A Conspiracy So Immense I
By David Peterson at May 14, 2005
The Subcommittee's report presents detailed evidence---including numerous documents created by Saddam Hussein's Ministry of Oil and testimony of senior Hussein regime officials---that former French Minister of Interior Charles Pasqua and recently reelected Member of the British Parliament George Galloway received lucrative oil allocations under the Oil for Food Program. This report exposes how Saddam Hussein turned the Oil for Food Program on its head and used the Program to reward his political allies like Pasqua and Galloway. The report includes evidence that Saddam Hussein personally approved allocations to Charles Pasqua, and that Pasqua "fear[ed] political scandals" because of these secret allocations. The report also shows that Galloway was granted allocations for a whopping 20 million barrels of oil. All told, this report paint a disturbing picture of the dark under-side of the Oil for Food Program.I am not sure why one of France's former Interior Ministers wound up lumped together with the British Respect Party's (and former Labour Party's) George Galloway. But Galloway has been an outspoken critic of the White House and Downing Street regimes' wars of aggression, and the Subcommittee's current line of inquiry smacks of a Colemanite witch hunt through-and-through. Why else derive the alleged evidence from "Saddam Hussein's Ministry of Oil and testimony of senior Hussein regime officials"? Why else characterize Pasqua and Galloway as Saddam Hussein's "political allies"? (For this smear alone the Senator from Minnesota deserves to be slapped across his face.) And why else tie everything together beneath the "dark under-side of the Oil for Food Program"---presumptive proof-positive, no doubt, that the old way of doing things at the United Nations is beyond the timid reforms outlined in the Secretary-General's In Larger Freedom document, the UN being so filthy-dirty that what it really needs is a Boltonesque cleansing like the kind Hercules delivered to the Augean Stables? According to Wayne Madsen (Online Journal, May 13):
What has Coleman's panties in a twist is the fact that in the recent British elections, Galloway, who was expelled from the Labor Party for his anti-Iraq war and anti-Bush politics, made easy work of his Labor Party opponent and Tony Blair sycophant, Oona King, an African-Jewish daughter of—ironically—an African-American draft evader from the Vietnam War. King was one of Tony Blair's most ardent supporters for his decision to join Bush in a genocidal war against Iraq. For that, she earned the support of the international neoconservative network of influence holders and peddlers that can, according to a senior Bush administration official, create their own reality because of their ownership of much of the international media. However, King also earned the enmity of her large Muslim constituency in East London's Bethnal Green and Bow district. They rejected King and threw their political weight behind Galloway.Although Madsen's chronology seems askew---the British elections were May 5, just one week to the day prior to Coleman's grandiose accusations---and the Report released on May 12 must have been in the works for quite some time---what Madsen identifies as the background to the current Colemanite smear strikes me as to the point. In the long and sordid annals of the American Right-Wing's hatred for the United Nations, everyone and everything that can be exploited to attack the UN and bring it down is fair game. The "bulk of the money Saddam made" from oil sales may indeed have derived from "smuggling outside the Oil-for-Food program," as Kofi Annan himself noted in some April 14 comments before a seminar of former UN spokespeople---and this smuggling may indeed have occurred "on the American and British watch," as he added. After all, "They were the ones who had interdiction," the Americans and the British. Just as "they were also the ones who knew exactly what was going on, and the countries themselves decided to close their eyes to smuggling to Turkey and Jordan because they were allies." (See at bottom, were I'll reproduce several media reports on these comments.) But acknowledging this fact is not going to help demolish the United Nations. So don't expect Senator Coleman's Subcommittee to open an investigation into what the American and British governments may have known about it anytime soon. Not at all. Instead, let's limit the Subcommittee's investigations to the UN Secretary-General and a few of his undersecretaries, his son, a British MP, a French Interior Minister, and the like: These, and only these, become recognized as the canonical scandals of the Oil-for-Food Program. And both the New York Times's Judith Miller and the New York Sun's Benny Avni (the Sun especially having been a den of monkeys where allegation of this kind are concerned) conduit the “findings” of the Monkey Boy Senator from the State of Minnesota.--- When the Senate's Permanent Subcommittee on Investigations was releasing all five volumes of Joseph McCarthy's executive sessions from 1953 and 1954, McCarthy's biographer David Oshinsky was asked about the old Monkey Boy Senator from the State of Wisconsin's preferred method for smearing opponents. "McCarthy thrived on the Fifth Amendment," Oshinsky said. McCarthy "liked nothing better than to ask people very pointed questions, and they would take the Fifth, so he could call them 'Fifth Amendment communists' and talk about a larger conspiracy." The Boston attorney Joseph Welch's famous exchange with Joseph McCarthy (June 9, 1954)---
