Oil for Food (OFF) Debacle aka UNSCAM

» Lawhawk - Claudia Rosett is on to something huge

Supplied by Iraq's oil wells, the sums involved in Oil-for-Food's transactions were so enormous that even the routine rounding errors of a few hundred million here or there easily rivaled, for example, the $300 million or so in family money believed to have given Osama bin Laden his terrorist start.

In a world beset right now by terrorist threats--which depend on terrorist financing--it's time to acknowledge that the U.N.'s Oil-for-Food program was worse than simply a case of grand larceny. Given Saddam's proclivities for deceit and violence, Oil-for-Food was also a menace to security. By letting Saddam pick his own business partners and draw up his own shopping lists, by keeping the details of his contracts and accounts secret, and by then failing abjectly to supervise the process, the U.N.--through a program meant to aid the people of Iraq--enabled Saddam to line his pockets while bankrolling his pals world-wide. In return, precisely, for what? That is a question former Federal Reserve Chairman Paul Volcker might want to keep in mind as he heads up the official investigation, finally agreed to by U.N. Secretary-General Kofi Annan, into Oil-for-Food.
In tallying various leaked lists, disturbing leads and appalling exposés to date, what becomes ever more clear is that Oil-for-Food quickly became a global maze of middlemen, shell companies, fronts and shadowy connections, all blessed by the U.N. From this labyrinth, via kickbacks on underpriced oil and overpriced goods, Saddam extracted, by conservative estimates of the General Accounting Office, at least $4.4 billion in graft, plus an additional $5.7 billion on oil smuggled out of Iraq. Meanwhile, Mr. Annan's Secretariat shrugged and rang up its $1.4 billion in Iraqi oil commissions for supervising the program. Worse, the GAO notes that anywhere from $10 billion to as much as $40 billion may have been socked away in secret by Saddam's regime. The assumption so far has been that most of the illicit money flowed back to Saddam in the form of fancy goods and illicit arms.

But no one really knows right now just how much of those billions went where--or what portion of that kickback cash Saddam might have forwarded to whatever he deemed a worthy cause. A look at one of the secret U.N. lists of clients authorized by the U.N. to buy from Saddam is not reassuring. It includes more than 1,000 companies, scattered from Liberia to South Africa to oil-rich Russia. And though the U.N. was supposed to ensure that oil was sold to end-users at market price--thus minimizing the graft potential for Saddam and maximizing the funds for relief--there is an extraordinary confetti of clients in locations known less for their oil consumption than for their shell companies and financial secrecy.

Why on earth, for instance, did the U.N. authorize Saddam to sell oil to at least 65 companies in the financial lockbox of Switzerland. What was the logic behind approving as oil buyers at least 45 firms in Cyprus, seven in Panama and four in Liechtenstein? At the other extreme, would Mr. Annan care to explain why the U.N. authorized Saddam to sell oil to at least 70 companies in the petroleum-soaked United Arab Emirates?

This program was a threat to international security, and not just to the US. Terrorists could quite easily have gotten funding via the program, and Saddam siphoned off billions to bribe others into turning a blind eye.

-- posted by Lawhawk