Backstabbing for Beginners:

  Other companies that traded under the UN relief program were linked to Al Taqwa, a cluster of financial entities spanning the globe, from the Bahamas to Italy, and controlled by members of the Muslim Brotherhood, which the United States and even the UN had placed on the terrorism watch list. Ayman al-Zawahiri, Osama bin Laden’s number two, was an early member of the organization, which essentially pioneered modern Islamist terrorism.

  Some columnists who had supported the war similarly decided this was the long-sought “smoking gun” linking Saddam to 9/11. But it was a tenuous link, and the public didn’t really bite. The links that reporters had established between companies doing business under the UN program and Al Qaeda did not prove that actual Oil-for-Food money had landed in bin Laden’s hands. Short of the name Osama bin Laden appearing directly on the list, the Oil-for-Food program could not legitimately be linked to the 9/11 attacks.

  This did not mean Saddam did not use the UN program to support other terrorist organizations more directly. Right there on the list of corrupt purchasers was the Popular Front for the Liberation of Palestine. (PFLP should not be confused with the Palestine Liberation Organization, or PLO, formerly led by Yasser Arafat and now by Mahmoud Abbas, who has abandoned terrorism and recognized the State of Israel, and is actively trying to achieve peace.) The PFLP is a Syria-based terrorist organization that has claimed responsibility for suicide bombings in Israel. Usually, it acts when Israel and the PLO are getting closer to a deal, and it often succeeds in derailing all progress made with a spectacularly bloody attack against civilian targets. There on the list, in black and white, was proof that Saddam had used the humanitarian program to support an international terrorist organization.

  I felt nauseous. Upon learning this news, I expected a statement to come out from the UN, a pledge finally to investigate this new evidence and get to the bottom of it. But nothing came.

  So I continued my own investigation, using all the information I could get my hands on. It soon became clear that the UN would be too embarrassed to shed light on some of the other names on the list as well, as they had been intimately linked with UN activities for years.

  One such person was France’s former ambassador to the United Nations, Jean-Bernard Mérimée. Ambassador Mérimée had sat on the UN Security Council when the Oil-for-Food scheme was first negotiated, at times presiding on the UN Security Council. One year after he retired from the French Ministry of Foreign Affairs, in 1998, he was appointed by Kofi Annan to serve as his special adviser on European affairs. His tenure in that position was extended until February 14, 2002, and he continued to work for Annan right up to the 2003 Iraq War. He was a known advocate within Annan’s team of advisers for lifting the sanctions. Even as he was working in Annan’s inner circle, he was profiting from Saddam’s bribes.

  Tariq Aziz would later confirm from prison that Mérimée had made a request for an oil allocation after he retired as France’s ambassador to the UN. Mérimée was included for the first time in the list in a table dated August 4, 2002. He would ultimately receive oil allocations totaling approximately six million barrels. While still in the position of special adviser, Mérimée arranged to resell two million barrels of oil for a net profit of $165,725. Nice little commission.

  Another key French official was Charles Pasqua, the former minister of the interior, who received eleven million barrels of oil from the government of Iraq. According to Iraqi officials and records, the oil allocations were handled on Pasqua’s behalf by his diplomatic adviser, Bernard Guillet. According to Guillet, Tariq Aziz conveyed through him an offer of underpriced Iraqi crude to Pasqua to thank him for his “support for Iraq.” The oil allocated to Pasqua was resold to Genmar Resources GMBH, a company based in Switzerland. The resale was handled by Guillet, who received at least $234,000 in cash payments as commission. His accounting of the distribution of that money was rather vague.

