report on programme manipulation - Independent Inquiry Committee

INDEPENDENT INQUIRY COMMITTEE INTO THE UNITED NATIONS OIL-FOR-FOOD PROGRAMME
REPORT ON PROGRAMME MANIPULATION
CHAPTER TWO
OIL TRANSACTIONS AND ILLICIT PAYMENTS
During that same period of time, a company named Alliance Petroleum sent six wire transfers
totaling $2.6 million from its Standard Chartered Bank (Hong Kong) account into the bank
accounts of Petrocorp and Jabal. Two of the wire transfers contained payment details with the
notation “c/o Taurus Petroleum.” 268 The deposits from Alliance and Taurus, discussed above,
constituted most of the money deposited in the Jabal and Petrocorp accounts through July 2001,
at which time Alcon and Fenar began transferring funds into the accounts. Among the bank
records reviewed, the Committee found one invoice describing the purported nature of the
payments to Petrocorp. The invoice, which was addressed to Mr. Schenker, requested that Taurus
Nassau remunerate Petrocorp for “loading fees” on the Front Commander, a vessel used to load
oil under Fenar contract M/09/04. The invoice specified that Taurus should pay Petrocorp via its
First National Bank account. 269
The funds, however, were used for a different purpose. Most of the money deposited in the Jabal
and Petrocorp bank accounts by Taurus Nassau and Alliance was used to pay surcharges imposed
on contracts of Alcon and Fenar. Between January 1 and July 31, 2001, a total of at least $7
million and €338,000 was transferred from the Petrocorp and Jabal accounts to a SOMO account
at Jordan National Bank in Amman. The requests for each of these wire transfers directed First
National Bank to replace Petrocorp’s and Jabal’s names on the transfers with names of various
individuals, including “Amr Bibi,” “Salim Ahmad,” “Souhail Ousta,” “Murice Rizli,” “Elias
Rizly,” and “Mohammed Ali.” Furthermore, as described below, funds from the Petrocorp and
Jabal accounts were transferred to SOMO also through a personal account belonging to Mr.
Ladki. 270
268 First National Bank record, Petrocorp account, credit advice (Dec. 19, 2001); First National Bank
record, Jabal account, credit advices (July 31 2001 to Feb. 11 2002) and statements (Jan. 1 to Dec. 31,
2001). The Committee was unable to obtain additional information regarding Alliance.
269 First National Bank record, Petrocorp account, invoice (June 10, 2001) (issued to Martin Schenker);
Lebanon Financial Intelligence Unit record, Lebanon Department of Examiners and Investigators <strong>report</strong>
(June 28, 2005) (translated from Arabic).
270 First National Bank record, Petrocorp account, debit advices and wire requests (Feb. 7 to July 16, 2001);
First National Bank record, Jabal account, debit advices and wire requests (Apr. 24 to July 23, 2001); First
National Bank record, Petrocorp account, wire request (Feb. 7, 2001) (requesting the use of the
name “Souhail Ousta” on the wire transfer); First National Bank record, Jabal account, wire request (May
22, 2001) (requesting the use of the name ”Salim Ahmad” on the wire transfer); First National Bank record,
Petrocorp account, debit advices (Feb. 23 to June 26, 2001) and statements (Jan. 1 to Dec. 31, 2001); First
National Bank record, Jabal account, debit advices (May 16 and 23, 2001); Cairo Amman Bank Beirut
record, Musbah Ladki account, bank statements (Feb. 24, 2001 to Nov. 29, 2002); Jordan National Bank
record, SOMO account, bank statements (Mar. 31 to June 30, 2001) (reflecting the receipt of funds in
amounts and on dates consistent with the transfers out of Mr. Ladki’s account).
REPORT ON PROGRAMME MANIPULATION–OCTOBER 27, 2005 PAGE 136 OF 623