NYTimes: France, China, Russia sabatoged Oil for Food

[Alex Moon]

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Congressional investigators say that France, Russia and China systematically sabotaged the former United Nations oil-for-food program in Iraq by preventing the United States and Britain from investigating whether Saddam Hussein was diverting billions of dollars.

In a briefing paper given yesterday to members of the House subcommittee investigating the program, the investigators said their review of the minutes of a United Nations Security Council subcommittee meeting showed that the three nations "continually refused to support the U.S. and U.K. efforts to maintain the integrity" of the program.

The program, set up in 1996, was an effort to keep pressure on Mr. Hussein to disarm while helping the Iraqi people survive the sanctions imposed after the invasion of Kuwait in 1990. The briefing paper was prepared by the House Subcommittee on National Security, Emerging Threats and International Relations, before hearings scheduled for Tuesday on the scandal-ridden program.

The paper suggests that France, Russia and China blocked inquiries into Iraq's manipulation of the program because their companies "had much to gain from maintaining'' the status quo. "Their businesses made billions of dollars through their involvement with the Hussein regime and O.F.F.P.," the document states, using the initials for the program. No officials of the three governments could be reached for comment.

The paper also accuses the United Nations office charged with overseeing the program of having "pressed" contractors not to rigorously inspect Iraqi oil being sold and the foreign goods being bought. The program office, headed by Benan Sevan, who is also under investigation by a committee appointed by the United Nations, turned a blind eye to corruption charges, the paper says, because it apparently saw oil-for-food "strictly as a humanitarian program."

Representative Christopher Shays, the Connecticut Republican who chairs the subcommittee, said in an interview that there was no doubt that the abuses were systemic and that blame for the widespread corruption must be shared by Security Council members, the United Nations office that administered the program, and the contractors hired by the United Nations to inspect Iraq's oil exports and aid purchases.

The briefing paper said the hearing would focus on Cotecna, the Switzerland-based company hired by the United Nations in 1999 to monitor goods shipped to Iraq, and Saybolt International B.V., the Dutch company that monitored Iraqi oil exports.

Also under scrutiny will be BNP Paribas, the French bank that handled oil revenues under the program and which "never initiated a review of the program or the reputation of those involved," the paper says. This "apparent incuriosity," it adds, "raises questions about its internal due diligence and ethical safeguards."

The paper said Mr. Hussein's government had influenced whom Saybolt and Cotecna employed and had made it hard for them to obtain the equipment and supplies they needed. "This slowed the inspection process, making it difficult for the inspectors to carry out their duties and easier for the Iraqis to pressure the inspectors or sneak things past the inspection regime,'' the paper says.

Cotecna, which monitored goods bought by Iraq, "had no authority to force authentication or inspection on shipments coming across the border, nor did they have the practical authority to detain shipments that failed authentication or inspection."

The subcommittee paper called Cotecna a "paper tiger.''

The paper concludes that the program's greatest weakness was a lack of transparency. "Most transactions involving the program were done behind closed doors or sometimes illicitly," it states. The lists of oil purchasers and aid providers were not known. The United Nations internal audits continue to be withheld from United Nations members and the public.

A recent report issued in Washington by the Government Accountability Office, formerly the General Accounting Office, accused the Hussein government of having pocketed more than $10 billion from the six-year oil-for-food program, which used $64.2 billion in Iraqi oil sales to pay for food, medicine and other goods from 1997 to 2003. Last February, a document from Iraqi ministries reportedly cited Mr. Sevan, the chief of the United Nations office that administered the program, as having received oil allotments himself. Mr. Sevan has denied the charges.

The Shays subcommittee is investigating all aspects of the program, as are several other Congressional panels and the United Nations-appointed panel, which is headed by Paul A. Volcker, former chairman of the Federal Reserve.