Australian wheat exporter faces class action suit over corrupt payments to Saddam Hussein – report

BAGHDAD / IraqiNews.com: The Australian daily newspaper said on Wednesday that Australia‘s wheat exporter went on trial today in a lawsuit brought by nearly 1,000 shareholders demanding compensation for millions of dollars they say they lost through the company’s kickbacks to Saddam Hussein’s former government in Iraq. The Australian Wheat Board, the exclusive marketer of bulk wheat exports from Australia, admitted for the first time in court Wednesday that it knew payments it made to a trucking company were going to the Iraqi government. In 2006, a government-commissioned inquiry found that the AWB paid more than $220 million in kickbacks to Saddam’s government between 1999 and 2003 to secure lucrative wheat contracts. Investors claim they collectively lost more than $100 million when AWB shares fell during the inquiry. They say AWB cost them money by concealing its actions in breach of the United Nations Oil-for-Food program and Australian export regulations. The company denies breaching its market disclosure obligations or engaging in misleading conduct. The trial opened Wednesday at a Federal Court in Sydney, almost three years after investors filed the class-action lawsuit. The 2006 Australian government inquiry concluded that AWB executives authorized $222 million in bogus transport fees to a Jordanian trucking company, Alia Transport, that was partly owned by Saddam’s government. Payments to Saddam were illegal under U.N. sanctions. AWB also allegedly inflated the cost of wheat it was charging to the oil-for-food program to cover the bogus transport fees. AWB‘s actions in Iraq came to light in 2005, when a U.N.-backed investigation said about 2,200 companies in the oil-for-food program, including ones in the United States, France, Germany and Russia, paid a total of $1.8 billion in kickbacks and illicit surcharges to Saddam’s government. American wheat farmers and Iraqi citizens have also filed suits against AWB, alleging lost business and humanitarian relief due to the corrupt payments. MH (S)/SR 1