State Dept. Endorses Senate Probe of U.N. Oil-for-Food Program

The State Department on Wednesday endorsed a Senate investigation into possible fraud in the U.N. Oil-for-Food program while sidestepping a senator's demand that Secretary-General Kofi Annan (search) resign.

"That is not something, frankly, that is in front of us," deputy spokesman Adam Ereli said. "What is in front of us is ensuring that if there is wrongdoing it is fully understood and that appropriate action be taken."

Sen. Norm Coleman (search), R-Minn., wrote in Wednesday's Wall Street Journal that Annan should quit because "the most extensive fraud in the history of the U.N. occurred on his watch. In addition, and perhaps more importantly, as long as Mr. Annan remains in charge, the world will never be able to learn the full extent of the bribes, kickbacks and under-the-table payments that took place under the U.N.'s collective nose."

The Oil-for-Food program, which began in 1996, permitted Iraq to sell oil, provided that the revenue went for food, medicine and other necessities. At the time, Iraq under President Saddam Hussein (search) was laboring under tough U.N. economic penalties.

At the United Nations, spokesman Fred Eckhard told reporters that Annan has not heard any U.N. member urge his resignation. "If there's some agitation on this issue on the sidelines, that's fine. That's healthy debate. But he is intent on continuing his substantive work for the remaining two years and one month of his term," Eckhard said.

Last month, the Senate Governmental Affairs subcommittee on investigations said it had uncovered evidence that Saddam's government had raised more than $21.3 billion in illegal revenue by subverting U.N. penalties, including the restrictive Oil-for-Food program.

"Mr. Annan was at the helm of the U.N. for all but a few days of the Oil-for-Food program, and he must, therefore, be held accountable for the U.N.'s utter failure to detect or stop Saddam's abuses," wrote Coleman, the subcommittee chairman.

Ereli said the department agreed with the senator that Congress has a right to investigate, adding that Annan "has been working positively and cooperatively" in trying to find out what happened. Ereli said he did not want to prejudge any investigation.

"We look forward to all of the facts being known and the appropriate action being taken," Ereli said.

Last week, Eckhard said Annan's son had received payments from a company with a U.N. Oil-for-Food contract more than four years longer than the United Nations previously acknowledged. Eckhard said there was nothing illegal about it.

In mid-November, amid a series of congressional investigations into the program, U.S. lawmakers questioned whether a French bank helped Saddam manipulate the $60 billion program. The bank denied any wrongdoing.