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US Prosecutors File Charges in UN Oil-for-Food Scandal


A U.S. federal prosecutor has filed bribery and conspiracy charges against the former head of the U.N. Oil-for-Food Program for Iraq. VOA's correspondent at the United Nations Peter Heinlein reports the lawyer for the accused ridiculed the charges.

The U.S. Attorney in New York Tuesday indicted former U.N. Undersecretary-General Benon Sevon, who ran the $64 billion Iraq Oil-for-food program. Also named in the indictment is Ephraim Nadler, a brother-in-law of Boutros Boutros-Ghali. Mr. Boutros-Ghali was U.N. Secretary-General when the humanitarian program was devised in the mid 1990s.

The Security Council initially set up Oil-for-Food to funnel food and other essential goods to ordinary Iraqis at a time when Saddam Hussein's government was under strict U.N. sanctions. An investigation headed by former U.S. Central Bank chief Paul Volcker turned up evidence of corruption by bureaucrats and oil industry figures.

Volcker documented how Saddam was able to manipulate the program to his own advantage by awarding contracts to, and receiving bribes and kickbacks from, favored buyers. In most cases, the buyers supported Saddam's regime and opposed sanctions.

The indictment handed down Tuesday charges Sevan with receiving about $160,000 from Nadler on behalf of the Iraqi government.

The 69-year-old Sevan currently resides in his native Cyprus, where he has lived since retiring after a 40-year U.N. career. His attorney, Eric Lewis issued a statement Tuesday calling the charges "ludicrous". In a telephone interview with VOA, Lewis said Sevan is being used as a "scapegoat" to divert attention from U.S. failures in Iraq.

"These allegations are without basis, they are not true," he said. "And they are a distraction from the massive financial fraud that took place with billions of dollars totally unaccounted for in Iraq since the Coalition Provisional Authority took over in 2003. Every penny of the U.N. oil for food budget was fully audited and accounted for."

Assistant FBI Director Mark J. Mershon Tuesday said the latest indictments bring to 14 the number of people charged in the case. He said the probe had "struck at the heart of the corruption that pervaded the Oil-for-Food program".

Sevan, however, is the only U.N. official charged in the case. Spokesman Farhan Haq says Secretary-General Ban Ki-moon will continue to demand strict ethical standards from the world body's staff.

"The secretary-general would like to convey that the United Nations has been cooperating with authorities about follow up to the Volcker reports, and the United Nations will of course continue to do so. He reiterates the commitment to have the United Nations uphold the highest ethical standards," he said.

Sevan faces up to 50 years in prison if convicted. The 79-year-old Nadler also faces additional charges of engaging in illegal financial transactions with Iraq, and could receive a sentence of as much as 112 years.

Authorities said they had contacted the international police organization Interpol to have both men extradited to face trial. Nadler is a U.S. citizen, but also resides in Europe.

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