News report claims ‘fixer’ firm Unaoil paid billions in bribes to help multinational companies secure contracts, including in the Middle East
U.S. firms Halliburton, former subsidy Kellogg, Brown & Root and Texas firm National Oilwell Varco are all implicated
Leaked documents allegedly prove corruption between 2000 and 2012
Unaoil has denied corruption, while companies involved have stated their anti-corruption policies and committed to working with investigators
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The news report, produced alongside Fairfax, said bribes were paid on behalf of many major international companies across Asia, Europe, the United States and Australia.
U.S. giant Halliburton and its former subsidiary Kellogg, Brown & Root are implicated, along with Texas firm National Oilwell Varco, Singapore conglomerate Keppel, Norway’s Aker Kvaerner and giant Turkish joint venture GATE.
The extent of the corruption in the oil industry was reported to be vast, with The Age branding it ‘the world’s biggest bribery scandal’.
It is run by the Ahsani family, father Ata and sons Cyrus and Saman, and based in Monaco.
A Monaco-based company called Unaoil cultivated an astonishing web of influence.
There was little about the man walking through Heathrow Airport to show he held secrets that could bring down some of the most powerful men in Iraq.
Moustached, olive skinned, hair receding, eyes sharp. His name was Basil Al Jarah. His British passport showed he lived in Hull, an unremarkable town in the north of England, but it bore the stamps of a frequent traveller: London, Baghdad, Basra, Amman, Paris, Istanbul, Kuwait.
Basil Al Jarah was an oil industry fixer. But had authorities known his true business, they might have taken a far keener interest in the man waiting for a plane to Amman in 2011. Because by that stage, Al Jarah and his employer, a Monaco-based company called Unaoil, had cultivated an astonishing web of influence in the upper echelons of Iraqi power – all based on the simple expedient of bribing the right man at the right time.
As tens of thousands of secret emails reveal, Al Jarah and Unaoil were at the heart of a global bribery operation funded, sometimes wittingly, by dozens of US, British, European and Australian multinationals. These firms paid huge sums to Unaoil. In return, Unaoil used its friends in high places to win billions of dollars worth of government contracts.
In Iraq, the man charged with making those friends was Al Jarah. From 2003 onwards, he used his influence to help deliver huge contracts to Unaoil’s clients. It did not matter if these clients were more expensive or less capable than their competitors. Unaoil and Al Jarah were, in effect, fleecing the people of Iraq, and in the process making a mockery of the US government’s promise, after toppling Saddam Hussein, to ensure Iraq’s oil wealth would benefit all Iraqis.
Al Jarah was careful to cover his tracks. He struck deals in hotel rooms late at night and used code words to communicate. To understand the scale of Unaoil’s Iraq operation, someone would have to break these codes. And to do that they would need access to thousands of emails. It is almost certain Al Jarah never believed this possible.
But last year, Fairfax Media and The Huffington Post began investigating the underbelly of the global oil and gas industry. After many months of digging and a trip across Europe, our reporters uncovered a treasure trove of emails and memos. The 66-year-old former ship’s captain from Hull, Basil Al Jarah, was the author of many of the most colourful.
They reveal him routinely bribing government officials who were deemed “useful to us” and to Unaoil’s clients – multinationals such as British firms Rolls-Royce, Petrofac and Clyde Pumps, US listed giants Weatherford, Cameron/Natco and FMC Technologies and European firms such Saipem, SBM Offshore and MAN Turbo.
The emails suggest that for years the very highest levels of Iraq’s oil industry – up to and including the deputy prime minister – has been corrupted with impunity under the noses of Iraqi, British, European and US authorities. This despite strict laws in the west designed to prevent foreign bribery. They also tell us what Al Jarah’s main goal was as he flew across Europe and the middle east that day early in 2011 — to influence two of the most powerful men in Iraq on behalf of a company that had agreed to pay bribes of up to $40 million.
In 2003, when US-led forces rolled into Baghdad, the oil ministry was among the sites designated for immediate protection. As looters stumbled out of museums clasping irreplaceable antiquities, coalition troops and tanks encircled the ministry building.
