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Angry U.S. wants envoys' answers
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FACT BOX. The Howard government set up what is known as the Cole inquiry in November 2005 to investigate possible breaches of Australian law, in response to the findings of the Volcker report on the U.N. oil-for-food program.
. The inquiry is headed by Terence Cole, a former Judge of Appeal of the New South Wales Supreme Court. . The three companies under investigation are Australia's monopoly wheat exporter AWB; Kingaroy company Alkaloids of Australia; and Melbourne manufacturer Rhine Ruhr.. The AWB was controlled by the Australian government up until its privatization and listing on the stock exchange in July 1999.. The Cole inquiry is looking into the alleged payment by AWB of about $220 million in kickbacks to Saddam's regime, at a time strict U.N. sanctions were in place, to secure about $1.725 billion in wheat contracts. The contracts were paid under the humanitarian oil-for-food program.. Evidence put to the inquiry suggests some AWB executives knew payments would breach U.N. sanctions.. AWB shares have fallen more than 20 percent since the inquiry began.Sources: Cole Inquiry; ASXYOUR E-MAIL ALERTSCANBERRA, Australia -- A key U.S. senator has called for Australia's current and past envoys to Washington to answer questions over the Australian government's role in the Iraqi wheat bribery scandal. Republican senator Norm Coleman, chairman of the U.S. Senate inquiry into illegal payments to former Iraqi dictator Saddam Hussein's regime, has criticized former Australian ambassador Michael Thawley over his 2004 lobbying for the Australian Wheat Board. Coleman has called on Thawley to face fresh questioning over the issue. Thawley, who has completed his five and a half year posting as Australia's ambassador in Washington, is now a private citizen in the United States working for investment management company Capital Group as senior vice president. Senator Coleman has also written to the new Australian ambassador, Dennis Richardson, saying he is "deeply troubled" by Thawley's denials of corruption, media reports said Wednesday, citing a copy of the letter. "I am particularly disturbed by the fact that evidence suggests that despite Ambassador Thawley's representations to me, officials in the [Australia's] Ministry of Foreign Affairs were aware of and complicit in the payments of the illegal kickbacks," Coleman wrote, according to a copy of the letter published in the Australian newspaper Thursday. The letter accuses AWB officials of lying and breaking U.S. law, and asks that Australian government officials also be investigated. Thawley has declined to respond to Coleman's criticisms. "I'm not making any comment to the media," Thawley told Australian Broadcasting Corporation radio on Thursday. Australia's Treasurer Peter Costello said Thursday that "anyone found to have knowingly paid kickbacks to Saddam Hussein under the corruption-riddled U.N. oil-for-food program could be convicted and sent to jail." "If anybody did (cheat) that program and funded Saddam Hussein, then it's disgraceful," Costello told Australian commercial radio on Thursday. "I would think they would be prosecuted and if they were to be prosecuted they would be subject to conviction and penalty," which could include jail time, Costello said. A U.N. inquiry into the corruption-riddled oil-for-food program found in October last year that AWB had made "side payments" to the Saddam regime in violation of U.N. sanctions. AWB is currently the focus of an Australian government investigation, known as the Cole inquiry, which is examining whether it knowingly paid $221.7 million in bogus fees to the Jordanian trucking firm Alia, which was part-owned by the Iraqi government. The money was then allegedly diverted to the former Iraqi dictator. The independence and credibility of the Cole inquiry is being questioned by groups within the U.S. and political opposition groups in Australia. The U.S. government was asked last month by a group of seven Democratic senators to reinstate its ban on AWB (USA) Ltd, an American subsidiary of AWB. The U.S. Department of Agriculture suspended the company from benefiting from U.S. export subsidies in November because of the kickback allegations but lifted the ban soon after because Australia promised to investigate the allegations. "Given the evidence that some Australian government officials may have agreed to, or had the knowledge in advance of, the illicit payments, is the Cole inquiry sufficiently independent of the current government of Australia to be entrusted to investigate the matter?" an excerpt from the January 30 letter says. Opposition lawmakers have also accused the Australian government of attempting to cover up the alleged kickbacks paid by AWB under the corruption-riddled U.N. oil-for-food program. The opposition Labor Party has accused the government of attempting to stop the U.S. congressional inquiry to cover up the scandal ahead of Australian federal elections on October 9, 2004. Downer said Wednesday the government had no knowledge of any wrongdoing by AWB but was concerned the U.S. Senate would give the exporter a biased hearing designed to advance the interests of AWB's American competitors, the Associated Press reports. "The United States is our principal competitor in the international wheat trade so we were deeply concerned that the Wheat Board would be very unfairly treated by what is, in effect, a commercial competitor," Downer told Australian Broadcasting Corporation radio. Copyright 2006 CNN. All rights reserved.This material may not be published, broadcast, rewritten, or redistributed. Associated Press contributed to this report. 
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