http://www.thecouriermail.news.com.a...55E954,00.html
Annan cleared of corruption (Kevin: "but....")
Evelyn Leopold in New York
09sep05
UN Secretary-General Kofi Annan, his deputy and the Security Council have all been blamed for mismanaging Iraq's oil-for-food program that allowed Saddam Hussein to rake in more than $US10 billion.
However, an independent year-long probe into the $US64 billion humanitarian program found no corruption by Mr Annan.
It did, though, castigate him and other top UN officials for tolerating corruption.
Investigators also faulted the 15-member Security Council for turning a blind eye to oil smuggling and other illicit earnings outside of the program, a violation of UN trade sanctions.
The now-defunct operation allowed Saddam to sell oil to buy food and medicine.
However, it became a "a compact with the devil and a devil had means for manipulating the program to his ends", inquiry chairman and former US Federal Reserve chairman Paul Volcker said.
Mr Annan himself addressed the Security Council, saying: "The report is critical of me personally and I accept its criticism."
He said the findings were "deeply embarrassing to us all", but that he had no intention of resigning.
At a news conference, Mr Volcker said his independent inquiry committee "found no corruption by the Secretary-General". But he said Mr Annan's "behaviour has not been exonerated by any stretch of the imagination".
The report called for sweeping reforms, a week before world leaders gather for a UN summit to consider a host of Mr Annan's proposals, including management and financial controls. But many of the initiatives are deadlocked because of sharp divisions among the 191 countries.
The oil-for-food program, which began late in 1996 and ended in 2003, was aimed at easing the impact of the sanctions, imposed in 1990 after Baghdad's troops invaded Kuwait and achieved considerable success in feeding Iraqis. But illicit oil sale surcharges, kickbacks and smuggling schemes "provided Saddam Hussein and his regime with access to hard currency outside of the control" of the program, said the report which ran to more than 1000 pages in five volumes. The panel said there had been a lack of supervision of the program. It was headed by Cypriot Benon Sevan, who was accused earlier of fraud, by Mr Annan and by his deputy, Louise Frechette.
"No one seemed in command," Mr Volcker said.
Iraq, the report said, set aside $US15 million in 1995 to bribe former UN secretary-general Boutros Boutros-Ghali, who set up the program before he left office in 1996. The intermediaries, being prosecuted by US federal authorities, were said to be Iraqi-American businessman Samir Vincent and Tongson Park, a South Korean lobbyist and centre of a bribery scandal in Washington in the 1970s. At one point, Vincent passed some $US60,000 in cash to Park in a shopping bag, the report said. But it said there was no evidence Mr Boutros-Ghali, a friend of Park, had received money. The report detailed the extent to which Kojo Annan, the 31-year old son of the Secretary-General by his first wife, lobbied at the UN for a lucrative contract for the Swiss firm Cotecna, which inspected goods coming into Iraq.
Among other actions, Kojo was said to have made a string of phone calls to a UN procurement official and his father's personal assistant at key moments in the Cotecna bidding process. Both were friends of the family. But the inquiry said it did not have "reasonably sufficient evidence" the Secretary-General knew about his son's actions.
While investigating Kojo's role, it stumbled across evidence of his purchase of a Mercedes-Benz, which he shipped to Ghana without paying duty using his father's diplomatic immunity.
Reuters