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Volcker Cites Broad UN Lapses In Oil-For-Food Probe

Paul Volcker (file photo) Washington, 7 September 2005 (RFE/RL) -- An independent panel says UN Secretary-General Kofi Annan and a broad range of UN bodies must share the blame for widespread abuses of the oil-for-food program in Iraq.

According to a new report from the panel, the UN's oil-for-food program in Iraq was plagued by mismanagement, corruption, and systemic problems that have left the organization weakened.

That is a central finding of the latest and most comprehensive report compiled by an independent panel headed by former U.S. Federal Reserve Chairman Paul Volcker.

The panel faulted top UN officials and the Security Council for permitting the smuggling of Iraqi oil outside the humanitarian program. That helped enrich the regime by more than $8,000 million, it said.

Volcker told the Security Council today it also failed to define responsibilities for the program and allowed Hussein too much influence in its operation.
"The inquiry committee has stripped away the curtain and shown a harsh light into the most unsightly corners of the organization." -- UN Secretary-General Kofi Annan

"No one seemed clearly in command. Delays in or evasion of decision making was chronic. The administrative structure and practices of the Secretariat and some agencies clearly were not up to the truly extraordinary challenge presented by the program. Sadly those weaknesses were aggravated by unethical and corrupt behavior at key points," Volcker said.

The oil-for-food program, which ran from 1996 to 2003, was designed to use revenues from Iraqi oil sales to help citizens cope with sanctions linked to Iraqi weapons of mass destruction and other issues.

Volcker said the UN succeeded in its main goal -- feeding Iraqis and preventing it from acquiring weapons of mass destruction. But he said abuses of the program revealed deep laws in UN management structures.

His panel's report recommends creating the new post of chief operating officer responsible for administration. Volcker also called for a more effective independent oversight board, an issue currently under debate by UN members.

"To some degree the organization has been weakened. That is why reform is so urgent. We commend our particular recommendations to you and we urge you and the general assembly to set firm benchmarks for progress," Volcker said.

The report reaffirmed earlier findings that there was not sufficient evidence to show Annan tried to influence the procurement process for the program. But it pointed to management lapses and said he failed to properly investigate conflict-of-interest charges involving his son.

Annan told the council he accepted responsibility for the administrative failings of the program. He said the findings were embarrassing to the whole UN system.

"The inquiry committee has stripped away the curtain and shown a harsh light into the most unsightly corners of the organization. None of us, member states, Secretariat, agencies, funds, and programs can be proud of what it has found," Annan said.

Annan said the panel's report underscored the need for member states to agree on management reforms ahead of next week's UN summit.

That point was also stressed by the U.S. ambassador to the UN, John Bolton. He said "dozens of countries" were still resisting key reform proposals. Bolton said the status quo can no longer be accepted at the UN.

"This report unambiguously rejects the notion that business as usual at the United Nations is acceptable. We need to reform the UN in a manner that will prevent another oil-for-food scandal. The credibility of the United Nations depends on it," Bolton said.

Next week more than 170 presidents and prime ministers are to meet at the United Nations to affirm a development agenda. Mostly Western states have been pressing for agreements on human rights, terrorism, and management reforms.

See also:

High Ranked United Nations Official Is Arraigned On Money Laundering Charge

UN Chief Seeks Mission Extension, Amid Corruption Allegations Against Former Oil-For-Food Head