United Nations officials apparently knew of specific allegations that bribes were being paid in the oil-for-food program but there's no sign they did anything to change the program, documents obtained by FOX News show.
Nearly two years ago, U.N. official Benon Sevan (search) — the man who ran the oil-for-food program — received a copy of a letter from Lakia (search), a Russian-owned oil company, that was sent to Iraqi authorities.
The Oct. 2, 2002, letter was blunt and direct. It accused the State Oil Marketing Organization (search) of "lying to us."
"It is necessary for us to ask the immediate reimbursement of the sum of $60,000 which was sent to you from us on your request for a so-called necessary advance payment," said the letter, written by Gazi Luguev, Lakia's president.
Kickbacks of any kind were illegal under the oil-for-food program. The program was created after the first U.S.-led war against Saddam Hussein's regime to address sanctions that were placed on the sale of Iraqi oil. It allowed for the sale of Iraqi oil to pay for food.
After getting the Lakia letter, Sevan wrote to Mohammed A. Aldouri (search), Iraq's ambassador to the United Nations.
"I am duty bound to bring the matter to the attention of the Security Council...prior to doing so, however, I should like to receive most urgently the views and comments of the Government of Iraq," Sevan wrote.
Aldouri issued a brief response that said Lakia's letter "contains information that is not correct" but it did not spell out the problems with the Lakia allegations.
Legal experts contacted by FOX News found two potential red flags with the correspondence from Sevan and the United Nation's reaction:
Why did Sevan, who's been reluctant to publicly answer any questions about the beleaguered oil-for-food program, tell the Iraqi government about the bribe allegation against it before apparently telling the Security Council? Was he getting the facts straight, or was he, in effect, tipping off Saddam Hussein that questions might soon be asked?
Second, after Sevan eventually brought the matter to the Security Council's attention, why did it not provoke an investigation and changes in the program especially since rumors of corruption were already widespread?
Sevan, contacted for comment on Monday, declined to discuss the matter. Sevan himself is accused of illegally profiting as much as $3.5 million from the program, allegations he has denied.