June 21, 2005
Memos: U.N. Knew Saddam Violated Sanctions
By THE ASSOCIATED PRESS 
Filed at 9:05 p.m. ET
UNITED NATIONS (AP) -- The U.N. Security Council had detailed knowledge of how Saddam Hussein was violating U.N. sanctions, but was so divided that many violations went largely unchecked, according to documents released Tuesday by a congressional panel.
Despite the divisions in the council committee monitoring sanctions, the Security Council managed to institute a pricing policy under U.S. and British pressure to cut lucrative surcharges on oil sales that Saddam was pocketing.
The committee's divisions and Saddam's sanctions violations were widely reported starting in the late 1990s and until the program ended in 2003. But the documents released Tuesday, which include U.S. memos and reports on committee meetings, provide a more comprehensive picture of the political dynamics at play and the difficulty in enforcing sanctions.
The council imposed sanctions after Saddam's 1990 invasion of Kuwait and authorized the oil-for-food program in 1996 to help Iraqis cope with the impact of the embargoes. Under the program, Iraq was allowed to sell oil -- provided most of the proceeds were used to buy humanitarian goods.
Thomas Schweich, chief of staff at the U.S. mission to the United Nations, released a statement Tuesday to the House Energy and Commerce Committee's oversight and investigations panel, saying that the atmosphere in the sanctions committee as the oil-for-food program evolved during the late 1990s ''became increasingly contentious.''
Saddam ''cleverly exploited'' sanctions in a variety of ways, granting ''oil and humanitarian supply contracts to those willing to bend the rules in Iraq's favor.'' Iraq's supporters on the Security Council included Russia, China and France until mid-2001 when it backed a U.S.-British sanctions proposal. Other supporters included Iraq's neighbors -- Jordan, Syria and Turkey -- who received smuggled Iraqi oil.
Among other violations, Saddam imposed surcharges, topped off oil loadings, and created phony service contracts, phantom spare parts, shell corporations, and used ''plain old-fashioned bribery and kickbacks involving millions of dollars,'' Schweich said.
He said U.S. and British efforts to address those problems were often ''negated by other members' desires to ease sanctions on Iraq.''
In 2000, Iraq was reported to have eroded sanctions and resumed commercial and diplomatic ties with many countries. Saddam got more than a dozen countries to start commercial flights to Baghdad, reopened a long-closed oil pipeline to Syria and illegally imposed a surcharge on its oil customers.
Many of the documents focus on U.S. and British efforts to end the illegal surcharges, which ranged between 20 and 70 cents a barrel of oil, according to a Feb. 13, 2001, letter from U.N. oil monitors.
Washington and London eventually succeeded in getting the sanctions committee to set the price of Iraqi oil at the end of every month -- rather than the beginning -- to prevent Iraq from taking advantage of fluctuations in the oil market to impose the surcharges.
The two countries said the policy cut illegal payoffs to Saddam's government. But U.N. officials and council members, including Russia and France, demanded an end to the retroactive pricing policy because it led to a sharp drop in oil exports, which meant less money for the oil-for-food program.
In a separate sanction, a June 28, 2002, memo from U.S. deputy ambassador James Cunningham reported a meeting with a Jordanian diplomat to express dissatisfaction that Royal Jordanian Airlines was flying frequently to Baghdad.
The same memo said Washington was still debating ''whether we would raise Syrian noncompliance issues on the pipeline, illicit shipment of goods and flights in the council.''
In addition, a memo from March 2000, with the author and recipient whited out, quoted an unnamed industry analyst as saying Saddam's government had started charging an ''in-land transportation fee'' on oil-for-food contracts -- and was also giving some contracts as gifts.