(Adds details, background)
By Edith Honan
NEW YORK Nov 20 Swiss oil trader Vitol pleaded
guilty to grand larceny on Tuesday for providing kickbacks to
Iraq under the U.N. oil-for-food program, paying $17.5 million
in fines but avoiding sanctions against individual executives.
Vitol, which had $114 billion of revenue in 2006, will pay
restitution of $13 million to Iraq and $4.5 million to cover
the cost of prosecution, Manhattan District Attorney Robert
Morgenthau said in a statement.
Vitol is one of the world's largest independent physical
oil trading companies. It admitted to paying $13 million in
kickbacks to Iraqi officials under Saddam Hussein to win oil
supply contracts, and the plea ended the New York
A former Vitol trader said the company would celebrate the
resolution of the case as a victory.
"They have excellent lawyers, as you would expect," he
said, speaking on condition of anonymity.
A lawyer for Vitol was not immediately available to
The U.N. oil-for-food program was established to help
Saddam's Iraq sell oil to buy humanitarian supplies while it
was otherwise under U.N. sanctions due to its 1990 invasion of
Kuwait. The program ran from 1996 to 2003.
A U.N.-commissioned inquiry headed by former U.S. Federal
Reserve Chairman Paul Volcker found the program was corrupted
by 2,200 companies in 66 countries that paid $1.8 billion in
kickbacks to Iraqi officials to win supply deals.
Federal and state prosecutors in New York have won several
convictions against individuals and companies in connection
with the program, including Texas oil tycoon Oscar Wyatt, who
pleaded guilty to federal wire fraud conspiracy on Oct. 1.
Wyatt agreed to forfeit $11 million and will be sentenced
on Nov. 27.
Chevron Corp last week agreed to pay $30 million to resolve
criminal and civil liabilities related to procurement of Iraqi
oil under the program. The case was the result of a joint
investigation by the U.S. attorney's office and the Manhattan
In February, Houston-based El Paso Corp agreed to pay $7.7
million to settle charges that it indirectly paid nearly $5.5
million in illegal surcharges to Saddam's government.
Vitol is made up of a network of separate companies and
privately owned by its staff. The group trades a wide range of
energy products and is also involved in derivatives, finance,
insurance, shipping, oil production, terminals and pipelines.
(Additional reporting by Janet McGurty and Daniel Trotta;
Editing by Patricia Zengerle)