02/04/2005, 00.00
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UN stunned by revelations over Iraq's food-for-oil programme

Iraqi minister praises Volcker's interim report. The money stolen should be repaid to the Iraqi people.

New York (AsiaNews/Agencies) – The UN official investigation into the oil-for-food programme in Iraq shows that the UN official running the programme was involved in a kickbacks scheme.

Paul Volcker, the former head of the US Federal Reserve who headed the panel of investigation, said that Benon Sevan, who ran the humanitarian programme, solicited and received allocations for a trading firm registered in Panama connected to the family of former Secretary-General Boutros-Ghali. "In making such solicitations, Mr Sevan created a grave and continuing conflict of interest. His conduct was ethically improper and seriously undermined the integrity of the United Nations," the panel said.

A second UN official, Joseph Stephanides, now director of Security Council Affairs, was alleged to have intervened in selecting large contractors for the programme he helped organise in 1996, before Sevan took over in late 1997.

The oil-for-food programme, which began in December 1996 and ended in November 2003, allowed Saddam Hussein's government to sell oil to buy basic goods for humanitarian purposes. It was intended to ease the life of ordinary Iraqis under UN sanctions since 1990.

Volcker said in the interim report—the final one will be available in June—the most serious violations of UN sanctions involved illegal oil sales outside of the oil-for-food programme. "And there is no question that those sales were known by the UN Security Council," Volcker said.

The fraud allegations have cast a shadow over the world body and its Secretary-General, Kofi Annan, who chose Volcker to lead the investigation.

The Secretary-General was "shocked" by the revelations and immediately ordered disciplinary action against the officials.

Annan, who took over the top UN post from Boutros-Ghali in January 1997, said in a statement that the report contained "extremely troubling evidence of wrongdoing" by Sevan.

Iraq's human rights minister said today that anyone who stole from the UN programme should stand trial and the money be repaid to the Iraqi people.

Bakhtiar Amin praised Volcker's report and said it revealed that even some UN dignitaries "profited as parasites on the misery of an impoverished nation". He said that "those proved to be involved should be rapidly brought to justice".

"Mr Sevan never took a penny," his lawyer Eric Lewis said. "Unfortunately, in the current political climate, the Independent Inquiry Committee needs to find someone to blame." Sevan has retired but could still face criminal action as the US authorities have their own investigation.

A CIA investigation in September 2004 found that Saddam had earned US$ 1.7 billion via kickbacks on goods and oil under the programme. He got an additional US$ 8 billion in oil sales to Jordan, Turkey and Syria, which were known to the council. (LF)



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See also
Evidence of corruption in the UN's Oil-for-food programme
UN knew about Saddam's smuggling under the oil-for-food programme, says independent investigation
Scant proof Annan knew of deal over oil for food
Iraqi judge and son gunned down
Mehlis leaves, UN probe into Assad's role continues


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