The Day Oscar Wyatt Caved
In the right light, the ornery octogenarian oilman’s guilty plea can be seen as a victory: After all, he won’t spend the rest of his natural life in jail. But the fact is, he couldn’t beat the rap—and he knew it.
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Despite Oscar’s devotion, the Iraqis tried again to take advantage of him once the first Oil-for-Food shipments began, in December 1996. They presented him with a contract, all right—but for a measly two million barrels. Livid, he stormed out of the meeting, headed back to the Al Rasheed Hotel, and started packing. “They don’t appreciate all we’ve done for them,” Oscar supposedly growled to Vincent. “Let’s get out of here.” An oil minister tried to calm him by promising more later, but he was in no mood to negotiate. Oscar wanted what he was due on the spot. After much scurrying about, the Iraqis came back with a revised offer: eight million barrels. According to Vincent, Oscar’s response was “This is more like it.”
Oscar sat nearly immobile during Vincent’s testimony, though he grumbled about his former deputy’s account of the rescue. (“You’d think he did it all himself,” he told a reporter.) It seemed—again, not surprisingly—that the two had had a falling out over payment back in 1997. At one point, the Iraqis gave Vincent his own allocation of oil, which he, in turn, offered to sell to Oscar, who came up with a bid of 7 cents a barrel. Vincent had an offer from Chevron at 15 cents, and told Oscar so, adding that a Coastal executive had already okayed a higher price. “I don’t know a thing about it,” Oscar replied, and he then told Vincent to forget the deal completely and not to bother calling him again if he had oil to sell. But like so many others who have been in Oscar’s orbit, Vincent had trouble severing ties to him. After not speaking to him for years, he called Oscar upon hearing he’d had a heart attack.
“My mother’s ninety-four,” Oscar told him. “I’m not going anywhere.”
Along with the poignant story of friendship gone awry, Vincent provided a crash course in oil business morality. When Shargel suggested that an attempted bribe by Vincent of U.N. Secretary-General Boutrous-Ghali, with Tongsun Park acting as intermediary, was illegal, Vincent shrugged and said the transaction would have involved “an Egyptian and a Korean,” as if that explained everything. Situational ethics were also on display when former SOMO official Mubdir Al-Khudhair took the stand. A resolute man with a slight Teutonic accent and the solicitous demeanor of a maître d’ at the best continental restaurant in a small American city in the sixties, he constantly referred to “Ohskar Vyatt,” and you practically expected to hear his heels click to attention each time. If Vincent appeared a little remorseful about goring his old friend, Al-Khudhair seemed almost giddily helpful to the prosecution. In short order he testified that Oscar had (a) set up front companies to purchase Iraqi oil once Saddam started instituting surcharges and (b) haggled over the price of those surcharges. This was in pretty stark contrast to Shargel’s earlier assertions that Oscar bought oil from the Iraqis legally and that he did not own the front companies. The witness also admitted that he once called Oscar “a son of a bitch” and “a weasel.”
Al-Khudhair seemed like a nice-enough guy, but on cross-examination Shargel managed to elicit the admission that the government had paid him $115,000 in relocation fees and moved his wife, son, daughter, and son-in-law to the U.S., all for the privilege of his testimony and access to a diary that contained notes about meetings to set up front companies in Cyprus and about Ohskar Vyatt’s illegal purchases of oil. (You can’t really blame Al-Khudhair for wanting to get the hell out of Baghdad; testifying without moving would have meant certain death for him and, most likely, his family. Then again, there were a few immigrants on the jury who might not have been too happy with the Iraqi’s instant admission into the U.S.)
It wasn’t hard to see how Oscar got himself into trouble with these guys. Al-Khudhair admitted that he was aware that Iraqi oil was sold improperly outside the U.N.’s Memorandum of Understanding, the face-saving Iraqi euphemism for the Oil-for-Food agreement. “But that is not corruption,” he insisted.
“You were transporting Iraqi oil in exchange for cash outside the Memorandum of Understanding?” Shargel asked.
“Yes,” Al-Khudhair answered.
“You were exporting Iraqi oil not approved by the Security Council?” Shargel asked, pressing for clarification.
“What does the word ‘you’ mean?” Al-Khudhair responded, taking a cue from Bill Clinton.
Still, Al-Khudhair did considerable damage to the defense, especially when he was asked about a particular meeting with Oscar. He blanched before responding, casting a nervous glance at the jury, and then said, “Maybe there’s some sensitivity here.”
When the judge told him to go on, Al-Khudhair anxiously eyed the jury again and said that Oscar had once asked another Iraqi oil official whether Al-Khudhair was part Irish. When he told Oscar that he was, in fact, part Austrian, Oscar supposedly said, “No, you don’t look like a Jew to me.”
“That surprised me,” Al-Khudhair told the court, before Shargel could cut him off.
