Following the U.S.-led coalition’s liberation of Iraq and the fall of Saddam Hussein’s Ba’athist government, a wealth of information into the dictator’s plans and methods became available. In addition to this valuable information on Iraq, much information on the U.N.’s Oil-for-Food program, which many people had long suspected was not all it was purported to be, was also discovered. This paper will explore what evidence came to light and how it has and will continue to affect the UN’s reputation as well as the reputation of some member states.
The Oil-for-Food Program (OFP), was started by the UN in 1995 as a way of allowing Iraq to sell its oil and use the profits to purchase food, medicine and other humanitarian supplies. It continued until 2003 when the U.S.-led coalition liberated Iraq.
According to US Ambassador to the UN and United States Representative for UN Management and Reform Patrick Kennedy, OFP grew out of the sanctions imposed on Iraq immediately following Saddam Hussein’s invasion of Kuwait in August 1990. These sanctions, established through UN Security Council Resolution 661, began to lose unanimous support amongst Council members almost immediately as they became increasingly concerned over the apparent humanitarian devastation the sanctions caused and news of the crisis spread throughout the world.
What followed in 1991 were resolutions 706 and 712, aimed at alleviating the suffering by paying for humanitarian aid through the strictly supervised sale of Iraqi oil. These two resolutions weren’t all that dissimilar to what OFP turned out to be except that protocols managing the program were much more stringent in terms of who Saddam could sell oil to and purchase humanitarian aid from. Likely for this reason, these were never enacted due to the lack of cooperation by Saddam’s regime. In 1995 the Council passed resolution 986, which laid the framework for OFP.
Under the agreement, the Iraqi government maintained authority over much of the program, specifically over contract negotiations with buyers of oil and sellers of humanitarian supplies as well as the disbursement of the humanitarian supplies to the Iraqi population. This portion of the agreement was, not surprisingly, unpopular with many of the UN Security Council member states, including the U.S. and the UK, but was insisted upon by Saddam and supported by other Council members, including France. The one exception to this was the purchasing and disbursement of humanitarian supplies in the three Northern Governorates of Iraq (an area popularly known as Kurdistan), where the UN carried out these functions.
The Sanctions Committee, created under resolution 661, (a watered down version of 706 and 712 and one that Saddam ultimately agreed to), also known as the 661 Committee, oversaw the implementation of this new program and monitored program member states’ compliance. Decisions were made on a consensual basis. All members of the committee having to agree on actions taken, which often led to problems. When the U.S. became aware of non-compliance and manipulation of the OFP by Saddam as well as other parties, for instance Syria and their lack of control over the Syrian-Iraqi border, which led to a high amount of smuggling of goods banned from entrance under OFP; it raised its concerns before the committee, often with the support of the UK; and although lengthy discussion and debate took place and outside briefings by members of the Multilateral Interception Force (the enforcement arm of the OFP made up of member nation’s military forces) were made, willingness from other member nations, including France, to take action was often absent. Not only were other member nations unwilling to investigate and enforce the stipulations of the OFP, they often advocated for a reduction of the sanctions that were present. These member states’ reluctance to enforce the OFP and their advocating for reduced sanctions is thought to be tied to their “self-serving national economic objectives.”
In short, the OFP was ripe for corruption because of an extreme lack of oversight by the UN, not necessarily through its incompetence but simply because of the way the OFP was set up. Unfortunately, it is unlikely that more oversight could have been built in to the program because of Saddam’s unwillingness to comply. In fact, the first two resolutions aimed at relieving the humanitarian crisis in Iraq, 706 and 712, would have had those added safeguards in place to monitor the program and they were rejected by Saddam’s regime. As it was, after resolution 986, which implemented OFP, was passed, it took over a year of negotiations before Saddam finally agreed, while all the while his people continued to suffer. In addition, following that resolution, nearly all subsequent resolutions dealing with Iraq aimed at reaffirming and strengthening its sovereignty. It would not have been possible to pass any resolutions to the contrary; resolutions strengthening the protocols used to enforce OFP, because of the lack of support by other member nations on the Council, including France.
