United Nations Archive 1

Allegations Against UN Oil for Food Program Are Murky

By Bill Miller

Paul Volcker, the respected former Federal Reserve Chair and head of the UN Oil-for-Food Program Inquiry Committee, recently released the second phase of a very exhaustive investigation of the UN operated Oil-for-Food Program (OFFP). One of the major conclusions was that there was “no evidence” that UN Secretary General Kofi Annan had been involved in any illegal activities to rig the bidding process or direct contracts to Cotecna, a Swiss-based firm who had employed his son Kojo.

Annan was criticized for not conducting an adequate investigation of Kojo's employment with Cotecna. Actually, Annan had received professional advice from then Under-Secretary General Joseph Conner, a squeaky-clean, no nonsense investigator, who looked into the allegations and found them baseless. Few of the media ever mention this important piece of evidence

Mr. Volcker went on to say that, “…this institution, (the UN), has been scrubbed very hard. I don’t know of any institution that has received (such intense scrutiny) …” He proceeded to indicate that the UN staff had been very cooperative in helping with his investigation; however, Kojo Annan has not been forthcoming with the inquiry committee. One UN employee who is being investigated is Benon Sevan, the UN head of the OFFP, who was not truthful with the Security Council; and his dealings, according to Volcker, were “ethically improper” and “a serious conflict of interest” and “undermined the integrity of the UN.”

Another major criticism was that the UN auditing system needed to be strengthened. An internal UN audit also indicated that there was some mismanagement, such as contractors overcharging (this sounds similar to the Halliburton situation in Iraq) the UN several million dollars

Unfortunately, there is a gigantic chasm of myths and misinformation emanating from this investigation. Some of the major myths are that the UN:

-- Did nothing to raise concerns about kickbacks and irregularities. In fact, on several occasions the Secretary General and the UN employees alerted the Security Council that the oil pricing formulas were incorrect and did not reflect the fair market value. No action was taken. Not a single one of the 36,000 contracts reviewed by this committee was derailed because of overpricing.

-- Should have stopped the smuggling. In fact, the UN had no authority and no military force to interdict the oil that was flowing to Turkey and Jordan. This task fell to the Multinational Interception Force (MIF) that was composed primarily of the US Navy’ Fifth Fleet. No action was taken.

-- Approved Saddam's illegal smuggling (or legally selling) oil to several countries. In fact, The Security Council, led by the US and the UK, gave their tacit approval to sell oil under Article 50 of the UN Charter to countries that had been adversely affected economically due to UN sanctions. NO action was taken to stop this flow of oil. Both Presidents Clinton and Bush, while being aware of the oil sales to Turkey and Jordan., also recommended that Congress continue military and financial aid to the two key US allies.

-- Attempted to obstruct the investigation. In fact, Kofi Annan wanted the Volcker Inquiry Group to take on the volatile issue of looking at the S-G, his son, Kojo, and Benon Sevan, head of the OFFP, so that Annan could get this distraction behind him and move forward with some of the more important work of the UN, especially the implementation of the Millennium Development Goals and UN reform (which Annan has been a strong proponent). Annan has basically been cleared of any bid tampering or favoritism, however, Kojo and Sevan are still under investigation

The Oil-For-Food Program (OFFP), in operation from 1996 until 2003, was established to permit the Iraqi government to sell oil with the proceeds spent to reduce suffering of the Iraqi populace and improve their quality of life by purchasing food, medicine and humanitarian goods, and rebuilding the infrastructure. For example, the program:

-- Fed 80% of the 27 million Iraqis; raised the average daily caloric intake of the people by 83% from 1,200 calories to 2,200 calories per person per day; and decreased the malnutrition rates over 50% throughout most of the country. Sadly, since the 2003 American-led invasion, the Iraqi caloric level and standard of living have declined dramatically. As the UN has reported, the daily living conditions are dismal with intermittent water and electricity supply; chronic malnutrition, and rising illiteracy rates;

-- Alleviated international pressure to weaken the sanctions. The sanctions and the OFFP purchases of key commodities’ combination derailed shut down Saddam’s plan to develop weapons of mass destruction (WMD).

Professional and responsible journalists who wish to inform the public will scrutinize the UN OFFP and the Secretary General and objectively report the facts. The OFFP irregularities are serious charges that must be investigated thoroughly. However, the vitriolic UN-bashing media and misguided Members of Congress should just report the facts, not rumors and innuendoes and stop clamoring for Kofi Annan to resign. If every CEO who experienced mismanagement by his/her employees resigned, there would probably not be one governmental agency or private company, including President Bush and Secretary of Defense Rumsfeld, spared this charge.

OFFP has been chastised by many ill-informed media outlets as being ostensibly the largest scandal ever and the most failed program (which it was certainly not in both cases). The OFFP was really quite successful. However, some of the “Minotaurs of the Media”, driven by a maniacal obsession to devour anything --such as truth--that impedes their quest to prove their unsubstantiated claim that Annan is guilty, regardless of the facts, should make a concerted effort to elevate themselves as paradigms of journalistic excellence and professionalism.,

Unfortunately for the US, the UN, and the general public, media outlets such as the Washington Times, Fox News, US News and World Report, CNN’s Lou Dobbs, the Heritage Foundation, and the Wall Street Journal editorial page, to mention only a few, have created a new low in their so-called objective coverage of the UN. As Sir Winston Churchill once opined, “ A lie gets halfway around the world before the truth has chance to get its pants on.” As more information is revealed about the OFFP, hopefully the public will research the issues, ignore many of the media pundits, and determine the facts of the program.

The Volcker Committee is moving aggressively into Phase 3, which will emphasize the role and responsibilities of the Security Council member states. What did they know? When did they know it? What were their responsibilities? By June 30 when the report is issued, the truth will be have its pants on.