Mind Sparks: On the Volcker Committee Report

For anyone interested in the turbid world of international power brokers, the report by the “Independent Inquiry Committee into the United Nations Oil-For Food Program”, known as the Volcker Report is a fascinating piece of material. This report recently submitted by the Independent Inquiry Committee chaired by the Paul A. Volcker, Professor Emeritus of the International Economic Policy at Princeton University and former United States Federal Reserve Chairman (position currently held by Mr. Alan Greenspan) is a probe into the illicit activities that transpired under the banner of the United Nations Oil-For Food Program in Iraq. Although, I have not read through the entirety of the report, which is freely available on the internet, the basic intent of the report is to serve as a description of the investigation and draw certain conclusions and recommendations. The conclusions, amongst other things also relates to listing the names of individuals and entities against whom the investigation by the committee has found certain damaging evidence. It mentions incriminatingly, the names of people who fare in the who’s-who list of international politics and diplomacy, like Mr. Kojo Annan, the son of the current Secretary General of the United Nations Mr. Kofi Annan, and Mr. Joseph Stephanides, a former Director of the Security Council Affairs Division in the United Nations Department of Political Affairs (DPA), amongst others. The reason this report has kicked up a political storm in India is the mention of K. Natwar Singh, the current Minister of External Affairs in the Government of India and the Congress Party as “Non-Contractual Beneficiaries”.

To understand the implications one needs to make a brief background study about the United Nations Oil-For Food Program and the circumstances in which this report has been prepared. After the Gulf War in the early 1990’s, economic sanctions were imposed on Saddam Hussein’s Iraq. In the aftermath of these comprehensive sanctions which stifled the Iraqi economy, the United Nations Security council instituted the Oil-For Food Program to aid in the humanitarian recovery of the Iraqi people. This was done after the sanction regime came under serious criticism and was instituted under a Security Council which was deeply divided over the issue. Maybe because of the division of interest amongst the members of the Security Council over this issue, certain NGO’s were “enlisted” to monitor the transactions of Iraqi oil exports and oversee activities of the United Nations Oil-For Food Program. After the recent war in Iraq, the Independent Inquiry Committee was set up to look into the alleged illicit payments which were made to the Saddam Hussein regime by individuals and companies in exchange for oil, under the pretext of the United Nations Oil-For Food Program.

Now, coming back to the India connection, all in all there has been a mention of India in four locations in the “Summary of Oil sales by Non-Contractual Beneficiary” referenced in the report as “Committee Oil Beneficiary Table”. The table is in alphabetical order and the following is a brief description of the four entries.

Appearing in page 25 of 60, under beneficiary, is India- Congress Party. The total number of barrels allocated is mentioned as 4,000,000 and barrels lifted as 1,001,000. There is also a mention of a contracting company, Masefield AG whose mission country is stated as Switzerland.

Appearing in page 40 of 60, under beneficiary, is Reliance Petroleum Limited. The total number of barrels allocated is mentioned as 19,000,000 and barrels lifted as 15,760,000. The contracting company in this case is mentioned as Alcon Petroleum whose mission country is mentioned as Liechtenstein and Switzerland.

Appearing in page 49 of 60, under beneficiary, is Mr. Bhim Singh. The total number of barrels allocated is mentioned as 7,300,000. There is no mention of the number of barrels lifted or any contracting company.

The next entry on page 49 of 60, under beneficiary, is Mr. K. Natwar Singh. The total number of barrels allocated is mentioned as 4,000,000 and total barrels lifted as 1,035,000. The contracting company mentioned in this case is again Masefield AG. It is also mentioned here the person is a Member of Indian Congress Party.

There are other details also mentioned alongside each entry in the table. To understand better the meaning of the entries, the meaning of the term “Beneficiary” is described as names of individuals or entities other than the contracting companies, which were mentioned in the Iraqi Ministry of Oil records of the Saddam Hussein government, as the intended beneficiary of the oil allocation. The appendix of the “Report on Program Manipulation” states the sources of information for these tables as mainly from the Records of the Government of Iraq, primarily from the Ministry of Oil and State Oil Marketing Organization.

Thus the groundwork has been laid for a diplomatic tussle which has pitched the Indian Government against the septuagenarian chairman of the Independent Inquiry Committee into the United Nations Oil-For Food Program, Mr. Paul Volcker. Amongst the main areas of contention is the evidence based on which the allegations have been purported. The Ministry of Oil and State Oil Marketing Organization records listed as one of the source has also been mentioned by Mr. Volcker in a recent press conference as the main source of data for the tables. This list is supposed to be authentic and is said to include ledgers of oil surcharge payments made by companies and individuals around the world, which is illegal under the international laws. Refuting the authenticity of these documents may prove to be a tricky task for the Indian Foreign Office, mainly because these documents are a remnant of the Iraqi Regime with which India had maintained friendly diplomatic ties. Mr. Natwar Singh and his son are also linked with the Baathist party of Saddam Hussein in friendly terms. It may also prove tricky to completely disparage these report tables as another interesting entry which is mentioned in the reports is as follows.

Appearing in page 37 of 60, as beneficiary, is the Government of Pakistan. The total number of barrels allocated is mentioned as 4,000,000. There is no mention of the number of barrels lifted or any contracting company.

Clearly, refuting a report which implicates the Government of Pakistan as a beneficiary which paid oil surcharges and illegally funded the Saddam Hussein’s government may not prove to be very beneficial for the current Indian stand in international diplomatic circles.

Another point raised by Mr. Natwar Singh as to the indignation of the Indian government towards the report is in regard to the lack of prior notification to those implicated, by the Volcker committee about the names to be mentioned in the report, providing opportunity for those mentioned to produce evidence to thwart such claims. The report does include long letters sent by people who had been mentioned in the first interim report refuting claims by the committee about their involvement. Many letters are also included where many of the implicated persons reputations and intentions have been upheld by certain other peers and members of the United Nations so as to refute claims of their involvement in the scandal. It might be interesting to note that these letters sent to the committee are reproduced verbatim as Photostat copies of the original documents. Most of these letters sent as emails also have the preamble of the email addresses of noted diplomats and subjects mentioned by them in their original form. It is worthwhile to mention the many letters repudiating any involvement of Mr. Joseph Stephanides in the allocation of certain oil contracts as a personal favor to Lloyd Register, a British company, as claimed by the Volcker report. Even certain legal notices served by Mr. Stephanides’ counsel are also included as a part of the report. Although, Mr. Volcker and the report have claimed that they have sent notifications to “addresses in the UN databases” of all those mentioned in the report, providing opportunities for them to refute any allegations, no response from any Indian entity is included in the report.

The report by the Independent Inquiry Committee into the United Nations Oil-For Food Program has ruffled quite a few feathers in India and around the world. The serious implications, against the son of the Secretary General of the United Nations are sufficient proof of the seriousness and reach of the report. Nevertheless, irrespective of the dubious political implications in India and around the world, the Volcker report is an eye opener into the dealings of power hungry politicians of the world who even stoop to acts illegally financing militant regimes in pursuit of power. With inclusions of actual transcripts of the investigation and candid appeals by international diplomats it makes for interesting reading too!

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