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Dear all,
the UN story is continuing and it gets worse. Victim blaming of the worst kind:
"Kennedy placed the majority of the blame for the abuse of the Oil-for-Food Program on the former
Iraqi regime. "The U.N. Oil-for-Food program was established to address the humanitarian needs of
the people of Iraq in the face of callous disregard by Saddam Hussein for their welfare. ...
However, this program was abused by Saddam Hussein in nefarious and clever ways," he said".
No suggestions yet?
Greetings.
Dirk.
Congress Explores Alleged Iraqi Oil-for-Food Abuses (2004-04-22)
http://www.uspolicy.be/Article.asp?ID=A46658CE-95C3-4253-96B6-4EA4D40598DD
By David Shelby
Washington File Staff Writer
Washington -- Representative Christopher Shays (Republican from Connecticut) characterized
the alleged corruption within the U.N. Oil-for-Food Program as "a scandal of almost unthinkable
scope and seriousness" as he opened a House Government Reform Committee hearing to explore the
matter April 21.
"What began as a temporary safety valve to meet the humanitarian needs of the oppressed Iraqi
people was allowed to become a permanent torrent of sanctions busting and profiteering," Shays said.
He added, "There has to be a full accounting of all Oil-for-Food transactions, even if that
unaccustomed degree of transparency embarrasses some members of the Security Council."
The committee heard testimony from several U.S. government officials as well as independent
analysts regarding the accusations of price manipulations and kickbacks in which U.N. officials or
member state contractors may have been complicit.
U.S. Ambassador to the United Nations for Management and Reform Patrick Kennedy outlined four
areas of alleged abuses: oil smuggling, price manipulation on approved oil exports, kickbacks on
humanitarian contracts and possible abuses on the part of U.N. personnel.
Kennedy reported that Saddam Hussein's former regime in Iraq engaged in outright smuggling of
as much as $2 billion of oil per year through Syria and the Persian Gulf. He indicated that this
was carried via small vessels operating out of the Shatt al-Arab, Iraq's maritime access route to
the gulf, and through the Iraqi-Syrian pipeline.
The international community responded by activating a maritime interception force and raising
its concerns with Syrian officials. Kennedy said that these measures had some limited success.
According to Kennedy, the Iraqi regime requested the imposition of additional fees on the
sale of Iraqi crude in the fall of 2000, and despite the refusal of the U.N. monitoring committee
to allow such fees, some oil companies were evidently willing to pay illicit surcharges of as much
as 50 cents per barrel.
United States and United Kingdom officials on the U.N. monitoring committee combated the
surcharges by withholding approval of the Iraqis' requested prices until the end of each month,
thereby removing any speculative incentives for companies to pay anything over the fair market
value on the delivery date.
Kennedy told the congressmen that undocumented allegations of kickbacks related to
Oil-for-Food humanitarian contracts began to surface in late 2000. He said that U.S. and U.K.
officials sought to investigate these allegations, but "our proposals received no support:
[committee] members claimed that absent receipt of evidence indicating that such kickbacks existed,
no action could be taken."
Michael Thibault, deputy director of the Defense Contract Audit Agency (DCAA), revealed the
findings of his agency, which reviewed numerous Oil-for-Food contracts as the program was
transitioned to Coalition Provisional Authority administration in May 2003.
The DCAA looked at 759 contracts valued at $6.9 billion and found evidence of overpricing in
48 percent of the contracts. The auditing team determined that the contracts, valued at $3.1
billion, contained as much as $656 million in overpricing.
Thibault noted that the greatest apparent pricing aberrations were related to food shipments.
However, he also mentioned unusually large quantities of spare parts with vehicle shipments and
illicit surcharges such as "after sales service charges" associated with numerous contracts.
Thibault also noted contracts of doubtful humanitarian value, such as $16 million worth of
Mercedes Benz touring sedans and $600,000 worth of cigarette paper.
As for allegations regarding the complicity of officials from the U.N. Office of the Iraq
Program in the kickback schemes, Kennedy said that the United States government had no knowledge of
any malfeasance.
He noted that U.N. Secretary-General Kofi Annan has established an independent inquiry into
the U.N. office and that the Iraqis are carrying out their own investigation of abuses on the Iraqi
side through the Iraqi Board of Supreme Audit.
Kennedy placed the majority of the blame for the abuse of the Oil-for-Food
Program on the former Iraqi regime. "The U.N. Oil-for-Food program was established to address
the humanitarian needs of the people of Iraq in the face of callous disregard by Saddam Hussein for
their welfare. ... However, this program was abused by Saddam Hussein in nefarious and clever
ways," he said
He added, "The inquiries now being launched will, we hope, identify those who may have
conspired with him, and perhaps assist in recouping lost funds for the Iraqi people."
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