According to Italian investigators, Total in 2002 unwittingly helped Baghdad finance an Iranian group, the Mujahidin Khalq, or People’s Mujahidin, which is on the U.S. government’s list of terrorist organizations. Less than a year later, in 2003, France’s counterintelligence agency stormed the group’s headquarters in Paris on terrorism charges. Besides collecting illegal funds through the surcharges, Baghdad also helped friends and allies around the world by awarding them oil contracts. A multinational committee led by the former U.S. Federal Reserve chairman, Paul Volcker, found that with this arrangement, Saddam was able to finance journalists, politicians and diplomats who he apparently believed would support his effort to lift the UN sanctions.
Seven oil contracts were also awarded to an Iranian exile organization, the Mujahidin Khalq, fiercely opposed to the government in Tehran, which was hostile to Saddam.
In 1992 the Mujahidin was blamed by the U.S. State Department for the almost simultaneous attacks on Iranian facilities in 13 European countries.
Investigators in the United States have a copy of a 1999 Iraqi memo summarizing an exchange between Iraqi intelligence and Iraq’s Oil Ministry regarding a request for oil received from the Mujahidin. The Iranian group had asked for the oil as a gift but, because of UN sanctions, the ministry could not comply.
The ministry was, however, willing to give the group a contract for two million barrels. The intelligence director had then provided the ministry the name of a company that the Mujahidin wanted to use as a front – Century Marketing Associates.
Contract M/11/44, which awarded more than five million barrels of oil to Century Marketing on Dec. 23, 2001, was signed by Haftavaradan Reza as a director of that company. Better known with his pseudonym of Saeed Mali, or Saeed Finance, Reza was at the time the No. 2 person in the finance department of the Mujahidin Khalq, according to Massoud Khodabandeh, a former executive committee member of the group.
At least some of that oil was bought by Betoil, a company controlled by an Italian trader, Fabrizio Loioli. An internal Betoil accounting document found by the Italian Guardia di Finanza indicates that 1,041,970 barrels of that contract was loaded onto the tanker Yannis P and sold to Total.
According to Loioli’s records, he received $156,295 in premium payments from Total for that shipment. "It was out of that money that Loioli would have paid the fee to the contract holder, that is Century Marketing," an Italian investigator said.
Almost a year later, in June 2003, the French riot police stormed the suburban Paris headquarters of the People’s Mujahidin. The investigation is still open.
Total declined to comment on the case.
Claudio Gatti
International Herald Tribune
The New York Times Media Group
17 May 2007