Conflict of Interest Seen in Oil-for-Food Investigation

NEW YORK – A conflict of interest involving Oil-for-Food investigator Paul Volcker (search) may be the reason why an oil company involved in paying illegal surcharges to Saddam Hussein received no punishment.

FOX News obtained copies of interviews in which two senior employees of the French oil company Total tell an investigating Paris judge they used two Swiss companies -- Genmar and Mero -- to illegally funnel bribes to Saddam Hussein (search) for oil contracts.

One of the executives told the judge: "Through companies like Genmar and others, Total retained the possibility of buying second hand Iraqi crude.The Iraqis did not care who the buyers were as long as the surcharges were paid."

The other Total executive said: "These two companies [Genmar and Mero] carried out successive contracts from which they extracted a profit of two cents a barrel."

France's former interior minister Charles Pasqua (search), named by Paul Volcker as an alleged recipient of Iraqi oil vouchers, believes Total and Genmar used his name to legitimize their dealings.

"Total used Genmar" Pasqua told FOX News. "If Genmar used my name, Total took advantage of it the same way. Since I was not involved, I want to know who used my name."

FOX News discovered that Volcker, who spent 18 months investigating the oil for food scandal, was aware of the admissions by the Total executives, yet failed to issue an adverse finding against the company, as he did against many others accused of the same thing.

Earlier this year FOX News reported that Volcker is a friend of, and has been a paid advisor to Canadian businessman Paul Desmarais (search), whose Power Corporation (search) is one of the largest shareholders in Total oil. Volcker has not responded to repeated requests for an interview on this subject.

Click on the box above to see a video report by FOX News' Jonathn Hunt.

FOXNews' Jonathan Hunt and Per Carlson contributed this report.