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Swiss oil company admits to Iraq oil kickbacks

Swiss oil-trading company Vitol SA has pleaded guilty to a larceny charge in connection with paying secret kickbacks to the former Iraqi government under the UN oil-for-food program, The Wall Street Journal reported Wednesday.

Vitol SA will pay $13 million in compensation to the Development Fund for Iraq and 4.5 million dollars to the city and the state of New York, the report quoted New York state prosecutors as saying. The development fund was created by the UN Security Council in May 2003 to receive all proceeds from the sale of Iraqi oil and natural gas after the UN oil-for-food program ended. Prosecutors alleged Vitol paid $13 million in kickbacks to Iraqi officials in connection with oil purchases from June 2001to September 2002 and allowed false representations to be made to the UN that no kickbacks were paid.

The oil-for-food program was launched by the UN in December 1996, to allow the then Iraqi government led by Saddam Hussein, which was facing international sanctions, to sell oil in exchange for basic food, medical supplies and other humanitarian needs. The program was stopped in November, 2003, months after the US-led Iraq War toppled the Saddam regime. Last week, a leading US oil company Chevron Corp. agreed to pay $30 million to settle civil and criminal charges related to secret surcharges paid by third-party merchants in exchange for oil from Iraq in the program. (