Former U.N. Oil-for-Food Chief Benon Sevan Indicted Over Bribes From Saddam's Regime

Former U.N. Oil-for-Food chief Benon Sevan has been indicted in New York federal court for allegedly taking bribes under the program from Saddam Hussein's regime, U.S. authorities announced Tuesday.

The charges, detailed in a joint press release by the FBI, the U.S. Attorney's office and the Manhattan district attorney, came over a year after former Federal Reserve Chairman Paul Volcker completed an investigation for the United Nations into the massively corrupted Oil-for-Food program that operated in Saddam's Iraq between 1996 and 2003.

According to the press release, Sevan allegedly received $160,000 generated from the sale of Iraqi oil under the program from one Ephraim Nadler, an associate who was also indicted, on behalf of the government of Iraq. The money was allegedly used to pay off overdue credit cards and bills.

Specifically, the two were charged with wire fraud, based on their depriving the United Nations of its right to Sevan's honest services; bribery concerning an organization — the United Nations that receives more than $10,000 annually from the federal government; and conspiracy to commit these offenses.

If convicted, Sevan would face a maximum sentence of 50 years' imprisonment. Nadler, who was also charged with conspiracy to commit wire fraud by engaging in prohibited financial transactions with Iraq and violating the International Emergency Economic Powers Act, would face a maximum sentence of 112 years' imprisonment if convicted.

Warrants have been issued for the two through Interpol.

Sevan, through his lawyers, has denied that any funds were obtained illegally.

The career diplomat is thought to be currently living in Cyprus. That nation's extradition treaty with the U.S. does not cover financial crimes, so it is unclear as to what impact the charges would have on Sevan.

In February 2005, FOX News reported that then Manhattan District Robert Morgenthau had launched a criminal probe into Sevan, who had what was being called a "serious conflict of interest" while overseeing the program. At the time, Sevan was thought to have received about $1 million worth of lucrative oil vouchers.

About a week earlier, in a report detailing an extensive investigation, Volcker said Sevan had "seriously undermined" the integrity of the United Nations.

"Our conclusion is he placed himself in a serious conflict of interest," Volcker said at a news conference. "Our investigation continues into what other implications there may be if any."

Click here to go to's United Nations Center.

Sevan, who served in a number of U.N. positions over a 40-year career, was retired by the time the Volcker report was released.

Volcker and his panel were unable to conclude if Sevan actually took bribes because they were prohibited from issuing subpoenas.

But Richard Goldstone, a member of the Volcker group and a justice of the South African Constitutional Court, told FOX News he believed the threshold had been reached for criminal charges against Sevan.

Responding to the conclusion, an attorney for Sevan said in a statement that his client had done nothing wrong and had become a "scapegoat."

"It is unfortunate that the Independent Investigative Committee [IIC] has succumbed to massive political pressure," Eric L. Lewis, a Washington-based lawyer, said in a written statement. "After eight months of investigation with more than 60 employees and a $30 million budget, the IIC needed to produce a 'smoking gun.' As Mr. Volcker has conceded, there is no smoking gun. Mr. Sevan never took a penny."

The Oil-for-Food program, launched to help ordinary Iraqis cope with U.N. sanctions imposed after Saddam's 1990 invasion of Kuwait, quickly became a lifeline for 90 percent of the population.

Under the program, Saddam's regime could sell oil, provided the proceeds went primarily toward humanitarian goods and pay reparations to victims of the 1991 Gulf War. Saddam's government decided on the goods it wanted, who should provide them, and who could buy Iraqi oil — with the Security Council committee monitoring the contracts.

Based on reporting by FOX News' Eric Shawn.