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Oil, Food Probe Faults Annan for Mismanagement
| quote: | Oil, Food Probe Faults Annan for Mismanagement
Tue Mar 29, 2005 05:23 PM ET
By Evelyn Leopold and Irwin Arieff
UNITED NATIONS (Reuters) - A key report concluded on Tuesday that Secretary-General Kofi Annan did not influence contract decisions for a firm that employed his son but it faulted the U.N. chief for not probing conflicts of interest properly.
"Hell no!" Annan told a news conference when asked if he would resign, as some lawmakers in the United States, had demanded.
The report, the second one from an independent inquiry into the U.N.-administered oil-for-food program, led by former U.S. Federal Reserve Chairman Paul Volcker, focused on Annan and his son, Kojo, who worked for the Swiss firm Cotecna.
Cotecna received a $10-million-a-year U.N. contract in late 1998 to certify goods coming into Iraq under the $67 billion program, which began in late 1996 and ended in 2003. The oil-for-food program was administered by the U.N. secretariat and supervised by the 15-nation Security Council.
Volcker's report concluded that Cotecna tried to hide its relationship with the younger Annan after the U.N. contract was signed. Kojo Annan had also misled his father, it said.
In response, Annan said the inquiry had "cleared me of any wrongdoing" but acknowledged his son had been less than truthful.
"I love my son and I have always expected the highest standards of integrity from him. I am deeply saddened by the evidence to the contrary," Annan said.
In Washington, the White House voiced cautious support for Annan but spokesman Scott McClellan said, "This is a very serious matter."
Volcker, at a separate news conference, repeatedly criticized as "inadequate" an investigation of the Cotecna contract award that the secretary-general had initiated, which lasted about a day.
"We think he should have authorized an independent and thorough investigation," Volcker said. "That was not done."
The report also revealed that an assistant to Iqbal Riza, Annan's chief of staff who retired in December, had shredded many documents in 2004, some relating to the oil-for-food inquiry. U.N. officials said the files were usually kept for a year but Riza kept them for six years before shredding.
The shredding continued even after Annan issued an order that all oil-for-food documents be preserved, Volcker said.
Riza "acted imprudently" and in violation of the document preservation order, the committee concluded.
The report also accused the chief internal U.N. watchdog, Dileep Nair, of violating staff rules by putting an aide on the oil-for-food payroll who performed no work for the program.
On Annan himself, the Volcker report said: "There is no evidence that the selection of Cotecna in 1998 was subject to any affirmative or improper influence of the secretary-general in the bidding or selection process."
As for the younger Annan, the report said he "intentionally deceived the secretary-general" about his continuing financial relationship with Cotecna.
"Significant questions remain about Kojo and his actions during the fall of 1998 as well as the integrity of his business and financial dealings with respect to the oil-for-food program. The committee's investigation of these matters is continuing," the report said.
Kojo Annan was a trainee with Cotecna from late 1995 until the end of 1998, about the time the firm received the U.N. contract for inspecting goods in Iraq.
The younger Annan, now 31, did not immediately reveal that he continued to earn $2,500 a month from 1999 until February 2004 in return for not joining Cotecna competitors in West Africa.
He lives in Lagos and is the son of the secretary-general and his first wife, Titi Alakija, a Nigerian. The parents divorced and Kofi Annan in 1984 married the former Nane Lagergren, a Swedish lawyer and artist.
Volcker will give a final report on the program in mid-year. His previous report accused Benon Sevan, the former head of the program, of steering oil contracts worth $1.5 million to a friend, an Egyptian trader.
The next report, he said, would also cover the action of the 15-nation Security Council. Volcker said that Saddam Hussein's government earned the most revenue through oil smuggling, outside of the U.N.-administered program.
The Saddam government siphoned nearly $2 billion from the oil-for-food program, according to a CIA report. He earned an estimated $8 billion through oil exports not part of the program, which the U.N. Security Council, including the United States, knew about.
Under the oil-for-food program, Iraq was allowed to sell oil to buy civilian goods to ease the impact of 1990 sanctions on ordinary Iraqis. |
I feel bad for Annan. He may not be a perfect person but to me he seems like a decent guy trying to do a decent job. Everyones always trying to bring him down.
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