Oilman Wyatt is headed for prison in Beaumont

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Oilman Wyatt is headed for prison in Beaumont
By TOM FOWLER

Houston oilman Oscar Wyatt will spend much of next year in his old
hometown when he reports to a minimum security prison in Beaumont.

Wyatt, 83, who pleaded guilty on Oct. 1 to a single count of conspiring
to make illegal payments for Iraqi oil under the United Nations'
Oil-for-Food program, is to report to prison by Jan. 2.

Beaumont, Wyatt's birthplace, is the closest minimum security federal
prison to his Houston home. U.S. District Court Judge Denny Chin
recommended the facility to Bureau of Prison officials, who have the
last word.

Reached at his Houston office Friday, Wyatt said he was prepared to
serve the time.

"After spending two years in the Pacific in a tent, I don't think that
will be a problem," he said, referring to his service as a military
pilot during World War II.

But asked if the nearby Beaumont facility was his first choice, Wyatt
replied, "My first choice would have been to be probated."

The founder of Houston-based Coastal Corp., which is now owned by El
Paso Corp., Wyatt was accused of funneling millions in illegal
surcharges to Saddam Hussein's regime to buy Iraqi oil under the
Oil-for-Food program.

The program was developed while Iraq was under international sanctions
because of Saddam's 1990 invasion of Kuwait. It was intended to use
Iraq's oil resources to provide much-needed food and medicine for the
Iraqi populace while keeping the proceeds out of the hands of the
regime.

Prosecutors said Wyatt used front companies to buy Iraqi oil and pay
the surcharges into a bank account secretly controlled by the Iraqi
government.

Wyatt was charged with conspiracy, wire fraud and violating U.S. laws
governing dealings with Iraq.

Three weeks into his trial, he pleaded guilty as prosecutors were
poised to zero in on a $200,000 surcharge payment in 2001. In his
guilty plea, Wyatt acknowledged orchestrating that payment.

Wyatt already has forfeited $11 million as part of his plea agreement.

The Beaumont Federal Correctional Complex consists of three facilities
— a low-, medium- and high-security prison. The high-security facility
also has a satellite for minimum security inmates, which is where Wyatt
is expected to report, said Wyatt attorney Gerald Shargel of New York.
It houses about 500 inmates, according to the Bureau of Prison Web
site.

Wyatt's sentence could have been longer.

Moved by an avalanche of support from Wyatt admirers, Chin ordered
Wyatt to serve six months less than the low end of a sentencing range
of 18 to 24 months that the defense and government agreed was
appropriate under federal sentencing guidelines.

In fact, Wyatt isn't likely to serve a full year. He could have 47 days
shaved off his sentence for good conduct, a Bureau of Prisons spokesman
told the Chronicle soon after the sentencing. And the last 30 days
could be spent in a halfway house.

That means Wyatt could be home for Thanksgiving next year.

Wyatt's wife, Lynn, said Friday the family was thrilled that he was
assigned to a prison nearby.

"I certainly am grateful he will be close enough so the family can come
and see him," she said.

The Wyatts are expecting family in town for the holidays but have not
yet decided if they will stay in Houston or spend time at their South
Texas ranch, Lynn Wyatt said.

"We're leaving it up to Oscar, whatever he feels like doing," she said.
"We had all of the family together for Thanksgiving, including the
grandchildren, so to me that was our Christmas."

tom.fowler@chron.com

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