Some blame for the manipulation and corruption within OFP has also been placed on the companies contracted to carry out OFP operations; among them Lloyd’s Registry of London, Cotecna of Switzerland and Saybolt Oil of the Netherlands. BNP Paribas, the French bank that maintained the OFP accounts has also been questioned. However, this is not necessarily warranted as these companies were only allowed to operate as their mandates from the 661 Committee allowed. They were only authorized to inspect humanitarian supplies ordered through OFP and did not serve as customs officials or border guards. These duties were left up to the Iraqi government. Saybolt was tasked with inspecting outgoing oil shipments, however, again, only shipments authorized under OFP. They could not seek out oil smuggling operations.
Most of the blame is being placed on the Saddam regime. This, of course, is no surprise. What is surprising is that an almost equal number of accusations have been thrown at the UN, from Secretary-General Kofi Annan on down. One such accusation toward Annan specifically has to do with his apparent questionable ties to the Swiss company Cotecna. His son, Kojo, worked for the company on contract from 1999 onward. What makes this so intriguing is that from the onset of the allegations toward the UN, Kofi Annan has denied any wrongdoing stating that he and his staff were not aware of Saddam using the program to, in essence, launder money made through OFP and use it to purchase goods banned by the program as well as influence those in power in countries like France, Russia and China in hopes of getting those nations’ support in lifting the sanctions passed as part of OFP. This may be the case. What is less likely, however, is Kojo Annan’s statement (and one that would have been altogether unnecessary had he truly not played a role in Conecta’s OFP dealings) that his father had nothing to do with the contract process but that these decisions were made by the contract committee. This is simply false. The OFP was run out of the General Secretariat and Kofi Annan himself signed off on each six-month phase, including the contracts filled. Perhaps Kojo’s involvement with Cotecna was not fraudulent in the sense that he has never been named as one of the people receiving oil vouchers or money from Saddam’s government either directly or as a beneficiary of a company that did, but the alternative is that Kofi was negligent, not reviewing the contracts he was signing off on. Making his lack of involvement even more unlikely is the fact that, not only was he in charge of the program due to his position as Secretary-General, he had also been involved with OFP from its infancy, doing much of the work in meeting with the Iraqi government and setting it up, shortly before he was made Secretary-General.
Allegations of misdeeds do not end with the Kojo-Cotecna tie however. During the final months of OFP it is blindingly obvious that the UN knew of Saddam’s exploitation of the program and only decided to do something about it when it knew its oversight of the program was nearing an end.
In May 2003, shortly before the fall of the Saddam regime, the Security Council voted to end OFP and have all contracts related to the program turned over to the U.S. Coalition Provisional Authority. It gave the Secretariat six months to put everything in order. By the end of its renegotiation with supplier companies of billions of dollars worth of contracts, the Secretariat had cancelled a quarter of them. On its website it listed reasons for many of these cancellations. Examples include the Lebanese welding-machine contractor “unwilling to accept the 10% deduction.” Belgian and Jordanian medical suppliers also refused a “10% reduction.” Sometimes the reasons are not even as clear as that as was the case with the Russian backhoe supplier, who “refused to accept extra fee deduction” or the supplier of “fork lift and spares” who “stated that the supply of remaining parts cannot be cost-effective under the current circumstances.”
In total, the UN cancelled 728 contracts from the OFP due to the companies’ lack of cooperation or simply their non-existence. Some of these were perfectly legitimate but had already been fulfilled. However, most were rejected because the contractors had disappeared, no doubt realizing that the cash cow many of them had been enjoying for the past seven years was now out of milk and that the angry farmer may be closing in on the barn. Examples of these contracts include the Jordanian school-furniture supplier who “does not exist and the person in charge moved to Egypt” or the “vehicle spare parts” supplier from Russia that “could not be contacted despite all efforts.”
