Annan Withholds Judgment on Boutros-Ghali

U.N. Secretary-General Kofi Annan (search) on Friday withheld judgment on the actions of his predecessor, Boutros Boutros-Ghali, who was accused in a new report of violating U.N. regulations in his handling of Iraq's Oil-for-Food program.

Boutros-Ghali (search) was secretary-general in the years leading up to the Oil-for-Food program's inception in late 1996 and played a crucial role in founding it.

The report, released Thursday, said Boutros-Ghali chose the Paris-based bank BNP to be the program's banker without accepting the "lowest acceptable bidder" — a violation of U.N. financial regulations.

Speaking to reporters on Friday morning, Annan refused to question Boutros-Ghali's actions.

"Each secretary-general has to do things his way and in accordance with the circumstances that he finds himself in," Annan said. "I think Mr. Boutros-Ghali has indicated in the report, the environment and the circumstance in which he was taking those decisions and I don't want to second guess him."

Boutros-Ghali could not immediately be reached for comment.

The report cites Boutros-Ghali as saying he was responding to political pressure from both the United States and Iraq, suggesting that the deal wouldn't have worked otherwise

In his book "Unvanquished: A U.S.-U.N. Saga," Boutros-Ghali makes clear how much trouble he had getting Iraq to commit to the Oil-for-Food program.

He was also under enormous pressure late in his tenure, having learned around the time he was trying to put Oil-for-Food (search) together that the United States would block his nomination for a second term as secretary-general. Instead, the United States supported Annan.

The report also details links between Boutros-Ghali and people implicated in the report for conflict of interest. For example, it lists him as a cousin of Fakhry Abdelnour, the head of an oil company called AMEP that the report says got oil concessions through the executive director of the Oil-for-Food program, Benon Sevan.

Annan has launched disciplinary proceedings against Sevan, who the report accused of conflict of interest and tainting the image of the United Nations for his role in getting oil concessions for AMEP.

Boutros-Ghali is also the brother-in-law of Fred Nadler, who the report says was a middleman between Sevan and Abdelnour.

The $60 billion Oil-for-Food program, which ran from December 1996 to November 2003, allowed sanctions-bound Iraq to sell oil to buy humanitarian supplies. But it allegedly became a way for Saddam to curry favor and push to end sanctions — by awarding former government officials, activists, U.N. officials and journalists vouchers for Iraqi oil that could then be resold at a profit.