Until this moment, Senator, I think I never really gauged your cruelty or your recklessness.... You've done enough. Have you no sense of decency, sir, at long last? Have you left no sense of decency?---came near the end of McCarthy's campaign to root out subversives within the ranks of the U.S. Army, McCarthy at that precise moment having alleged something or other about the communist sympathies of one of Welch's younger assistants. By which moment, McCarthy was finished. It is a testimony to the depravity of the reigning political culture in the United States today that Minnesota Senator Norm Coleman, who holds the same chair that the long-discredited charlatan from the State of Wisconsin once held more than 50 years ago---a "lickspittle Republican committee," in George Galloway's apt phrase about its current incarnation---and is one of Joseph McCarthy's true heirs, not only is nowhere near finished. But appears to be flourishing. Neither Norm Coleman, the Subcommittee he chairs, nor the full weight of the U.S. Senate will be able to browbeat George Galloway during next Tuesday's hearings. So they better be prepared.
Permanent Subcommittee on Investigations, U.S. Senate Committee on Homeland Security and Governmental Affairs Report on Oil Allocations Granted to Charles Pasqua and George Galloway, Permanent Subcommittee on Investigations, U.S. Senate, May 17, 2005 "Subcommittee Investigation Indicates Senior British and French Officials Were Awarded Millions of Barrels of Oil from Saddam Hussein," Office of Senator Norm Coleman, May 12, 2005 Oil-For-Food (Homepage), Office of the Iraq Program Independent Inquiry Committee into the United Nations Oil-For-Food Program (Homepage) Oil-For-Food Inquiry, UN News Center (Homepage) "Annan U.S., UK Also Bear Blame in Oil, Food Scandal," Evelyn Leopold, Reuters, April 14, 2005 "U.S., UK hit back at Annan for comments on oil, food," Evelyn Leopold, Reuters, April 15, 2005 "Boschwitz criticizes Annan's actions," Sharon Schmickle, Minneapolis Star-Tribune, April 21, 2005 "Annan exoneration claim too hasty - U.S.," Irwin Arieff, Reuters, April 21, 2005 "Walkouts add to heat on Annan," David Nason, The Australian, April 22, 2005 "Volcker report 'did not' exonerate Annan," Mark Turner, Financial Times, April 22, 2005 [$$$$$] "Lawyers Resign Over Oil-for-Food 'Whitewash'," Anne Penketh, The Independent, April 22, 2005 [$$$$$] "UN chief losing allies in Washington," Steven Edwards, Ottawa Citizen, April 22, 2005 "UN scandal won't go away," Editorial, Newsday, April 23, 2005 "Annan Remark on Oil Sales Draws Nods of Agreement," Warren Hoge, New York Times, April 24, 2005 [$$$$$] "Investigators resigned over oil for food inquiry 'cover-up'," Charles Laurence and Henry Samuel, Sunday Telegraph, April 24, 2005 "Head of probe into UN denies conflict of interest," Evelyn Leopold, Reuters, April 26, 2005 "Swiss Oil-for-Food Monitor in Iraq Rejects 'Malicious' Criticism," Judith Miller, New York Times, April 27, 2005 "Official Defends Oil-for-Food Probe," Colum Lynch, Washington Post, April 27, 2005 "Volcker, Congress Differ on Subpoenas on UN Probe," Evelyn Leopold, Reuters, April 29, 2005 "Agent 'may have evidence' on Annan," David Nason, The Australian, May 3, 2005 "Audits find flaws in U.S. handling of Iraq deals," Reuters, May 4, 2005 "Defiant U.N. sleuth hands over oil-for-food papers," Sue Pleming, Reuters, May 5, 2005 "Congress Gets Oil-for-Food Inquiry Papers," Maggie Farley, Los Angeles Times, May 6, 2005 "Volcker offers Congress compromise on UN probe," Evelyn Leopold, Reuters, May 6, 2005 "The Volcker Contretemps," Editorial, Wall Street Journal, May 6, 2005 “Former Oil-for-Food Program Investigator Gives Papers to House Panel,” Colum Lynch, Washington Post, May 6, 2005 "Congress keeps papers which threaten Annan," Charles Laurence and Philip Sherwell, Sunday Telegraph, May 8, 2005 "U.N. challenges U.S. Congress on oil, food probe," Evelyn Leopold, Reuters, May 9, 2005 "Full text: Galloway response," BBC News, May 12, 2005 "Galloway accepts Washington call," BBC News, May 12, 2005 “Galloway faces renewed claims over Saddam oil,” David Pallister et al., The Guardian, May 12, 2005 “Oil-for-Food Report Alleges Officials Gained,” Maggie Farley, Los Angeles Times, May 12, 2005 “Senate Accuses European Politicians Of Accepting Bribes From Saddam,” Benny Avni, New York Sun, May 12, 2005 “Hussein Gave Oil Rights to French and British Officials, Senate Says,” Judith Miller, New York Times, May 12, 2005 "Committee accuses Galloway, Pasqua over Iraq oil," Sue Pleming, Reuters, May 12, 2005 "Briton seeks to clear name in U.S. on Iraq scandal," Sue Pleming, Reuters, May 12, 2005 “Galloway was given Iraq oil allocations, says Senate report,” James Bone, The Times, May 12, 2005 “Panel Connects Oil Program To Europeans,” Colum Lynch, Washington Post, May 12, 2005 "Galloway was part of Saddam's oil fraud, says