Friday, November 26, 2004

Oil for Fraud update

This has not been getting that much attention lately, but it may soon change:

Oil-for-food has become the biggest financial scandal in the UN's history. Senior officials are under intense scrutiny. The UN has been known for decades to play host to pockets of patronage and cronyism, but never before has it been linked to fraud on this scale.

Benon Sevan, the director of the oil-for-food program, continues to deny he profited from oil vouchers allocated in his name. He, like others, will be awaiting anxiously an interim report, expected by January, from a UN-appointed inquiry.

It's bad enough for UN Secretary-General Kofi Annan that somebody he appointed to a position of trust may be implicated. But what has most besmirched the UN's reputation is the accusation it was linked organically to a multibillion-dollar scam set up to sustain the Iraqi dictator in power.

The question is where this sordid money trail might lead - not just at the UN, but in the government and business elites of leading powers on the Security Council.

Where indeed:

One of the next big chapters in the United Nations oil-for-food scandal will involve the family of the secretary-general, Kofi Annan, whose son turns out to have been receiving payments as recently as early this year from a key contractor in the oil-for-food program.

The secretary-general's son, Kojo Annan, was previously reported to have worked for a Swiss-based company called Cotecna Inspection Services SA, which from 1998-2003 held a lucrative contract with the U.N. to monitor goods arriving in Saddam Hussein's Iraq under the oil-for-food program. But investigators are now looking into new information suggesting that the younger Annan received far more money over a much longer period, even after his compensation from Cotecna had reportedly ended.

The importance of this story involves not only undisclosed conflicts of interest, but the question of the role of the secretary-general himself, at a time when talk is starting to be heard around the U.N. that it is time for him to resign, and the staff labor union is in open rebellion against "senior management."

"What other bombshells are out there being hidden from the public and U.N. member governments?" asked an investigator on Rep. Henry Hyde's International Relations Committee, which has held hearings on oil-for-food.