The Misleaders: Corrupt, Filthy Rich, and Proud of it

Sheri Laizer | Exclusive to iKurd.net

One week before the Presidential elections on 12 May, corruption remains the face of power in Iraq.

Protests put down by force last month highlighted the deep socio-economic divide in the Kurdish region. Austerity measures are passed on to the professional work force while the ruling KDP and PUK families and their sidekicks continue to rob the nation.

Corruption is the face of power and therefore of success. “If you aren’t corrupt, no one respects you”, a local businessman explained. “The sons of the trillionaires have to drive Ferraris while their wives spend their time between the beauty parlour and shopping excursions. When a deal is done, the son in the next room will ask papa afterwards, how much did he have to pay you in the black? Can I have $300,00?”

The ‘salary-saving’ system imposing a 60% reduction that has been implemented over the past two years affecting teachers, doctors, the peshmerga and other key members of the work force does not extend to the corrupt trillionaires still skimming the profits of the oil trade whilst declaring a false barrel sales figure. Construction is dead. Miles of unfinished buildings blot the cityscape of the capital, Erbil.

Liquid Gold

According to reliable sources, KRG sells all oil at a discounted figure per barrel and the discount goes directly into the pockets of the ruling families as well as Turkish dictator, President Recep Tayyip Erdogan 1 and others.

“The so-called discount is a lie. It is what they apply in falsified accounts – the real take-home pay for the KDP, PUK, All Parliamentary Group profiteers in the UK and other top players in the KRG is close to $5 million a day on top of the above.

“These criminals between them split the oil proceeds of the 60,000 bpd that goes to the Dukan refinery.

It is generally assumed that the oil moves via Croatia, but it is actually being transported via Trieste in Italy, near Croatia. It is then routed via pipelines to Bavaria via Vitol, Carlyle, Glencore, Rosneft, and via Bazan’s offshore refinery through the likes of multi-millionaire Kurdish MP, Nadhim Zahawi and his UAE, UK, and KRG partners.” 

The misleaders at the top of the KDP and PUK have become the most powerful players in the Kurdish region. As they now own almost everything they also exploit their military and economic power to be able to continue their course without restraint until that day when revolution shall come.

Instead of re-election the ‘kings’ of the KDP and PUK merit prosecution for theft, fraud, and seizure of the property of others. The true extent of their criminal activity is startling: enormous land holdings with palaces in Kurdistan and property abroad.

The Barzani family own most of Erbil. For example, Sirwan Barzani is the lord of Kurdistan Tower, mall, hotel and business centre as well as Korek, the only mobile company in Erbil.

The oil ministry that was once based in the Kurdistan Parliament now sits imposingly on the new road Gulan conveniently located by Kurdistan Bank (CEO Nechirvan Barzani) and RT Bank (Regional Trade Bank) of which the major share holder is also Nechirvan Barzani, the bank owned by his aunt’s husband, Salar Hakim.

When James Jeffrey 2, Ali Khedery 3 and their cohorts moved Exxon Mobil into Kurdistan in July 2011, with the assistance of Barham Salih, Impulse Energy’s job was done. They then dropped off the PSC oil contract and Hunt Oil passed parts of that three block PSC to Exxon/TEC i.e. Turkey Energy Company. The parts passed were Jebel Khand, Al Qosh and Maglub, which contained part of Barda Rash which Komet SA had drilled.

Kurdistan’s PM, Nechirvan Barzani owns Salahaddin Holding and has links with the Ster group said to be owned by Marcel Daoud of Daoud4 partners, that was set up to go into Kurdistan as a front company to help Hunt Oil obtain an oil contract covering three blocks. Daoud Partners’ own set up was used as Impulse Energy; its name went on the PSC contract along with Hunt Oil , but came off in July 2011 after three of the PSC’s had exploration done on them by a company known as Komet SA, whom Exxon were paying to do the work.