Senate," Francis Harris, Daily Telegraph, May 13, 2005 "Galloway hit by new claims over Saddam oil contracts," Andrew Sparrow and Francis Harris, Daily Telegraph, May 13, 2005 "Appeal to help child 'became a political tool'," Philip Johnston, Daily Telegraph, May 13, 2005 "Crucial question could remain unresolved," By Andrew Sparrow, Daily Telegraph, May 13, 2005 "Galloway to rebut charges of receiving oil from Saddam," Christopher Adams et al., Financial Times, May 13, 2005 [$$$$$] "Galloway to face US hearing," David Pallister and Jamie Wilson, The Guardian, May 13, 2005 "No need for balance," Roy Greenslade, The Guardian, May 13, 2005 "U.S. Senators Will Get 'Good Hiding' Pledges Galloway," Ben Russell and Andrew Buncombe, The Independent, May 13, 2005 "The Oil-for-Food Programme: The Players and the Claims," Anne Penketh, The Independent, May 13, 2005 "Jordanian Who Backed Mariam Appeal," Kim Sengupta, The Independent, May 13, 2005 "House Releases Iraqi Papers On Strategy for Oil Sales," Judith Miller and Craig S. Smith, New York Times, May 13, 2005 "Galloway Vows To Take on Senate Accusers in 'Lions Den'," George Fraser, The Scotsman, May 13, 2005 "Iraqi Papers Detail Efforts to Buy Favors," Colum Lynch, Washington Post, May 13, 2005 "Saddam spies 'offered to help Chirac get re-elected'," Francis Harris et al., Daily Telegraph, May 14, 2005 "Senate are out to smear me, says George as he faces 'kangaroo court'," Severin Carrell et al., The Independent, May 15, 2005 "Galloway accuses senators of 'smear'," Severin Carrell and Andrew Buncombe, The Independent, May 15, 2005 "Panel on Iraq Erred, Ex-Investigator Says," Judith Miller, New York Times, May 16, 2005 "UK's Galloway to U.S. in bid to clear name on Iraq," Matthew Jones, Reuters, May 16, 2005 "US Senate points to Russian officials in Iraq scam," Evelyn Leopold, Reuters, May 16, 2005 "Saddam paid Russia in oil for support at Security Council," James Bone, The Times, May 16, 2005 "Annan's esteem takes a hit in U.S.," Barbara Slavin and Bill Nichols, USA Today, May 16, 2005 "Kofi Annan discusses Bolton, scandal, Iraq," Barbara Slavin, USA Today, May 15, 2005 "Oil-for-Food Benefited Russians, Report Says," Justin Blum and Colum Lynch, Washington Post, May 16, 2005 "MP faces Capitol Hill grilling," Alec Russell, Daily Telegraph, May 17, 2005 "Fighting talk as Galloway meets Senate accusers," Francis Harris, Daily Telegraph, May 17, 2005 "British MP flies to Washington to rebut charges by senators," Jimmy Burns et al., Financial Times, May 17, 2005 "U.S. 'backed illegal Iraqi oil deals'," Julian Borger and Jamie Wilson, The Guardian, May 17, 2005 "U.S. approves Iraq trade by man named as Galloway middleman," Kim Sengupta and Terri Judd, The Independent, May 17, 2005 "Senate panel tracks windfalls made in U.N. oil-for-food program," Charles Homans, Knight Ridder, May 17, 2005 "Volcker Findings 'Flawed,' Filing Says," Benny Avni, New York Sun, May 17, 2005 "French Senator Rebuts Report By U.S. Panel In Oil Inquiry," Craig S. Smith, New York Times, May 17, 2005 "British MP says he ready for Senate 'lynch mob'," Sue Pleming, Reuters, May 17, 2005 "Showdown looms on Capitol Hill as Galloway talks tough," James Bone, The Times, May 17, 2005 "Report Says Treasury Missed Iraq Oil Abuses," Colum Lynch, Washington Post, May 17, 2005 "Defending A Probe And a Principle," Dick Thornburgh, Washington Post, May 17, 2005 "British Lawmaker Lashes out at Senators," Ken Guggenheim, Associated Press, May 18, 2005 "British Lawmaker rips U.S. Senators," Bob Deans, Atlanta Journal-Constitution, May 18, 2005 "Oil-for-food probes expose cultural gulfs," Peter Grier and Faye Bowers, Christian Science Monitor, May 18, 2005 "Galloway assault on Capitol Hill," Francis Harris, Daily Telegraph, May 18, 2005 "Galloway takes anti-war battle to US for dramatic showdown in the Senate," Andrew Sparrow, Daily Telegraph, May 18, 2005 "Insults fly before the battle begins," Alec Russell, Daily Telegraph, May 18, 2005 "British MP denies link to oil-for-food scheme," Mark Turner and Edward Alden, Financial Times, May 18, 2005 "Galloway's acerbic tongue unsettles his political inquisitors," Mark Turner and Edward Alden, Financial Times, May 18, 2005 "Leftwing diehard with a colourful past and a knack for speaking out," Frederick Studemann, Financial Times, May 18, 2005 "Charity regulator considers fresh probe," Jimmy Burns, Financial Times, May 18, 2005 [$$$$$] "Galloway testimony: 'I am not, nor have I even been, an oil trader'," Julian Borger, The Guardian, May 18, 2005 "No new revelations - but do not expect the controversy to go away," Ewen MacAskill, The Guardian, May 18, 2005 "Galloway and the mother of all invective," Oliver Burkeman, The Guardian, May 18, 2005 "Galloway tells US accusers: you have nothing on me," Michael Settle and Louise Hancock, The Herald, May 18, 2005 "Galloway's showdown: A bravura performance but a question remains," Editorial, The Herald, May 18, 2005 "Oil-for-food fight," David Ivanovich, Houston Chronicle, May 18, 2005 "Galloway Fights Corner on Accuser's Home Patch," Andrew Buncombe, The Independent, May 18, 2005 "Accused British Official Slams the U.S. on Iraq," Maggie Farley and Johanna Neuman, Los Angeles Times, May 18, 2005 "Galloway