Iraq Reportedly Hid Billions in Foreign Banks

March 23, 1991|From Associated Press

NEW YORK — Iraq hid $3 billion to $5 billion in foreign bank accounts that have not been frozen by the United States and its allies, a newspaper reported Friday.

Some of the funds were moved into bank accounts with indirect links to Iraq just before Iraq invaded Kuwait on Aug. 2 and later after Iraq's official accounts were frozen, the Wall Street Journal said, quoting an unidentified source.

The source also said Iraq holds more than $1 billion in stock in numerous European companies.

Kroll Associates, a New York investigative firm that has tracked down assets of fallen dictators, including the late Ferdinand E. Marcos of the Philippines, is investigating Iraq's finances for the Kuwaiti government.

Kroll would not comment on the report Friday but may comment Monday, said company spokeswoman Betsy Blumenthal. A U.S. Treasury spokesman declined to comment on the reports.

The Journal's source said Kroll investigators found evidence linking Iraqi funds to secret accounts in at least three major European banks in Switzerland and Britain, and a leading Arab-European bank.

The source said the money was accumulated over 10 years and most was skimmed from deliberately inflated purchase prices for arms and construction equipment.

The stock holdings represented more than 2% ownership of the companies, some of which are in the arms business and have U.S. subsidiaries, the source said.

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