Va. firm pleads guilty in oil-for-food scandal

updated 12:57 p.m. ET Oct. 20, 2005

NEW YORK - A Virginia oil trading company has pleaded guilty to grand larceny in the United Nations oil-for-food scandal, prosecutors said Thursday.

Midway Trading of Reston, Va., was accused of being part of a scheme to pay kickbacks to Iraq in connection with oil purchases made under the program, Manhattan District Attorney Robert Morgenthau said.

The company will pay a $250,000 fine for its guilty plea to first-degree grand larceny, Morgenthau said.

Midway and a trading partner, Bulf Oil, of Romania are accused of paying more than $440,000 in kickbacks to Iraqi officials in connection with oil purchases, but falsely telling the U.N. that no kickbacks were paid.

Mike Holtzman, spokesman for the U.N.-backed Independent Inquiry Committee, which has been investigating oil-for-food, would not say whether it had worked with Morgenthau on the case, but said that the committee and the district attorney have cooperated in the past.

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