vehemently denies profiting from UN Oil-for-Food program," Stephanie Griffith, Middle East Online, May 18, 2005 "Galloway: You've Nothing on Me," Chris Hughes, The Mirror, May 18, 2005 "Galloway Comes Out Fighting But the Yanks Fail To Lay A Glove on Him," Christopher Hitchens, The Mirror, May 18, 2005 "Galloway Deplores U.S. Probe of U.N.," Claudia Rossett, New York Sun, May 18, 2005 "British Lawmaker Scolds Senators on Iraq," Judith Miller, New York Times, May 18, 2005 "Galloway Bluster Fails To Convince Senate," Gethin Chamberlain, The Scotsman, May 18, 2005 "The day Garrulous George fired at the Senate with both barrels," Ben Macintyre, The Times, May 18, 2005 "Galloway is unrepentant as he attacks US senators," James Bone, The Times, May 18, 2005 "Briton blasts U.S. accusers," Tim Harper, Toronto Star, May 18, 2005 "British Politician Denies Profiting from Oil-for-Food," Yochi J. Dreazen, Wall Street Journal, May 18, 2005 "Briton Denies Having Rights to Buy Iraqi Oil," Colum Lynch, Washington Post, May 18, 2005 "British lawmaker slams probe," David R. Sands, Washington Times, May 18, 2005 "Who profited from $addam?" Editorial, Washington Times, May 18, 2005 "Funds for Galloway charity to be checked," Andrew Sparrow, Daily Telegraph, May 19, 2005 "Jordanian oil trader who gave pounds-375,000 to Mariam appeal," Michael Settle, The Herald, May 19, 2005 "Galloway: The Man Who Took America," Rupert Cornwell, The Independent, May 19, 2005 "Just what we need - a Baathist fused with a sectarian Muslim," Christopher Hitchens, The Independent, May 19, 2005 [$$$$$] "Trial by Parish Council Would Be More Convincing," Mark Steel, The Independent, May 19, 2005 [$$$$$] "Watchdog May Ask Police To Investigate Galloway Fund," Gethin Chamberlain, The Scotsman, May 19, 2005 "Galloway wins on points rather than knockout, says U.S.," James Bone, The Times, May 19, 2005 "Big Day for Bush Foes," Jefferson Morley, washingtonpost.com, May 19, 2005 "Bravo, George, You've Recalled A Lost Art," Matthew Norman, The Independent, May 20, 2005 [$$$$$] "Galloway: Is he right, or is Coleman?" Editorial, Minneapolis Star Tribune, May 20, 2005 "In the Belly of the Beast," Scott Ritter, The Guardian, May 21, 2005 "Oil for What?" Editorial, Washington Post, May 21, 2005 "Galloway hounded by AIPAC cell within U.S. Congress; Bolton tied to same cell," Wayne Madsen, Online Journal, May 13, 2005 (For the PDF version of the same.) In Larger Freedom Interruptus, March 30, 2005FYA ("For your archives"): As best I can tell, Kofi Annan's April 14, 2005 remarks on oil-smuggling, what the American and British governments likely knew about it, and the UN Oil-for-Food Program never have been archived on the Secretary-General's official website. But recognizing--and asserting publicly---that the "bulk of the money that Saddam made came out of smuggling outside the oil-for-food program, and it was on the American and British watch" was an important moment, and is worth preserving. Consequently, I am depositing here copies of some of the media reports I've been able to find on Kofi Annan's April 14 remarks. (Exclusive of Reuters' material, for example. Which I've been able to link above.) The Associated Press April 14, 2005, Thursday, BC cycle HEADLINE: Annan: U.S., Britain share blame for Saddam Hussein's illicit oil funds BYLINE: By NICK WADHAMS, Associated Press Writer DATELINE: UNITED NATIONS U.N. Secretary-General Kofi Annan said Thursday that the United States and Britain are partly to blame for Saddam Hussein's regime making billions of dollars in illicit money from smuggling oil. Annan said the Americans and the British could have stopped the smuggling but did not, and most of the money Saddam Hussein made illegally when his country was under U.N. sanctions in the 1990s was from smuggling oil, not from kickbacks under the U.N. oil-for-food program. "They were the ones who had interdiction, possibly they were also the ones who knew exactly what was going on, and the countries themselves decided to close their eyes to smuggling to Turkey and Jordan because they were allies," Annan said. The United States had ships in the Persian Gulf to intercept smugglers, and allegations have swirled for years that Washington looked the other way while some of Iraq's neighbors made substantial profits from oil smuggled out of Iraq. Shipments to Jordan and Turkey were not concealed. While the smuggling occurred, the administrations of Bill Clinton and George W. Bush asked Congress for waivers allowing Jordan and Turkey to continue receiving U.S. aid despite their violations. "There is a fundamental difference between oil smuggling, which was happening without our knowledge, and the very public waiver which was granted to some countries," U.S. Mission spokesman Richard Grenell said. "We informed Congress and publicly acknowledged our desire to grant these certain countries an exemption. "This exception was given before the oil-for-food program even began." A spokeswoman at the British mission refused to comment. Annan partly excused the smuggling to Turkey and Jordan, saying the U.N. Charter requires states affected by sanctions on another country to be compensated. "We didn't have billions to compensate these countries, and some felt the