UN Profits from Genocidal Sanctions on Iraq

The United Nations has raked in billions of dollars in plunder from Iraq’s oil revenues while crippling sanctions, described as “genocidal” by former UN officials, have devastated the Iraqi economy and brought extreme deprivation to the population.

Iraq’s immense oil wealth and the role it plays in the thinking of the global planners at the United Nations is a subject seldom discussed in any meaningful way by the U.S. news media. By obscuring the important facts of Iraq’s mineral assets and who actually controls them, the public has long been deceived by comforting globalist slogans such as “Oil for Food.”

While the UN has sold more than $61 billion dollars worth of Iraqi oil during the past six years under the so-called Oil for Food (OF) program, very little has been written about where that money has actually gone. Although the UN has managed $61 billion of Iraq’s oil revenues since 1996, the global organization refuses to take $16 million from the funds to pay Iraq’s membership dues, thus depriving Iraq of its vote in the General Assembly.

The UN’s OF program, which began in 1996, is generally portrayed as a program designed to provide the long-suffering Iraqi population with food in exchange for Iraqi crude. The program’s name “Oil for Food” is deceptive, however, for it hides the fact that much of the money actually winds up in UN bank accounts – and those of its friends.

Although not widely known, it is clear that the UN OF program has been operated as a huge money making scheme for the globalist institution, which has been greatly enriched by Iraqi oil proceeds, while the basic needs of the Iraqi people have gone unmet.


Hans von Sponeck, the former UN humanitarian coordinator who headed the OF program in Iraq from October 1998 to March 2000, said recently that one of the most misrepresented notions about the sanctions regime is that the OF program allows the humanitarian needs of the Iraqi people to be met.

Von Sponeck said the money from the program amounted to only $174 per person per year. “That’s it. That’s all that people in Iraq got for food, for medicine, for agriculture, for electricity, for water, for sanitation and for education, and, recently, from a year and a half ago, for housing. That’s it. Now don’t come and tell me that this is a figure that is even remotely what should guarantee a minimum of life.”

Today, out of 188 countries, Iraq is the 188th country in terms of increase in child mortality, according to a study carried out by UNICEF. In 1990, child deaths were 56 per thousand. In 1999, they were 131 per thousand. “This is a trend in Iraq; it continues,” von Sponeck said, “children die because of polluted water, lack of medicine, malnutrition – three factors that have something to do with sanctions.”

Von Sponeck and another former UN humanitarian coordinator for Iraq, Denis Halliday, condemned the UN sanctions on Iraq as “nothing short of genocide perpetrated by the very organization founded to protect the humanity and sovereignty of its member nations.”

The two former UN officials spoke at a Cairo conference of the International Campaign against American Aggression (ICAA) on Dec. 18-19. Halliday, the former UN Assistant Secretary-General who first directed the OF program in Iraq, resigned in 1998 in protest over the sanctions regime which he called genocidal.

“The fact is, the UN Security Council has allowed these sanctions on Iraq to drag on for 12 years, and this is not happenstance; this is deliberate decision-making. That’s why I’ve determined it to be a genocide,” Halliday told the Cairo weekly Al-Ahram. “I think at this late date, after 12 years, that is collective punishment; that is, as I said, genocidal.”

Halliday said the sanctions were “warfare” and “consistent with war crimes.” He said that the US had committed war crimes during the Gulf War pointing to the purposeful destruction of water systems to “very deliberately kill the children of Iraq.” The severe UN sanctions regime that followed only increased the suffering and death rate in Iraq.

The sanctions prevented Iraq from repairing essential infrastructure damaged during the Gulf War, which led to the well-documented calamity that has devastated Iraqi society for 12 years. According to the UN Human Development Index, Iraq, which had been ranked 50 out of 130 countries in 1990, fell to 126 out of 174 countries in 2000.

To understand how the Oil for Food program pads UN bank accounts while Iraqis starve, it is necessary to understand how the oil revenue pie is cut. The revenues from the sales of Iraqi oil are deposited in the New York branch of the French bank BNP Paribas SA, which runs Iraq’s escrow UN account.

In 1999 the UN’s OF account was flush with more than $5 billion while its own agency, UNICEF, said an average of 250 Iraqis died per day as a “direct effect of the sanctions.”

UN Secretary-General Kofi Annan, who is married to a relative of the Swedish banking family of Wallenberg, suggested at the time that some of the money be deposited in Swedish and Dutch banks.

