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IN THE NEWS - Cheating Investigated in UN Oil-for-Food Program in Iraq - 2004-10-15

Broadcast: October 16, 2004

This is Steve Ember with In the News in VOA Special English.

The United Nations will use money left over from its oil-for-food program in Iraq to pay for an investigation of that program. Secretary General Kofi Annan told the U.N. Security Council this week that thirty million dollars will be used. The money was meant to pay costs of the program, which ended last year.

This past April, Mister Annan appointed Paul Volcker to lead an independent investigation into reports of wrongdoing. Mister Volcker is former chairman of the United States central bank, the Federal Reserve. The oil-for-food program also faces other investigations in the United States and Iraq.

The Security Council established the program at the end of nineteen ninety-six. The program was designed to ease the harm caused to the Iraqi population by U.N. economic restrictions. These went into effect after Iraq invaded Kuwait in nineteen ninety.

The program was valued at sixty thousand million dollars. It permitted the former government of Saddam Hussein to sell limited amounts of oil. Money from the oil sales was used to buy food, medicine and other aid.

But in January, an Iraqi newspaper listed about two hundred seventy foreigners suspected of illegally profiting from the oil sales. There were more accusations last week in a report by an American team, the Iraq Survey Group. Chief American weapons inspector Charles Duelfer, a special adviser to the Central Intelligence Agency, prepared the report.

The report said Saddam Hussein made eleven thousand million dollars in oil profits outside U.N. control. It said his government also imported military equipment and other illegal goods.

The report says the former government offered deals to hundreds of individuals, companies and governments in an effort to end the U.N. restrictions. It says many offers were aimed at Russia, France and China, all permanent members of the Security Council. The report also says there were illegal oil sales to Jordan, Syria, Turkey and Egypt during the full period of the restrictions.

The thousand-page Duelfer report says Iraq used a secret system of oil vouchers. These permitted the holder to buy oil and resell it at a profit. Benon Sevan, the former chief of the U.N. oil-for-food program, is listed among those said to have received vouchers. He has denied any wrongdoing. So have Russia, France and others named in the report.

The Iraq Survey Group also listed American companies and individuals. But American officials said they could not release those names because of privacy laws.

Mister Duelfer said the report was based on Iraqi documents and information from members of the former government. But many of those named in the report say there is no independent proof that illegal offers were accepted.

In the News, in VOA Special English, was written by Cynthia Kirk. This is Steve Ember.