Captain Moonlight's Notebook: Writs fly as Iraq oil firm fends off media

HAMID JAFAR is an Iraqi businessman who lives occasionally in a flat just off Sloane Square and owns the world's biggest private oil company, Crescent Petroleum. His brother, Jafar Jafar, is the chief scientist in charge of the Iraqi nuclear programme. He is not only Vice-chairman of the Iraqi Atomic Energy Commission - the chairman is a political hack - but is also deputy minister of Industry and Military Manufacture with special responsibility for the rehabilitation of the country's electricity sector.

For some time now, Crescent Petroleum has been the subject of an investigation by the US Treasury and three Congressional committees - Foreign Relations, Banking, and Ways and Means - which are trying to discover whether there is any truth in suggestions that Crescent is a front company acting for Saddam Hussein. In December Richard Newcomb, Director of the Office of Foreign Asset Control at the US Treasury, wrote to Senator Jesse Helms confirming that an investigation had been opened into 'possible Iraqi ownership or control of Crescent for, or on behalf of, the Iraqi government'. He added: 'it would be premature for us to engage in speculation about the exact nature of Crescent's activities'.

Mr Jafar doesn't like what the Americans are doing and has got into the habit of bringing in the lawyers of Clifford Chance to fend off unwelcome publicity. Clifford Chance have written fierce letters to the Guardian, the Observer and the Calgary Herald, and even sprinkled around a few writs. Last September, the Observer's editor, Donald Trelford, wrote a fulsome apology to Mr Jafar and, on his insistence, paid pounds 5,000 into the Fund for Refugees in Slovenia, a charity recently set up by Lady Nott, wife of the former defence secretary, Sir John Nott.

The only time Mr Jafar took one of these libel suits to the High Court, he lost. He said an article by a freelance journalist, Alan George, implied Crescent Petroleum was in some way owned or controlled by Saddam Hussein's government. Mr Justice Drake disagreed and threw the case out on 25 February on the grounds, he said, that only somebody 'avid for scandal' would find hidden meaning in the piece. He ordered Mr Jafar to pay costs. Mr Jafar's lawyers are taking their client's setback in their stride. Michael Smyth, a partner of Clifford Chance, told a colleague: 'One doesn't want to appear threatening, but I should point out that we are making a lot of money issuing writs on Mr Jafar's behalf.'

None of this has stopped the investigation into Crescent being the talk of the oil industry. Perhaps this is why Mr Jafar last week felt it necessary to add to his circle of retainers by employing John Birt's public relations adviser, Sir Tim Bell, to put the record straight.

In the first statement from Sir Tim's firm, Lowe Bell Consultants, on Tuesday, we were told that Crescent Petroleum was a victim of a campaign of smear and innuendo. (Sounds rather like John Birt's fate according to the Tim Bell rubric). A catalogue of allegations - that it is an agent of the Iraqi government; that it is owned by the Iraqi government; that it is controlled by the Iraqi government; that it does business with Iraq; that it has been involved in arms procurement; that it has tried to bust its way through UN sanctions - were each denied with a four- word sentence: 'This is not true'.