As September droned on, the sky above Manhattan was crystal clear and the cool breeze was glorious, but inside the courtroom, Oscar slumped lower and lower in his chair behind the defense table. The accretion of information presented by the prosecution was pretty grim. There was a paralegal who displayed a list of purported surcharges that had been paid by Oscar through companies he claimed were not his but certainly appeared to be. There were audio recordings of phone conversations in which Oscar seemed to be calling the shots of those companies in an attempt to purchase oil from Iraq. There were e-mails and faxes to various Iraqi ministers and officials from Oscar that alluded to expediting payments of some sort or another. On one call that appeared in the filings but was never presented to the jury, Oscar demanded reimbursement for a surcharge from El Paso, the company that bought Coastal, because money “I’ve already paid to the bastards . . . came out of my hip pocket.” In another conversation, Oscar could be heard cackling for perhaps fifteen seconds. The jury laughed too. You could see they had joined him in Oscar World, bought into his duality, just like so many folks back home. They liked him—but that didn’t necessarily mean they were going to let him off.
Still, it may have been the prosecution that blinked first. The makeup of the jury had to have worried them all along, and then Shargel demolished a witness named Yacoub Y. Yacoub, another oil bureaucrat, who had been a finance official at SOMO. On direct questioning, Yacoub, through an interpreter, had professed to have prepared for Coastal a list of outstanding surcharges totaling $200,000. He had also stated that Oscar had paid another $7 million through multiple transactions via various front companies. But after holding himself out as an authority on the payments—no less than the creator of the Iraqi surcharge database—and going through a mind-numbing accounting lesson, Yacoub crumpled when Shargel started pressing him on the fine points. “I really do not remember. I really do not remember details,” he confessed (again, through his translator), his razor-sharp memory suddenly dulled by Shargel’s unrelenting disdain. “There are people who can remember everything they said, but there are other people who forget,” he whined.
That was on a Thursday, with no proceedings on Friday and the prosecution promising to wrap things up the following Tuesday. Shargel, to the disappointment of everyone who hoped Oscar would take the stand, announced casually that he planned to call no witnesses, which meant things were drawing to a close. His blistering cross-examinations would stand as Oscar’s defense. (“Who did we have to call but old Wyatt?” Carl Parker asked me. “He’s like a ninety-year-old accused of rape who’s so proud of it he wants to testify.”)
It may not have seemed like the perfect moment to strike a bargain, but over the weekend, an old deal floated by the prosecution surfaced again: somewhere between 18 and 24 months in prison and an $11 million forfeit, in exchange for a confession of one count of conspiracy to commit wire fraud. The truth was that both sides must have feared a hung jury, which would have meant millions more spent on a retrial with the outcome still in doubt. On Monday, October 1, reporters alerted by e-mail to a special 9:30 a.m. “proceeding of interest” found Oscar’s defense team a study in dejection. Shargel, in particular, had wanted to keep fighting, though he supported Oscar’s decision to plead. “Cases settle when you no longer want to assume the risk,” he told me, adding, “I didn’t originate the idea. I’m disappointed it didn’t go to verdict.”
Instead, Oscar stood before Judge Chin and cut his last deal—of this trial, at least. Chin began by leading him through a series of questions about his mental competency to make his plea. Then the judge said, “Mr. Wyatt, tell me what you did.”
Oscar spoke mechanically, as if it took all his will to answer: “On or about December of 2001, I agreed with others to cause a surcharge payment of 220,000 euros . . . to be deposited in a bank account controlled by Iraqi SOMO officials at the Jordanian National Bank. I caused facsimile transmissions and telephone calls to advise others to make this payment. This payment was in violation of the United Nations Oil-for-Food Program, because the program required that all payments be made directly to the United States escrow account in New York, and no money was to be paid directly to the Iraqi government.”
“Are you pleading guilty because you are guilty?” the judge asked.
“Yes, sir,” Oscar answered, though, not surprisingly, his voice lacked a certain conviction.
Sentencing was set for November 27; Oscar is to turn himself in to the authorities on January 2, 2008. His defense team believes he’ll serve at least six months in prison.
Polling the jury, both lawyers and reporters found that their instincts about a hung jury had been correct. Most jurors leaned toward a guilty verdict, but at least two told the Chronicle they would have let Oscar go. “I like you and I like Mrs. Wyatt,” one of them told Oscar as he was exiting the courthouse.
Oscar downplayed his plea, using a line similar to one he’d used to explain away other jams: “I didn’t want to waste any more time, at eighty-three years old, fooling with this operation,” he told the press. “The quicker I get it over with the better.” The next day, he was back at work at his desk in Houston, in an office in a high-rise where the air conditioner cooled like an arctic blast and the cars, trucks, and SUVs on the adjacent freeway burned up gas like there was no tomorrow. For an old Texas oilman, it was the only place to be.
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