report on programme manipulation - Independent Inquiry Committee

More documents

Recommendations

Info

INDEPENDENT INQUIRY COMMITTEE INTO THE UNITED NATIONS OIL-FOR-FOOD PROGRAMME REPORT ON PROGRAMME MANIPULATION CHAPTER TWO OIL TRANSACTIONS AND ILLICIT PAYMENTS controlled accounts may not correspond to surcharges assessed on an entire contract or may be applied to surcharges owed on a number of lifts under more than one contract. Iraq’s unrealistic expectation that the market would bear a $0.50 surcharge in Phase IX caused an oil exporting crisis in Iraq. At that time, the oil overseers also warned traders and companies that it was illegal to pay surcharges or otherwise make payments to Iraq outside the United Nations escrow account. Customers dropped out of the market. The Minister of Oil made personal efforts to persuade oil traders and companies to help Iraq by promising them substantial oil contracts. Ultimately, four traders and companies financed and lifted over 60 percent of the Iraqi crude oil during the exporting crisis in Phase IX. The top financiers of Iraqi crude oil in that phase were Bayoil Supply & Trading Limited (“Bayoil”), the Taurus Group (“Taurus”), Glencore International AG (“Glencore”), and the Vitol Group (“Vitol”). None of these traders had been given the significant direct access to oil contracts that they sought under the Programme. In Phase IX, these companies purchased substantial amounts of crude oil through intermediary entities: Bayoil mainly through Italtech SAR, an Italian-based company; Taurus mainly through Fenar Petroleum Ltd. and Alcon Petroleum Ltd, Liechtenstein-based companies; Glencore through its own Swiss-based company, and Petrogaz Distribution S.A.; and Vitol mainly through Mastek Sdn Bhd, a Malaysian-based company, among others. REPORT ON PROGRAMME MANIPULATION–OCTOBER 27, 2005 PAGE 12 OF 623
INDEPENDENT INQUIRY COMMITTEE INTO THE UNITED NATIONS OIL-FOR-FOOD PROGRAMME REPORT ON PROGRAMME MANIPULATION CHAPTER TWO OIL TRANSACTIONS AND ILLICIT PAYMENTS Chart B – Top Financiers of Oil Purchases in Phase IX 8 Glencore 11.54% Oil purchased mostly through Glencore Int’l AG & Petrogaz Distribution S.A. registered in Switzerland Other 38.59% Vitol 13.21% Oil purchased mostly through Mastek Sdn. Bhd. registered in Malaysia Taurus 17.81% Oil purchased mostly through Italtech SRL registered in Italy Bayoil 18.85% Oil purchased mostly through Alcon Petroleum Ltd. & Fenar Petroleum Ltd. registered in Liechtenstein Iraq’s decision to value illicit income over political influence in Phase IX altered the typical distribution of Iraqi oil to companies which had been principally based on nationality in prior phases. The four traders and the companies they used to purchase oil were not from the countries most favored by Iraq. As illustrated above in Chart A, Liechtenstein, Italy, Malaysia, and Switzerland replaced countries like France and China. Surcharges were assessed and paid on contracts financed by Bayoil, Taurus, Glencore, and Vitol in the surcharge phases. All four traders had some of the surcharges paid to Iraqi-controlled bank accounts through other entities and agents. Taurus and Vitol also paid certain surcharges directly to Iraqi-controlled bank accounts. All of these oil traders and companies deny knowingly making surcharge payments to the Government of Iraq. Certain practices developed to cope with the surcharges. Companies used a disclaimer in their contracts providing that the party to the contract was not involved in paying surcharges. The inclusion of the disclaimer did not appear to prevent the payment of surcharges. In one instance, an agent for Bayoil admitted to including the disclaimer in fabricated, after-the-fact agreements created to disguise the payment of surcharges. Companies sometimes attempted to disguise 8 Committee oil financier table. Some companies lifted the oil contracted under previous phases in Phase IX. This Chart reflects only contracts executed in Phase IX, as opposed to the quantity of oil lifted in Phase IX, as mentioned in other parts of the Report. REPORT ON PROGRAMME MANIPULATION–OCTOBER 27, 2005 PAGE 13 OF 623
Page 1 and 2: INDEPENDENT INQUIRY COMMITTEE INTO
Page 3: INDEPENDENT INQUIRY COMMITTEE INTO
Page 55 and 56:
INDEPENDENT INQUIRY COMMITTEE INTO
Page 57 and 58:
Page 59 and 60:
Page 61 and 62:
Page 63 and 64:
Page 65 and 66:
Page 67 and 68:
Page 69 and 70:
Page 71 and 72:
Page 73 and 74:
Page 75 and 76:
Page 77 and 78:
Page 79 and 80:
Page 81 and 82:
Page 83 and 84:
Page 85 and 86:
Page 87 and 88:
Page 90 and 91:
Page 92 and 93:
Page 94 and 95:
Page 96 and 97:
Page 98 and 99:
Page 100 and 101:
Page 102 and 103:
Page 104 and 105:
Page 106 and 107:
Page 108 and 109:
Page 110 and 111:
Page 112 and 113:
Page 114 and 115:
Page 116 and 117:
Page 118 and 119:
Page 120 and 121:
Page 122 and 123:
Page 124 and 125:
Page 126 and 127:
Page 128 and 129:
Page 130 and 131:
Page 132 and 133:
Page 134 and 135:
Page 136 and 137:
Page 138 and 139:
Page 140 and 141:
Page 142 and 143:
Page 144 and 145:
Page 146 and 147:
Page 148 and 149:
Page 150 and 151:
Page 152 and 153:
Page 154 and 155:
Page 156 and 157:
Page 158 and 159:
Page 160 and 161:
Page 162 and 163:
Page 164 and 165:
Page 166 and 167:
Page 168 and 169:
Page 170 and 171:
Page 172 and 173:
Page 174 and 175:
Page 176 and 177:
Page 178 and 179:
Page 180 and 181:
Page 182 and 183:
Page 184 and 185:
Page 186 and 187:
Page 188 and 189:
Page 190 and 191:
Page 192 and 193:
Page 194 and 195:
Page 196 and 197:
Page 198 and 199:
Page 200 and 201:
Page 202 and 203:
Page 204 and 205:
Page 206 and 207:
Page 208 and 209:
Page 210 and 211:
Page 212 and 213:
Page 214 and 215:
Page 216 and 217:
Page 218 and 219:
Page 220 and 221:
Page 222 and 223:
Page 224 and 225:
Page 226 and 227:
Page 228 and 229:
Page 230 and 231:
Page 232 and 233:
Page 234 and 235:
Page 236 and 237:
Page 238 and 239:
Page 240:
show all

report on programme manipulation - Independent Inquiry Committee

Create successful ePaper yourself

Delete template?

Save as template?