Oil for Food comes to Reston

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The U.N. oil-for-food program's many threads continue to unravel, and the latest leads to the Washington area. Yesterday, New York prosecutors announced that Reston-based Midway Trading, an oil-trading company, told the New York State Supreme Court that it gave $440,000 to the Saddam Hussein's regime in connection with the U.N. oil-for-food program.

The company has already pled guilty to first-degree grand larceny, prosecutors said. Now it emerges that the company paid the money in connection to $42 million worth of Iraqi crude it won rights to purchase from a Romanian company called Bulf Oil in late 2000 under the U.N. oil-for-food program and then falsely told the UN it paid no kickbacks. No doubt the money went straight to a Saddam relative or member of the inner circle. The number of American firms that did the same is unknown; next week's Volcker Committee report on private companies in the oil-for-food scandal will reveal at least some of them.

What kind of company brings oil-for-food a few miles from Washington? So far, the only answer is a shadowy one. There is no directory listing for a Midway Trading in the Reston area and in the past ten years there is no mention of the company in any major Virginia or Washington newspaper. Yesterday we called the only listed company in Reston called "Midway" for comment -- Midway Oil Holdings, Inc., an offshore holding company with offices in Switzerland and Greece -- but the calls went unanswered, as did an email.

All of this confirms that the reach of the oil-for-food scandal is long, uncertain and shadowy. Mike Holtzman, spokesman for the Volcker Commission, would not comment yesterday, but Manhattan District Attorney Robert Morgenthau got to the point. "The oil-for-food program was set up as a way for the Iraqi people to receive humanitarian goods and not to line the pockets of the ruling party," he said. Midway will now have to pay $250,000 in fines for its offense. That is a tiny amount considering the suffering and tyranny it helped perpetuate.