US oilman sentenced to prison in oil-for-food case
March 7, 2008 
Reuters
Original Source: http://www.reuters.com/article/latestCrisis/idUSN07343317

NEW YORK, March 7 (Reuters) - Texas oilman David Chalmers was sentenced to two years in prison on Friday after admitting to paying millions of dollars in kickbacks to Iraq in connection with the U.N. oil-for-food program.

Chalmers, 54, and his two corporations, Bayoil Supply and Trading Ltd. and Bayoil USA Inc., were sentenced in federal court in Manhattan. Chalmers also was ordered to forfeit $9 million dollars.

He pleaded guilty to one count of conspiracy to commit wire fraud in August, weeks before he was due to go on trial with Texas oil tycoon Oscar Wyatt. Wyatt was sentenced to a year in prison in November for his role in the oil-for-food scandal.

The $67 billion oil-for-food program -- begun in 1996 and ended in 2003 -- was aimed at easing the impact of sanctions imposed on Saddam Hussein's government after Iraq invaded Kuwait in 1990.

The charges against Chalmers, Wyatt and others stemmed from Iraq's requirement from 2000 to 2003 that recipients of oil pay a secret surcharge, in violation of U.N. sanctions and U.S. law, to front companies and bank accounts controlled by the Iraqi government.

The secret payments were not made to the United Nations' monitored bank account from which humanitarian goods could be purchased for the Iraqi people, but in a secret deal with Baghdad outside of the program.

Chalmers was ordered to surrender to a federal prison in Texas by April 30. (Reporting by Christine Kearney, editing by Daniel Trotta)