I am joined today by: Criminal Division Assistant Attorney General Christopher
Wray; U.S. Attorney for the Southern District of New York David Kelley; FBI
Counterintelligence Division Assistant Director David Szady; and,
Special Agent in Charge of the New York office of the FBI National Security Division, John A. Klochan.
I thank each of you for your efforts in pursuing justice in the case we are here to announce.
In 1996 the United Nations implemented the Oil-for-Food Program. Proceeds of sales of Iraqi oil were required to be deposited into an escrow bank account monitored by the United Nations. The funds were to be used only to purchase such necessities as medicine and food for the Iraqi people. The Oil-for-Food Program was designed so that innocent Iraqi people would not unduly suffer from the United Nations sanctions lodged against the brutal Hussein regime in the aftermath of Operation Desert Storm.
But the Hussein regime corrupted the Oil-for-Food Program, depriving Iraqi people of food and medicine, and undermining the international sanctions. The Hussein regime had accomplices in corrupting and weakening the international sanctions program imposed on it.
Today one of those accomplices becomes the first to be convicted under the Justice Department's active and ongoing probe of fraud and abuse in the U.N. Oil-for-Food program.
This morning in federal court in the Southern District of New York, Samir A. Vincent pled guilty to a four-count Information about his activities related to the United Nations Oil-for-Food program:
One count each of conspiracy to act as an unregistered agent of a foreign government and acting as an unregistered agent; one count of violating the International Emergency Economic Powers Act; and, one count of false statements in income tax returns.
The offenses charged carry a maximum sentence of 28 years in prison: 5 years' imprisonment on the conspiracy charge; 10 years' imprisonment for acting as an unregistered agent of the Government of Iraq; 10 years' imprisonment for International Emergency Economic Powers Act violations; and a maximum sentence of 3 years' imprisonment on the tax charge.
As part of the agreement, Vincent is cooperating with the Justice Department's investigation of corruption in the U.N. Oil-For-Food Program.
The United Nations' Oil-for-Food Program was to be used only for humanitarian purposes. This program followed the 1990 economic sanctions put in place by the U.N. that prohibited member states of the United Nations from, among other things, purchasing Iraqi oil and selling a wide range of goods to Iraq.
During the operation of the Oil-for-Food Program, federal law prohibited United States companies and individuals from executing contracts with the Government of Iraq unless they received a license issued by the Department of Treasury's Office of Foreign Assets Control.
Iraq began selling oil pursuant to the Oil-for-Food Program in late 1996. Under the Oil- for-Food Program, officials at the highest levels of the Iraqi regime had the power to select the companies and individuals who received the rights to purchase Iraqi oil. These companies and individuals - many of whom were not otherwise involved in the oil industry - made large profits by selling their allocations of Iraqi oil to brokers or companies capable of transporting the oil to a refinery.
From about the year 2000, up to the beginning of Operation Iraqi Freedom in March 2003, officials of the Iraqi regime conditioned the distribution of allocations of oil on the recipients' willingness to pay to the regime - in secret - a percentage of the total amount of each oil contract sold.
The Iraqi regime directed that these surcharges - which totaled at least several hundred million dollars - be paid to front companies or bank accounts under the control of the Iraqi regime in various countries in the Middle East and elsewhere.
Samir Vincent, a naturalized United States citizen, was one of these individuals selected by the Iraqi regime to receive oil allocations. Between 1996 and 2003, Vincent has admitted to receiving allocations for more than nine million barrels of oil, the rights to which he sold for millions of dollars.
Vincent has admitted his ties to the Hussein regime extended beyond the period when the Oil-for-Food program was in operation. Going back to 1992 Vincent has admitted to consulting with, and repeatedly receiving direction from, Saddam Hussein's Iraqi regime. Vincent has also admitted to lobbying officials of the United States Government and the United Nations to repeal sanctions against Iraq, and to support the Oil-for-Food program.
In February 1996 Vincent traveled to Baghdad and drafted agreements with Iraqi Government officials that guaranteed millions of dollars of compensation for Vincent and others if they were able to get the Oil-for-Food Program implemented.
Between 1998 and 2003, Vincent lobbied former officials of the United States Government who maintained close contacts to high-ranking members of both the Clinton and Bush Administrations in an unsuccessful effort to persuade the United States Government to support a repeal of sanctions against Iraq. Vincent reported the results of those consultations to the Iraqi Intelligence Service and other officials of the Government of Iraq. At no time did Vincent register as an agent of a foreign power with the Department of Justice.
I thank Christopher Wray, the Criminal Division, and U.S. Attorney David Kelley for their focus and pursuit of justice in this matter.
I also thank the Federal Bureau of Investigation and the FBI's National Security Division for their invaluable and ongoing efforts in this investigation.