Watching the U.N. Oil-for-Food Watchdog

NEW YORK – It was January when a small Baghdad newspaper got a big scoop.

The Al Mada weekly (search) published a list of the names of some 270 people and organizations that purportedly received Oil-for-Food vouchers from Saddam Hussein (search).

[Editor's Note: this is the final story in a series of articles about the U.N. Oil-for-Food program. Check the links in the box to the right for the rest of the series.]

Some investigators believe the vouchers allowed Iraqi oil to be bought at below-market prices, and later could quickly be converted to hundreds of thousands, even millions of dollars, in cash. That wasn't the intent of the Oil-for-Food program, which was created in late 1996 to allow Iraqi oil to be sold so that the nation could buy humanitarian goods.

Al Mada's editor, Jihad Zahir, told FOX a former Iraqi government official leaked the names to the paper. Zahir said the document came from the Oil Ministry and he believes it to be valid.

Among the names on it: a British Member of Parliament, the president of a Canadian oil company and the children of political leaders in the Middle East and Asia.

The most sensational entry, however, was a single word: "Sevan." It suggested that "Sevan" may have received more than $3 million.

"Sevan" is also the last name of Benon Sevan (search), the man picked in 1997 by U.N. Secretary-General Kofi Annan to run the Oil-for-Food program at a salary of $186,000 a year.

"He is a clear suspect," said Rep. Christopher Shays (search), R-Conn., chairman of the House Subcommittee on National Security, Emerging Threats and International Relations.

Sevan has refused to discuss Oil-for-Food with reporters this year but FOX has confirmed that Sevan has told Annan that he is innocent.

"If Mr. Sevan's name appears on this list ... that would be deeply shocking," said Denis Halliday (search), the former head of Oil-for-Food's Baghdad operation and an outspoken critic of U.S. policy toward Iraq.

Halliday dismisses the Oil-for-Food scandal as a "small" matter, whether or not Sevan received millions from Saddam.

"I mean, every large organization has problems," Halliday said. "So let's not kill the organization because we have one or two people who may or may not have been corrupt."

But Sevan was not just any person — he was the chief Oil-for-Food watchdog for the U.N. Security Council.

In fact, the Al Mada list contains numerous names from two Security Council countries that opposed Operation Iraqi Freedom: Russia and France.

From Russia alone, there are 46 entries on the Al Mada list — including scores of Kremlin ministries and the Russian Orthodox Church. Among the dozen or so French names listed: at least one senior government official close to French President Jacques Chirac (search).

What's more, FOX News obtained a secret Oil-for-Food computer database listing some of the companies from which Saddam chose to "buy" goods. Again the Security Council looms large.

Between January 1997 and February 2001 alone, French companies listed in the database sold more than $2.9 billion worth of goods to Iraq. Russian companies got almost $2.6 billion and Chinese firms received nearly $1.9 billion. Sales from the United States and the United Kingdom amounted to $376 million.

Russia, France and China are permanent members of the Security Council and all opposed U.S. and British efforts to topple Saddam before the second Gulf War.

The issue is whether Oil-for-Food corrupted both the U.N. administration and the Security Council itself, therefore affecting decisions of war and peace.

Shays fears it did.

"Saddam never thought we would attack. He was convinced because the French ... and the Russians and the Chinese weren't with us, that we simply wouldn't do it," Shays said.

French, Russian and Chinese officials declined FOX News' interview requests. Officials from those countries, however, have said elsewhere that their actions at the United Nations were based on principle, not money, and that they have been vindicated by the failure to find weapons of mass destruction in Iraq.

FOX's "Breaking Point" asked Annan for an interview. His office said it would let a representative appear on another FOX News Channel program, but would not do a taped interview for "Breaking Point."

Halliday, the former Oil-for-Food official, said he thinks the United States and Britain should blame themselves if anything went wrong with Oil-for-Food, because their officials had the power to stop it.

"They must have known what was going on. They're not naïve, they're not foolish," Halliday said.

Asked if he believed the real "villain" was not Saddam, but President Bush (search) or British Prime Minister Tony Blair (search), Halliday said they all share blame and are all villains.

"They all were playing games with the lives of the Iraqi people," Halliday said.

The U.S. State Department would not comment about Halliday's accusations because it said it would only talk about current investigations.

But former Ambassador Richard Williamson (search), who was a U.S. representative at the United Nations during the final years of Oil-for-Food, did speak to FOX.

"Unfortunately, I think [Oil-for-Food] propped up a terrible regime longer than it should have been allowed," Williamson said.

Asked why, if it was clear that some Oil-for-Food money was finding its way into Saddam's pockets and Annan or the Security Council did not step in, Williamson said the focus was on the bigger-picture question of the weapons Saddam may have had.

"I think the United States said, 'Is there a way to stop this, or at least make it more difficult for Saddam Hussein to acquire military hardware, to acquire the ingredients for weapons of mass destruction?'" Williamson said. "That became the single priority, and I think the correct priority at the time."

Priorities for the United States shifted after the Sept. 11, 2001, attacks and President Bush wanted regime change in Iraq. But many of the traditional U.S. allies — including those who supported the first Gulf War with Iraq — were opposed.

Asked if Saddam was in effect buying the votes of countries like Russia and France, Williamson said he had no idea. But he said that Oil-for-Food money was probably funding the insurgents who continue to kill American soldiers.

Although he had no proof of it, Williamson said he believed some of that money "quite possibly" ended up in the hands of Al Qaeda (search). And he acknowledged that he may have ignored some of the warning signs.

"I especially apologize to the coalition forces who have been injured or killed because Oil-for-Food ... allowed weapons of death to get in the hands of very, very bad people," Williamson said.