Unwelcome publicity for oil giant in legal battle with billionaire

Secret negotiations to settle a multimillion-pound dispute between the Total oil company and London-based businessman Nadhmi Auchi have broken down, The Independent on Sunday has learnt.

Confidential talks between lawyers for both sides have foundered, raising the prospect that highly sensitive details of the operations of Elf, which Total took over in 2000, could be publicly aired in a British court. Lawyers for both sides were unavailable for comment but one authoritative report suggested talks broke down because Auchi was insisting on a public apology.

A legal battle between the two erupted after Auchi, an Iraqi-born British citizen, received a 15-month suspended sentence and a £1.5m fine after being convicted of corruption. French investigators found that he had received $2m (£1m) in illegal commissions in the Elf Aquitaine oil scandal.

Several senior executives of the company were jailed over their part in the affair. The investigators claimed that Auchi had paid bribes to Elf. As a result of the ruling, Total took legal action against him in France.

Auchi, named the UK's 27th richest man, with an estimated £2.1bn fortune, denies any wrongdoing and has appealed against his conviction. He responded to Total's legal action by suing it for £200m at the High Court in London. He claims it has "vicarious liability" for the damage inflicted on his reputation and business interests after he was embroiled in the Elf executives' corruption "against his will".

If the London case proceeds it is certain to add to Auchi's colourful reputation. He fled Iraq to Britain in 1980 after being jailed by Saddam Hussein, who later murdered two of his brothers. His Luxembourg-based General Mediterranean Holding investment company quickly prospered and is now a global operation with interests ranging from luxury hotels through to telecoms and pharmaceuticals.

Auchi was recently named in the US fraud trial of Chicago businessman Antoin Rezko, a friend of US presidential hopeful Barack Obama. Court documents revealed that Rezko lobbied government officials for Auchi to be permitted entry to the US after he was banned following his fraud conviction in France. Auchi denies any connection to Rezko's activities.

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