UN chief’s son received cash from companies in probe

By Claudio Gatti 
September 7, 2005
Financial Times
http://news.ft.com/cms/s/9cf27dea-1f1c-11da-94d5-00000e2511c8.html

Kojo Annan, son of Kofi Annan, United Nations secretary-general, received more than $750,000 from several oil trading companies now under investigation for their role in the UN's oil-for-food programme (OFFP) for Iraq.
The funds were dispatched between 2002 and 2003 to an account Kojo Annan opened under his middle name – Adeyemo – in a Swiss branch of Coutts bank, according to people familiar with the transactions and records from two of the companies that issued the payments.
The payments, discovered by the Financial Times in a joint investigation with Il Sole 24 Ore, the Italian business daily, appear to be connected to oil deals in the west African market. In a statement, Kojo Annan’s lawyer stressed they were not related to the oil-for-food programme. “Our client has never personally received any money from oil trading under the OFFP.”
She said Mr Annan was a director of Petroleum Projects International, a Nigerian company that dealt in west African oil and gas markets, not crude oil that was traded in the oil-for-food programme.
Sources told the FT and Il Sole that all the companies that sent money to Mr Annan were now the subject of inquiries by the US Congress and the committee led by Paul Volcker for violating UN sanctions against Iraq. One of these companies was already the target of multiple investigations when the payment was mad
e.
The disclosure of these payments is therefore potentially embarrassing to the UN secretary-general. On Wednesday, the Volcker Committee will issue its latest report, which will focus on the management of the programme by Mr Annan and his top aides.
In 2003, one company –  Trafigura Beheer BV, a Dutch-based entity founded by traders who formerly worked for the then fugitive commodities trader Marc Rich –  sent $247,500 (¬ 197,500, £134,200) to Kojo Annan's account at Coutts. At the time, Trafigura was widely
 reported to be the target of an investigation for two incidents involving the Essex, a tanker chartered by the Dutch company that was caught smuggling Iraqi oil in violation of UN rules.
Trafigura has always denied participating in the Essex scheme. “Neither Trafigura Beheer BV, nor any subsidiary or associated company, has hired or paid Kojo Annan for any services or goods,” Trafigura said in a statement.
After further research, the company found records of the payment in question, but explained that it was related to a transaction with PPI, the Nigerian company that employed Mr Annan as a director. “The request [of payment] was received from a PPI fax and it was assumed that this was a PPI account.” Mr Annan's lawyer said PPI “conducted business with Trafigura in 2002 and 2003” clarifying the deals were confined to Nigerian gasoil and petrol.
PPI’s representative in Geneva is Michael Wilson, a Ghanaian friend of the Annan family, who has attracted scrutiny in the oil-for-food investigation. Mr Wilson and Mr Annan both worked for Cotecna, the Swiss inspection company that in 1998 received a UN contract under the oil-for-food programme ultimately worth $60m.
Between spring 2002 and spring 2003, Mr Annan’s Coutts account received over $200,000 from two other oil traders whose names appear in an Iraqi list of companies now in the hands of congressional investigators which are suspected of paying surcharges to Saddam's regime. At the end of 2000, Baghdad asked for extra payments described as surcharges from companies taking part in the oil-for-food programme.
In 2002, Mr Annan also received more than $200,000 from Fosdyke Finance Corp, part of a network of oil-related companies at the time also involved in the programme.
During 2000, Fosdyke marketed millions of barrels of Iraqi oil on behalf of the Russian company Tatneft, also named in the Iraqi list of payments of illegal surcharges.
The final recipient of that oil was Bay
oil, the company owned by David Chalmers, the Texas oil trader indicted last April for making illegal payments in violation of US law and UN sanctions.
In an e-mail exchange, Stephan Brunner, a director of the UK subsidiary of Fosdyke, denied the Fosdyke Group ever did business in Africa or sent money to Kojo Annan for his services.
However, Mr Annan's lawyer acknowledged her client had conducted business with Fosdyke through PPI in the Nigerian oil and gas market.