oil going in was a way of compensation to them, and so it was all generally accepted," Annan said. The secretary-general was speaking at a reunion of current and past U.N. spokesmen, and his comments were part of a vigorous defense of the United Nations against recent media attacks. The U.N. oil-for-food program, which was endorsed by the United States and begun in 1996, permitted Iraq to sell oil despite a stiff U.N. economic embargo against Saddam's regime, provided the proceeds were used to buy food and medicine for Iraqi people suffering under the sanctions. Beginning at least by 2000, Saddam's government, which had the power to choose who would have the right to purchase oil, demanded that those it dealt with be willing to pay kickbacks. Estimates of how much illicit money Saddam's regime may have made from smuggling and corruption in the oil-for-food program range from $9 billion to $21 billion. But former U.S. Federal Reserve Chairman Paul Volcker, who is conducting an independent investigation, said Saddam gained far more money from smuggling than through oil-for-food deals. Annan himself has come under fire recently over the handling of the oil-for-food program. Volcker criticized Annan for not pressing to learn details of his son Kojo's employment by a Swiss company that won a contract under the program. Annan said the scandal around the United Nations was largely "an American story," while people in the rest of the world "still have quite a lot of respect and enthusiasm for the U.N. and appreciate what the U.N. does." "We are outgunned. We are outmanned," Annan said of critics of the United Nations. "And they have resources that we don't have, and they are relentless and they are organized." Annan said he expected Volcker's report would reveal that at the end of the oil-for-food program in 2003, the United Nations gave $8 billion- $9 billion to the Coalition Provisional Authority, and the money has not been accounted for. "When you put things in the right perspective, one should certainly realize where the bulk of the problem came out," Annan said. "But would it influence this group? I am not sure." Agence France Presse -- English April 15, 2005 Friday 11:56 AM GMT HEADLINE: UN's Annan: Oil-for-food scandal broke on US, Britain's watch DATELINE: UNITED NATIONS April 14 UN Secretary General Kofi Annan, whose integrity has been dragged into a scandal surrounding the UN oil-for-food program in Iraq, said Thursday the United States and Britain shared the blame. Speaking in New York, Annan said that most of the money that former Iraqi president Saddam Hussein had pocketed "came out of smuggling outside the oil-for-food program, and it was on the American and British watch." "Possibly they were the ones who knew exactly what was going on," he said, "and that the countries themselves decided to close their eyes to smuggling to Turkey and Jordan because they were allies." Annan spoke after US prosecutors charged three people with scheming to pay millions of dollars in kickbacks to Saddam's embargoed regime out of oil-for-food funds, which were meant to purchase relief supplies for Iraqis. Britain rejected his claims, saying it had always fully cooperated with UN measures aimed at forcing Saddam to comply with UN resolutions on weapons of mass destruction. "We took vigorous actions at all times to ensure that the sanctions regime was not undermined," Foreign Office Minister Bill Rammell said. In a veiled swipe at Annan, he added that it was the United Nations which needed to learn the lessons of an inquiry by former US Federal Reserve chairman Paul Volcker into the oil-for-food program. "His interim report actually makes criticisms of the UN management system and not of national governments," he said. "Now I think the UN needs to learn those lessons." Volcker's committee has so far issued two interim reports which charged the program's director Benon Sevan with unethical behavior, and raised serious questions over the dealings of Annan's son, Kojo Annan. "One had hoped that when Volcker comes out with his final report in June, putting things in perspective, this will die down," the secretary general said. "But I don't think with that group it will die down." Texas oil man David Chalmers and Bulgarian national Ludmil Dionissiev were arrested in Texas earlier Thursday in connection with oil-for-food kickbacks, US Attorney David Kelley said. Extradition from Britain was being sought for the third man charged, British oil trader John Irving. If convicted, the three could each face a maximum 62 years in prison. "These disturbing indictments illustrate a continuing pattern of corruption that we have found in numerous instances involving the United Nations," said Henry Hyde, chairman of the House of Representatives international relations committee, which has held hearings on the scandal. Oil-for-food was the largest aid programme in UN history, overseeing 64 billion dollars in deals beginning in 1996 as the United Nations supervised Iraqi oil sales and the purchase of humanitarian supplies with the revenues. Under the program, the Iraqi government had the power to select the companies and individuals who received the rights to purchase Iraqi oil. Those selected were able to reap large