Two men have been found guilty after a trial in London which was told $6 million in bribes were paid to Iraqi officials to secure contracts worth $800 million in the country’s burgeoning oil industry between 2005 and 2011.
Stephen Whiteley, 65, and Ziad Akle, 45, were found guilty of conspiracy to give corrupt payments to Oday Al Quoraishi, an official in Iraq’s state-owned South Oil Company. A jury at the Old Bailey in London was unable to return a verdict on Paul Bond, 68.
Whiteley and Akle worked for Monaco-based Unaoil while Bond worked for one of Unaoil’s clients, a Dutch company, SBM Offshore. The convicted pair face up to seven years in jail following the 10-week trial led by the UK’s Serious Fraud Office. The agency has confirmed it will pursue a retrial against Bond.
The convicted pair "took advantage of a government reeling from dictatorship and occupation... [They] abused the system to cut out competitors and line their own pockets," Lisa Osofsky, SFO director said.
Osofsky has ironically herself been subject to allegations of impropriety over her dealings with a US-based agent representing Unaoil's owners, the Ahsani family.
Akle attempted to get the case thrown out in January, arguing Osofsky repeatedly made “improper” contact with former US prosecutor David Tinsley, founder of private spying agency 5 Stones Intelligence, which represented the Ahsanis. According to evidence read in court by Akle's lawyer, Tinsley communicated via text messages with Osofsky and offered to help the SFO secure a guilty plea from Akle and his colleague Basil Al-Jarah.
Moreover, despite internal warnings to cease contact with Tinsley in 2019, Osofsky continued to speak with him until the SFO's lead counsel in the trial "became aware of it and put a stop to it in October 2019," the trial judge said. While there’s no suggestion Osofsky or the SFO was influenced by Tinsley, the presiding judge raised concerns about the back-channel contact between them. Osofsky was “vulnerable to flattery” in her dealings with Tinsley as he was “talking up her talents,” the judge said.
Unaoil was seeking to obtain lucrative contracts for single point moorings (SPM) equipment for SBM and pipelines for Leighton Offshore, a Singapore firm.
— Total Crime (@totalcrime) May 21, 2020
But Alain Battiston*, who worked for SBM for almost a decade, said the UK trial may be just the "tip of the iceberg."
Global Investigation Into Oil Bribes
He said investigations began in several countries in 2016 after whistleblower Jonathan Taylor, a former in-house lawyer at SBM, tipped off the media in his native Australia.
While most of the media were obsessed with the revelations from the Panama Papers, Melbourne-based journalist Nick McKenzie and his team at The Age were splashing on the story behind the "Unaoil Papers", a treasure of trove of emails which spilled the beans on what had been going on.
The Age reported Unaoil’s clients included not just Monaco-based SBM but also British firms Rolls-Royce, Petrofac and Clyde Pumps, US companies Halliburton, Honeywell, KBR, Weatherford, Cameron/Natco and FMC Technologies, Saipem from Italy, MAN Turbo from Germany and South Korean giants Samsung and Hyundai.
Several emails detailed how Al-Jarah, Unaoil’s Country Manager for Iraq, had “babysat” a senior Iraqi oil official, Kifah Numan, in Dubai and spent US$2,684 on gifts for him, including "perfume, various CD's, mobile top-up and leather jacket."
In one email al-Jarah said: "Spending $2,684 on a key decision maker and remain(ing) in his good books to process things…is worth 100 times that value, without which we would have no contract in our hands now."
The emails which formed the Unaoil Papers were at the heart of the UK trial - which began at Southwark Crown Court and moved after the coronavirus lockdown to the Old Bailey in central London.
The trial heard Akle and Whiteley bribed Al Quoraishi with a total of US$6 million (£4.7 million).
Iraqi Official With A Liking For Russian Women
Al Quoraishi was nicknamed Ivan by Unaoil executives because of his predilection for Russian women and al-Jarah was his main go-between.
Al-Jarah, a former ship’s captain from the city of Hull in northern England who is now 70, pleaded guilty in July 2019 to five offences of conspiracy to give corrupt payments and will be sentenced later this year.
In his opening statement Martin Brompton QC, prosecuting for the Serious Fraud Office, said: “Most of the prosecution evidence consists of email correspondence and the documents attached to such correspondence. It has been obtained from the following sources: the Unaoil server seized by the Monégasque authorities; Unaoil’s service provider; electronic devices found in the possession of some of the individuals concerned and foreign law enforcement agencies.”
