This Washington Post article reports that a Senate Permanent Subcommittee on Investigations investigation into the U.N.’s oil-for-food program has concluded that Houston-based oil trading company, Bayoil, “paid millions of dollars in illegal, under-the-table surcharges” to the Iraqi regime of Saddam Hussein regime under the program and that Hussein used the illicit proceeds from the oil sales to buy weapons, among other things. The Senate Subcommittee report was made public last night in advance of a hearing today on the matter. Here are earlier posts on the oil-for-food scandal.
The report concludes that the Bayoil payments were part of a scheme under which Iraq sought to influence and reward the Russian government for supporting the Hussein regime in U.N. Security Council deliberations regarding sanctions against the Iraqi government. The Senate report contends that Bayoil played a key role in numerous transactions with the Iraqi government, and that Bayoil arranged transactions between Iraq and former prominent Russian politician Vladimir Zhirinovsky under which a Russian entity would purchase the oil and, without ever taking possession, sell it to Bayoil. Apparently, the Senate report includes a copy of a letter from Bayoil described how the company paid an “agreed premium” to Mr. Zhirinovsky for his cut of the transaction.