Sevan, the man U.N. Secretary General Kofi Annan personally selected to head the Oil for Food program, is directly responsible for a huge part of the oil smuggling that ultimately enriched Saddam. Sevan, Spare Parts, and Smuggling

Over the last several months, U.N. apologists have tried to downplay the Oil for Food scandal by arguing that Saddam Hussein's ill-gotten funds came more from oil smuggling than from corruption in the U.N. Oil for Food program. Last week’s report from the Volcker Committee thoroughly undermines this argument.

In order to smuggle (or, more accurately, export oil illegally, in violation of U.N. sanctions), Saddam needed a functioning oil infrastructure -- pumps, pipes, etc. However, the international sanctions, as enforced by American and British naval patrols, had steadily deprived him of the spare and replacement parts necessary to maintain his infrastructure, despite his aggressive campaign to convince the Security Council to allow him to import the parts.

Last week’s report from the Volcker committee reveals that almost immediately after taking over as the head of the Oil for Food Program, Benon Sevan began to strongly support Iraq's requests for spare parts. After a few months, he succeeded. And here’s where the story gets interesting. The report reveals that just two days after the Security Council passed the resolution (at Sevan's urging) allowing Iraq to import spare parts for its oil infrastructure and pay for them with Oil for Food money, Sevan flew to Baghdad and made the first of several requests that Iraq provide an allocation of oil to Sevan’s friends at AMEP, an Egyptian oil company.

Within months, spare parts were flowing into Iraq, courtesy of the U.N.-run Oil for Food program, and oil was flowing out of Iraq to the benefit of Sevan’s hand-picked beneficiary.

So, what of the smuggling? According to the report of the U.S. Iraq Survey Group, in the five years after the Gulf War but before the Oil for Food program began, Saddam earned approximately $486 million per year from illegal oil exports. During the six years during the Oil for Food program, that amount skyrocketed to $1.13 billion per year. As these figures reveal, Saddam probably would have been able to smuggle some oil out of Iraq with his damaged infrastructure (as he did before Oil for Food began helping him repair it). However, there can be no question that the huge sums Saddam ultimately pocketed from illegal oil exports came as a direct result of Sevan's campaign to manipulate Security Council permission for the dictator to buy the oil equipment and spare parts he so desperately needed.

The bottom line is simple: Sevan, the man U.N. Secretary General Kofi Annan personally selected to head the Oil for Food program, is directly responsible for a huge part of the oil smuggling that ultimately enriched Saddam and helped him stay in power. And, just as crucially, Saddam never could have earned the smuggling money he did without Oil for Food.

Finally, the Sevan-spare parts-smuggling connection begins to answer a question that has perplexed Oil for Food watchers since it first emerged that Sevan was probably on the take: What did Sevan do in exchange for the pay offs? Now we know -- in exchange for the oil allocations that he requested from Iraqi officials, he helped Saddam’s regime secure the spare parts necessary for the dictator to significantly expand his oil smuggling operations and, hence, pocket billions of dollars.

As of this writing, it’s not yet clear what the consequences for Sevan will be. At a minimum, it appears that Sevan was thoroughly bought off. Here’s hoping that some prosecutor in some corner of the world will make sure that Sevan spends some significant time pondering his malfeasance inside a jail cell.

February 10, 2005
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