Global Policy Forum

Saddam Hussein's ousted regime gave crude oil "coupons" to its foreign backers to thank them for their support and help in circumventing UN-imposed sanctions, former Iraqi officials told AFP on Wednesday. "The regime used to give Arab and other foreign political figures coupons worth millions of barrels of crude oil which they could sell on the market and almost always make a full profit," one of the officials said.

According to the former official, these deals were "legal" and were managed by Iraq's State Oil Organisation (SOMO) which continued to hand out crude oil favours to supporters of the regime a few months before the war in March. "The coupon for a barrel of oil from SOMO was selling for 25-30 cents in 1999 and 2000 but the cost fell to 10 cents by the end of 2002 when the market was flooded," he said on condition of anonymity in a phone interview. Many important people received such gifts over the years "and made lots of money," he said.

According to the former official, the beneficiaries of such deals "sold their coupons to specialized firms in the United Arab Emirates mainly, who would in turn sell them on the market". "It was a quick and uncomplicated system that allowed these people to make a quick profit without having to fuss with transporting the crude oil out of (Iraq's southern port) Basra," he said. The firms that bought the oil coupons also made good profits because of the demand for Iraqi crude, even after commissions were paid out to middlemen. Depending on the nature of the deals, these middlemen would pocket the commissions or give part of them back to the regime in violation of the UN sanctions imposed on Iraq after it invaded Kuwait in 1990.

Another former Iraqi official contacted by AFP said a barter system also existed between Saddam's ousted regime and "Jordanian, Lebanese or Syrian businessmen". "They would export to Iraq products banned under the sanctions regime in exchange for barrels of oil," he said. In 1996, the United Nations eased its sanctions on Iraq by setting up the oil-for-food program authorizing Iraq to export crude oil and use the money from the sales to buy food and other basic necessities. The funds were placed in a special account to ensure there were no irregularities.

But the regime managed to secure deals with some of its foreign friends despite these measures, the former official said. "Sometimes businessmen would get clearance from the United Nations to purchase 'legal' products and would then hand over the documents to Iraq which would use them to obtain products banned under the sanctions," he said. Iraqi oil ministry undersecretary Abdul Sahib Salman said Sunday that Saddam had rewarded 200 of his leading supporters abroad with millions of barrels of crude oil. The supporters included at least two prime ministers and two foreign ministers, as well as high-profile politicians, political parties, journalists and the sons of ministers and heads of states across four continents, he said. Salman said the ministry was building a case with the help of Interpol to recover profits made from the oil sales.

The Baghdad newspaper Al-Mada on Sunday published a list of oil contracts passed by SOMO in 1998 which included the names of around 200 people, political organizations and religious figures from more than 40 countries whom it said received free crude oil.

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