Billionaire Iraqi linked to Labour arrested in London
Tempest
France demands extradition of Iraqi friend of UK politicians
Mark Hollingsworth
Wednesday April 2, 2003
The Guardian
http://www.guardian.co.uk/guardianpolitics/story/0,3605,927777,00.html
An Iraqi billionaire with controversial past links to Saddam Hussein's
regime has been arrested in London on a French extradition warrant after
apparently being kept under British protection for two years.
Nadhmi Auchi - who has put a number of British politicians on the boards
of his companies, including the former Foreign Office minister Keith Vaz
- was arrested on Monday. Scotland Yard says he has been bailed to
appear at Bow Street magistrates court on April 8 on three counts of
conspiracy to defraud.
He was believed to have been advising British ministers on Iraq and to
have sought a role in postwar Iraqi politics. He has also attended
meetings of an intelligence-linked group Le Cercle, described as
CIA-backed by the late Alan Clark, a participant and former Conservative
minister.
Attempts by a French investigating magistrate to have Mr Auchi arrested
during corruption inquiries had been blocked by Britain since July 2001.
A mammoth French corruption trial involving the giant oil firm
TotalFinaElf has just begun in Paris. It is expected next month to
involve testimony about Mr Auchi's alleged role in channelling a £28m
commission from the French oil company to buy an oil refinery from its
Kuwaiti owners.
Mr Auchi, who has a house in Kingston, south-west London, was a Ba'ath
party activist in Iraq. When Saddam Hussein came to power he moved to
London and made millions of pounds in commission on the sale of Italian
warships to the Iraqi regime in 1980, before sanctions were imposed.
Members of his family were subsequently involved in a lucrative deal
involving Italian companies building a pipeline to Saudi Arabia. But in
a dispute his brother Nazir, an Iraqi oil minister, and a number of
other participants in the deal were executed by President Saddam. Mr
Auchi was reported to have transferred $3m to the Iraqi leader in a vain
attempt to stop the executions.
Mr Auchi's business empire, which has assets worth more than £1bn, is
held offshore in structures whose ownership is difficult to penetrate.
His holding firm, General Mediterranean Holdings SA, is registered in
Luxembourg, and the Luxembourg and EU politician Jacques Santer is on
one of his boards.
British politicians on Mr Auchi's payroll have included the former Tory
chancellor Norman Lamont and the former Tory health minister Gerry
Malone.
A former Conservative Home Office minister, Tom Sackville, resigned from
the board of one of the banks Mr Auchi bought into, BCN of Germany.
Mr Auchi's attempt to control another bank, BCL of Luxembourg, led to
controversy. Asked by Paris Match earlier this year about allegations
that he was close to Saddam Hussein and had sheltered funds in the
Luxembourg bank belonging to politicians, he said: "All this is false. I
have never met Saddam. And if I had, I would simply be one amongst the
majority of heads of state or Arab businessmen who wished to have
relations with Saddam, particularly in the 1980s."
Mr Auchi's business empire is also at the centre of a £27m lawsuit by
the National Health Service, which is claiming that a pharmaceuticals
firm controlled by him was among those which colluded to overcharge the
NHS for the drug warfarin.
Mr Auchi was granted British nationality in the 1980s, some years after
he took up residence here. He says he is in danger in Iraq since his
fall-out with the regime.
The ambiguity of his relations with the UK is demonstrated by one of his
mementos, hanging in pride of place in his office - a portrait of the
houses of parliament which 130 MPs of all parties have signed.
It was presented to him by the science minister, Lord Sainsbury, "on
behalf of Tony Blair" at the 20th anniversary ceremony of his GMH
company.
His Le Cercle meetings - originally a cold war group of businessmen and
politicians - have brought him into contact with political figures such
as Lord Lamont and the Tory MP Alan Duncan, and with intelligence
officers such as the former MI6 officer Anthony Cavendish and the former
head of MI6's Middle East division, Geoffrey Tantum.
Mr Auchi, whom French police have been seeking to question for more than
five years, does not dispute that he received more than £28m in
commission from the French oil company to obtain Ertoil, a Spanish
refinery, from its Kuwaiti owners in 1990.
But he says the explanation is innocent. "The Gulf war had just started
and Kuwaitis in exile needed a lot of new money urgently _ the problem
was the French company had to wait for the approval of the anti-trust
authorities in Brussels, that could have taken months," he told Paris
Match.
So he agreed to buy the refinery with his own funds, "warehouse" it and
eventually resell it to Total. He denied that any of the commission was
kicked back to Total executives in France.
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