A French judge has placed Total, the country's biggest energy group, under formal investigation for suspected bribery in a case relating to the UN Oil for Food Programme in Iraq. The eight-year-old case has been revived even though a French criminal investigation was closed in 2007, and the prosecutor's office last year recommended dismissing allegations against Total's chief executive and other current and former employees.
Serge Tournaire, a new investigating judge, decided this year the company should answer charges of bribery, complicity and influence peddling, Total said in its annual report and a review published on its website. The case centres on allegations that current and former employees of Total and French diplomats received vouchers for Iraqi oil in exchange for lobbying the UN to loosen sanctions against the regime of Saddam Hussein.
Total was formally charged last Thursday with corruption, Jean Veil, a company lawyer, told Dow Jones. "This formal investigation has been pronounced eight years after the beginning of the investigation without any new evidence being added to the affair," Total said. "The company believes that its activities related to the Oil for Food Programme have been in compliance with this programme." In its annual report for last year, Total said some of its current and former employees, including its chief executive Christophe de Margerie, had earlier been indicted under suspicion of bribery.
Mr de Margerie, who was Total's head of oil and gas exploration and production when the investigation was launched in 2002, was indicted in 2006. The following year, the case was transferred to the Paris prosecutor's office, which late last year recommended dismissing all charges. Judge Tournaire, who took over the case at the start of this year, was expected to close it but decided "against all odds" to launch a formal investigation, Mr Veil said.
The UN programme allowing Iraq to export oil in exchange for imports of food and other humanitarian goods ran from 1996 to November 2003, when sanctions against Iraq were lifted after the US invasion. It was aimed at relieving the impact the UN sanctions were having on ordinary Iraqis. Before the programme ended, Iraq sold US$65 billion (Dh238.73bn) of oil, but not all of the money went to alleviating the hardships of its populace.
A UN report found the regime had raised more than $10bn of foreign revenue illegally, which it diverted to its own uses. That was made possible through widespread collusion with the regime by corrupt foreign and corporate officials, the UN found. A series of UN and US investigations after the 2003 invasion found Saddam and his deputies had been demanding surcharges for foreign oil sales. The regime also raised revenue through oil smuggling.
Paul Volcker, the former chairman of the US Federal Reserve, conducted an independent investigation of the Oil for Food Programme but "discarded any bribery grievance", Total said. email@example.com