In December 2002, the UN sold more than $1 billion worth of Iraqi oil, exporting roughly 2 million barrels of oil daily through the Iraqi port of Mina al-Bakr and its pipeline to the Turkish port of Ceyhan. From these sales of Iraqi oil the UN now receives 28 percent (previously 33 percent) off the top, although the critical humanitarian needs of the Iraqi people continue to go unmet due to “oil revenue shortfall.”

While about $40.8 billion worth of humanitarian supply contracts have been approved, only $25.9 billion (or 63 percent) worth of humanitarian supplies and equipment has actually been delivered to Iraq under the program.

Twenty-five percent (previously 30 percent) of the Iraqi oil revenues goes to the Geneva-based UN Compensation Commission (UNCC) to pay claims for reparations from Iraq for the Gulf War of 1991. The UN takes a commission, 2.2 percent, for administration costs, and 0.8 percent goes to UNMOVIC, the UN weapons inspections regime in Iraq.

Although the remaining 72 percent is allocated for humanitarian aid for the Kurdish north of Iraq (13 percent) and the rest of the country (59 percent), the actual delivery of goods is slow and restricted by UN bureaucracy.

The weapons inspections program, UNMOVIC, has received to date nearly $500 million dollars from Iraqi oil sales and has several hundred million dollars in the bank according to Ewen Buchanan, spokesman for UNMOVIC. Buchanan told American Free Press that UNMOVIC incurred monthly costs of about $1 million before inspections began and currently has monthly costs of about $4 million with the on-going inspections headed by the Swedish diplomat Hans Blix.

Buchanan told AFP that UNMOVIC had more than $200 million in its account at the end of 2002. Iraq is required to provide personnel and facilities for the inspectors in Iraq at no cost to UNMOVIC, Buchanan said.

From the $61 billion of Iraqi oil sold through the program, the UN has received a 2.2 percent commission for “administrative and operational costs,” nearly $1.35 billion. AFP asked Stefan Dujarric, spokesman for the UN Secretary General about the money and where it was being spent. Dujarric said he had to check the figures and would respond, but did not.


The largest and most secretive part of the Iraqi oil revenue pie, which does not go to help alleviate the suffering in Iraq, is the 25 percent that goes to a shadowy organization known as the UN Compensation Commission (UNCC).

France’s Le Monde Diplomatique exposed how the UN legalized the plundering of Iraq in an article “Oil for Food: The True Story” in Oct. 2000: “The pillaging of Iraq continues, as shown by the work of the UN Compensation Commission – a secretive body which operates on a distinctly shaky legal basis and creams off a third of Iraq’s oil revenue.”

The UNCC was established in 1991, under Security Council Resolution 692, which said that Iraq was “liable under international law for any direct loss, damage … or injury to foreign governments, nationals and corporations, as a result of Iraq’s unlawful invasion and occupation of Kuwait.” The thinking in the US then, as now, was “Iraq must pay.”

The UNCC has received claims worth $320 billion, including $180 billion for Kuwait, equivalent to nine times the country’s gross domestic product in 1989. If only a third of this amount, some $100 billion, were to be awarded, it would take UNCC revenues from Iraqi oil exports until the year 2070 to pay the debt. Iraq is not informed of the decisions until later and has no right of appeal in the process.

The Kuwait Petroleum Corporation was awarded $15.9 billion in 2000, twice the amount the Baghdad government had received between 1996 and 2000 to feed and care for 17 million people.

Israeli businesses, including florists, grocers, cinemas, and hotels, have reportedly received millions of dollars in compensation for revenue lost during the Gulf War.

The people and the process which decides whom the UNCC will pay and the actual recipients of the payments are well kept secrets. There is no transparency or auditing body at the UNCC. The US reportedly plays a major role in the decision making on the UNCC’s governing council.

American Free Press asked one of the officials involved in the process, Mark Clodfelder of the State Dept., how the UNCC decisions are made. Clodfelder said he would accept the questions and answer later.

When AFP asked Clodfelder about ethical criticism from legal experts that the reparations were unjust in that they aggravated the human suffering in Iraq, he said, “I’m not talking to you anymore” and hung up.

Halliday addressed the predicament that the Security Council is itself violating international law. He said the resolutions calling for sanctions of Iraq are incompatible with the UN charter and the declaration of human rights.

“The Security Council is out of control,” Halliday said. “There’s no device in the UN structure to oversee the work of the council, to monitor its decisions, to monitor the impact of those decisions, and their compatibility, or otherwise, with other aspects of international law. There’s no Supreme Court.”