Jail term for supplier guilty of illegal payments

15 April 2011

15 April 2011 | Angeline Albert

A supplier who won contracts in Iraq to provide medical products by paying kickbacks to the country’s previous dictatorship has been sentenced to six months in prison.

Mark Jessop this week pleaded guilty to breaking United Nations sanctions by making illegal payments to Saddam Hussein’s government during the Oil-For-Food Programme.

In addition to the jail term, Jessop was ordered to pay £150,000 compensation to the Development Fund for Iraq and pay court costs of £25,000 within a year.

Between 1996 and 2003, Jessop was awarded 54 contracts worth $12.3 million (£7.5 million) by the Iraqi state owned company Kimadia to supply it with medical products. Under the Oil-For-Food Programme, the UN allowed Iraq to export oil to pay for humanitarian goods. Oil revenue was managed through a UN account to pay suppliers for goods, such as the medical equipment he supplied.

Southwark Crown Court heard how Jessop had agreed to the Iraqi government’s policy that contract prices be inflated to allow for a 10 per cent cut to the regime, which was described on invoices as an “after sales service fee”. He admitted €104,649 (£92,617) was ultimately paid to the government, with €235,237 (£208,180) outstanding.

Jessop received information on tenders from an old business contact who had connections with Kimadia. This contact took a fee before passing the money to a Kimadia bank account. This was in breach of UN sanctions that forbade payments to Iraq or people in Iraq without a licence from the UK Treasury, which Jessop did not have.

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