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Volcker: Probe a Blow to U.N.
Thursday, February 03, 2005
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NEW YORK — Paul Volcker (search), the man charged with uncovering corruption in the U.N. Oil-for-Food program, said Thursday his investigation will be a blow to the United Nations but he hoped its findings will lead to reforms that restore the world body's credibility.
"They are being knocked down, so that they can come back. This is part of their knockdown I am afraid," the former U.S. Federal Reserve (search) chairman told The Associated Press in an interview after he delivered a hard-hitting report that revealed U.N. mismanagement.
Volcker's Independent Inquiry Committee launched the investigation of the $60 billion Oil-for-Food program last June at the request of U.N. Secretary-General Kofi Annan (search).
He delivered a preliminary report Thursday. It sharply criticized the head of the program, Benon Sevan (search), for conflicts of interest for soliciting oil allocations from Iraq, saying his actions undermined the U.N.'s integrity. Annan responded by ordering disciplinary action against Sevan and a couple of other U.N. officials involved in the now-defunct program.
Volcker said that he hoped that his interim report issued Thursday will begin to answer serious questions raised by U.N. critics alleging widespread corruption within the organization, and sort fact from fiction.
"I think it's important to find out the extent those attacks are justified," he said. "There are obviously problems in the institution and we have identified some of them. But the end of this should be a reformed and stronger U.N., because I believe — and I know the other committee members believe — that the U.N. has an important role to play but it cannot be effective if it is under suspicion all of the time."
He praised the United Nations for opening itself to scrutiny and aiding investigators. "I don't know of any other institution that has been scrubbed quite as hard as this one," he said.
Some of the allegations have been unfair, he said, particularly charges that U.N. officials had misused $1.4 billion of administrative funds allocated to the program.
"We do not find evidence that this was a big slush fund," he said. "The money was carefully budgeted. They didn't spend all of the money they had budgeted. They gave some of it back to Iraq."
While U.N. accounting had been thorough and clear, he said, investigators have found discrepancies.
"We found a couple of misallocations, the scale of which was not great, and we will report on those instances," he said.
Volcker said he believed that the report issued Thursday would answer critics — including a number of U.S. congressman — who have questioned whether the committee has the tools and the resolve to investigate the scandal thoroughly.
"I hope this report refutes any notion that we don't have a thorough investigation," he said, dropping the weighty 219-page document on the table for effect.
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