  Pasqua had met with Aziz twice, in 1993 and in 1995, and he also facilitated a visit to France for Aziz at a time when the two countries had no official diplomatic relations. In addition, Pasqua’s diplomatic adviser traveled to Baghdad on two more occasions, including in June 1999, when an Iraqi Oil Ministry official wrote a memo certifying to the Iraqi leadership that Guillet was indeed there to represent Pasqua and was authorized to handle his eleven-million-barrel oil allocation for him. Again, Aziz told Guillet that “the leadership [i.e., Saddam Hussein] would like to thank Mr. Pasqua for what he did for Iraq.” Guillet would later tell investigators he was worried that a man of Pasqua’s stature might not be able to take in this kind of bribe. But Aziz must have said something reassuring, because Guillet then went straight to the Oil Ministry to discuss the details of the Iraqi offer.

  Upon returning to France, Guillet said he provided Pasqua with an oral briefing, during which he told him about Aziz’s generous offer. According to Guillet, Pasqua exclaimed, “Je serai le roi du pétrole!” (“I’ll be the king of oil!”).

  Guillet explained that this was meant as a joke and that Pasqua then added, “I hope you did not accept this offer.”

  Pasqua, who by then was a French member of parliament, denied ever shouting that he’d be the king of oil, and said he never received a briefing from Guillet as he returned from Iraq and never heard about Aziz’s offer. But documents prove that the firm Genmar did purchase Iraqi oil that was allocated to Pasqua. And an internal memo from the executive director of Iraq’s oil marketing organization to Iraq’s minister of oil specified that “the Swiss company Genmar is confirmed as the company nominated by Charles Pasqua to lift” (meaning, pick up) the eleven million barrels of oil from the Iraqi port. And a third man, Elias Firzli—a consultant for Total, a large French oil conglomerate closely linked to the French government—confirmed to investigators that he helped Guillet (who had never traded oil before in his life) resell the underpriced Iraqi crude to Genmar. In return for his help, Firzli would collect the profits from the oil sale and pay Guillet a commission. Guillet traveled to Switzerland on eight occasions to collect the cash from Firzli’s account there. This lucrative business eventually yielded Guillet a total profit of $1,111,874—money that should have gone to Iraq’s most needy.

  Investigators left open the possibility that Guillet acted on his own, using Pasqua’s name to make money behind his back. Whether it was Pasqua or his diplomatic adviser who in fact became the “king of oil” would be investigated by a French anticorruption judge. In April 2005, Guillet was arrested in his home and questioned by a French magistrate. The affair would hang over Pasqua for years to come as court proceedings dragged on. As with all the members of Saddam’s secret list, no final conclusions can be drawn about their guilt outside of a court of law. Even as he claimed his own innocence, Pasqua speculated that it was quite likely that other French officials had taken part in the illicit scheme.

  Russia’s parliament was well oiled as well (as previously mentioned), with Vladimir Putin’s oil minister distributing underpriced oil allocations to the rest of Russia’s political parties and favored oligarchs directly. Just as Saddam had used the program to strengthen his hold on power, Putin had used it to solidify his control over the Russian parliament and prepare his post-presidential power shift to the post of prime minister. Of course, the information contained in Saddam’s list would take time to confirm. In the case of Russia, where the justice system was not free to do its job, it would take until 2008 to find a firsthand witness to corroborate key information.

  In January 2008, a former Russian top spy confirmed that he personally set up a network of agents who helped the Russian government steal nearly $500 million from the United Nations’ Oil-for-Food program in Iraq before the fall of Saddam Hussein. Sergei Tretyakov, who defected to the United States in 2000 as a double agent, revealed in a book that he oversaw an operation that helped Saddam’s regime manipulate the price of Iraqi oil and allow Russia to skim profits. Tretyakov, a former deputy head of intelligence at Russia’s UN mission from 1995 to 2000, revea
led that he recruited a senior Russian official in the Oil-for-Food program. Though he speaks of the person in code name, I recognized the description of our Russian “oil overseer”—one of those we used to refer to as Double O’s.

  It was interesting to find out what kind of work our former colleague actually did all day long. He basically helped “fix” Iraq’s oil prices in a way that facilitated fraud. And to think I suspected him of merely picking his nose all day long.

  As the governments and diplomatic establishments of Britain, France, and Russia, three key members of the Security Council, had now been implicated, I wondered if they would retaliate with information involving wrongdoing by the United States.