The message was clear. Iraq’s future lay beneath its blood-soaked earth, in some of the world’s biggest oil reserves. The question was, who would benefit?
In 2006, three years after the invasion, as conflict raged on, US President George W Bush insisted that the oil belonged to the Iraqi people: “It’s their asset,” he said. The US would help the new government of Nouri al-Maliki use the nation’s resources to build a new Iraq.
That meant increasing oil production. It meant repairing wells. It meant new pipelines, infrastructure and technology. The government couldn’t do it alone. It would need the expertise and resources of the giant American, British and European energy companies.
To ensure a fair and transparent process, the Iraqi government sought to run competitive tenders. The Saddam era, when the foreigner who paid the biggest kickback won would win the job, had supposedly been consigned to history.
Unaoil, though, was old school. By the time of Bush’s declaration, it had been operating in Iraq for three years, with Al Jarah as country manager. Unaoil favoured the old kickback system, albeit with a new crop of officials to be bribed.
A 2005 email illustrates their modus operandi. Al Jarah wrote to Unaoil colleagues about a meeting at Paris’ Charles De Gaulle airport with a senior manager from US firm FMC Technologies. FMC’s “past contacts who held sway in the old [Saddam Hussein] regime are worthless now,” he wrote.
“FMC must look to the future with new contacts and new faces. [FMC manager] requested time to disentangle himself from his current agent to sign up with Unaoil.”
According to his email, Al Jarah had struck a deal for Unaoil to get a 5 to 10 per cent cut of any contract it could win for FMC in Iraq or Kuwait. In Kuwait, for example, FMC had promised to pay Unaoil $2.5 million to win a $25 million contract. Unaoil could use a “portion” of that fee to pay-off “the big cheese in Kuwait”.
Al Jarah then approached a senior Iraq oil official, Kifah Numan, to help the US firm. FMC wanted to win contracts that had already been promised to its rivals. “I have to lean really heavy on Kifah to swing this if at all possible. I will start softening Kifah from tonight.”
Numan, in fact, features repeatedly in Al Jarah’s emails. Once in Dubai, Al Jarah had to “baby sit [Numan] for 4-5 days” to ensure none of Unaoil’s competitors made contact.
“He is too valuable to leave him lose [sic] in Dubai for other suppliers,” Al Jarah warned. Sometimes the attention was surprisingly personal, and trivial. Al Jarah spent “US$2,684.00 for Gifts for Mr Kifah during London visit”, including “Perfume, Various CD’s, Mobile Top-Up and Leather Jacket”.
At the time, Al Jarah was duchessing Numan on behalf of Unaoil client Rolls-Royce, which was chasing generator supply contracts worth tens of millions of dollars.
“Getting hold of Kifah to just spend any time with him is a bonus other contractor/suppliers would give their right arm for. Hence spending $2,684 on a key decision maker and remain in his good books to process things … is worth 100 times that value, without which we would have no contract [for Rolls-Royce] in our hands now.”
In a later email, Al Jarah wrote that Numan had advised him that Unaoil and Rolls-Royce could charge the Iraqi government inflated prices, to ensure fatter profits.
“He advised that cost will be no object… I expect we should make a minimum of $2m per [Rolls-Royce generator] unit net. After all costs have been taken into account.”
Rolls-Royce has told Fairfax Media and the Huffington Post that concerns about bribery involving intermediaries are being investigated by the British Serious Fraud Office “and other authorities”. Rolls-Royce is co-operating, said a spokesman, but “do not comment on ongoing investigations”.
In 2008, Numan became director general of the Iraq Government’s powerful South Oil Company, which was in charge of the country’s most valuable oil fields and infrastructure.
“Kifah called me yesterday,” wrote Al Jarah, “he still didn’t know if the news is confirmed. He said he… is planning to come to Dubai next week while I am here … Don’t know about you, I am having few beers today to celebrate.”
The response from Unaoil CEO Cyrus Ahsani was equally upbeat: “Excellent and let’s see how we can quickly do certain things to make sure we are the only ones with access.”