UN Oil for food and Kickbacks.

[Phlegm]

It's good to be a dictator with an oil supply. From CNN:

UNITED NATIONS (CNN) -- Former Iraqi President Saddam Hussein's regime received about $1.8 billion in illicit payments under the United Nations' oil-for-food program, a U.N.-backed independent report said Thursday.

The investigation, led by former Federal Reserve Chairman Paul Volcker, said illicit kickbacks came from 66 member states, "while those paying illicit surcharges on oil purchases came from some 40 member states."

"Oil surcharges were paid in connection with the contracts of 139 companies and humanitarian kickbacks were paid in connection with the contracts of 2,253 companies," the report said.

The program was almost three years old "when the regime began openly to demand illicit payments from its customers," the report said.

Though the oil overseers expressed concern about the demands to the secretariat and to the Security Council, "little action was taken," it said.

The report also cited Banque Nationale de Paris, which held the escrow account for the $64 billion program, saying it "was in a position to have first-hand knowledge" of what was going on but "did not recognize a particular responsibility to adequately inform the U.N."

In addition, the countries that "were responsible for approving their national companies to do business with the program took no action."

By early fall of 2000, the Iraqi government had ordered surcharges be imposed on every barrel of oil sold under the program, the report said.

"Iraq's largest source of illicit income under the program came from kickbacks paid by companies that had been selected to receive contracts for humanitarian goods under the program."

It added, "Available evidence indicates that Iraq derived more than $1.5 billion of income from the kickbacks."

The report cited a number of contracts with Russian companies, which it said accounted for about 30 percent of oil sales.

"By far, the largest portion of surcharge payments went through the Iraqi Embassy in Moscow between March 2001 and December 2002," when more than $52 million in surcharges was paid through the embassy there, the report said.

The report said Marc Rich and Co. financed 4 million barrels of oil under a 9.5-million-barrel contract awarded to the European Oil and Trading Co. (EOTC), a French-based shell company.

"Surcharges were imposed on the oil," the report said, and "Marc Rich & Co. directed BNP Paris not to disclose its identity to BNP NY in connection with its financing of the U.N. contract."

It added, "According to an individual familiar with the companies, EOTC and Marc Rich & Co. agreed that the premium paid to EOTC would cover a commission and a surcharge.

"The premium paid by Marc Rich & Co. of 30-40 cents per barrel was sufficiently high to cover both."

Rich is an American expatriate and former fugitive who was pardoned in 2001 by then-President Bill Clinton.

The report also cited Daimler Chrysler for having "knowingly made or caused to be made a kickback payment of approximately $7,134 to the government of Iraq outside the program and in violation of the U.N. sanctions against Iraq."

The report said the payment was known to at least one managerial-level person working for the company in Germany.