U.N. Didn't Ask Volcker to Disclose Finances

U.N. Secretary General Kofi Annan did not ask Paul Volcker for a financial disclosure statement before appointing him to investigate the Oil-for-Food (search) scandal, U.N. officials admitted.

The admission comes in the wake of a FOX News investigation that revealed several potential conflicts of interest for Volcker, former chairman of the U.S. Federal Reserve.

It also comes as Volcker prepares to release the first part of his investigation into the troubled Oil-for-Food program, which is expected to focus on U.N. management and administration. The report from the Independent Inquiry Committee is scheduled to be released Thursday.

The attention to Volcker and his potential conflicts of interest focuses on the following:

— Volcker has a longtime membership in the UNA-USA Business Council (search), a pro-United Nations organization partly funded by BNP Paribas (search), the bank that handled all Oil-for-Food transactions.

— There are questions about Volcker’s position as an adviser to the Power Corporation of Canada (search), a company with close ties to BNP and also to Total (search), the French oil giant that did nearly $2 billion of Oil-for-Food business.

U.N. staff regulations specifically state that "all staff members at the assistant secretary-general level and above shall be required to file financial disclosure statements upon appointment."

Another document titled “status, basic rights and duties of U.N. staff members” says "they should also voluntarily disclose in advance possible conflicts of interest that arise in the course of carrying out their duties."

Volcker apparently did not volunteer information about his possible conflicts of interest before he was appointed. But under U.N. regulations, which were signed by Annan, the secretary-general can ask an appointee such as Volcker to file a financial disclosure statement.

Asked why Annan didn’t do that in Volcker’s case, U.N. spokesman Fred Eckhard said, “I don't think the secretary-general had any reason and still today has no reason to question Mr. Volcker's integrity.”

Eckhard said he believed Annan had “every reason” to trust Volcker. “And he still does have that trust,” the U.N. spokesman said.

Volcker is still refusing to make public all his financial interests. If he had been taking on a similar position for the U.S. government, he would have had to fill in a financial disclosure report drawn up by the Office of Government Ethics declaring all consultant, advisory or board positions and all compensation over $5,000.