THE REAL WORLD

Frenchmen Fried?
France discovers the Oil-for-Food scandal

By Claudia Rosett

Friday, October 14, 2005

Even the French have finally discovered the United Nations Oil-for-Food scandal. With the arrest in Paris this week of a former French ambassador to the U.N., Jean-Bernard Merimee, alleged to have received illicit and lucrative contracts to buy oil from Saddam Hussein's U.N.-sanctioned regime, the French newspapers are now aflutter over "petrole contre nourriture."

The funny thing is, while France had plenty to do with Oil-for-Food, Merimee's main trail leads not to the Quai d'Orsay, but to the doorstep of the U.N. secretary general. Authorities at the French foreign ministry have said the allegations against Merimee concern his activities after he retired as French ambassador to the U.N., and they're probably right. During the period most in question — late 2001 — Merimee was working primarily not for La France, but with the rank of U.N. undersecretary general, as a handpicked high-level "special adviser" for Kofi Annan.

That fact seems to have escaped Annan himself, who, as the French investigation was turning hot, turned up on Swiss TV last weekend lamenting in French that criticism from "these people" (presumably he meant the people who object to corruption at the U.N.) is "unfair" and "hard to bear." If that is Annan's bottom line after abundant evidence that his handpicked head of Oil-for-Food, Benon Sevan, was on the take from Saddam, and that his own son, Kojo Annan, sought to profit from the program, then perhaps the case of Merimee will not interest the secretary general in the least.

Bad Timing

But the timing of Jean-Bernard Merimee's trajectory through Kofi Annan's list of "Special and Personal Representatives and Envoys" ought to interest anyone who cares about the integrity of top management at the United Nations.

Here's the chronology. From 1991-1995, Merimee served as ambassador of France to the U.N. From there, he went on to serve until 1998 as ambassador of France to Rome. Then, he became one of the U.N's own. In February, 1999, Kofi Annan brought Merimee into his select U.N. team of special advisers and envoys, bestowing on Merimee the U.N.'s third-highest rank of undersecretary general, and appointing him as "Special Adviser of the Secretary-General for European Issues." According to the secretary general's office, Merimee held that position from February, 1999 until February, 2002, on a "when actually employed basis." In reply to my questions this past July about Merimee's specific duties, Annan's spokesman said Merimee had worked, "as needed," as Annan's envoy to the European Commission, helping in "the negotiations of a financial and administrative framework agreement relating to the disbursement of funds from the European Commission to the United Nations which was signed in 2003." In other words, Merimee from 1999-2002 helped Annan deal with collecting money from Europe for the U.N. — potentially an influential slot.

During this same period, Oil-for-Food was evolving from a limited, ad hoc U.N. relief program into the biggest heist in the history of humanitarian relief. Saddam by the year 2000 was routinely doling out millions in bribes for influence, and demanding kickbacks totaling billions on such scams as his underpriced oil sales and over-priced relief purchases. The U.N., while collecting $1.4 billion from Saddam's oil sales to cover its costs in supervising this program, was systematically failing to sufficiently monitor and inspect Saddam's traffic, or even adequately audit itself. Under Oil-for-Food, Saddam was allowed to pick his own business partners, subject to U.N. approval. A number of investigations, including several conducted by the U.S. Congress, have by now reported that Saddam used this latitude to try to buy influence. Russia became his number one U.N.-approved trading partner, followed immediately by France — with which Saddam did more than $7 billion in U.N.-approved deals. From their permanent, veto-wielding seats on the Security Council, the governments of both Russia and France opposed the U.S.-led overthrow in 2003 of Saddam.

After almost seven years in operation, from 1996-2003, the U.N. oil-for-food program wound to an end seven months after the fall of Saddam. By early 2004, a list based on formerly secret Iraqi official documents had surfaced in Baghdad's Al Mada newspaper, naming some 270 individuals or entities worldwide alleged to have received bribes by way of oil allocations from Saddam. Merimee's name was on the list.

In September, 2004, CIA chief weapons inspector Charles Duelfer released a major report on his hunt for weapons of mass destruction in Iraq. While Duelfer did not find WMDs, he did discover massive evidence of Saddam's sprawling global network of sanctions-busting arms traffic, graft and attempts to buy influence. In volume I of this report, running to hundreds of pages, Duelfer included lists, based on secret Iraqi official documents, of those alleged to have received oil allocations from Saddam. Again, Merimee's name showed up, transliterated as "Mr. Jan Mirami (French)."

According to Duelfer, Saddam's regime allocated lucrative oil contracts to Merimee during the last two years of Oil-for-Food. More specifically, the Oil-for-Food program was divided into 13 phases, averaging roughly six months each; Merimee pops up in phases 10-13, which ran from mid-2001 to mid-2003. For the last three of these phases, from December, 2001-June, 2003, he is shown as having been allocated oil, with a French company, Aredio Petroleum, listed as the designated shipper. But there is no record the oil was actually shipped. It is not clear what happened — whether Merimee did not go along, Saddam's regime did not follow through, or Saddam simply fell before the deals could be consummated.