Ster (Star) Group also has control of the franchises for Pepsi and Coca Cola. Nechirvan Barzani additionally owns the Divan Five Star Hotel and his private property in the centre of Erbil has its own private underpass and takes up a fifth of the inner city over some 50 hectares. The ‘palace’ is entirely walled off from view. The palace and compound were formerly occupied by Izzat Ibrahim al-Douri when he was governor of Kurdistan under Saddam Hussein. It was then seized during the Kurdish uprising by the Kurdish rebel forces and changed hands several times before becoming the private property of Nechirvan Barzani. It is not the residence of the Prime Minister as with No. 10 Downing Street – it is Barzani’s personal property.

Who owns what? Who owns all?

When in post as PM, Barham Salih was also provided with a luxury residence, which he has been privileged to keep. It is rumoured to be valued at more than $10 million. Barham was intimate with the CIA and worked closely with Zalmay Khalilzad. His reported wealth last time we checked was around $3.2 billion. Barham got approximately $ 1 billion when he agreed with Nechirvan and Hawrami with Erdogan to have pipeline built to Turkey. Barham’s greatest accomplishment is the American University at Sulaimani, that made him some $600,000 when built. Now he is running as head of a new party called the Coalition of Democracy and Justice (CJD), pledging to fight corruption. Most locals laugh: they don’t see change coming anytime soon and they don’t believe their vote will change a thing – it’s too late – corruption is essential to continuity. “Mistaken policies, misreading local and foreign realities, failure to care for the public interest, and holding hands “with the enemies of the nation,” brought Kurdistan to “an unwanted condition,” he explained to KDP’s media organ, Rudaw, introducing his party as a new political, democratic organization…”5  

UK and USA dirty business in Kurdistan and Iraq

When Iraq was invaded it drove up oil prices up without even getting to the oil in Iraq. (The same happened again when the US, France, and American forces USA bombed Syria over the last two years). 

“Ashti Hawrami, the UK’s man is wrapped in the Union Jack. He is protected better than any UK PM or former PM and has done the UK’s dirty work for decades. He is a personal friend of the Thatcher family, as well as of former British PMs, John Major, once of the Carlyle Group, Tony Blair, David Cameron and Theresa May and her husband, Philip May who influences the Capital Group. Capital has been active in Kurdistan since 2006.

A personal friend of the Thatcher Family, and of other former British PMs, John Major, (once of the Carlyle Group), and Tony Blair, Ashti Hawrami, planned with Blair and Bush to take disputed Iraqi territory and place it under the control of the KDP and PUK leaders, Masoud Barzani, and Jalal Talabani. This was not planned for the benefit of the Kurdish people but rather for those involved.

From 2003 onwards Arab-American tycoon, Jamal Daniel, and CIA-linked, David Manners, played a pivotal role in Iraq’s financial affairs through the Levant Foundation.

The ‘Decapolis’ company (Decapolis is another name for the ‘Levant’) links Manners to Jamal Daniel when the latter was acting for New Bridge strategies and Crest Investments, as well as another of his forays – Al Monitor news media. (Al Monitor’s editor, interestingly enough, is Barbara Slavin of the Atlantic Council.) Many key players in Kurdish oil feature in the Atlantic Council’s programmes and annual summits.6

Bottomless pockets

Aza Doğramacı 7, a close aide to the Talabani family, owns Federal Petroleum. Among the biggest of the criminals in the PUK area, he receives 10% of the oil profits. The PUK/Talabani and KDP/Barzani family get 50%. Bafel Talabani and Ashti Hawrami get 30% and a well-known UK MP of Kurdish origin, Nadhim Zahawi, receives 10% through a Dubai company.

