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A Paris court fined Total 750,000 euros ($825,000) on Friday for corrupting foreign officials, overturning an earlier acquittal over the French oil giant's role in the United Nations' Iraqi oil-for-food program.
French prosecutors had appealed in 2013 after a lower court cleared the oil group and all other defendants accused of funneling proceeds from U.N-authorized oil sales to former president Saddam Hussein's government via intermediaries, in defiance of international sanctions.
Under the 1996-2003 program, Iraq was allowed to sell oil in exchange for goods that met basic humanitarian needs, including food and medicines.
But an independent inquiry, led by the former U.S. Federal Reserve chairman Paul Volcker, disclosed in 2005 that Baghdad had used the trades to solicit hidden surcharges from oil purchasers.
Between 2000 and 2002, Hussein's regime collected $228 million in illicit payments from 2,200 companies in 60 countries, according to the report - part of an estimated $11 billion haul from sanctions-busting and kickbacks over more than a decade until the 2003 U.S.-led invasion of Iraq.
On 16 December 2008, the managing director of the Italian division of Total, Lionel Levha, and ten other executives were arrested by the Public Prosecutor’s Office of Potenza, Italy, for a corruption charge of €15 million to undertake the oilfield in Basilicata on contract. Also arrested was the local deputy of Partito Democratico Salvatore Margiotta and an Italian entrepreneur.
UN Oil-for-Food Programme for Iraq
In April 2010, Total was accused of bribing Iraqi officials during former president Saddam Hussein's regime to secure oil supplies. A United Nations report later revealed that Iraqi officials had received bribes from oil companies to secure contracts worth over $10bn.
Investments in Iran
Total has been a significant investor in the Iranian energy sector since 1990. Total is suspected of concealing the source of its oil imports from Iran. On 28 June 2010 Total announced that it would cease shipments of oil products to Iran following adoption by the United States of economic sanctions against the country.
Bribery in Iran
In 2013, a case was settled that concerned charges that Total bribed an Iranian official with $60 million, which they documented as a "consulting charge," and which unfairly gave them access to Iran's Sirri A and Sirri E oil and gas fields. The bribery gave them a competitive advantage, earning them an estimated $150 million in profits. The Securities Exchange Commission and the Department of Justice settled the charges, expecting Total to pay $398 million.
...The only effective deterrent is to fine them above their profit and expenditure...got to really make it hurt their bottom line...looks like this at least was a step in the right direction...
The bribery gave them a competitive advantage, earning them an estimated $150 million in profits. The Securities Exchange Commission and the Department of Justice settled the charges, expecting Total to pay $398 million.