profits by selling their allocations of Iraqi oil to brokers or companies capable of transporting the oil to a refinery. Allocation of the purchase rights was conditional, according to Thursday's indictment, on payment of a secret surcharge to be paid into bank accounts under the control of the Iraqi government. Chalmers and his associates engaged in the surcharge scheme through two companies, Bay Oil Inc. and Bay Oil Supply and Trading, in which Chalmers was the sole shareholder, prosecutors said. In order to hide the rise in price for Iraqi oil occasioned by the illicit surcharges, the defendants allegedly conspired with Iraqi officials to deflate the official selling price of Iraqi oil. "Each played a major role in fine-tuning the oil-for-food program as a cash cow masquerading as a humanitarian venture," said John Klochan, assistant director of the FBI's New York office. The system set the price for Iraqi oil so low, Klochan said, that Bay Oil was getting a great business deal, even taking into account the kickback they were required to pay. The Associated Press April 15, 2005, Friday, BC cycle HEADLINE: Hounded by critics, U.N. secretary-general goes on the offensive BYLINE: By NICK WADHAMS, Associated Press Writer DATELINE: UNITED NATIONS Besieged over the oil-for-food program and other scandals, U.N. Secretary-General Kofi Annan has taken a tougher stand against his critics in recent weeks, defending himself heatedly against American opponents, the media and even member governments. The depth of his exasperation was evident this week in remarks he made during a reunion of former U.N. spokesmen - an event he thought was off the record. Shedding the diplomatic discretion for which he is well-known, Annan lamented that U.N. opponents had been "relentless" in their attacks and the world body wasn't fighting back enough. "We are outgunned. We are outmanned," Annan said. "We need help from outside groups. We need to be able to organize outsiders to work with us to write to papers, to appear on television." The last several months have been extremely difficult for Annan and the United Nations. Several scandals have rocked the world body, and Annan has found himself in the middle of it. U.S. congressional leaders have demanded he resign, but he has steadfastly refused to do so. An investigation led by former U.S. Federal Reserve Chairman Paul Volcker, criticized Annan for his management of the $64 billion humanitarian program in Iraq and faulted his son, Kojo, for hiding the extent of his involvement with a Swiss company that won a contract under the program. While acknowledging flaws in the oil-for-food program, Annan also has hit back before the media and to staff, part of a larger strategy shift toward taking bolder action, according to U.N. officials and people close to him. "I think his natural instinct has been to take a lot of blame," said William Luers, a friend of Annan's and a former U.S. ambassador who now heads the U.N. Association of the United States, an advocacy group. "He's somewhat self-effacing and he's sort of a servant to the U.N., (but) I think he's convinced himself and others that he's got to be an assertive leader and it's probably time to do it." There could be several reasons for the shift, Luers said. Despite Annan's travails, President Bush's administration hasn't withdrawn its backing, so he may feel more inclined to speak. He also could be emboldened by the fact that his second and last term runs out at the end of next year. Across the organization, too, there have been changes, big and small, in changing the image of the United Nations. One significant move by Annan was to replace his chief of staff, Iqbal Riza, with the outspoken Mark Malloch Brown. Whereas Riza shied away from news conferences, Malloch Brown has sat for long tete-a-tetes with journalists. In Colombia, meanwhile, U.N. officials played themselves in a soap opera. Annan also allowed the movie "The Interpreter," starring Nicole Kidman and Sean Penn, to be filmed inside U.N. headquarters in New York, a reversal in policy. The World Food Program, a U.N. agency, just released a video game called "Food Force," in which players join a crack team of aid workers to get crucial aid to hungry refugees. Annan's outspokenness hasn't been entirely without controversy. His response - "Hell no" - when he was asked if he would resign over the oil-for-food scandal raised eyebrows. And in the remarks made Monday, he accused Britain and the United States of turning a blind eye to illegal oil smuggling by Saddam Hussein in the 1990s. While the accusations were not particularly new, the remarks seemed injudicious at best because they violated an unwritten U.N. rule that high-ranking officials like Annan don't name names or shame nations, even among current and former colleagues. Officials acknowledged he would have been more delicate had he known the forum was public. Annan had assumed that the event was closed to the media. "I think it's fair to say that were the secretary-general speaking in a public forum he would have couched his thoughts slightly differently," said Shashi Tharoor, the U.N. undersecretary-general for communications and public information. In the end, such comments may actually help Annan, who