But in phase 10, which ran from July-November, 2001, Duelfer lists Merimee as having been allocated two million barrels of Iraqi oil. Next to that, Duelfer reports that the oil was actually shipped, or in oil-industry jargon, "lifted," by a company described as "Fenar Petroleum (Swiss)."

If Duelfer's documentation is accurate, then this oil allocation and shipment took place well within the period in which Merimee was serving as Annan's special adviser on Europe. The question, then, is what Saddam might have hoped to get for his money. It is possible that some of Saddam's officials simply knew Merimee, due among other things to his previous stint as French ambassador to the U.N., and in scattershot fashion Baghdad's Baathists might have tried to buy influence wherever they could. Merimee at that stage occupied an interesting niche. He had strong ties to the French government, he spoke with the authority of the U.N. to the European Commission, and he had the ear of the U.N. secretary general.

Unanswered Questions

But Merimee had been Annan's special adviser since 1999. So why did these alleged oil allocations start more than two years later, in 2001? What jumps out is that the Oil-for-Food phase in which Merimee is alleged to have received his first allocation — the oil listed as actually having been shipped — happens to span the Sept. 11, 2001 terrorist attacks on the U.S. For Saddam, accustomed at that stage to flouting U.N. sanctions and resolutions with no serious penalty, this was a turning point. By Sept. 12, the political landscape had shifted. Saddam was in America's sights.

That raises the question of whether Saddam, possibly scrambling to recruit additional allies and support, might have turned to Annan's special adviser to the EC. The further question, then, is when exactly in the Oil-for-Food phase that ran from July-November, 2001, Merimee might have received that first Iraqi oil allocation. The question following on that — in light of Merimee's appearance on the Al Mada list, the Duelfer list, and now in a French court — is what Annan might know of the behavior and counsel of his former envoy. Or, for that matter, what Merimee might know about Annan.

These are matters on which Paul Volcker's U.N.-authorized probe into Oil-for-Food should be striving to enlighten us. Volcker, in his massive "main report" issued last month, focused on the role of the U.N. headquarters in Oil-for-Food. But he made not a single mention of former Under-Secretary-General Merimee, although allegations about Merimee's role had been out there since before Volcker began his inquiry in mid-2004, and the French investigation into Merimee had been public knowledge since at least this past July.

Volcker is expected to release one more report, in the next few weeks, dealing with companies involved in Oil-for-Food. At the very least, he might be expected to explore the identity of the mysterious "Fenar Petroleum (Swiss)," which does not appear in publicly available records of companies approved to do business with Saddam, but is alleged by Duelfer to have lifted oil from U.N.-supervised Iraq on behalf of Merimee. There was a Fenar Petroleum based not in Switzerland, but in Liechtenstein, which was authorized by the U.N. to deal with Saddam. But that company in its own right raises disquieting questions, also begging explanation from Volcker. Under Oil-for-Food, the U.N. was supposed to ensure that Saddam sold oil not to middlemen, and especially not to front companies, but to end users — to minimize the opportunities for graft and maximize oil revenues meant for relief. According to Volcker's own scant and cryptic data released so far, Fenar, based in Liechtenstein (a principality with 34,000 inhabitants), was the 11th-largest of Saddam's 248 U.N.-authorized purchases of oil — buying more than $1.1 billion worth of oil during the last three years of the program. You don't have to be a former chairman of the Federal Reserve to know that looks odd. Fenar out of Switzerland is yet another question mark.

Yet more mystery attends upon the U.N.'s handling in recent years of Jean-Bernard Merimee's U.N. status — which recently entailed one of those Orwellian U.N. moments. Although the secretary general's office now claims that Merimee's work for the U.N. ended in February, 2002, he was listed until July, 2005 on Kofi Annan's section of the U.N. website as an active special adviser to the secretary general.

To be precise, Merimee's name was on Annan's select list of special and personal representatives and envoys until July 26 of this year, when I asked Annan's office where I might contact him. The next day, July 27, Merimee's name vanished from Annan's website list. When I asked the U.N. about the abrupt and unannounced disappearance, Annan's spokesman said it had been an "oversight" that although Merimee's "official affiliation" with the U.N. ended in 2002, his name had remained on Annan's public list of special envoys for another three years and five months. The U.N., I was told, had merely updated the list. The spokesman added that the U.N. had no knowledge of Merimee's whereabouts, not even a phone number.

Even by the standards of U.N. bureaucracy, Merimee's lingering calling card seems to have been a monumentally persistent oversight, suggesting at best that Annan holds cheap the designation of high U.N. rank. Other entries on the list showed it had been updated by way of at least 60 new entries since Merimee was supposed to have departed. There was also at least one more update earlier this year, involving the removal of the name of another of Annan's top advisers and envoys, Canadian Maurice Strong — who stepped aside in April in connection with a U.S. federal investigation related to Oil-for-Food. Throughout, Merimee remained on the list.

Whatever the explanation the U.N. might now choose to offer, both the timing of Merimee's three-year stint as Annan's man in Europe and his six-year listing by the U.N. as a member of Annan's personal top "team" suggest the real bottom line. While a number of others now under investigation in France may stand out in the global oil-for-food saga chiefly for being French, the tale of Jean-Bernard Merimee belongs properly to realms of inquiry surrounding the U.N. secretary general himself.