In addition to these 728 contracts, another 762 were postponed indefinitely by the UN’s Office of the Iraq Programme because of their “questionable utility.” At first glance, these contracts seem to be useful for humanitarian purposes: medicine from China, medical equipment from France, wheat from Russia; which leads one to wonder if it was not the utility of the items in question but the terms of these contracts negotiated by Saddam and the supplier companies and subsequently allowed by the UN. These cases may seem rather innocuous but they are still not the only evidence of wrong doing by the UN. Perhaps most grievous is the allegation that Benon Sevan, the Executive Director of OFP, received oil vouchers from Saddam, allowing him to purchase oil from Iraq at reduced prices; something similar to a stock option. (Duelfer Report) Given his position and authority over the program it begs the question of what Sevan may have done in return.
So what has all this apparent corruption led to? According to the General Accounting Office, Saddam was able to acquire over $10 billion through manipulation of OFP itself as well as the related lack of enforcement of sanctions. Specifically, he was able to collect $4.4 billion through kickbacks and surcharges and another $5.7 billion through smuggling. In turn, with this money he was able to slowly dig himself out of the military finance hole he had gotten himself into with, first, the Iran-Iraq War of the early 80s, then the invasion of Kuwait in 1990. These two operations cost Saddam a great deal more than he had expected, both in terms of cash spent and troop casualties. After coalition forces pushed him back into relative submission during the first Gulf War his forces were devastated. If he was going to achieve his goals of dominance in the area he needed desperately to regain his military power. If not, Iraq would be at the mercy of many of its neighbors, especially Iran.
According to the Duelfer Report, Saddam had always been concerned about how history would view him and was obsessed with his legacy. He believed that Iraq was the natural and historical leader of the Arab world and he was the next in line of its great leaders like Hammurabi and Nebuchadnezzar. He even ordered the restoration of the ancient city of Babylon and had all the bricks being used imprinted with the phrase “made in the era of Saddam Hussein,” thinking he would be remembered long into the future.
But bricks alone would not build his legacy. To fend off his real and perceived threats, he needed real military hardware in the form of chemical, biological and even nuclear weapons. The much-debated WMDs were never technically found and the search has now been halted. This is simply a technicality though as mountains of evidence of the will and especially the ability, both in the form of facilities and the scientists needed to start the program, were found, according to the Duelfer Report.
One thing to consider in relation to the apparent lack of WMDs is that, while not many Westerners were studying in Baghdad in the 90s, thousands of Iraqis studied in the West. This gave those within Saddam’s regime a leg up on the competition, so to speak. His scientists and lieutenants could more easily predict how weapons inspectors would operate than the other way around. In addition, the longer searches went on the better at concealing evidence Saddam got. For the UN inspectors it was like playing a game of hide and seek where not only did they not know exactly what they were looking for, the location of it was apt to change frequently.
A specific example of this, according to the Duelfer Report, was the UN’s investigation of the Saddam Regime’s hierarchy and how it related to the delivery of orders regarding the concealment of WMD evidence. Since the inspectors were basing their investigations on Western assumptions they only looked at government bureaus that were directly tied to Saddam (the Republican Guard, the Special Security Organization, etc.) because, to them, it made sense that Saddam would have been giving the orders for concealment. The Saddam Regime did not necessarily operate like this in all circumstances, and even in the cases in which it did, it was able to quickly change that after watching the inspectors work so that they would not uncover any further information, like changing the path of a maze after the inspectors had already entered it.
But the UN cannot take all the blame for OFP. After all, the UN is only as strong as its member countries and, more specifically, the permanent members of the Security Council. Therefore, much of the blame can be placed on those nations that did not do what they should have as part of the Council to ensure that resolutions, including OFP, were enforced.
