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| author/source:Sunday Times (UK) |
| published:Sun 13-Jun-2004 |
| posted on this site:Wed 16-Jun-2004 |
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| Article Type : News |
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| AHT had won the contract through its association with Leo Mugabe, Robert Mugabe’s nephew |
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From The Sunday Times (UK), 13 June
Kofi Annan’s son faces probe in UN oil scandal
Robert Winnett
The son of the United Nations secretary-general is to be investigated over his alleged role in a company that negotiated to sell millions of barrels of Iraqi oil under the discredited UN oil-for-food scheme. Kojo Annan faces questions about a conflict of interest as the oil scheme was ultimately the responsibility of his father Kofi, who heads the UN. Financial investigators for the Iraqi government are to look into apparent links between Kojo and a company that negotiated a contract to sell Iraqi oil as part of its wider probe into deals struck during Saddam Hussein’s regime. The UN oil-for-food programme - which allowed Saddam to trade controlled amounts of oil to buy food and other essential supplies - is alleged to have been corruptly administered by the former Iraqi leader and the UN. The allegations centre on an Iraqi oil deal worth $60m (about £33m) that was lined up by Hani Yamani, the son of Sheikh Yamani, the former Saudi oil minister. The business relationship between Hani Yamani and Kojo Annan represents the coming together of two of the world’s most influential families. In his mid-twenties, Annan became a director of Yamani’s main company, Air Harbour Technologies (AHT). Documents seen by The Sunday Times show that Yamani agreed to sell 1m barrels of Iraqi oil - through another of his companies Hazy Investments — to a Moroccan company, Samir, in September 2001. He was given a further option to sell another 1m barrels.
A source close to the transaction said: “This was a major coup for Yamani at the time as it was critical to his main business as funds from the Hazy deal were planned for AHT. Kojo was a director of AHT.” Yamani is alleged to have said Kojo was important to the Hazy deal. Kojo, however, says he had no knowledge of Yamani’s oil negotiations. He firmly states, through London lawyers, that he ceased being a director of AHT in July 2001, two months before the oil deal was signed. His lawyers say they have seen a letter of resignation that proves his leaving date, but Kojo Annan has refused to release it to The Sunday Times. Although the Hazy contract for the Kirkuk oil was agreed, Yamani now says the deal never went ahead. Speaking from his home in Jeddah, Saudi Arabia, he said: “We didn’t have an allocation from the Iraqis, we were selling the oil on behalf of someone else. I never actually traded a barrel of Iraqi oil.” The investigators will now have to establish when Annan resigned and may seek evidence from other senior executives of AHT. In late 2000, the majority of the AHT board resigned after several projects failed to materialise, but Annan’s directorship was renewed in January 2001. Annan insists he only ever received two director’s payments. He also points out that when he was last accused of using his father’s name in an oil-for-food contract he was cleared.
After leaving university in 1994, Annan worked for Cotecna, a company that specialised in inspecting and verifying oil shipments. He became a Cotecna consultant through the Sutton Group, a company he set up in Nigeria. In 1998 the UN began tendering a multimillion pound contract to “inspect” its oil-for-food programme. This involved monitoring shipments of food and medicine being imported into Iraq, and checking oil tankers as they left port. Annan stopped acting as a consultant for Cotecna six weeks before it won the UN contract. An internal UN investigation found Annan had no knowledge or involvement in the Cotecna bid. A spokesman for the company said: “Kojo Annan’s activities concerned exclusively Cotecna’s activities in Nigeria and Ghana, and he was not involved in any of Cotecna’s operations involving the United Nations or Iraq.” Annan joined AHT in 1999, two years after his father was elected UN secretary-general. The company was set up to build airports and hotels and is wholly owned by Yamani. The company has close links to Hazy Investments which, records indicate, signs contracts and pays employees and consultants on AHT’s behalf. Both companies were ultimately based in the same office in Nicosia, Cyprus. Annan was approached to join the board of AHT at a time when Yamani was hoping to increase the company’s profile by hiring well-known figures, such as a former president of Costa Rica and Maurice Strong, a senior UN official and special envoy to Kofi Annan. One source close to AHT said: “Hani Yamani liked to surround himself with the great and the good. Kojo was a very passive executive and I always thought he basically lent his name to the firm. The Annan name obviously has a certain presence when you are putting together deals in Africa.”
One of the company’s biggest projects was the building of a new airport in Harare, Zimbabwe. It attracted controversy over allegations that the company had won the contract through its association with Leo Mugabe, Robert Mugabe’s nephew. During 2001, AHT was in trouble and Yamani allegedly stopped paying a number of key staff. It was against this background that the oil deal was negotiated. The Sunday Times has seen a contract drawn up between Hazy and Samir, a Moroccan company owned by prominent Saudis, for the sale of oil from Kirkuk in Iraq in September 2001. At the time, Iraq’s oil exports were strictly controlled by the oil-for-food programme. It is claimed Saddam handed out vouchers giving allocations of oil at discounted rates in return for favours, including political support outside Iraq and the supply of goods not permitted by UN sanctions. A spokesman for Kofi Annan declined to comment on Kojo’s relationship with Yamani. However, he said: “The secretary-general has categorically stated that neither he nor his son had any connection with the awarding of a contract to Cotecna.”
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