Another Trail to Follow (Oil For Food Scandal)

snip) Paul Volcker's U.N.-approved inquiry finally released the program's 55 secret internal audits, which Congress and others had been requesting for months.

Now, with the release of the U.N.'s previously secret internal audits, we learn that there was considerable concern within the Secretariat's auditing department over some aspects of UNCC performance--(snip), may have resulted in overpayments of perhaps as much as $4 billion.

For example, the auditors objected that in paying out claims at old (snip)exchange rates, the UNCC overpaid by $2.2 billion. Or there's the notation on a March 6, 2002, audit report that a UNCC payment of $58.9 million for a refugee camp in Jordan had overstated the camp's population by a factor of three, and "the UNCC was unable to provide an adequate explanation for the difference."

This was hardly the picture conveyed by Secretary-General Kofi Annan in the little the public glimpsed of the internal audits, via reports he forwarded to the U.N. General Assembly. In a public report dated April 4, 2002, Mr. Annan vaguely mentioned (snip) a reference to $486,130, which he said the auditors had questioned and the UNCC had nonetheless decided was "appropriate."

The rotating panels of commissioners who awarded the (UNCC)$18.8 billion were chosen via in-house evaluation of their credentials by the U.N. Secretariat, nominated by the UNCC and approved by Mr. Annan; but little detail about them or their decisions was disclosed to the public. The records made publicly available by the UNCC do not in some cases disclose who the end-recipients were. Some of the funds were channeled to end-users via governments, including those of such terrorist-sponsoring states as Syria and Iran, as well as Yasser Arafat's Palestinian Authority.

I can name a few of those who got money as compensation for "lost profits" from Iraq:

Texaco $505m
Halliburton $18m
Sheraton $11m
Bechtel $7m
Pepsi $3.8m
Nestlé $2.6m
Mobil $2.3m
Shell $1.6m
Philip Morris $1.3m
Kentucky Fried Chicken $321,000
Toys R Us $189,449

Now that's the real scandal - that Iraq is STILL paying for outrageous claims. Not some wacky theory that Iraq was secretly suing itself to pocket its own money.

Category "E" Claims

Category "E" claims are claims of corporations, other private legal entities and public sector enterprises. They include claims for: construction or other contract losses; losses from the non-payment for goods or services; losses relating to the destruction or seizure of business assets; loss of profits; and oil sector losses. The Commission received approximately 5,800 category "E" claims submitted by seventy Governments seeking a total of approximately US$80 billion in compensation. The category "E" claims range from asserted losses of a few thousand US dollars to those for several billion US dollars. The Commission has established four subcategories of category "E" claims.

Category "F" Claims

Category "F" claims are claims filed by Governments and international organizations for losses incurred in evacuating citizens; providing relief to citizens; damage to diplomatic premises and loss of, and damage to, other government property; and damage to the environment. The Commission has received approximately 300 category "F" claims, submitted by forty-three Governments and six international organisations, seeking a total of approximately US$210 billion in compensation. The category "F" claims have been organised into four subcategories. In addition, the "E/F" category covers export guarantee and insurance claims.

Category "A" Claims

Category "A" claims are claims submitted by individuals who had to depart from Kuwait or Iraq between the date of Iraq's invasion of Kuwait on 2 August 1990 and the date of the cease-fire, 2 March 1991. Compensation for successful claims in this category was set by the Governing Council at the fixed sum of US$2,500 for individual claimants and US$5,000 for families. However, where a claimant who had filed claims in category "A" only, he or she was eligible to receive a maximum category "A" payment of US$4,000 for individuals and US$8,000 for families. The Commission received approximately 920,000 category "A" claims submitted by seventy-seven Governments and thirteen offices of three international organizations, seeking a total of approximately US$3.6 billion in compensation.

Category "B" Claims

Category "B" claims are claims submitted by individuals who suffered serious personal injury or whose spouse, child or parent died as a result of Iraq's invasion and occupation of Kuwait. Compensation for successful claims in this category was set at US$2,500 for individuals and up to US$10,000 for families. The Commission received approximately 6,000 category "B" claims submitted by forty-seven Governments and seven offices of three international organisations, seeking a total of approximately US$21 million in compensation.

Category "C" Claims

Category "C" claims are individual claims for damages up to US$100,000 each. Category "C" claims can be made for twenty-one different types of losses, including those relating to departure from Kuwait or Iraq; personal injury; mental pain and anguish; loss of personal property; loss of bank accounts, stocks and other securities; loss of income; loss of real property; and individual business losses. The Commission received approximately 420,000 category "C" claims submitted by eighty-five Governments and eight offices of three international organisations, seeking a total of approximately US$9 billion in compensation. In addition, the Central Bank of the Government of Egypt submitted a consolidated category "C" claim on behalf of over 800,000 workers in Iraq for the non-transfer of remittances by Iraqi banks to beneficiaries in Egypt. This consolidated Egyptian category "C" claim comprised 1,240,000 individual claims with an asserted value of approximately US$491 million.

Category "D" Claims

Category "D" claims are individual claims for damages above US$100,000 each. The types of losses that can be claimed under category "D" are similar to those under category "C", with the most frequent being the loss of personal property; the loss of real property; the loss of income and business-related losses. The Commission received approximately 10,500 category "D" claims submitted by fifty Governments and eight offices of three international organisations, seeking a total of approximately US$10 billion in compensation.

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