Source Pravda.Ru

US firm fined in Oil-for-Food kickbacks

A US oil trading company has pleaded guilty to involvement in the Iraq oil-for-food scandal and agreed to pay a fine of $250,000 (Ј141,000).

Midway Trading was accused of paying $400,000 in bribes to Iraqi officials for oil purchases under the UN scheme.

The scheme was devised to let Saddam Hussein sell oil and buy humanitarian goods while sanctions were in force.

But the Iraqi government, politicians and some UN officials are said to have illegally profited from the programme, informs BBC.

The United Nations launched the $64 billion oil-for-food program in 1996 to help ordinary Iraqis cope with U.N. sanctions imposed after Saddam Hussein's 1990 invasion of Kuwait. All money paid for Iraqi crude oil was supposed to go toward purchases of humanitarian goods.

Although the program delivered food and other aid to Iraq's 26 million people until the 2003 U.S. invasion, it also was rife with corruption. The U.N. committee found that Saddam's government pocketed $10.2 billion through kickbacks and other illegal oil sales.

In March 2001, Midway wired $225,000 to free up an oil shipment that it had purchased but was being held up at a Turkish port. The company later learned the money was for Iraqi government officials, Morgenthau said. Midway wired more than $215,000 that September before another allocation of oil was received.

Prosecutors thought a fine of just $250,000 was appropriate because Midway actually lost more than $1 million on the transactions, said Daniel Castleman, Morgenthau's investigations chief, reports the AP.