U.N. to Take Up Oil-for-Food Probe

U.N. to Take Up Oil-for-Food Probe
Tuesday, April 20, 2004

NEW YORK — A United Nations Security Council resolution is expected to pass Wednesday that would back an investigation into the troubled Iraqi oil-for-food program.

The probe would look into how Saddam Hussein and his allies allegedly siphoned off billions of dollars that were meant for the Iraqi people.

The resolution is part of the probe into the allegations of bribes, kickbacks and illegal contracts that cost an estimated $10 billion.

The resolution was reportedly a requirement for Paul Volcker, the respected former chairman of the U.S. Federal Reserve, to accept the job of heading up a special U.N. team to investigate the scandal-scarred program.

Volcker wanted assurances that the U.N. investigation wouldn't exempt U.N. Secretary-General Kofi Annan's office.

Annan's son once worked for a program consultant but denies any wrongdoing. Sources say the resolution says that any illicit activity by U.N. officials, personnel and contractors is "unacceptable."

Last week the Russians said there was no need for a resolution but have since retracted their objection. Critics said the Russians were against it because they made billions off Saddam and do not want the truth to come out.

"There are many countries, individuals ... who do not want the truth to come out ... they have cheated the system," Claude Hankes-Drielsma, advisor to Iraq's Governing Council told Fox News, citing Russia and France as two countries that were "significant beneficiaries" of Saddam.

A list of people who allegedly got vouchers to sell Iraqi oil included a former Russian ambassador to Baghdad and the former head of the program itself, Benon Sevan.

Sevan has denied the allegations and he's now on leave pending his retirement.

But experts who have examined the program say only an independent investigation will uncover the truth.

"Mr. Benon Sevan's name appears on several records, which I have seen personally in ministries in Baghdad ... and one has to ask, why is that?" said Hankes-Drielsma. "The same applies to the former French ambassador to the U.N. who appears on the list, the son of a Russian ambassador on the list. And I can go on for quite a while."

Volcker made no comment Tuesday morning, but a resolution Wednesday could be a first step toward a probe.

The corruption claims — a major embarrassment for the United Nations — surfaced last January in the Iraqi newspaper Al-Mada, which published a list of about 270 former government officials, activists and journalists from more than 46 countries suspected of profiting from Iraqi oil sales under the U.N. program.

The U.S. General Accounting Office, Congress' investigative arm, estimated last month that the Iraqi government pocketed $5.7 billion smuggling oil to its neighbors and $4.4 billion extracting illicit surcharges and kickbacks on otherwise legitimate contracts.

Annan launched an internal inquiry into the oil-for-food program in February but canceled it to allow an independent examination covering governments and companies that signed contracts with the United Nations or Iraq.

Fox News' Eric Shawn and The Associated Press contributed to this report.