  Once again, Saddam’s secret list provided ample ammunition for competing intelligence services to sling mud at one another. Judging from the vigor with which the U.S. Senate engaged in the investigative process, I found it interesting that the White House seemed to be taking a step back from the whole scandal. Why the sudden silence from the Bush administration? As both houses of Congress and think tanks like the Heritage Foundation and the American Enterprise Institute (where President Bush had made his “vision” speech about a new Iraq and a new Middle East) were banging on about the scandal, how could the White House stay aloof?

  It turned out that U.S. firms, some of which had strong White House connections, had been in on the illegal and deeply immoral feeding frenzy as well. This, despite the fact that the Iraqi government followed an explicit policy of favoring companies and individuals based in France, Russia, and the Middle East as recipients of its underpriced oil bribes.

  To circumvent this policy, some British and American oil-trading companies attempted to disguise themselves as French to fool the Iraqi regime. In October 1998, an official in the French government’s Sanctions Department—that is, the arm of the French government that was supposed to enforce the sanctions on Iraq rather than break them—wrote to an Iraqi official in Paris about his own “concerns, and his government’s concerns . . . regarding the increase in British and American companies who exploit the decision of the Iraqi leadership to provide priority to French companies, by signing contracts with Iraq through their offices in France.”

  The French official referred to these as “hoax” companies. An interesting word choice given the general setup France itself was involved in. Nonetheless, after being notified of the official French complaint in November 1998, Iraqi Vice President Taha Yassin Ramadan wrote a letter titled “Dealing with French Companies.” In his letter, Ramadan made it clear to all ministries that Iraq needed to prevent American and British companies from exploiting Iraq’s preferential treatment of French companies. Clearly, they didn’t like being conned at their own game. Texans with French berets on their heads would no longer be tolerated.

  On one occasion, in order to obtain more oil, a beneficiary named on the list—the French diplomat Serge Boidevaix—emphasized to Iraqi officials a position taken by the French government that was supportive of Iraq at the UN, thereby going on the record to establish a clear link between France’s voting record at the United Nations and Saddam’s preferential oil sales policy.

  “We were happy to see the decision of the Security Council to increase the total amount for exports to $8.3 billion,” wrote Boidevaix in a letter to the Iraqi government, “and as you may know, on the French side we proposed an increase without limits or restrictions. As I mentioned in my last letter, we would be grateful for an increase to our [read: my own] current allocation of 5 million barrels, and could lift at Basra [port] anytime in October or November if you had additional volumes to allocate.”

  French officials would later deny that their policy was guided by economic interests. France had acted to “uphold international law,” explained Dominique de Villepin, even as French diplomats were being investigated for breaking international law and had themselves gone on record linking their country’s UN policy to their thirst for more Iraqi oil. The most respected French newspaper, Le Monde, eventually published an editorial that openly questioned France’s claim to have acted purely in the interest of international law, given the undeniable profits made by its diplomatic and political elites.

  At least France’s justice system, and its press, saved the country’s honor by pursuing wrongdoers. The same could be said for the United States. But the mere fact that Texas oil companies had tried to disguise themselves as French was not the most embarrassing part for the Bush administration. Two stories in particular had the White House concerned. The first was the fact that Chevron had been one of the U.S. companies buying Iraqi oil and allowing for kickbacks of more than $20 million to find their way back into Saddam’s pocket. As it turned out, Condoleezza Rice was a member of Chevron’s board at the time. Specifically, she led Chevron’s public policy committee, which oversaw areas of potential political concern for the company. In 2007 Chevron was brought to court and forced to settle for a large fine after admitting it “should have known” in 2000 that kickbacks would be going to Saddam.

  Correction: it knew. And the woman who would soon be named secretary of state after serving on the board’s policy committee was probably aware of this dirty business as well.

  The other awkward “link” that had the White House concerned was a tad more complex. It started with a rather banal crooked deal but ended up causing possible embarrassment for Vice President Dick Cheney, because it involved a client previously represented by one of his aides, I. Lewis “Scooter” Libby.

