When a contract had been executed suppliers were paid from the UN escrow account upon presentation of contract and consignment documents to show that the goods had reached Iraq, been inspected by UN appointed agents and cleared into the country by the authorities there.
The illicit payments
In August 2000, the Iraqi government imposed a policy that contract prices be uplifted to allow for a 10% kickback to the regime. Suppliers who accepted this condition were required to submit pro-forma invoices that did not reveal the uplift, or described it as "after sales service fees". Contracts were duly awarded, consignments shipped and documents presented by the supplier to be paid out of the escrow account. The supplier was required to pay the kickback into accounts held by the Iraqi government before the goods were shipped to Iraq.
Mark Jessop accepted contracts on this basis. He admits that nearly €104,649 was illegally transferred to benefit the Iraqi regime, with a further € 235,237 outstanding, unpaid because of military intervention in March 2003. The conduit was an old business contact in Jordan, an Iraqi named Dr Janan Matloob who had contacts with Kimadia and who provided Jessop with information on tenders. The kickbacks were paid to Dr Matloob who then transferred them (after retaining a small fee) to Jessop's account at the Jordan National Bank, Amman ready for on-forwarding to a Kimadia account at an Iraqi bank (Rafidain Bank) in Amman.
Jessop also had contract dealings with Kimadia through a local agent Dr Ishan Ibrahim whose business, Beja Scientific Office, was authorised by Kimadia to represent foreign firms. Jessop paid commission to Ibrahim for his services in the form of cash during his visits to Iraq. These commission payments to Ibrahim, amounting to £40,000, represented cash withdrawn from Jessop's companies' dollar or euro accounts.
Such payments were outside the scope of the contracts and, like the 10% contract value payments into a Kimadia account, were made without approval from HM Treasury, therefore in breach of UN sanctions that prohibited payments to Iraq or persons in Iraq without (in the UK) a Treasury licence.
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