As his larger-than-life persona grew, so did the number of enemies he made, many of them other oilmen whose companies he swallowed in hostile takeovers. His ruthlessness as a businessman took on the sheen of legend. MEANER THAN A JUNKYARD DOG, Texas Monthly magazine once called him. “I’ll tell you what,” says William Greehey, Wyatt’s friend and onetime protégé who has sat across from him at the negotiating table. “The Devil would be afraid of him.”
Unfortunately for Wyatt, federal prosecutors in New York aren’t. In a trial that gets underway this week, Wyatt will defend himself against charges that he padded his fortune in part by cozying up to Saddam Hussein. The Feds allege that between 2000 and 2003, Wyatt and two codefendants paid Saddam millions in illegal kickbacks to win Iraqi oil contracts under the United Nations’ Oil-for-Food Program. The program was intended to use limited sales of embargoed Iraqi oil to feed the country’s suffering people. The revenues went to a bank account monitored by the U.N. so Saddam couldn’t steal the money. But there was a loophole: the U.N. allowed the Iraqi dictator to choose which companies could buy his oil. Over time, Saddam began shaking down the oil companies. To get a contract, he demanded a secret surcharge on every barrel sold. The Feds allege that Wyatt funneled the payments through front companies into bank accounts Saddam controlled in Jordan.
The allegations don’t end there. The indictment further says that Wyatt “lobbied” the oil program’s U.N. overseers to set the price of Iraqi oil low enough that the oil companies Saddam selected could “pay the required surcharge and still retain a profit for themselves.” In court papers, prosecutors say Wyatt also violated the U.S. embargo against Iraq by giving Saddam satellite-communications equipment.
Wyatt maintains his innocence. If he is convicted, he could face as much as 74 years in prison. His lawyer, Gerald Shargel—who is best known for successfully defending mobster John Gotti—has a tough fight ahead. The prosecution may unleash a flood of damaging evidence, including photographs of Wyatt and Saddam together and records of telephone calls in which Wyatt is allegedly heard discussing the kickbacks. They may present notes made by an Iraqi oil official which suggest that during a trip to Iraq shortly before the U.S. invasion, Wyatt told Iraqi officials he was trying to persuade American politicians to speak out against the coming war. Prosecutors say the notes indicate that he allegedly talked to the Iraqis about the possible timing of a U.S. attack. (The Feds don’t allege that Wyatt divulged, or had access to, any inside information beyond what was being reported in the news.) Prosecutors are also expected to call a star witness—an Iraqi-born oil consultant who claims intimate knowledge of Wyatt’s alleged part in the scheme and his dealings with Saddam, including a visit to the presidential palace.
Shargel won’t disclose his defense strategy. He isn’t expected to deny that payments were made. Wyatt has argued that oil-company payments to Saddam were an open secret in the industry and that hundreds of other companies also paid them. Instead, his defense team may try to make a novel argument: that Wyatt’s dealings with Baghdad were part of an effort to avert a war with Iraq, and that now he is the target of a political vendetta by the Bush White House. Wyatt, this line of argument goes, was acting as an unofficial emissary to Iraq in hopes of finding a way to settle the growing hostilities between Baghdad and Washington. His lawyers argued in court papers that the U.S. government is singling him out and trying to make him look like a traitor—not only for his vocal opposition to the Iraq War, but also because he was against the gulf war in 1991, when George W. Bush’s father was president. (In fact, Wyatt isn’t the only person the Feds have gone after. They have already won convictions or guilty pleas from several other Oil-for-Food defendants.) Shargel asked Judge Denny Chin to dismiss the case for “selective, discriminatory and vindictive prosecution” by the Bush administration. The judge rejected the request.
The Manhattan courtroom where Wyatt will spend the coming weeks is far from Navasota, the tough southeastern Texas town where he grew up. The only child of a single mother, he flew bombers in the Pacific during World War II. He studied engineering at A&M and got a job selling drill bits to oil companies. In 1950 he hocked his car for $800 and started a small company that ran pipelines to carry natural gas from oil wells. Over the next decades, he built the multibillion-dollar Coastal Corp. (He would go on to become a big political donor, mostly to Democratic campaigns.)
It wasn’t easy working for Wyatt. He seemed never to sleep and called his employees in the middle of the night. Working for him meant following his schedule. “Saturday was a regular workday,” says Greehey. “If you took off Saturday, come Monday he would ask, ‘Who said you could take a vacation?’ " In the late 1980s, Wyatt developed ties to Iraq. At the time, there wasn’t much stigma about buying Iraqi oil. That all changed in 1990, when the country invaded Kuwait. When Saddam took a group of foreigners, including Americans, hostage that year, Wyatt went to Iraq with former Texas governor John Connally to meet with the dictator and ask for their release. Wyatt flew a group of captives home on his private plane. The mission briefly made him a hero, but President George H.W. Bush was irritated that Wyatt hadn’t cleared the trip with him first.
Wyatt’s friends say he may have been interested in Saddam’s oil, but the idea that he was in any way siding with Iraq over America is ridiculous. “You cut him, he’d bleed red, white and blue,” says Roger Smith, the former General Motors chairman and Wyatt’s hunting buddy. Yet Wyatt’s willingness to do business with Saddam—and his strong stands against the Iraq War—strained some longtime relationships. His friend Robert Mosbacher, who served as George Bush Sr.’s secretary of Commerce, admits he had a falling out with Wyatt over Iraq. Eventually the two patched things up. “There was a time when we went back to being friends,” he says. “Not close friends, just friends.” As Wyatt heads into the trial that could decide where he spends the rest of his life, he doesn’t need the jurors to like him. He needs them to believe him.