  Here’s how that twisted entanglement of interests came into existence. In 1998, after several unsuccessful attempts to participate in the UN Oil-for-Food program by trading pharmaceuticals and cosmetic goods, a French businessman named Claude Kaspereit, the son of a French parliamentarian, decided to get into the oil business and established a company called EOTC. The question was: how could he get an underpriced oil allocation from the Iraqi government? Word of mouth had it that one had to be recognized as one of Saddam’s little helpers in order to gain entry to the den of thieves.

  Kaspereit found a rather creative solution. In June 2000 he arranged to charter a flight to Iraq, without UN authorization and in violation of the embargo, to generate publicity against the sanctions. His plane included a number of anti-sanctions activists, including, bizarrely, Jany Le Pen, the wife of the notoriously racist and Arab immigrant-bashing French politician Jean-Marie Le Pen, who came in second in France’s 2002 presidential election. Jany Le Pen had started a “nonprofit” organization called SOS Enfants Iraq (SOS Iraqi Children).

  This embargo-breaking visit attracted the attention of Saddam Hussein, who sent a delegation out to the airport to receive them. Kaspereit later sent letters to a number of senior Iraqi officials, including Tariq Aziz, to thank them for their warm reception. He requested that Aziz and Amer Rashid, Iraq’s oil minister, convey directly to Saddam the group’s solidarity with the Iraqi people and their “support for Saddam Hussein’s political action.”

  Such shameless statements had a way of turning out profits. Following Kaspereit’s publicized flight to Baghdad, the government of Iraq began granting him oil allocations, for a total of 9.5 million barrels. The problem was, Kaspereit’s EOTC was a shell company that had no means of financing such large purchases of crude oil.

  Enter Marc Rich and Company. Remember Marc Rich? The Jewish-American multimillionaire was convicted in U.S. federal court of tax evasion, racketeering, and other charges related to his oil deals with Iran during the U.S. embargo on that country. Rich had fled to Switzerland, where he received asylum, but his ex-wife, Denise Rich, continued to live in the United States, where she was an active supporter of the Democratic Party; she contributed money to Bill Clinton’s presidential library fund and to Hillary Clinton’s 2000 Senate campaign. On top of giving $450,000 to the Clinton Library, Denise Rich gave upwards of $1 million to the Democratic Party and $109,000 to Hillary Clinton’s 2000 Senate campaign.

  The Riches’ generosity paid off when Marc made
the list of more than 100 people President Clinton pardoned just before leaving office in January 2001. Rich’s pardon prompted a public outcry and Congressional investigations into whether it had been granted in return for Denise Rich’s political contributions. Clinton regretted his decision but tried to defend it partially by saying that Marc Rich had received a lot of letters of support from Jewish leaders and had been an active supporter of Israel.

  Well, he was certainly also a supporter of Iran in the 1980s, and he had no scruples about making a profit by trading with Saddam Hussein under the UN Oil-for-Food program.

  Still, Rich had to act discreetly. Following the media frenzy that followed his pardon, he could not be seen to help finance purchases of underpriced Iraqi crude oil by Saddam’s political friends, especially not people like Kaspereit, who had gone on paper supporting Saddam’s “political action.” It wouldn’t look good for Marc Rich to support the political action of a funder of Palestinian terrorism while he was cultivating an image as a strong supporter of Israel. . . . In any case, “Moses is Moses, business is business,” goes the saying. Clearly, Rich had not gotten rich by letting scruples keep him up at night. He was quite prepared to finance Kaspereit’s deal, as long as his name was not revealed to the United Nations. So, in his instructions to the French bank BNP, which held the UN’s Oil-for-Food account, Rich specified that the letters of credit for the purchase of Iraqi crude should not, under any circumstance, be under the name of his own company (even though he was underwriting the deal); instead, it was attributed directly to Kaspereit’s company, EOTC.