16 April 2005	Saturday	06 Rabi-ul-Awwal 1426

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UNITED NATIONS, April 15: UN Secretary General Kofi Annan’s remarks at a meeting on Thursday holding the US and Britain partly responsible for the scandal involving the oil-for-food programme, have stirred a storm of controversy.

On Friday US and Britain rejected allegations with the British Foreign Secretary Jack Straw saying that the charges were “inaccurate”, while Washington also rejected the assertion.

The US spokesman at the UN, Richard Grenell, said the US did not know of any oil smuggling at the time, but said there was a “very public waiver ... granted to some countries.”

Mr Annan said smuggling to Jordan and Turkey had been accepted as a way of compensating them for lost trade with Iraq.

The UN has been under fire over the so-called oil-for-food programme. and the Inquiry Commission looking into the scandal has blamed many UN officials for mismanagement of the account which allowed Saddam Hussein to get kickbacks.

Saddam Hussein made billions of dollars smuggling oil in defiance of sanctions policed by the US and Britain, the UN chief said.

The Independent Inquiry Commission headed by former head of US Federal Reserve Paul Volcker, in its final report due at the end of June, is expected to address the issue of sanctions violation allowed on the watch of UN sanctions committee manned by the United States and Britain.

The 60 billion dollar programme allowed Saddam Hussein’s Iraq to sell oil in order to buy civilian goods — including medicine — and thereby ease the impact of UN sanctions imposed after Iraq’s 1990 invasion of Kuwait.

US Senate investigators have alleged that the Iraqi regime received some $4 billion in illegal payments from oil companies involved in the programme.

But this figure is a pittance compared to the $14billion that allegedly came from “sanctions-busting” — the illegal sale of oil to neighbouring states such as Jordan and Turkey.

“The bulk of the money that Saddam made came out of smuggling outside the oil-for-food programme, and it was on the American and British watch,” Mr Annan said.

“Possibly they were the ones who knew exactly what was going on, and that the countries themselves decided to close their eyes to smuggling to Turkey and Jordan because they were allies.”