Iraqi-American charged in U.N. oil-for-food probe

  1. Iraqi-American charged in U.N. oil-for-food probe

    By CNN's Terry Frieden and Phil Hirschkorn

    (CNN) -- An Iraqi-American businessman pleaded guilty Tuesday to illegally doing business with and lobbying for Iraq for a decade as part of the United Nations' oil-for-food program.

    Samir Vincent entered the guilty pleas to four charges Tuesday in U.S. District Court in New York, including engaging in prohibited financial transactions with Iraq, acting as an unregistered agent of a foreign government and making false statements on his income tax returns.

    Vincent likely will face less than the maximum 28-year prison term. No sentencing date is set.

    The charges against Vincent represent the first U.S. criminal prosecution to result from multiple investigations regarding alleged corruption in the U.N. program, which allowed the Iraqi regime of Saddam Hussein, while still under sanctions stemming from its 1990 invasion of Kuwait, to export a limited supply of its crude oil and earmark the revenues for purchases of food, medicine, and supplies.

    Various U.S. estimates allege that Saddam, who was able to choose the vendors, exploited the program to seize an estimated $2 billion to $4 billion in illegal surcharges on its oil sales and kickbacks on the humanitarian goods purchases.

    "The integrity of a program that's designed to protect innocent people from suffering at the hands of brutal regimes is a serious matter," said Attorney General John Ashcroft, who announced the charges and plea deal at a Tuesday afternoon news conference. "This is not a concluded investigation but an ongoing one."

    The United Nations operated the oil-for-food program from 1996 to 2003. A CIA report found evidence that Saddam had used the program to bribe several international figures, including oil-for-food administrator Benon Sevan. Sevan has denied wrongdoing.

    In response to the allegations, U.N. Secretary-General Kofi Annan appointed a committee to investigate, led by former Federal Reserve Chairman Paul Volcker. That investigation has not yet been completed.

    The U.S. charges state that in return for Iraq's permission to buy its oil and millions of dollars in cash payments, Vincent lobbied U.S. and U.N. officials to have stringent international economic sanctions repealed but failed to register as a lobbyist, as U.S. law requires.

    Vincent bought approximately 9 million barrels of Iraqi crude oil and profited by $3 million to $5 million by reselling it, said U.S. Attorney David Kelly, whose office prosecuted the case.

    According to court documents, as early as 1992 Vincent met with U.N. officials to seek favorable treatment for Iraq and convey messages from Baghdad.

    Between 1998 and 2003, following instructions from Baghdad, Vincent lobbied former U.S. government officials to exert their influence on the Clinton and Bush administrations in an unsuccessful effort to repeal the U.N.-imposed sanctions on Iraq, according to court documents.

    Vincent is among a handful of American individuals and companies who together directly purchased less than 1 percent of the $64 billion in oil bought under the program.

    A number of U.S. oil companies, including ExxonMobil, ChevronTexaco, oil refiner Bayoil, and oil field equipment supplier Baker-Hughes have been subpoenaed by federal prosecutors, along with the largest U.S. buyer of Iraqi oil, Houston businessman Oscar Wyatt and his former company, Coastal Oil, now owned by El Paso Inc.

    Vincent's name and the name of a firm he runs -- Phoenix International, based in Fairfax, Virginia -- appear in former Iraqi oil ministry records obtained since the U.S.-led invasion toppled Hussein's regime in 2003. Phoenix International has not been charged.

    According to studies by the CIA-backed Iraq Survey Group and the U.N.-appointed Independent Inquiry Committee, Phoenix International paid $162.2 million for 4.1 million barrels purchased from Iraq.

    The ISG report last October by former Iraq weapons inspector Charles Duelfer found that Vincent purchased an additional 3.8 million barrels for himself.

    Volcker's committee is expected to issue a detailed report at the end of the month.

    Federal prosecutors accounted for five separate oil allocations to Vincent between 1997 and 2001 for 9.2 million barrels. Prosecutors said Vincent wrote a letter to the Iraqi Intelligence Service in 2002 requesting additional allocations as a payoff for his lobbying efforts.

    The 64-year-old Vincent, a naturalized American citizen born in Iraq, has lived in the United States since 1958 and graduated in 1962 from Boston College, where he was a star of the track team, competing in the high jump, long jump, triple jump, hurdles, discus, and javelin, according to a university Web site.

    In 1964, he represented Iraq on its Olympic Team.

    In 2000, Vincent, a Catholic, organized a delegation of Iraqi religious leaders to visit the United States and meet with former President Jimmy Carter and the late New York Cardinal John O'Connor. The National Conference of Catholic Bishops later spoke out against the sanctions, citing its ill effects on Iraqi children, as did many opponents of the embargo.

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