Iraq's Judiciary Explores Settlements to Recover Corruption Funds

Iraq's judiciary is paving the way for 'conditional settlements' as a means to recover public funds lost to corruption. The Supreme Judicial Council announced Friday it is working with the government on legal mechanisms that would combine holding corrupt officials accountable with the repatriation of stolen money.

Under proposed amendments to the General Amnesty Law, defendants who voluntarily return embezzled funds could be eligible for reduced legal measures or lighter sentences. The council stated its objective is twofold: to ensure perpetrators of financial and administrative corruption face consequences and to recover state assets. It believes these goals can be achieved by streamlining legal procedures or lessening sentences, provided they remain within constitutional and legal boundaries.

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its objective is to both hold perpetrators of financial and administrative corruption accountable and recover state funds, adding that these goals could be achieved by easing legal procedures or reducing sentences “within constitutional and legal limits.”

This approach mirrors a strategy previously employed in the "Heist of the Century" case, which involved the fraudulent withdrawal of tax deposits. In that instance, businessman Noor Zuhair, implicated in the scheme, was reportedly released on bail by the head of the Supreme Judicial Council and then-Prime Minister Mohammed Shia al-Sudani. This was in exchange for Zuhair repaying funds in installments and receiving a reduced sentence. This arrangement led to the recovery of approximately $252 million.

However, Zuhair later left Iraq, halting repayments. He was tried in absentia and sentenced to 10 years, with extradition proceedings initiated. His lawyer has since requested his client benefit from the amended amnesty law by repaying the remaining funds. The court awaits a response from the Finance Ministry, the injured party, on the proposed repayment plan. Additionally, 12 employees of the General Commission for Taxes, who facilitated the withdrawals, have been sentenced and may also qualify for leniency upon paying compensation determined by the Finance Ministry.

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Following amendments to the General Amnesty Law, Zuhair’s lawyer requested that his client be covered by the legislation in exchange for repaying the remaining funds.