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IRAQ: US Unearths Iraqi Front Companies

BBC
April 16th, 2004

Eight firms and five people have been named by US and UK investigators as fronts used to finance the activities of the former Iraqi regime.

The list, the US Treasury said, had been given to the UN to make sure their assets would be frozen worldwide.

Among the firms are some accused of being vehicles for illegal arms trading and for flouting the oil embargo.

Others allegedly embezzled money from Shia pilgrims for the use of Saddam Hussein's intelligence services.

More to come?

In a statement, the US said it had already "designated" three of the firms and one of the people.

Under US law, that means assets associated with them should be frozen and business dealings with them are barred.

The move, the Treasury said, "begins the unveiling of Saddam's financial web around the world", promising an expansion of the list in the coming weeks and months.

In the 13 months since a move to freeze Iraqi assets, more than $6bn has been seized worldwide with $2.5bn transferred to a fund intended to pay for development efforts in Iraq.

Long haul

The hunt for Iraqi assets is not a new one.

In the late 1990s, a non-governmental organisation hired private corporate investigators Kroll Associates to find out who was looking after the regime's money.

Kroll's report, which the BBC has seen, listed more than a dozen people, mostly based in Switzerland, as well as several companies.

Experts believe that there remain billions to be found, mostly held in European and US banking centres.

Tens of millions is thought to have left bank accounts in Iraq in the first few months of 2003, as the US-led coalition geared up to invade, culminating in a last-minute rush before the regime capitulated on 9 April.

Charge sheet

The firms now listed by the US include:

* Al-Arabi Trading Co, a holding company accused of controlling 99% of two UK firms used for arms procurement in the 1980s

* Al-Wasel and Babel General Trading, accused of obtaining kickbacks from the oil-for-food programme and seeking weapons technology

* Al-Huda State Company for Religious Tourism, accused of ripping off Shia pilgrims to the holy cities of Najaf and Karbala to the tune of $500m to fund intelligence operations

* Logarcheo, accused of acting as a holding company for property in France ultimately owned by Saddam Hussein

* Al-Bashair Trading Co, alleged to be Iraq's largest arms procurement front company and a key element in the laundering of Iraqi government funds and their concealment overseas

* Aviatrans, Midco and Montana Management, holding companies for shares, aircraft and intelligence funds on behalf of senior Iraqi officials.

A check of UK company records shows that the two firms allegedly controlled by Al-Arabi share an address in London, and were set up on the same day in 1987.

Neither has been wound up.





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