Hewa Karamani, a frontman for Bafel Talabani, was “owner” of Tigris Energy that owns the Dukan Refinery where all the oil comes from. WZR (now Crest Investments owned by Jamal Daniel) comes from there. Plus a share from Gazprom who also operate with Crest Investments in some of the oil contracts. Jamal Daniel also has a share in Khalakan PSC, as mentioned above. Other oil comes from Kor Mor and goes to Dukan. 8 The piped oil goes to Italy where the buyers are Vitol, Rosneft, etc. with part of the piped oil being sold to Israel. Neither Israel’s Netanyahu or Turkey’s Erdogan has any problem with taking oil for profit that suits both their families whatever their public political differences are. That line provides back up for the Italian pipeline. The KRG also sends oil to Sardinia that goes to Rosneft’s refinery on Sardinia.9

Another of Bafel Talabani’s lynchpins, who fronted deals, is Ahmed Sarchil Qazzaz.10 11

International legal proceedings apace

The FDI account in the UN used to send the Iraq Ministry of Finance the proceeds of oil sales from Iraq minus the 6% due to Kuwait and that money went into the budget.

In 2011, the KRG stopped sending the 110, 000 bopd via the NOC under the Iraqi Government pipeline and trucked it to Turkey with the other 40,000 bopd they were already trucking. Iraq objected and warned the KRG they would be subjected to removal of their share of the budget if they continued to send oil to Turkey.

In 2012, the KDP peshmerga destroyed the NOC Kirkuk pipeline that was sending the oil from Kirkuk to Turkey, and then started their own pipeline that they had been working on since July 2011.

The UN warned the KRG and Turkey that they could not use the new KRG pipeline to transit Iraq’s oil to Turkey and both would be liable to repay Iraq the proceeds of the oil sold, with the Turks bearing the biggest responsibility for the 6% repatriation money to Kuwait. The KRG were summoned by the UN to Baghdad over the 6% to Kuwait and asked where the missing money from the oil and the 6% had gone. The KRG KDP MNR refused on three occassions to attend the Supreme Court in Iraq, and when the KRG tried to sell oil on to an American company, it resulted in the oil tanker running away as the US had said it would impound the oil and the KRG KDP MNR would have to attend the Iraqi Supreme Court. The US judiciary backed Iraq 100% on the KRG KDP MNR selling illegally acquired – i.e. stolen Iraq oil.

The full legal ramifications are clear that anyone (i.e. KRG) violating that IPT under international law becomes a guilty party as well as those with whom they transit the oil to Turkey.

Iraq listed the IPT violation in the Paris Court of Arbitration in July 2014, after the KRG failed to attend the Iraq Supreme Court three times.

The cost of the oil sent through the pipeline since 2013 has cost Iraq $52 billion, but it also means that the KRG and Turkey are solely responsible for paying 6% of that to Kuwait. The UN motion passed on the violation of the IPT was held against Turkey and the KRG. It named Halkbank as well as Botas and the KRG MNR. 

Basically, Rosneft has bought 60% of the KRG pipeline they built with money from XOM, Turkey and the ICG budget. It means Rosneft own a part of a KRG oil pipeline, but does not have any rights or legal standing to transit the oil or receive fees for doing so – only the Iraq Oil Ministry can transit oil through Iraq’s central government as the legal IPT is held by Iraq’s Oil Ministry’s Northern Oil Company. The KRG pipeline transiting oil out of Iraq is still illegal and has been ruled on, so what in reality has Rosneft brought? 12 

For any oil to leave Iraq legally by the KRG-Turkey pipeline it would require Baghdad to set up a new IPT with Turkey; it would need the KRG and Turkey to pay 6% of the $52 billion owed to the FDI at the UN and that to be paid on to Kuwait. At the present time Kuwait holds the full legal rights to seize any oil from Turkey/Kurdistan and take it as payment. It can also seize anything else from Turkey and Kurdistan.

Where Iraq has full international legal standing on the transit of oil through its NOC pipeline owned by the central government is by the fact that Iraq and Turkey signed a new IPT agreement in early 2011 valid for 15 years. This was not an extension to existing IPT contracts between sovereign nations that had been in place between Turkey and Iraq since 1946.

