CORRUPTION:
Iraq Oil Connection Leaves Greasy Marks
Julio Godoy
PARIS, Nov 15 (IPS) - Questions continue to hover above 180 French firms said to have profited illegally from the
oil for food programme in Iraq.
Many of the firms named in the Volcker report that inquired into corruption around that
programme deny wrongdoing. Some have announced internal investigations.
BNP Paribas, Total and Peugeot, three of the largest French companies named in the
corruption scheme established by the ousted regime of Saddam Hussein, have rejected the
allegations.
BNP Paribas, Banque Nationale de Paris, denies that its services "were marked by a lack of
transparency or by a conflict of interests," as stated in the report of the inquiry
commission led by the former U.S. head of the Federal Reserve, Paul Volcker.
Other companies too have issued flat denials. "We do not feel concerned about the Volcker
report," a spokesperson for the car manufacturer Peugeot told IPS. "In our operations in
Iraq, we always respected the legal framework. The Volcker report does not provide any
proof to the contrary."
Total, the oil giant, has for months denied any wrongdoing in its operations in Iraq despite
claims by French authorities that it paid up to five million dollars in illegal commissions to
Iraqi officials, and that it was "deeply involved in numerous infractions" in the oil for food
programme.
The UN oil for food scheme was set up in 1995 to allow Iraq to import humanitarian
goods, especially food, to ease the embargo imposed upon the Saddam regime after its
invasion of Kuwait in 1990.
The UN programme allowed Iraq to export some 3.4 billion barrels of oil valued at about
65 billion dollars between December 1996 and March 2003. But, according to Volcker's
findings, the regime of Saddam Hussein transformed the programme into a corruption
scheme, diverting up to 1.8 billion dollars.
Selected private companies involved in the scheme paid illegal commissions to Saddam's
highest-ranking officials in order to gain preferential treatment in winning contracts, the
report says.
The report released last month claims that 2,200 companies in 66 countries colluded with
Saddam Hussein's government, and paid his regime bribes and kickbacks to benefit from
the UN programme.
BNP Paribas managed lines of credit and escrow accounts for Iraq for 64.2 billion dollars,
and authorised transactions concerning the import of humanitarian goods into the country
for 34.5 billion dollars.
According to the Volcker report, the bank failed to adequately scrutinise the accounts, and
did not cooperate fully with investigators.
The report says Renault VI, the industrial vehicles division of the French auto
manufacturer, paid 6.8 million dollars in illegal commissions to obtain a 78.2 million
dollar contract. Peugeot paid seven million dollars in illegal commissions for a 73.3 million
dollars contract, the report says.
Renault VI is now owned by Swedish auto manufacturer Volvo. Volvo president Leif
Johansson has announced an internal investigation "to determine what really happened" in
Iraq.
"We take very seriously that the name of Volvo be mentioned in the Volcker report," he
said in a statement. "If the accusations are verified, and illegal acts were committed, we
will take adequate measures."
According to the UN inquiry, French companies were favoured by the Saddam regime
because France, together with other countries such as China and Russia were considered
friends of Iraq.
Among the 180 French companies named in the Volcker report are several U.S. and British
companies, which established subsidiaries in France in order to benefit from the "friendly"
status of France, the report says.
The French judiciary has been investigating several local politicians, government officials
and companies over allegations of collusion in the Iraqi corruption scheme.
Judge Philippe Courroye, the prosecutor in charge of these investigations, has launched
proceedings against two former high-ranking French diplomats, and against several
politicians.
Jean-Bernard Mérimée, who was French ambassador to the United Nations during the early
1990s, has been formally accused of "influence peddling" and "corruption of foreign
officials" in the oil for food programme.
Mérimée has been accused of receiving vouchers for some two million barrels of oil, and
selling them between 2001 and 2003 to two French companies operating in Iraq.
The list of French personalities who allegedly received illegal commissions from the Iraqi
regime is almost as long as that of the French firms. It includes former minister for the
interior Charles Pasqua, several businesspeople, and leading politicians close to President
Jacques Chirac.
(END/2005)
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