UN: A UN-appointed panel investigating corruption in the $64 billion UN oil-for-food programme in pre-war Iraq has reopened an investigation into whether Secretary General Kofi Annan steered business to a Swiss company that once employed his son.
The move came after investigators obtained a 1998 memo written by a former executive of the Geneva-based company, Cotecna Inspection SA, claiming that Mr Annan and his staff indicated support for the company's bid for a $10 million-a-year contract to oversee imports of humanitarian aid into Iraq.
Mr Annan has denied knowing that his son's former employer was trying to do business with the UN before it won the Iraq contract. On Tuesday his spokesman questioned the veracity of the memo, noting Mr Annan "had no knowledge that Cotecna was a contender for that contract".
The UN-appointed Independent Inquiry Committee, headed by former US Federal Reserve Bank chairman Paul Volcker, said in a March 29th report that it found no evidence Mr Annan had used his influence to award contracts to Cotecna.
But the committee issued a statement on Tuesday saying it was "urgently reviewing" the new information; and Reid Morden, its chief of staff, said: "We will have to take careful look at what this [ memo] says. Certainly, it's a very interesting document that has now come to light."
The memo's disclosure drew sharp response from congressional critics of the UN, who argue that UN mismanagement of the oil-for-food programme underscores the need for reform. Henry Hyde, a Republican, is preparing to introduce legislation to withhold funding to the organisation if it fails to implement far-reaching changes.
Senator Norm Coleman (Republican), chairman of the Senate permanent subcommittee on investigations, said the new document "corroborates our suspicions and amplifies our concerns about the secretary general's serious conflict of interest. I fully expect that Mr Volcker's investigators, due to their unique access to the secretary general, will aggressively follow up on these new revelations."
On Monday, Cotecna made available to Mr Volcker and congressional investigators the memo from Michael Wilson, a former Cotecna vice-president whose father was a friend of Mr Annan's, to his bosses describing a November 1998 meeting in Paris with Mr Annan and his staff.
"We had a brief discussion with the SG [ secretary general] and his entourage," said the memo, dated December 4th, 1998, one week before Cotecna beat two competitors for the contract.
"Their collective advice was that we should respond as best as we could to the Q & A session of the 1-12-98 and that we could count on their support" - referring to a December 1st meeting Mr Wilson had in New York with UN officials about the Iraq contract. Existence of the memo was reported in Tuesday's New York Times.
Mr Annan's spokesman said the secretary general could not remember meeting Mr Wilson. He said the United Nations had provided Mr Volcker with a record of Mr Annan's meetings during the trip and the names of the members of the UN delegation. "There is no mention in that trip record of any exchange with Michael Wilson," he told reporters. "We spoke to the secretary general, who is in Paris today, and he has no recollection of any such exchange."
A senior official familiar with Mr Volcker's investigation cautioned that Mr Wilson's credibility has long been a subject of concern by the committee. Mr Wilson initially told Mr Volcker's investigators that he had discussed Cotecna's attempts to do business with Iraq in 1997. He later retracted the statement, saying the discussion occurred in 1999, long after Cotecna had been awarded the contract. More recently, Mr Wilson has been involved in a corruption investigation in Geneva involving construction of a UN facility.
The Volcker panel had accused former head of the UN programme Benon Sevan of improperly steering Iraqi oil deals to an Egyptian businessman. Mr Volcker's decision to clear Mr Annan of directing business to Cotecna prompted the resignation of a top investigator, former FBI agent Robert Parton, in protest.