Cole Inquiry (Australian Wheat Board scandal)

Essay by jarrahHigh School, 12th gradeA+, March 2007

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(Note: Any random numbers were originally in superscript and are references to sources mentioned in the bibliography)BackgroundThe UN Oil-For-Food program began operation in early 1998. The purpose of the program was to allow the Iraqi government to purchase food and other necessary resources essential for the population, without allowing the Iraqi government to rebuild its military. Iraq would sell its oil on the global market, but the money received would be put into a specially monitored bank account, used to purchase food. The program ended in 2003 when Coalition forces invaded Iraq.1However, it was discovered in 2005 that the Australian Wheat Board had paid almost $300 million to Alia, a Jordanian trucking company, which passed on most of the money to the Saddam Hussein regime. In return, Iraq purchased their wheat from Australia at a higher price to compensate for the fees. This effectively allowed Iraq to turn the ‘food money’ in the monitored bank account into ‘spending money’ for regime-related purchases that the UN economic sanctions were there to prevent.

The benefit for AWB was that Iraq bought wheat from them and at a higher price.1,2The Cole Inquiry was established in December 2005 to ascertain whether Australian companies (including AWB) were responsible for paying kickbacks to Saddam Hussein. It is generally undisputed that the illegal transaction did occur and AWB were aware of it, however the confusion now is about whether the government knew what was happening and allowed it to happen.3The key innovative aspect of this issue is the conduct of the AWB. Corruption has occurred throughout history, but this particular event shows how sometimes economics and politics have different interests, and it is when these interests are mutually exclusive that we compromise our own values for other benefits. A relatively new concept that the AWB scandal represents...