WASHINGTON – Saddam Hussein’s regime made more than $21.3 billion in illegal revenue by subverting the U.N. oil-for-food program and other sanctions – more than double previous estimates, according to congressional investigators.
“This is like an onion – we just keep uncovering more layers and more layers,” said Sen. Norm Coleman, R-Minn., whose Senate Committee on Government Affairs received the new information at a hearing Monday.
The oil-for-food program was put in place in 1996 amid concerns that the Iraqi population was suffering from lack of food and medicine under the sanctions.
New figures on Iraq’s alleged surcharges, kickbacks – and oil smuggling that dates back to 1991 – are based on new documents obtained by the committee’s investigative panel, Coleman said before the hearing.
The findings also reflect a growing understanding by investigators of the intricate schemes Hussein used to buy support abroad for a move to lift U.N. sanctions.
Coleman said the probe is just beginning and that officials hope to discover “how this massive fraud was able to thrive for so long.” He said he is angry that the United Nations has not provided documents and access to officials that investigators need to move ahead.
“Saddam Hussein attempted to manipulate the typical oil allocation process in order to gain influence throughout the world,” Mark Greenblatt, a counsel for the Senate panel’s permanent subcommittee on investigations, said in prepared testimony.
“Rather than giving allocations to traditional oil purchasers, Hussein gave oil allocations to foreign officials, journalists and even terrorist entities, who then sold their allocations to the traditional oil companies in return for a sizable commission.”
Previous estimates – one from the Government Accountability Office and the other by the top U.S. arms inspector Charles Duelfer – concluded that Hussein’s government brought in $10 billion illicitly from 1990 to 2003, when sanctions were in place.
But congressional investigators found that vastly more oil – amounting to $13.7 billion – was smuggled out of Iraq than previously thought. Investigators also raised the GAO’s estimate of $4.4 billion in oil-for-food kickbacks by $200 million, and said the regime made $2.1 billion more through a scheme where foreign companies imported flawed goods at inflated prices.
According to the documents, the Iraqi government signed deals to import rotting food and other damaged goods with the full understanding of the exporting companies, who accepted payments for top quality products while kicking back much of the price difference to the Iraqi regime.
The panel estimated that such substandard goods accounted for 5 percent of all goods imported under the oil-for-food program.
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