Federal prosecutors in New York have announced the indictment of three men in a price-fixing scheme that siphoned millions of dollars from the United Nations oil-for-food program and gave kickbacks to Saddam Hussein's regime.

Prosecutors say Texas businessman David Chalmers and two associates at the Houston, Texas-based oil trading firm Bay Oil USA were involved in fixing the price of oil that was traded and sold under the auspices of the United Nations oil-for-food program in Iraq. The businessmen are also accused of facilitating the payment of illegal surcharges on the oil to the regime of Saddam Hussein.

David Chalmers and Ludmil Dionissiev, a Bulgarian, were arrested at their homes in Houston. Prosecutors are requesting the extradition of the third defendant, John Irving, from Britain.

US Attorney David Kelley addresses New York press conference, Thursday

U.S. Attorney David Kelley says the three men helped the Iraqi regime corrupt the oil-for-food program by paying inflated commissions to oil brokers and secret surcharges to companies and bank accounts controlled the the Hussein regime.

"Instead of funneling aid to the needy as the program was intended to do, the defendants facilitated the funneling of the money from the surcharges to front companies that were designated by the Hussein regime," he explained.

The men could receive sentences of up to 62 years in prison on charges of wire fraud, engaging in prohibitive transactions with a country supporting international terrorism, and violating a presidential executive order banning financial transactions with the Iraqi regime. Prosecutors say they are also filing a forfeiture notice seeking $100 million, the value of the oil that was purchased by the defendants.

Charges were also unsealed against a South Korean, Tongsun Park. Prosecutors say he received $2 million from the Hussein government serving as an unregistered agent in negotiations on the terms of the oil-for food program.