the antiwar democrat
representative Jim McDermott, who, after press accusations, reimbursed the money."

... (more at link, in French)

Thanks to Scott Burgess at Daily Ablution for the translation.

Samir Vincent and Shakir ak-Khafaji

These two were the American recipients of Saddam's "Oil for Food" bribes. And who benefited from their largesse?

Shark Blog has done an outstanding job researching their political contributions. Here's an excerpt of al-Khafaji's:

Michigan's David Bonior, at the time the second ranking Democrat in the House, received $2,500 between 1998 and 2000. Bonior accompanied McDermott to Baghdad in 2002.

Then Senator, now Energy Secretary, Spencer Abraham received $250 in 1999

Detroit Democrat John Conyers received $1,000 in 1999. (Conyers introduced a bill in the House to end economic sanctions against Iraq in March 2000)

Michigan Republican Joe Knollenberg received $1,000 in 1998.

The Arab American PAC received $500 in 2002, while James Zogby's Arab American Leadership Council PAC received $5,000 in 2000.

The latter's top recipients in 2000 and 2002 included Democrat Congressmen Bonior, Conyers, Dingell, McKinney, Rahall and Moran and Republicans Stephen, Sununu and Issa. The former PAC's sole recipients in 2002 were: Bonior and Dingell.

Note that Congressman McDermott has returned al-Khafaji's $5,000.

... (more at link)

Congressman returns money to al-Khafaji

The Seattle Times: Local News: Aide says McDermott wasn't aware of Saddam link

Congressman Jim McDermott this week returned a $5,000 contribution made to his legal defense fund by an Iraqi-American businessman who has admitted to financial ties with Saddam Hussein's regime.

Shakir al-Khafaji, a Detroit-area businessman who had been active in the anti-Iraq-war movement and who accompanied McDermott, D-Seattle, on his highly publicized trip to Iraq in 2002, acknowledged to the Financial Times of London this week that he received lucrative vouchers for Iraqi oil from Saddam's government.

The oil-voucher story surfaced in January, when a Baghdad newspaper published what it said was an Iraqi government document naming 270 recipients of oil vouchers from around the world. Al-Khafaji was one of two Americans on the list, which included French, British and Russian political and business leaders and many prominent opponents of the war.

In 2002, Al-Khafaji accompanied McDermott and Reps. Mike Thompson, D-Calif., and David Bonior, D-Mich., on a trip to Iraq, during which McDermott gained national attention for criticizing President Bush and calling for an alternative to war.

After the trip, Al-Khafaji donated $5,000 to McDermott's legal defense fund set up by the congressman to pay expenses from an unrelated lawsuit.

A nonprofit organization, Life for Relief and Development, paid McDermott's $5,510 travel expenses for the Iraq trip, according to a disclosure form filed with the House clerk. Al-Khafaji has been named as a financial supporter of the organization, though the extent of his support is not known. The group says it ships humanitarian aid, including food and medicine, to Iraq.

From Saddam to Scott Ritter

Instapundit.com -

A Detroit-based businessman of Iraqi origin who financed a film by Scott Ritter, the former chief United Nations weapons inspector, has admitted for the first time being awarded oil allocations during the UN oil-for-food programme.

Shakir Khafaji, who had close contacts with Saddam Hussein's regime, made $400,000 available for Mr Ritter to make In Shifting Sands, a film in which the ex-inspector claimed Iraq had been "defanged" after a decade of UN weapons inspections.

The disclosure is likely to raise further questions about the operation of the oil-for-food programme, which is already the subject of Congressional investigations and a separate high-level UN inquiry.