[Congressional Record Volume 150, Number 61 (Wednesday, May 5, 2004)]
[Senate]
[Pages S4914-S4917]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. ENSIGN (for himself, Mr. Miller, Mr. Smith, Mr. Graham of 
        South Carolina, Mr. Sessions, Mr. Kyl, Mr. Brownback, Mr. 
        Thomas, Mr. Burns, Mr. Lott, Mr. Coleman, Mr. Santorum, Mr. 
        Cornyn, Mr. Craig, and Mr. Allard):
  S. 2389. A bill to require the withholding of United States 
contributions to the United Nations until the President certifies that 
the United Nations is cooperating in the investigation of the United 
Nations Oil-for-Food Program; to the Committee on Foreign Relations.
  Mr. ENSIGN. Mr. President, I rise today to introduce legislation in 
the hopes that it will correct a grave injustice committed against the 
people of Iraq as well as the honest and law-abiding citizens of the 
world community.
  We now believe that Saddam Hussein, corrupt U.N. officials, and 
corrupt well-connected countries were the real benefactors of the Oil-
for-Food Program. Their benefits came from illegal oil shipments, 
financial transactions, kickbacks, and surcharges and allowed Saddam 
Hussein to build up his armed forces and live in the lap of luxury.
  The evidence in this far-reaching scandal tells an unbelievable 
story. In January of this year, the Iraqi Governing Council (IGC) 
released a list of 270 former government officials, businessmen, 
political parties, and foreign cronies of Hussein from more than 46 
countries suspected of profiting from illegal oil sales that were part 
of the U.N.'s Oil-for-Food Program.
  Our own U.S. General Accounting Office estimates that Saddam Hussein 
siphoned off $4.4 billion through oil sale surcharges. Saddam Hussein 
also demanded kickbacks on the humanitarian relief side from suppliers 
which amounted to 10-20 percent on many contracts.
  Saddam used this revenue to rebuild Iraq's military capabilities, to 
maintain lavish palaces, buy loyalty, oppress his people and 
financially support terrorism. And as Claude Hankes-Drielsma, an IGC 
consultant investigating the scandal testified, the secret payments 
``provided Saddam Hussein and his corrupt regime with a convenient 
vehicle through which he bought support internationally by bribing 
political parties, companies and journalists . . . This secured the 
cooperation and support of countries that included members of the 
Security Council of the United Nations.''
  The United Nations should be embarrassed.
  What resulted from the goodwill gesture was international scandal, 
corruption at the highest levels, and suffering Iraqi citizens. Not 
exactly a model U.N. program.
  Contrary to its protestations, the United Nations Secretariat had a 
critical role in the implementation and management of the program. It 
kept the contract records. It controlled the bank accounts and was the 
only entity allowed to release Saddam Hussein's oil earnings. And it 
arranged for the audits. As Secretary General Kofi Annan noted, ``under 
the program, the [U.N.] Secretary General was required to supervise the 
sale of Iraqi oil, and to monitor the spending of the proceeds on 
specific goods and services for the benefit of the Iraqi people.''
  Well, he did a lousy job.
  Tasked by the international community to deny Saddam Hussein the 
ability to rebuild his military apparatus while providing humanitarian 
needs, the United Nations allowed the corrupt to become richer and 
innocent Iraqis to be oppressed.
  Today we have a chance to rectify that injustice. We must demand that 
the United Nations cooperate completely with efforts to extrapolate the 
truth from this scandal and punish the guilty. We know that the Volker 
panel does not have subpoena power.
  And we've now learned that officials acting on behalf of Benon Sevan, 
the Executive Director of the Oil-for-Food Program, who is personally 
implicated in the scandal, are asking contractors not to release 
documents relating to the program to congressional investigators 
without getting U.N. authorization. An April 2, 2004, U.N. letter to a 
Swiss firm Cotecna reminded the firm that according to its contract all 
documents: ``shall be property of the United Nations, shall be treated 
as confidential and shall be delivered only to United Nations 
authorized officials.'' Cotecna, was in charge of inspecting the 
humanitarian goods shipped to Iraq under Oil-for-Food. It had Kofi 
Annan's son Kojo on its payroll until the month it won its U.N. 
contract. And an April 14 letter reminded a Dutch company called 
Saybolt of its confidentiality agreements with the U.N., demanding 
``that Saybolt address any further requests for documentation or 
information concerning these matters to us.'' Saybolt was in charge of 
making sure oil invoices matched shipments.
  The United Nations should be more interested in bringing the truth to 
light then trying to protect its tattered reputation and its corrupt 
officials.
  The legislation I am introducing today will hold the United Nations' 
feet to the fire on this scandal. It calls for transparency and 
accountability. Under this bill, the United Nations must allow GAO and 
law enforcement agencies access to its Oil-for-Food records. U.N. 
officials must waive their immunity for any crimes committed on United 
States soil and repay their ill-gotten gains.
  If not, 10 percent of our assessed U.N. regular budget contributions 
will be withheld the first year and 20 percent the second year. 
Granted, the withholding of $36 million in the first year is no where 
near the more than $1 billion that the United Nations skimmed

[[Page S4917]]

off the top of Iraqi oil sales for administrative costs or the billions 
that were stolen from the Iraqi people through corruption and 
mismanagement. But the 10 percent withholding worked in the past when 
the 103rd Congress used it to compel the United Nations to create an 
inspector general. And I believe it can work again.
  But we have to make an important choice first. We can do nothing and 
allow the word ``humanitarianism'' to be the new code word for 
corruption scandal from here on out. Or we can stand up and make the 
United Nations rightfully accountable for the corruption that harmed 
innocent Iraqis. The answer is clear. We must act.
  The U.N. is broken. This scandal revealed that the U.N. Security 
Council is unable to do its job when some members are more interested 
in lining their pockets than preserving security. I contend that there 
was no way that the U.S. could get France and Russia to enforce 
Security Council resolutions on Iraq and go to war when so many of 
their politically connected individuals, companies, and institutions 
received Iraqi oil contracts. Victory brought their corruption to 
light. And I am deeply worried that the ability of the United Nations 
to convey ``legitimacy'' to the new Iraqi government and assist in 
postwar Iraq is hampered by its history of corruption and mismanagement 
in the Oil-for-Food program.
  The U.N. needs to come clean and start over. The first step toward 
doing that is to accept the terms and conditions of the Oil-for-Food 
Accountability Act.

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