Annan vows 'truth' in oil-for-food case
UNITED NATIONS -- Secretary General Kofi Annan pledged yesterday to get to the bottom of any wrongdoing by the United Nations in the Iraq oil-for-food scandal.
''We are as determined as everyone to get to the bottom of this. We do not want this shadow to hang over the UN," Annan told reporters as he arrived at headquarters. ''So we want to . . . get to the truth and take appropriate measures to deal with the gaps."
An independent inquiry named by Annan to look into the $69 billion program, which was shut down in 2003 a few months after the US-led invasion of Iraq, issued an interim report Thursday that found lax UN controls, a shortage of audit staff, and political favoritism when the program was put in place in 1996.
It found no pilfering of money from the UN administration of the program.
But Volcker said the program's director, Benon Sevan, engaged in a ''grave conflict of interest" by soliciting oil allocations for a small trading firm run by relatives of Boutros Boutros-Ghali, the UN secretary general from 1991 to 1996. Volcker is investigating whether Sevan received a kickback for his efforts, as Iraqis have alleged.
''Obviously there were some hard knocks in the report and we are concerned about it," Annan said. ''This is why we intend to take action promptly."
Annan intends to take disciplinary action against Sevan and Joseph Stephanides, who now heads Security Council affairs and was accused in Volcker's report of interfering in contracts without competitive bidding in 1996. He said he was consulting lawyers on how to do this.
He said diplomatic immunity would be lifted if there were charges of criminal acts, and that the UN would fix financial controls and accounting procedures and more reforms would follow.
In a separate development, the
Shell bought about 6.4 million barrels of Iraqi crude from African Middle East Petroleum, which has told UN investigators it paid an illegal surcharge to getcontracts from Saddam Hussein's regime.
''Shell wasn't aware of any surcharge payments being made to any persons on any of the cargoes it bought from third parties," spokeswoman Lisa Givert said from Shell's London headquarters.
