In April 1995, the U.N. adopted Security Council Resolution 986, which permitted the government of Iraq to sell oil and to use proceeds from those sales to purchase humanitarian supplies such as food for the Iraqi people (“U.N. Oil-for-Food Program”). In an extensive scheme, the Iraqi government received illicit payments in the form of surcharges from oil purchasers and kickbacks, often termed “after sales service fees,” from humanitarian goods suppliers. The kickback payments were masked by inflating the contract price, usually by 10% of the contract value. The government did not allege bribery of any individual foreign governmental officials.
Volvo Construction Equipment (formerly Volvo Construction Equipment International, AB or “Volvo Construction”) is an international seller of heavy commercial construction equipment. Between December 2000 and January 2003, Volvo Construction paid approximately $1.3 million in kickbacks to the Iraqi government, improperly labeled as “commission” payments in its books and records. These kickbacks were included in various contract prices submitted by Volvo Construction and its distributors and ensured that Volvo Construction was awarded a total of approximately $13.8 million worth of contracts to supply construction vehicles to the Iraqi government.
From November 2000 through April 2003, Renault Trucks SAS (“Renault”) entered into 17 contracts with various Iraqi ministries, including the 10% kickback payment. In performing the contracts, Renault used a Swiss bodybuilder to tailor the requested vehicles to the Iraqi ministry’s specifications. Renault provided extra payments to that company and was aware that these extra payments were being passed on to the Iraqi government to ensure that they were awarded additional contracts. Overall, the Iraqi government received $4.8 million in kickbacks from Renault. In return for these kickbacks, Renault Trucks SAS obtained contracts to supply vehicles and other equipment approximately worth €61 million.
