The UN, New York, NY - February 3, 2005

The Volcker Committee, charged to investigate the UN Administered
Oil-for-Food program, has submitted its 300 pages interim report, and
an out
of the ordinary Press Conference was called this afternoon at the UN.

The speaker for the Secretary-General was European Mr. Malloch Brown,
the
former Administrator of the UN Development Programme (UNDP), who
recently
was brought into the General-Secretary’s office as Chef de Cabinet or
main
troubleshooter. Mr. Brown is in charge of all that deals with UN Reform
and
is now the face in the effort to mend the UN relations with the main
Western
powers by leading the charge for change.

The interim report mentions two names - Messrs. Joseph Stephanides and
Benon Sevan: the latter was head of the of the Iraq Programme at the
UN.

Mr. Brown said that let us be clear - no attempt here to hide - the
Volcker’s
report is published without delay. Criminal actions were not yet
proven.
The moment there is a case file that satisfies the prosecutors, the UN
will
cooperate with that. It is now a matter of discussion between Volcker
and
the prosecutors. If it is found that diplomatic immunity should be
waved,
the Secretary-General will wave the immunity for Mr. Sevan.

Then, let us keep things in perspective, according to Mr. Brown.
There are
$21 billion missing and only $160,000 are mentioned so far connected to
the
Oil-for-Food program and Mr. Sevan’s name. There is here a huge
difference
in scale. The large amounts stem from oil smuggling and price fixing
- not
from Oil-for-Food. “It is a much bigger story then the UN - we would
like
that all actors show the openness to inquiry that we showed (at the
UN).”
Many countries should look at their own ways of condoning the Sadam
regime.”

Mr. Brown’s defense points at the fact that many countries and many
businesses took advantage of the official embargo on Iraq and dipped
their
hands in the oil wells. He is right that the Gilded Oil Barrel sits on
a
tripod stool. True that countries and businesses are better
positioned at
taking the largest share of this - under the table business - so let’s
accept that the UN Bureaucracy leg of that tripod is shorter then the
other
two legs. But this is only a small part of the story, even if it may
be
the larger part in the take. The other aspect is that all know -
governments and businesses will take advantage when they can do so -
but then, an international bureaucracy is there to make sure that this
does
not happen, rather then to swim in the same puddle with the rest and
then
cry - see we got the mouse share and they got the lion’s share.

In terms of loss of face, those bureaucrats, if proven guilty, are the
major
leg of the above mentioned tripod.

The up-shot is thus that the UN must be thoroughly reformed, quite a
few
member states supported bureaucrats must be let go. There must be a
most
stringent adherence to staff that is made up of independent
international
civil servants. Their allegiance should be only to the institution,
and
not to the countries that put them there because of an insane quota
system,
and then hold them responsible for supporting the interests of those
that
appointed them in the first place. I assume that this might turn out
to
have been the way the barrel was skimmed off.

If Mr. Brown does not come up with real reforms, he will end up wasting
his
time trying taking out thorns from the UN’s hide, and this institution
will
fail like the League of Nations failed.

The Secretary-General’s Statement on the interim report of the
Independent
Inquiry Committee says among other things:

“As chief administrative officer of the United Nations Organization, I
am
responsible and accountable to the member states for its management.
Last
year, in order to fulfil that responsibility, I set up, with the
support of
the Security Council, an independent inquiry into the administration
and
management of the Oil-for-Food Programme, including allegations of
fraud and
corruption - so as to get a clear idea of what was wrong, and what
remedial
actions are needed. I asked Mr. Paul Volcker, Justice Goldstone and
Professor Mark Pieth - three men of extraordinary distinction in their
respective fields of finance, law and criminology, men whose integrity
and
competence is beyond doubt - to conduct that inquiry”.

“Mr. Volcker has said that ‘the findings do not make for pleasant
reading’,
and I agree. Indeed, they make especially uncomfortable reading for
all of
us who love this Organization and have done our best to serve it over
the
years - for two reasons:

First, colleagues alongside whom we worked face serious accusations….

Secondly, while I am very glad to note the finding that UN budgeting,
accounting, and administration were in general disciplined in
maintaining
the use of funds for Programme purposes, I must also take note of the
findings that the initial procurement process for companies to carry
out
banking and inspection services fell far short of the standards of
fairness,
objectivity transparency required by the Charter and by United Nations
rules, and that the management controls and systems set up for the
programme
were, in many cases, inadequate to the task”.

The Secretary-General in his statement does indeed declare the kind of
institutional bankruptcy that comes with the acknowledgement of - lack
of
“fairness, objectivity and transparency required by the Charter.”
This
besides the acknowledgement that “the initial procurement process” or
the
setting up of the “banking and inspection services” was below standard
- or
in plain English the worm was inbred right from start !

This is what we observed in our February 1, 2005 article on “The Gilded
Oil
Barrel At The East River and The Holocaust: The Real News”. Examples
abound at the UN. Transparency and self-criticism should not be
foreign
concepts to the inhabitants of the UN tower. Trying to reduce the
importance of the present case by pointing at the discrepancy of scale
is a
very poor idea, instead it would have been better to point out that
there
might have been, yet to be proven, links between the smaller figure and
the
larger figure - the lack of inspection and a possible miserable banking
situation that was set up perhaps specifically to enable the larger
losses.

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