Most of this blame rests on France, China and Russia. During Congressional hearings last October, investigators stated that, according to UN Security Council subcommittee minutes, these three nations “continually refused to support the U.S. and U.K. efforts to maintain the integrity” of OFP. The investigators went on to quote the minutes as stating that companies within these nations “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.”
Among these companies were such giants as French oil companies Total and SOCAP and the Iraqi-French Friendship Society.
According to former Iraqi deputy prime-minister Tariq Aziz, several French individuals were given oil vouchers in exchange for efforts to lift UN sanctions and oppose US initiatives within the Security Council. (Duelfer Report)
Not only were several businesses allegedly involved in questionable dealings with the Iraqi government, some high-ranking officials were also fingered. According to the Duelfer Report, former French Interior Minister Charles Pasqua reportedly received 11 million barrels in exchange for promoting pro-Iraqi policies within the French government. He publicly denied the allegations but did mention that others within the French government may have been involved.
The connections between the Saddam Regime and the French government may even extend all the way to President Jacque Chirac. Indeed, Saddam and Chirac have had a long relationship. In the 1970s, it was then Premier Chirac who sold Saddam two nuclear power plants, the “first concrete step towards production of the Arab atomic bomb,” according to Saddam himself. In terms of OFP, there are no direct connections between Saddam and Chirac, but the two are tied together through other individuals. For example, the Duelfer Report cites “a former Iraqi official” as claiming that Iraq gave 14 million barrels of oil to French businessman Patrick Maugein, whom it considered “a conduit to French President Chirac.”
In addition, Iraqi Intelligence Service (IIS) documents recovered by coalition forces state that the Saddam Regime, through the IIS, attempted to influence Chirac through other connected businessmen as well as the official spokesman for President Chirac’s re-election campaign and two of his advisors.
France’s questionable involvement with Iraq doesn’t stop with OFP, however. Even today the French are marginally assisting the former regime by supporting the Ba’athist Party in exile, which has set up its operations in Paris and is calling itself the resistance in hopes of eliciting a favorable response from French who remember their own “resistance” movement against the Nazis. French Foreign Minister, Michel Barnier has proposed that the Ba’athist Party, which has been outlawed in Iraq, be allowed to participate in any future conferences discussing the future of Iraq.
Investigations into this corruption continue, in particular one being conducted separate from, but authorized by the UN and headed up by former Federal Reserve Chairman Paul Volcker. Despite any conclusive findings thus far from that commission there are still many things that were uncovered through the House investigation and, especially, the report written for the CIA by Charles Duelfer. From these it is apparent that the UN, at the very least, was clearly not up to the task of managing OFP.
The UN collected a 2.2% commission on every barrel of oil. Not a considerable amount but considering that this money was supposed to be used to fund the monitoring operations, it seems that it was a poorly spent. This is just the beginning and the least of the UN’s failures. Perhaps the biggest failure of OFP was in its inception, the terms under which it would be enforced. These were perfunctory at best, but to be fair, the UN claims that had it been for more stringent oversight, Saddam would never have agreed to OFP (Hearing before House Subcommittee on NSETIR, 10/5/04). This does appear to be true, for even the plan that did end up being administered took nearly a year’s worth of negotiation with Saddam to begin. However, OFP was still a failure and was always destined to be. The UN turned over too much of its power in running OFP to Saddam and the companies and national leaders he dealt with. It failed to perform necessary audits and then, to cover itself from more public scrutiny, kept most of the records – prices and quantity of oil and relief supplies, identities of those buying the oil (who were selected by Saddam, not the UN), bank statements and financial transactions – secret (Duelfer Report).
One of the biggest problems the UN has always had is enforcement power. Now, unfortunately, corruption can be added to that list and both have chilling examples in OFP. Perhaps this failure can be viewed as a blessing in disguise however. Hopefully it will lead to reforms within the world body. If not, it is unlikely the UN will survive to see its centennial.