WASHINGTON – World Bank President Paul Wolfowitz is taking "full responsibility" for helping a close woman friend get transferred to a high-paying job.
Wolfowitz's comments — contained in an e-mail message Monday to the bank's employees — were aimed at defusing outrage and accusations of favoritism from the bank's staff association.
The case involves the transfer of a bank employee, Shaha Riza, who has been romantically linked to Wolfowitz. She was detailed to an outside assignment to the State Department in September 2005, shortly after Wolfowitz became bank president.
To avoid a conflict of interest, Wolfowitz said he sought the advice of the bank's Board of Directors once he took over the World Bank in the summer of 2005.
"I subsequently acted on the advice of the board's Ethics Committee to work out an agreement that balanced the interests of the institution and the rights of the staff member in an exceptional and unprecedented situation," Wolfowitz's letter to employees explained.
The bank's rules bar employees from supervising anyone with whom they had a personal relationship.
The bank's association, however, charged that the job transfer — which it deemed a "promotion" — didn't conform to bank rules. Normally, such a promotion is "supposed to be competitive, vetted and approved by the relevant sector board," the association said last week.
In his letter to staff, Wolfowitz responded: "I accept full responsibility for the actions taken in this case."
His letter did not mention Riza by name or provide details of her employment and compensation.
"I have already indicated to the board my intention to cooperate fully in their review of the details of the case," Wolfowitz said. "In particular, I will ensure that the board has access to the facts in this case, in a manner that also respects the bank's rules concerning the right of every staff member to the confidentiality of his or her records,"
Before the job transfer, Riza worked as a communications adviser in the bank's Middle East Department.
The Government Accountability Project, a watchdog group, put Riza's salary at $193,590 as a result of the job transfer and generous pay raises. The group's officials say she was paid by the World Bank and still remains on the bank's payroll. Bank officials would not discuss her salary, citing confidentiality reasons.
State Department spokesman Sean McCormack said Riza had been transferred to the department's Bureau of Near Eastern Affairs from the World Bank in September 2005, but was still being paid by the World Bank and not the U.S. government.
McCormack said she had left in September 2006 and was now working for the Foundation for the Future, an international organization that gets some funding from the State Department.
"It's an independent international NGO," or nongovernmental organization, he said. "Talk to the World Bank. That's who she works for," McCormack said.
Bea Edwards, international director of the Government Accountability Project, found the situation involving Riza's compensation disconcerting. "It's ironic that Mr. Wolfowitz lectures developing countries about good governance and fighting corruption, while winking at an irregular promotion and overly generous pay increases to a partner," she said.
The World Bank staff association said it has been "inundated with messages from staff expressing concern, dismay and outrage" over the matter.
The flap comes as the World Bank and the International Monetary Fund prepare to hold their spring meetings this weekend.
The World Bank's stated mission is to fight poverty and improve the living standards of people in developing countries. It lends about $20 billion a year for various projects.
Wolfowitz said he didn't want the flap to overshadow the World Bank's mission. "What remains of the utmost importance to me is the protection of the interests of this institution as a whole, and our need to remain focused on our agenda of helping the world's poor."
President Bush' appointment of Wolfowitz — a main architect of the Iraq war as deputy defense secretary — to the top job at the World Bank was greeted with protests by international aid and other groups. Critics worried that he might try to use the bank to help America's allies and punish its enemies.