Galloway given 18m barrels of oil from Saddam, claims independent US report

An independent investigation by the former US Federal Reserve chairman Paul Volcker has charged that the MP received an allocation of 18 million barrels of oil from the regime. It also claims that $120,000 (£67,000) in revenues from oil sales was paid into the bank account of Mr Galloway's estranged wife.

The money allegedly paid to Amineh Abu Zayyad is a separate sum from the $150,000 that another investigation, by the US Senate, claimed she had received from oil sales.

As Mr Volcker's report was published in New York yesterday, the former government minister Denis MacShane demanded a joint committee of the House of Commons and US Congress should inquire into the "serious allegations" against Mr Galloway.

Mr MacShane, who compared the Respect Party MP for Bethnal Green and Bow to wartime traitor and Nazi propagandist Lord Haw-Haw, maintained that the reputation of the British parliament was at risk if it failed to carry out the investigation.

Mr Volcker refused to comment on whether the alleged transactions detailed in his report could be the basis for legal or disciplinary action against Mr Galloway.

However, he appeared to suggest that his investigation has more material regarding Mr Galloway which has not been published. "If the legal authorities in Britain want to discuss with us what other evidence we may have, that may not be in the report, then we would be prepared to co-operate", said Mr Volcker.

The 500-page document, the final in a series of damning reports by Mr Volcker into the oil-for-food programme for Iraq while it was under UN sanctions, devotes nine pages to Mr Galloway and his links with Iraq.

It states that payments of $445,000 were channelled through the "Mariam Appeal", which Mr Galloway had set up for Iraqi leukaemia victims, and which also became a platform for a campaign against sanctions.

The payments were made by Fawaz Zureikat, a wealthy Jordanian businessman who is named as being a key player in negotiating Iraqi oil allocations for Mr Galloway.

The report claims: " ... a total of over 18 million barrels of oil were allocated either directly in the name of George Galloway, a member of British Parliament, or in the name of one of his associates, Fawaz Abdullah Zureikat, to support Mr Galloway's campaign against sanctions ... Mr Zureikat received commissions for handling the sale of approximately 11 million barrels that were allocated in Mr Galloway's name." The report also claims an Iraqi-born British businessman, Burhan al-Chalabi, deposited "a portion of the profits from this allocation into an account of Mr Galloway's wife, Amineh Naji Daoud Abu Zayyad, who was also involved with the Mariam Appeal." Added to the claims made by the US Senate inquiry, this means that $270,000 of oil-related money had allegedly ended up in Dr Abu Zayyad's account.

Augusto Giangrandi, a trader in oil, claimed to Mr Volcker's investigators that he had held informal meetings with Mr Galloway in Baghdad, during which the MP had "asked him to explain how the oil allocation process worked financially and how commissions were negotiated".

Mr Giangrandi said that an Iraqi agent in his employ had told him that "oil had been given to 'Abu Mariam' [as Mr Galloway was known] and Fawaz Zureikat was acting as his representative". The report further holds that: "Iraq officials identified Mr Zureikat as acting on Mr Galloway's behalf to conduct the oil transactions in Baghdad."

However, Mr Volcker has not produced any evidence that any money was paid directly into accounts held by Mr Galloway. The report also acknowledges that "both Mr Galloway and Mr Zureikat have denied that Mr Galloway was involved in obtaining the oil allocations or receiving any proceeds from the oil sales".

Mr Galloway accused the report of being "untrue, unjust, misleading and based on the same falsehood that has been levelled against me by the same sources over the past two and a half years".

Mr Galloway said last night: "How many times must I repeat this; I've never had a penny through oil deals and no one has produced a shred of evidence that I have.

"I have never asked anyone to act for me, as Fawaz Zureikat, who is alleged to be my intermediary, has said repeatedly. This is all a tissue of lies and a lie doesn't become a truth through repetition."

In a letter to the investigation, Mr Galloway said: " I had nothing to do with any oil deals done by Mr Fawaz Zureikat or anyone else. He and any other company involved were trading on their own behalf and not on mine. It follows I have no responsibility for any of these transactions."

Turning to the claims against "my soon to be ex-wife Dr Amineh Abu-Zayyad", Mr Galloway said: "I cannot speak on her behalf - the divorce proceedings are under way and she is now undergoing treatment for cancer - but I have ascertained that you have at no time made any attempt to contact her, to ask her a single question about the allegations ...

"I should inform you that Dr Abu-Zayyad says she has never received $120,000 from Dr Burhan Chalabi or anyone else."