has been frank about the need for reform at the same time that he has defended the United Nations. Last month, he unveiled a plan to overhaul the world body and bring more transparency in what would be the biggest changes in its 60-year history. That stance got the respect of one longtime U.N. critic, former Republican House speaker Newt Gingrich, suggesting that Annan's tough talk might be working. Gingrich was at the U.N. on Friday in his role as co-chairman of a U.S. congressional task force to examine United Nations reform. "I know of no occasion where there has been as wide an agreement that the U.N. has to be reformed," Gingrich said after meeting Annan. "I know of no occasion where we've had a secretary-general as open and direct as Kofi Annan has been in the last two months about the need for reform." The Associated Press April 15, 2005, Friday, BC cycle HEADLINE: State Department brushes off Annan criticism BYLINE: By BARRY SCHWEID, AP Diplomatic Writer DATELINE: WASHINGTON The Bush administration is brushing off assertions by U.N. Secretary-General Kofi Annan that the United States and Britain were partly to blame for Iraq pocketing billions of dollars in smuggled oil revenue. Instead, Secretary of State Condoleezza Rice and a State Department spokesman stressed a need for reform of U.N. management. "It's going to require that member states are much more vigilant than they were during the oil-for-food episode," Rice said on Fox News Channel. "It really was a terrible scandal. It's a terrible thing that was done to the Iraqi people." Department spokesman Tom H. Casey defended the Bush administration. "We believe we have been playing a positive and important role in overseeing the activities of the United Nations," he said Friday. On the scandal itself, Casey said that a U.S. maritime force had stopped and inspected thousands of vessels to help prevent smuggling. Neither Rice in Thursday's interview, nor Casey, responded directly to Annan's allegations that the United States and Britain were in part to blame for the scandal. Annan said the United States and Britain could have stopped the smuggling but did not, and most of the money that Saddam Hussein made illegally when his country was under U.N. sanctions in the 1990s was from smuggling oil, not from kickbacks under the U.N. oil-for-food program. Sen. Norm Coleman, R-Minn., and several other members of Congress have called on Annan to resign, suggesting that at a minimum he failed in administration of the program. With strong U.S. support, the U.N. Security Council permitted Iraq under Saddam to sell oil beginning in 1996 despite a U.N. embargo, provided the proceeds were used for food and medicine for hard-pressed Iraqi people. Saddam's government had authority to decide who would have the right to purchase oil and it is believed to have extracted kickbacks ranging from an estimated $9 billion to $21 billion. Former U.S. Federal Reserve Chairman Paul Volcker, conducting an independent investigation, criticized Annan for not pressing to learn details of his son Kojo's employment by a Swiss company that won a contract under the program. Deutsche Presse-Agentur April 15, 2005, Friday HEADLINE: Annan: U.S. and Britain looked the other way in oil scandal United Nations Secretary General Kofi Annan has charged that the United States and Britain looked the other way while billions of dollars were siphoned off in the U.N.'s oil-for-food programme in Iraq. Annan made his remarks late Thursday upon hearing that the U.S. government had indicted a Texas oil executive and his British and Bulgarian associates in connection with the humanitarian programme that enabled Iraq to buy food, medicine and other human necessities during the oil boycott of the 1990s. Annan has suffered the brunt of U.S. criticism for the loss of billions of dollars in the programme, and some U.S. legislators have called for him to step down. He was largely exonerated in a preliminary inquiry report released last month, and has moved to discipline one retired and one active U.N. employee for conflicts of interest in the oil-for-food programme in Iraq from 1996 to 2003. Investigations have shown that deposed Iraqi leader Saddam Hussein and some U.N. officials pocketed 11 billion dollars from the humanitarian programme. Speaking to journalists, Annan said that the U.S. and Britain would have been able, at any point, to stop the oil smuggling that circumvented U.N. sanctions. He charged that Washington and London were looking out for their allies Jordan and Turkey, who were involved in the smuggling, by keeping quiet about the abuses. The U.S. mission at the Untied Nations declared that it had been quite open during those years about making exceptions to the sanctions, and that U.S. Congress was informed. A spokesman for the British foreign ministry said that London always blocked sanction violations. In the U.S. indictment, David Chalmers, who heads the Texas-based company Bayoil USA Inc., John Irving of Britain and Ludmil Dionissieve of Bulgaria face charges of paying kickbacks to Hussein's regime. U.S. charges were also filed against South Korean Tongsun Park for illegally acting as a representative of Saddam's regime by negotiating oil sales in the United States. The U.S. government intends to seek 100 million dollars in forfeitures from the three men, representing the value of the oil they purchased. Chalmers and Dionissieve were arrested Thursday in Houston, and U.S. authorities were to issue a warrant for Irving's arrest in Britain. Under the programme, before U.S.