Annan Fires First Official Over Oil-for-Food

U.N. Secretary-General Kofi Annan (search) has fired a staffer for his role in the Iraq Oil-for-Food scandal but the U.N. official vowed to clear his name.

The dismissal marks the first time Annan has relieved someone from his duties because of alleged wrongdoing in the multibillion-dollar program.

The man fired was Joseph Stephanides (search), head of the U.N. Security Council Affairs Division. Annan fired him Tuesday for interfering in the competitive bidding process for an Oil-for-Food (search) contract. A U.N. spokesman announced the move Wednesday.

Annan concluded that Stephanides had committed "serious misconduct" after the independent inquiry headed by Paul Volcker (search) raised questions about Stephanides' involvement, U.N. associate spokesman Stephane Dujarric said.

"Mr. Stephanides was advised accordingly yesterday and was separated from service with immediate effect," Dujarric said.

Stephanides told FOX News' Eric Shawn that he intends to clear his name in the matter but referred further questions to his lawyer, George Irving.

Irving said the information contained in the Volcker reports regarding his client was based on "incomplete information." Plus, Irving said that Stephanides wasn't afforded the opportunity for a hearing on the termination decision as U.N. procedures require.

"The organization took four months and there has been no hearing so our first request is that this matter be reviewed by their own internal body for reviewing disciplinary penalties," Irving said.

Stephanides had been accused of tainting the competitive bidding process for a company to inspect humanitarian goods entering Iraq under the program.

His contacts with an unnamed U.N. mission — which a U.N. committee acquiesced to for political reasons — led to Lloyd's Register Inspection Ltd. winning the contract even though there was a lower bidder, it said.

Stephanides, 59, had planned to retire in September, when he turns 60.

The Volcker investigation had accused two other U.N. staff members of wrongdoing in the Oil-for-Food program, established to help ordinary Iraqis cope with sanctions imposed on Saddam Hussein's government after its 1990 invasion of Kuwait.

Under the program, Iraq was allowed to sell oil, provided the proceeds were used primarily to buy humanitarian goods, including food and medicine.

U.N. action against former Oil-for-Food chief Benon Sevan (search) has been suspended until Volcker's probe finishes its work. Sevan was accused of a "grave conflict of interest" in soliciting oil deals from Iraq.

Also, Dileep Nair (search), the now-retired chief of the U.N. watchdog agency, allegedly paid an employee with money from the program even though the staffer's work was not directly tied to it. Annan sent a letter expressing disappointment but took no action.

The Associated Press contributed to this report.