Impoverished Peshmerga betrayed

Despite the eye-watering plunder, in February 2018, the US again agreed to pay $360 million for the present year for the peshmerga’s salaries to be paid in monthly instalments to the KRG. The peshmerga are not receiving their salaries.

While talk abounds, joint action is limited, including over the issue of re-deploying the Peshmerga forces to disputed areas, allowing ISIS to regroup in the interim. Rudaw reported the stalemate to be ongoing as of 5 April, Jabar Yawar, the secretary-general of the Peshmerga ministry told reporters” “So far there has been no official meeting between KRG’s Ministry of Peshmerga and Iraq’s Ministry of Defense or between the regional government and the Iraqi federal government on how to deploy the Peshmerga forces alongside the Iraqi federal forces in the disputed territories…”13 No love is lost between the Kurds and the PMU. In the Kirkuk take-over of 16 October last, some 240 PMU militia members and 67 peshmerga lost their lives. The PMU used US Abrams tanks against the Kurds to the consternation of the Americans that provided the equipment for deployment in the war against IS, not internal dispute.

Thousands of families from Kirkuk that are historically connected with the KDP remain displaced, including in abandoned construction sites like Deshte Beheshte (Field of Paradise) in the new suburb of Kesnazan.

Among the Kirkuki IDPs are former peshmerga General Tariq Mouloud Salahi and his family. Tariq has seen it all – 35 years displaced from home under Saddam and since 16 October 2017, forced to abandon everything anew and flee with his adult peshmerga son and family – Turkmen have seized their home. Now they find themselves in yet another of the hundreds of abandoned construction sites – Deshte Beheshte begun by Turk Kurd singer, Ibrahim Tatlises and partners who left before completing the project they began in 2009 – now an unfinished ghost town. “You are the first to have come here to ask about us here” he complained.

Ghost construction sites

Since Baghdad cut the payments to the KRG in 2014, huge construction sites across the Kurdish capital comprising hectares of land allocated to projects for new model villages, high rise apartment complexes, shops and Malls, stand half finished or barely begun. Private buyers that invested in these projects must now go to court to obtain access to the property they purchased as a finished project. They then have to try to finance and finish building it themselves. Going to court will cost money and can take years.

The new Kurdish security (Asayish) complex – High-cost intimdation completed project

In staggering contrast, the new General Directorate of Security headquarters 14 incorporating the Asayish Security Council and Intelligence Agency (Parastin) is a 60 m2 construction site on the Kirkuk road in front of Naza Mall and near 92 Apartments, costing some $88.6 million.15 Turkish Kürk Construction (Kürk İnşaati Irak (Erbil) established in Mersin in 1981, with offices registered in Mersin and Erbil, is the construction company.16 17

The on-site short term jail – or detention facility – processes political and other detainees, such as foreigners recruited to fight for the YPG and ISIS prisoners.18 If charged they are moved on to the outer Erbil prison facility near the bland new Kasnazan neighbourhood where in 2014 an arms market thrived from the sale of private weapons for protection in case ISIS rolled in.19

Whilst the complex is vast and the interiors luxurious, according to visiting officials, the detainees are kept in a very confined space on the excuse that it is a short-term detention facility.

The grey complex sends an intimidating message about who is firmly in control. Dominating the landscape, partially blocked from street view by bomb blast walls, its logo is a watching eye, repdroduced at regular intervals.

Another cost of war: the misery of 1.5 million refugees and IDPs in KRI

Not all IDPs and refugees are registered: if they don’t require support and shelter they can merge with friends and families in cramped conditions.