-led forces toppled the regime in 2003, Iraq took in 65 billion dollars in the U.N.-administered programme. Press Association April 15, 2005, Friday HEADLINE: STRAW DENIES BRITAIN IGNORED IRAQI SANCTIONS-BUSTING BYLINE: Gavin Cordon, PA Whitehall Editor Foreign Secretary Jack Straw today hit back at UN General Secretary Kofi Annan over claims that Britain turned a blind eye to sanctions-busting by Iraqi dictator Saddam Hussein. Mr Annan last night claimed that Britain and the US ignored illegal oil smuggling by the regime in the 1990s because it involved two of their closest allies in the region - Jordan and Turkey. He said that Baghdad had earned far more from the illicit trade than from kickbacks under the UN's oil-for-food programme. However his claims brought a fierce denial from Mr Straw. "I regret to say that suggestions that the United Kingdom ignored smuggling of oil from Iraq to Jordan and Turkey are inaccurate, and at variance with the record of successive British governments from the end of the Gulf War," he said. "They were the ones who had interdiction, possibly they were also the ones who knew exactly what was going on, and the countries themselves decided to close their eyes to smuggling to Turkey and Jordan because they were allies," he said. Mr Straw insisted that Britain had been active throughout the period against oil smuggling in the Gulf, including the interception of shipments. He said he did not know of any representations made by the UN to Britain regarding smuggling while other members of the UN Security Council had adopted an "ambiguous approach" to the whole issue. He said the fact that oil smuggling was "most likely" to have taken place to Turkey and Jordan simply reflected the fact that they both had land borders with Iraq. "Throughout this period, the United Kingdom was active against oil smuggling in the Gulf, including through intercepting shipments," Mr Straw said in a statement. "The United Kingdom was consistently in the lead in seeking to enforce sanctions against Iraq. We took the necessary measures to ensure sanctions were implemented in UK legislation. "We took the lead in the UN Sanctions Committee, on a number of occasions, to get the committee to deal with a range of sanctions-busting activities. But enforcing UN sanctions was the responsibility of Iraq, all other UN member states and the UN administration. "There were no occasions which we can recall on which the UN made representations to the UK in regard to the smuggling." He said that when Britain had proposed measures in the Security Council seeking to clamp down on smuggling through providing lawful supplies of Iraqi oil to Jordan and Turkey, it was opposed. "I might add that maintaining the sanctions regime was one of the first issues I had to deal with on becoming Foreign Secretary in early June 2001," he said. "What I encountered was an ambiguous approach by certain members of the Security Council to the Saddam regime. But the UK was not one of these members - far from it." The spokesman for the US mission at UN headquarters in New York, Richard Grenell, also denied that his government had known of the smuggling. "There is a fundamental difference between oil smuggling, which was happening without our knowledge, and the very public waiver which was granted to some countries," he said. "We informed Congress and publicly acknowledged our desire to grant these certain countries an exemption. This exception was given before the oil-for-food programme even began." There have been allegations for years that Washington - which had ships in the Persian Gulf to intercept smugglers - looked the other way while some of Iraq's neighbours made substantial profits from oil smuggled out of Iraq. Shipments to Jordan and Turkey were not concealed. While the smuggling occurred, the administrations of US presidents Bill Clinton and George Bush publicly went to Congress for waivers that allowed Jordan and Turkey to continue receiving US aid despite their violations. Mr Annan partly excused the smuggling to Turkey and Jordan, saying the UN Charter requires states affected by sanctions on another country to be compensated. "We didn't have billions to compensate these countries, and some felt the oil going in was a way of compensation to them, and so it was all generally accepted," he said. A British citizen was indicted in the US yesterday over an elaborate scheme to pay millions of dollars in kickbacks to Saddam's regime under the UN oil-for-food programme. Prosecutors said they would seek the extradition from the UK of John Irving after two of his associates were arrested. All three face up to 62 years in prison and a maximum fine of £530,000 (one million dollars) if convicted. They could also be forced to pay back some £53 million (100 million dollars) in assets. In a statement today, Mr Irving said he intended to mount a "robust defence" against the claims. UPI April 15, 2005 Friday 8:24 PM EST H