Wednesday, November 17, 2004

The scandal surrounding Saddam Hussein’s embezzlement of U.N. oil-for-food revenues continues to mushroom. Until this week, his regime was estimated to have stolen approximately $10 billion. But on Monday, the Senate Permanent Subcommittee on Investigations disclosed that Saddam and his cronies took more than $21 billion. The lion’s share of the thievery (more than $17 billion) occured on the watch of U.N. Secretary-General Kofi Annan (1997-2003).

Meanwhile, former Federal Reserve Chairman Paul Volcker — appointed by Mr. Annan to head the U.N. investigation of the scandal — rejected a bipartisan request made by subcommittee Chairman Norm Coleman and the ranking member, Sen. Carl Levin, that U.N. officials waive diplomatic immunity and testify before Congress. In response to a Nov. 9 letter from Messrs. Coleman and Levin requesting that Mr. Annan reconsider his decision to bar release of more than 55 internal audits of the oil-for-food program, Mr. Volcker defended withholding the data. He cited the U.N.’s “need to maintain confidentiality in its internal deliberations.” Mr. Annan’s spokesman says that the U.N. boss feels himself bound by Mr. Volcker’s request. Mr. Volcker says he will release an interim report on some of the allegations of misconduct in January, with a more comprehensive report to be issued in the middle of next year. It will indeed be interesting to see what Mr. Volcker, who was appointed by Mr. Annan and lacks subpoena power, manages to unearth.

If the Volcker panel’s handling of a private firm’s investigation of corruption in oil-for-food is any indication, it’s difficult to see how any U.N. probe will yield much useful information. The Washington Times reported yesterday that IBIS Risk Management Services Inc., a company tasked by the panel with investigating the program, uncovered new information — some of it dealing with connections between the program and possible oil-for-food payments to French President Jacques Chirac — that was ignored by U.N. officials. An IBIS representative said he believes the lack of interest was due to incompetence or a desire to ignore information that could pose problems for the United Nations.

These problems include the distinct possibility that oil-for-food largesse meant to alleviate the suffering of the Iraqi people under sanctions went to subsidize Saddam’s military programs and favored terrorist groups. Mr. Coleman said the cash from the program went to purchase missiles, munitions and dual-use military items. Committee investigators said recipients of oil-for-food money include such terrorist groups as the Syrian-backed Popular Front for the Liberation of Palestine. At a hearing held yesterday by the House International Relations Committee, lawmakers heard testimony that Saddam tapped secret bank accounts in Jordan to pay $25,000 each to compensate the families of Palestinian suicide bombers targeting Israel. The Treasury and Defense Departments, together with the FBI, continue to search for stolen oil-for-food money that may have been diverted to support Iraq’s terrorist insurgency. What has come out thus far — despite U.N. stonewalling — is very likely just the tip of the iceberg.

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