For the others, conditions remain rudimentary to say the least. Vast camps sprawl across open barren tracts of stony land, rough structures and basic tents as far as the eye can see as with Khazir M1 camp on the Mosul road, home to some 9000 IDPs and the three Debaga camps on the Dibis-Kirkuk road with similar capacity. There are ten camps in Erbil alone host to 40, 535 individuals and all remain open. 20

IDP numbers went up overall after the 16 October 2017 government claw-back of the KRG’s territory liberated from IS and forcible take-over of Kirkuk.

The Shi’a militia (PMU) used prohibited US Abrams tanks and expended millions of bullets to gain the military advantage overt the shocked peshmerga forces. It is illegal to use such weapons against your own people. Peshmerga described the sky being red with the ammunition fired by the PMU against them. Now there is a tense standoff at the Kirkuk checkpoints from the KDP dominated area.

The PUK faces no such problems coming directly from Sulaimani. From Erbil, detours taking time on poorly maintainted roads send out a strong message about Abadi’s punishment for the referendum. Under Iraqi law, the referendum was not illegal.

Same old faces – elections 2018

Iraq’s streets, public spaces, traffic lights, are hung with the posters and flags of the competing parties and candidates ranked in order of importance, hundreds only standing to reap neighbourhood votes that will contribute to the central pot of the party.

There are no campaign pictures of al-Maliki in the KRG where he is despised for having wrought massive destruction to Iraq.

Iraq-wide corruption

The Kurdish misleaders are not alone in boastful corruption. $360 billion went missing from state funds under Maliki’s eight-year tenure according to a spokesman for the Iraqi Commission of Integrity.21 The missing oil money was a result of the KRG’s actions with factions in Iraq such as Ayad Allawi and the Nujafi brothers, who worked with Mehdi Varsi, chief advisor to UNAOIL, currently under investigation by the UK Serious Fraud Office (SFO).

From 2003 to June 2005, 1 trillion dollars’ worth of oil was stolen under Paul Bremer and the CPA. Some $400 billion of Iraq’s gold reserves also vanished with Peter Galbraith22 (American advisor to the Kurds), the late Ahmad Chalabi, and Ayad Allawi all reputedly playing prominent parts.

During the first part of June 2005 some 50 billion dollars of Iraqi oil money vanished when it was loaded onto a US transporter plane. Iraq never saw it. Part of it was under the UN from the DFI account in New York City.

The USA has refused to repay what was handed to US interests in Iraq with between $2.5 – 5 billion flown by helicopters to Erbil on June 16th 2005 and split between the KDP and PUK.

As court cases progress against UK forces who tortured and abused Iraqi civilians, some evidence has arisen indicating where part of the missing money went to under the CPA. Unless the US repays the money to Iraq, criminal proceedings are to be expected against American, British and UAE companies and individuals.

As for al-Abadi, the Kurds consider him too weak to be able to reel in the PMU and hold Iraq together. Not hated like al-Maliki, he is not seen as a doorway to future stability.

One commentator observed: “Abadi was never elected as PM: he was placed in that position by the UK and when all is said and done, he is a mere lift operator – an engineer: Can you imagine having a lift operator taking control of Iraq? Well that is where the UK put him and that will be hard to change. “

On the Kurdish street, little confidence is expressed in the same old faces. A hung parliament is expected with the Hashd al-Shaaabi candidates who stepped down from their militia command potentially able to secure enough seats to legally impose Tehran’s presence.

Hezbollah is already ahead in Lebanon’s polls from this week’s vote: a knock-on effect?

Related posts:

Why corrupt Kurdish politicians don’t land in jail in Iraqi Kurdistan Why did the US denied the Iraqi Kurdistan govt’s request of $2 billion assistance? Can Barham Salih succeed in repatriating Iraqi Kurdistan’s embezzled money? Dana Gas lawsuit against the Kurdistan Regional Government has come to a halt It is time I give up and no need to bring a lawsuit against me! Barzani and Talabani families are above law in Kurdistan of Iraq Iraq – The Cynical Swindle KDP and PUK politicians are corrupt and dishonest in Iraqi Kurdistan