Auditing

SEC Enters the Fray in Iraq

Tyco, Wyeth, and El Paso have received requests from the commission regarding the oil-for-food program.
Stephen TaubDecember 16, 2004

The Securities and Exchange Commission has requested documents from “numerous” companies as part of a probe into the United Nations Oil for Food Program in Iraq during the 1990s, reported The Wall Street Journal, citing people with knowledge of the inquiry.

On Tuesday, Tyco International Ltd. announced that in November, it received an order from the SEC to report facts and circumstances involving its participation, if any, in the program governing sales of Iraqi oil. “We are gathering information responsive to the order and will fully cooperate in ongoing investigations,” added Tyco.

Drug maker Wyeth and energy giant El Paso Corp. also acknowledged receiving these requests, the paper added.

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The Journal, citing a person close to the probe, stressed that the SEC orders don’t mean these companies have been specifically targeted in the inquiry or are suspected of wrongdoing.

As CFO.com reported in May in “The Battle for Iraqi Audits,” some investigations into the oil-for-food program — as well as attempts to recover funds allegedly diverted by Saddam Hussein into his private coffers — are suffering from the same lack of coordination that have become all too familiar in reports from Iraq.

The SEC’s ultimate interest is whether any U.S. company paid bribes or kickbacks to get Iraqi business, or dealt with companies that may have committed such violations, the Journal explained.

A Tyco spokesman offered no further comment to the paper. A spokesman for Wyeth told the Journal that the company sold “limited quantities of nutritional and pharmaceutical products” to Iraq under licenses granted by the “appropriate government authorities.” An El Paso spokesman told the paper that the company is cooperating with the SEC and declined to comment further; the Journal noted that Coastal Corp., which was acquired by El Paso in 2001, was the largest U.S. buyer of Iraqi crude oil.

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