Mr Brompton said: "Of course, not all communications were by email, there were face to face meetings and calls by telephone and Skype. But we say that the email correspondence provides a clear account, in real time, of what was going on and of what the Crown say was the conspiracy in action."
Unaoil earned millions of dollars in commission from SBM for contracts it won for them.
Dutch Firm With Fingers In Many Oil Pies
SBM, which is worth around US$10 billion, specialises in building and operating Floating Production Storage and Offloading (FPSO) units, which work in tandem with offshore gas and oil rigs.
It also produces SPM equipment, such as the CALM buoy, which floats offshore and allows oil tankers to fill up without the need to come into port.
It was CALM buoys which the Iraqis were buying - so that tankers would not have to enter the narrow Shatt-al-Arab waterway near Basra - and SBM was in competition with a rival bid by Bluewater, who use a different system, known as turret buoys.
But Iraq was not the only oil-rich country where SBM was involved in corrupt payments, it has emerged.
In 2018 Tony Mace, 66, the British former CEO of SBM Offshore, was jailed for 36 months and fined US$150,000 in the United States and Robert Zubiate, 66, a former sales executive at SBM USA, was given a 30 month sentence.
Assistant Attorney General Brian Benczkowski said the pair "played key roles in a massive bribery scheme.”
In his plea agreement Mace admitted other SBM employees "had entered into an agreement to pay bribes” to officials at Brazil’s state-controlled oil company Petrobras, the national oil company of Equatorial Guinea and Angola’s state-owned Sonangol.
Iraqi Oil Defendant's Ironic Angola Alibi
The mention of Angola and corruption in the same sentence is no surprise to those who have followed that country’s recent fortunes.
Africa’s richest woman, Isabel dos Santos - the daughter of Angola’s former president - allegedly enriched itself while in charge of Sonangol. Ms dos Santos, who claims she is innocent, has gone into exile in Europe but faces charges of corruption in the Angolan capital, Luanda.
Ironically at the London trial Mr Whiteley’s barrister, Adrian Eissa QC, sought to distance himself from the alleged Iraqi bribes by saying his client was “focusing on Angola” at the time.
Alain Battiston said he visited Angola while working for SBM and was shocked by what he saw.
"When I first went it was not long after the civil war ended but there were beautiful new buildings - government ministries and villas - but no roads or hospitals. There were plenty of luxury SUVs but the money from Angola’s oil industry clearly didn’t benefit the average Angolan," Mr Battiston told Sputnik.
The indictments against Akle, Whiteley, Bond and al-Jarah named several alleged co-conspirators who were not put on trial.
Iranian-Born Family At Heart Of Unaoil
They include the founder of Unaoil, Iranian-born Ata Ahsani and his sons Cyrus and Saman, Unaoil executive Peter Willimont and two of Bond’s “bosses” at SBM - Patrick Chapalain and Stephane Montbarbon.
Oxford-educated Cyrus and Saman Ahsani, who both have dual British/Iranian nationality, pleaded guilty to one count of conspiracy to violate the US’s Foreign Corrupt Practices Act in March 2019.
The SFO's case controller, Elizabeth Collery, said both Britain and the US had been seeking Saman Ahsani's extradition from Rome but in the end the Italians chose to send him to America.
But she would not comment on why none of the others on the indictment were charged.
Mr Battiston, who left SBM before the Unaoil Papers became public, said the company had a "cavalier attitude" about "rogue" operators like Whiteley for years but that changed when Bruno Chabas became CEO in 2012.
He said: "We were all called to the manager’s office and told that there were allegations of payments having been made. But the way the company was structured at the time we just didn’t know what was going on in another department."
Mr Battiston said it had amazed him to hear SBM was involved in “shady deals” because the company was “the best” in its field and he thought it had no need to buy contracts.
The SFO's Principal Investigator, Dermot Rice, said SBM Offshore had co-operated fully with them and the Dutch Fiscal Information and Investigation Service (FIOD).
The Australian Federal Police are still investigating allegations surrounding Leighton Offshore.
Asked whether she believed the Unaoil case was an isolated example or proof of endemic corruption in the oil industry, Ms Collery said only: "We have investigated a specific case of corruption and we are not going to make accusations about an entire industry. But we will always investigate evidence of fraud, bribery or corruption."
* Alain Battiston is a pseudonym used to protect the interviewee's real identity. The views and opinions expressed by Mr Battiston are his alone and do not necessarily reflect those of Sputnik.