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October 5, 2004
UN Inspectors Took Massive UNSCAM Bribes

The Wall Street Journal reports (through the London Telegraph) that Iraqi oil officials have accused a UN inspector responsible for enforcing the UN Oil-For-Food program of taking over 60,000 in bribes, equivalent to around $100K:

Iraqi oil officials have accused a United Nations inspector of taking almost 60,000 in bribes from Saddam Hussein's regime as his henchmen and foreign business partners siphoned millions from the UN's oil-for-food programme, it was reported yesterday.

An inquiry by officials in the State Oil Marketing Organisation - a body which, under Saddam, was a key player in schemes that allegedly diverted billions in oil revenues from the UN-run programme - accused an inspector contracted through the Dutch company Saybolt of falsifying documents in return for bribes, the Wall Street Journal reported.

Saybolt was one of two Western companies hired by the UN to provide inspectors to help monitor the oil-for-food programme. A second company, Cotecna Inspection Services of Switzerland, has come under fire from Congressional Republicans, after it emerged that it employed Kojo Annan, the son of the UN secretary-general, as a consultant, after being awarded an oil-for-food contract. A UN review of Mr Annan's employment found no conflict of interest.

Saybolt, for its part, claims that no bribes had been received by any of its employees. Saybolt managing director Peter Boks gave the Congressional commitee hearing the testimony a "vast quantity" of correspondence demonstrating that they had complained often to the UN about Iraqi non-compliance. Obviously, the question that follows is what the UN did in response to these documented allegations. The equally apparent answer is that they did nothing, and the American government's representative at the committee shows why:

The United States government representative at the hearing, Ambassador Patrick Kennedy, said that "voluminous oil-for-food documents are now being safeguarded" in Baghdad and the US embassy was working to gain access to them.

Mr Kennedy, of the American mission to the United Nations, directly blamed the "self-serving national economic objectives of certain key member states" on the Security Council for inhibiting British and American efforts to clamp down on oil-for-food corruption. The statement appeared to be aimed at France and Russia, which sought to have sanctions against Saddam lifted.

One hundred billion dollars is known to have officially passed through the OFF program. According to the WSJ and the Telegraph, the GAO has determined that Saddam charged a flat 10% kickback tax on all transactions. The example given is of a hypothetical $10M baby-milk contract; $9M in baby milk would be delivered with $1M in cash, while the books would show that the contract had been fulfilled. Under this scheme, Saddam pocketed 10% of all contracts, since he had a monopoly on trade as tight as any monarch or potentate in world history, amounting to a personal windfall of $10 billion dollars. Not even the bribes came out of this; the bribes were mostly paid through oil options, a pre-sale structure.

John Kerry and John Edwards continue to claim that Saddam was "trapped" by global sanctions. Having the UN stuff $10B into his pockets only trapped Saddam by the weight of the windfall they threw at him. The nations that Kerry/Edwards presume held Saddam fast had no intention of doing so and actively assisted in his corrupt schemes to avoid the sanctions. The organization from which Kerry insists we derive legitimacy for any action not only turned a blind eye towards this but participated in the corruption at the highest levels of the OFF program, at least (Kofi Annan managed to get a job for his son at another watchdog contractor, too); Benon Savan, the program director, tooks millions in Iraqi money for himself.

Is the "global test" a backwards ethics examination? If you fail, you pass?

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Posted by Ed Morrissey at October 5, 2004 11:17 PM

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Tracked on October 6, 2004 10:22 AM

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