[Congressional Record (Bound Edition), Volume 150 (2004), Part 11]
[House]
[Pages 15252-15253]
[From the U.S. Government Publishing Office, www.gpo.gov]




                          OIL-FOR-FOOD SCANDAL

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from New Mexico (Mr. Pearce) is recognized for 5 minutes.
  Mr. PEARCE. Mr. Speaker, the Oil-for-Food fraud is possibly the 
largest scandal in the history of the United Nations and one of the 
greatest financial scandals of modern times. Set up in the mid-1990s as 
a means of providing humanitarian aid to the Iraqi people, the U.N.-run 
Oil-for-Food program was subverted and manipulated by Saddam Hussein's 
regime, allegedly with complicity of U.N. officials to help prop up the 
Iraqi dictator.
  Saddam's dictatorship was able to siphon off an estimated $10 billion 
from the program through oil smuggling and systematic thievery by 
demanding illegal payments from companies buying Iraqi oil and through 
kickbacks from those selling goods to Iraq, all under the noses of U.N. 
bureaucrats.
  Members of the U.N. staff that have administered the program have 
been accused of gross incompetence, mismanagement, and possible 
complicity with the Iraqi regime. Benon Sevan, former executive 
director of the Oil-for-Food program appeared on an Iraqi oil minister 
list of 270 individuals, political entities and companies from across 
the world that allegedly received oil vouchers as bribes from Saddam 
Hussein's regime.
  The U.S.'s General Accounting Office estimates that the Saddam 
Hussein regime generated $10.1 billion in illegal revenues by 
exploiting the Oil-for-Food program. These figures include $5.7 billion 
from oil smuggling and $4.4 billion in illicit surcharges on sales and 
after-sales charges on suppliers.
  Without a shred of evidence, European and domestic critics have 
frequently derided the Bush administration's decision to go to war with 
Iraq as an oil grab driven by U.S. corporations such as Halliburton. 
They ignore the reality that the leading opponents of war at the U.N. 
Security Council, Russia and France, had vast oil interests in Iraq 
protected by the Saddam Hussein regime.
  The Oil-for-Food program and its elaborate system of kickbacks and 
bribery are a major source of revenue for many European politicians and 
business concerns, especially in Moscow.
  Mr. Speaker, the role of Congress should include first of all the 
strengthening of the Paul Volcker Commission of Inquiry. It should 
ensure that the Iraqi interim government and congressional 
investigators are able to conduct

[[Page 15253]]

an effective and exhaustive investigation in the Oil-for-Food program. 
It should push the administration to ensure that the Oil-for-Food 
scandal is thoroughly investigated. It should keep the international 
spotlight on Oil-for-Food, encouraging foreign governments to launch 
their own investigations. It should increase the likelihood of serious 
reform at the U.N., including significant safeguards to prevent 
repetitions of its failures. It should limit the role of the United 
Nations in shaping the future of Iraq.
  Mr. Speaker, the most effective way to ensure that the United Nations 
fully cooperates with its own commission of inquiry, which has received 
veiled threats if it continues to probe, the most effective way that we 
in the United States can deal with that inability to do its own 
investigation is threaten to reduce funding from the U.S. to the U.N., 
specifically the United States's assessed contribution.
  Mr. Speaker, the U.N.'s dismal and allegedly corrupt handling of the 
Oil-for-Food program should lay to rest any notion that the 
organization can be entrusted with shaping the future of the Iraqi 
people. Many Iraqis regard the U.N. with suspicion, lacking both 
legitimacy and credibility.
  Iraqis have bitter memories of Secretary General Annan's February 
1998 statement to reporters, ``Can I trust Saddam Hussein? I think I 
can do business with him,'' said Mr. Annan.

                              {time}  1915

  The Benon Sevan letters give us evidence that the former director of 
the Oil-for-Food Program interfered with congressional investigations. 
Specifically, Sevan wrote several letters on official U.N. stationery 
warning some of the companies implicated in the scandal that they must 
first seek U.N. approval before releasing documents to investigators.
  Mr. Speaker, the Security Council had heated debates over whether the 
U.S.-led war to liberate Iraq should proceed, but the resistance in the 
Security Council cannot remain separated from the Oil-for-Food scandal 
and the fact that influential politicians, major companies and 
political parties from key Security Council member countries may have 
benefited financially from the program.
  The Al Mada list of 270 individuals, political entities and 
businesses across the world that allegedly received oil vouchers 
included no fewer than 46 Russian and 11 French names. The Russian 
Government alone allegedly received an astonishing $1.36 billion in oil 
vouchers.
  The close ties between Russian and French politicians and the Iraqi 
regime may have been an important factor in influencing their 
governments' decision to oppose Hussein's removal from power.
  Mr. Speaker, this Oil-for-Food scandal must come to the attention of 
the American public, and if it is only Republicans who will address it, 
we will do so.

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