05/16/2005 | Сергій Кабуд

Putin advisers implicated in oil-for-food inquiry
By Mark Turner and Neil Buckley
Published: May 16 2005 05:49 | Last updated: May 16 2005 05:49


Saddam Hussein's Iraq allocated 90m barrels of cut-price oil to Russia's presidential council, in return for Moscow's support against sanctions, a US Senate committee investigating the UN administered Iraq oil-for-food programme has alleged.

In findings released ahead of congressional hearings on Tuesday, the permanent subcommittee on investigations estimates that almost $3m (€2m) worth in commissions were paid to the RPC a group of highly influential advisers to the Russian president through its former head, Mr Putin's chief of staff, Alexander Voloshin, or Sergei Isakov, his friend.

The committee also said 75m barrels were allocated to Vladimir Zhirinovsky, an ultranationalist Russian politician with close ties to the Hussein regime, or his political party.

And in both cases Bayoil, an American oil-trading company that was last month indicted by US federal prosecutors over its alleged role in the oil-for-food programme, assisted in the trade, by arranging for the actual transport and subsequent sale of the oil to the US and elsewhere, the committee said. A spokesman for Mr Voloshin said he could not be reached for comment on the report on Sunday night. The report said that Mr Voloshin had declined to comment on its contents.

Mr Zhirinovsky could also not be reached for comment on Sunday, but has previously denied any involvement in the oil-for-food programme, saying he “never took a drop [of oil], or a single dollar from Iraq or from any country”.

The Senate report adds more pieces to a jigsaw puzzle that suggests that Mr Hussein aimed to exert influence on governments with a seat on the UN Security Council.

The committee has been investigating how the sale of Iraqi oil at below market prices created a profit margin that apparently allowed friends of the regime, the regime itself, and the businessmen who helped them, to make millions of dollars. Last week, the Senate committee also alleged that George Galloway, a British MP, and Charles Pasqua, a former French interior minister, had been granted oil allocations.

Both have denied the charges.

Mr Galloway has accepted an invitation to appear before tomorrow's hearings. Norm Coleman, the committee chair, has warned he will be speaking on oath, under US jurisdiction.

The new allegations touch directly on one of Vladimir Putin's former closest advisers, days after the Russian president met George Bush, his US counterpart, in Moscow during celebrations of the 60th anniversary of the end of the second world war.

The committee said that by allocating oil to the RPC, and officials associated with it, Iraq hoped to open a conduit to President Putin.

Its key intermediary was Mr Voloshin. “Although Voloshin resigned in late 2003 over a scandal involving the Russian oil giant Yukos, there is little debate over the magnitude of Mr Voloshin's influence in Russian government during the oil-for-food programme,” the Senate report said.

“Mr Voloshin was widely known as the ‘power behind the crown' at the Kremlin.

“The Hussein regime had reason to believe that Mr Voloshin would be an effective conduit to President Putin,” the report says. “[Iraqi] Vice-President [Taha Yasin] Ramadan recognised Mr Voloshin as the head of Russia's presidential administration and stated that the oil allocations awarded to him had been approved by Saddam Hussein.

“Other regime officials stated that the allocations given to Mr Voloshin were a show of support to him, and were granted to him because of his relationships with ‘very important characters'.”

The committee also said senior members of the Hussein regime had told them that Russia's Unity party, “a pro-Kremlin party associated with Russian president Vladimir Putin”, had received substantial allocations. Now known as the United Russia party, it is the dominant party in the Duma.

In total, Russian individuals and political parties received about 30 per cent of all the oil allocated during the programme, according to the report.

In the case of the RPC, the actual shipment and trade of oil was done by Bayoil, which paid for the oil, plus a commission to one of several different companies that nominally contracted for the RPC's allocation, the report said.

The Senate committee estimates that $5.6m was kicked back to the Iraqi regime as a result of the alleged RPC transactions.

A Kremlin spokeswoman said the Kremlin was not aware of the contents of the report. The spokesman said the Kremlin did not wish to comment before publication of the report on Monday.