/ 8 August 2005

Former oil-for-food chief resigns ahead of report

The former chief of the Iraq oil-for-food programme resigned on Sunday, a day before investigators release a report that is expected to accuse him of taking kickbacks under the $64-billion humanitarian operation.

Benon Sevan accused United Nations Secretary-General Kofi Annan of failing to stand by him and blasted the independent inquiry committee investigating allegations of corruption, suggesting it had succumbed to political pressure from the United Nations’ critics.

”As I predicted, a high-profile investigative body invested with absolute power would feel compelled to target someone and that someone turned out to be me,” Sevan wrote in the letter.

The resignation is largely symbolic because the UN was paying Sevan just one dollar a year to keep him on payroll so he would cooperate with the committee. But it does remove his diplomatic immunity and could leave him open to prosecution; Sevan is also being investigated by the Manhattan District Attorney’s office.

On Thursday, Sevan’s lawyer Eric Lewis said the committee would find in its upcoming report that Sevan got kickbacks for steering contracts under oil-for-food to a small trading company called African Middle East Petroleum. Lewis said it would also accuse Sevan of failing to cooperate with the investigation.

The amount of money Sevan allegedly took wasn’t immediately known — and may be as little as $160 000. In a February report, the committee, led by former US Federal Reserve Chairperson Paul Volcker, concluded that Sevan solicited oil allocations on behalf of the company, known as AMEP, between 1998 and 2001. It

accused Sevan of a ”grave conflict of interest”.

That report questioned $160 000 in cash which Sevan said he received from his aunt in his native Cyprus between 1999 and 2003. The report called the money ”unexplained wealth” and noted that the aunt, who has passed away, was a retired government photographer living on a modest pension.

The oil-for-food programme, launched in December 1996 to help ordinary Iraqis cope with UN sanctions imposed after Saddam Hussein’s 1990 invasion of Kuwait, quickly became a lifeline for 90% of the country’s population of 26-million.

Under the programme, Saddam’s regime could sell oil, provided the proceeds went to buy humanitarian goods or pay war reparations.

Saddam’s government decided on the goods it wanted, who should provide them and who could buy Iraqi oil. But the Security Council committee overseeing sanctions monitored the contracts.

In a bid to curry favour and end sanctions, Saddam allegedly gave former government officials, activists, journalists and UN officials vouchers for Iraqi oil that could then be resold at a profit. – Sapa-AP