Virginia oil firm admits kickbacks to Iraq Jeanne King Thu Oct 20,12:50 PM ET NEW YORK (Reuters) - A Virginia oil trading company pleaded guilty on Thursday to charges of scheming to pay more than $400,000 in kickbacks to Iraq for oil purchases made as part of the defunct U.N. oil-for-food program for Iraq. Midway Trading, a Reston, Virginia-based firm, agreed to pay a $250,000 fine in a plea deal, according to the Manhattan district attorney's office. The kickback scheme also involved one of its trading partners, Bulf Oil, the office said. But it provided no details on Bulf Oil. The case grew out of an investigation into the scandal-ridden $64 billion oil-for-food program launched by District Attorney Robert Morgenthau's office this year. Also investigating corruption in the program, which was shut down in 2003 after the U.S.-led invasion of Iraq, are the federal U.S. Attorney's office in the Southern District of New York, several congressional committees and a U.N.-appointed commission led by former Federal Reserve Chairman Paul Volcker. Morgenthau's office said the case against Midway began as a result of cooperation with Volcker's Independent Inquiry Committee, which is expected to issue its final report this month, on companies around the world who benefited from the U.N. program. Morgenthau has also opened a criminal investigation of Benon Sevan, the U.N. official who headed the U.N. program. The Volcker inquiry has accused Sevan, a Cypriot and veteran U.N. senior staff member, of getting about $150,000 in kickbacks from an oil trading firm while he was in charge of the program. Sevan has denied the charges, but has fled to his native Cyprus which has no extradition agreement with the United States. The oil-for-food program began in December 1996 and allowed former Iraqi President Saddam Hussein to sell oil to buy civilian goods to ease the impact of U.N. economic sanctions on ordinary Iraqis. The sanctions were imposed after Iraq's 1991 invasion of Kuwait.