(CN) – A former agent for a U.S. chemicals company was sentenced to 30 months in prison for conspiring to defraud the United Nations Oil for Food Program.
Ousama Naaman, 61, a former agent for Innospec Inc. in Iraq, also was fined $250,000 for bribing Iraqi officials in the sale of a chemical additive used to refine leaded fuel, the U.S. Attorney’s Office said.
Naaman, of Abu Dhabi, United Arab Emirates, was indicted in August 2008 and arrested in Frankfurt, Germany, in July 2009, then extradited to the United States. He pleaded guilty in March 2010 to of conspiring to commit wire fraud, violating the Foreign Corrupt Practices Act and falsifying the records of a U.S. issuer.
Innospec pleaded guilty in March 2010 to a 12-count wire-fraud indictment for paying kickbacks to the Iraqi government under the Oil for Food Program, and to Foreign Corrupt Practices Act violations for bribes it paid to officials in the Iraqi Ministry of Oil.
Prosecutors say Naaman paid 10 percent kickbacks to the Iraqi government in exchange for five contracts under the program. They say Naaman negotiated the contracts and routed the money to Iraqi government accounts in the Middle East.
Naaman admitted paying and promising to pay more than $6.8 million in bribes from 2004 to 2008, in cash, travel and entertainment, to officials of the Iraqi Ministry of Oil and the Trade Bank of Iraq to secure sales of tetraethyl lead in Iraq, and to get favorable exchange rates on the contracts. Naaman provided Innospec with false invoices to support the payments, and the invoices were incorporated into the books and records of Innospec.
Naaman earned $2.7 million in commissions on the contracts and would have earned an additional $5.3 million had the final contract not been stopped as a result of the investigation.
In addition to bribes actually paid to Iraqi officials, Naaman persuaded Innospec to pay him $750,000 for additional bribes that he never paid, but kept for himself.
Naaman settled civil charges in August 2010 with the SEC. He disgorged $877,096 in that settlement. The SEC civil penalty of $438,038 will be satisfied in part by his criminal fine.