| Russian companies accused of bribing Saddam The UN needs urgent and radical reforms to ensure that “illegal, unethical and corrupt” practices are not repeated in the future. Such as were allowed during the implementation of the Oil for Food program. This conclusion is contained in the final report of the Volcker Commission, released yesterday in New York, investigating the implementation of the largest humanitarian program in world history.
Yesterday, UN Secretary General Kofi Annan for the first time clearly took responsibility for mistakes during the implementation of the program. However, Volcker’s commission did not find any corruption in the actions of the Secretary General himself. “Endless corruption,” the report claims, plagued the activities of foreign companies involved in the program. Most of the companies receiving oil from Iraq were Russian. But, as stated in the report, citing the opinion of some Russian officials, among these companies there were also shell companies that used Russia as a suitable platform for this type of business.
As the commission found, Iraqi President Saddam Hussein, overthrown in 2003, by manipulating the Oil-for-Food program, received illegal income worth $1.8 billion. The former Iraqi regime received $225.9 million in commissions alone, of which a third of them were in cash, which were allegedly brought in suitcases to the Iraqi embassies in Russia, Egypt, Greece, Italy, Malaysia, Switzerland, Syria, Turkey and Vietnam. "But the largest portion of such payments came from Russian companies (including several state-owned companies) to the Iraqi Embassy in Moscow - more than $52 million for the period from March 2001 to December 2002," the report says.
The former Iraqi leader received even more substantial money through oil smuggling, bypassing international sanctions. According to the authors of the report, this brought him $10.2 billion. Moreover, the Americans knew about the smuggling of Iraqi oil through Turkey, Syria and Jordan. But, not wanting problems in the world oil market, the United States turned a blind eye to this.
In the form of compensation for losses, the Volcker Commission recommended that the UN demand $50 million from the agencies involved in the scandal surrounding the Oil-for-Food program. In addition, it recommended that the post of a general manager and an independent supervisory board be established at the UN to monitor the expenditure of funds, as well as improve financial reporting and expand the list of persons subject to financial audits to the level of the Secretary General and his deputies.
From 1996 to 2003, the Oil-for-Food program sold $64 billion in Iraqi oil and purchased $39 billion in food and medicine for Iraqis. As the report acknowledges, this helped “maintain minimum standards of nutrition and health care" in a country against which the world community imposed sanctions in 1990 for the invasion of Kuwait.
But insufficient control on the part of the UN Secretary General and the member countries of the Security Council led to corruption and illegal enrichment of the Saddam Hussein regime, which, under the terms of the program, was given the right to choose oil buyers. Hussein took advantage of this to extort kickbacks and bribe foreign government officials, politicians, journalists, and UN officials in exchange for political support.
The commission of Paul Volcker, former chairman of the US Federal Reserve, was created in April 2004 by decision of UN Secretary General Kofi Annan. Yesterday she concluded that poor management of the program is not the fault but the problem of the UN, which is "ill-prepared to carry out a program of this scale." And the UN Secretary General “was elected to this post not due to his qualities as a manager and administrator,” but as “the main diplomatic and political representative of the UN.”
Yesterday's document - almost 900 pages long - was the final report of the Volcker Commission (there were four in total). But in October, the commission also promises to present a complete list of 4.5 thousand companies involved in the program, and for the first time, not front companies, but the companies hiding behind them will be named.
The first three Volcker Commission reports resulted in two arrests. Moreover, both of those arrested were Russians. Two months ago, 51-year-old Alexander Yakovlev, an employee of the UN procurement commission, was arrested on charges of corruption. And last week, the chairman of the advisory committee on administrative and budgetary issues of the UN General Assembly, 48-year-old Vladimir Kuznetsov, was detained on charges of money laundering.
The Russian Foreign Ministry almost did not react to Yakovlev’s arrest, noting only that he was not a Russian diplomat. As for Vladimir Kuznetsov, consular officers in New York are trying to secure his release. This even gave rise to speculation that Mr. Kuznetsov was allegedly carrying out orders from the Russian special services under the cover of the UN. A Vremya Novostei source in the Russian Foreign Ministry called these assumptions “complete stupidity.”
Yesterday, the status of Mr. Kuznetsov in New York became clear - an official serving the UN General Assembly. This means that while Mr. Yakovlev got a job at the UN Secretariat on his own initiative, Vladimir Kuznetsov was elected to an elected position in the UN General Assembly on the nomination of Russia. The Ministry of Foreign Affairs considers him one of its own, and, as a source in the ministry explained to Vremya Novostei, after the end of his term in New York, Kuznetsov could return to the Russian diplomatic service with a promotion.
The final report of the Volcker Commission appeared just a week before the start of the anniversary, 60th session of the UN General Assembly, which will be attended by the leaders of 175 countries, including Russian President Vladimir Putin. It will also discuss issues of UN reform. Yesterday, in a conversation with Vremya Novostey, the director of the Institute for Strategic Assessments, Sergei Oznobishchev, ruled out the assumption that the scandalous report was specially timed to coincide with the summit in New York: “It’s unlikely that anyone in the world is conducting a coordinated campaign against Russia. The commission has a strong evidence base and has laid it out simply in its reports.” As the Russian Permanent Representative to the UN Andrei Denisov said yesterday immediately after the presentation of the Volcker report, “Russia shares many of the conclusions of the Volcker Commission.” Andrey ZLOBIN |
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