Crooks coming out of the wood work. Read on please.
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By Roger Franklin
March 28, 2004
Almost a year ago, when kitchen workers at the United Nations' headquarters walked off the job in a dispute over holiday pay, the cream of the world's diplomats thronged to the five unattended restaurants there and stole everything that wasn't nailed down.
As one witness marvelled after seeing an envoy make off with a baked turkey under one arm and a framed picture under the other: "They were locusts!"
The next day, however, the incident had not happened - not officially, anyway.
A UN spokesman swore blind that a senior official, concerned that his colleagues might go hungry, had granted permission for staff to help themselves. In other words: no mass theft. As excuses go, it was not bad.
If all pillage was as easy to explain, the UN might not today be facing what is shaping up as the biggest scandal in its history. This time it's not about cutlery and baked hams, but at least $11 billion, depending on who is doing the counting - or rather, the guessing, since the UN has been disinclined to investigate.
Whatever the sum, it vanished from the UN-administered Iraq Oil for Food program, and those at the centre of suspicion are not lowly bureaucrats but a tight cluster of high-up insiders centred on the office, family and inner circle of Secretary-General Kofi Annan himself.
To understand what happened - what might have happened - you have to go back to 1996, when the UN set up a system whereby Iraqi oil could reach the market only if the proceeds went to the "humanitarian relief" of the Iraqi people.
Two years later, at the end of 1998, the UN appointed a Swiss company called Cotecna to run the program, which would supervise the flow of some $100 billion in oil receipts before it was finally shut down last November, when the UN reluctantly surrendered the job to the US-appointed Iraqi Governing Council in Baghdad.
What was Cotecna? For one thing, it was the former employer of Kofi Annan's son, Kojo, who was on the payroll until just before the contracts were awarded.
Cotecna's job involved squaring the income from oil sales against the goods allegedly bought. In the first year alone, Cotecna pocketed $6 million for its services. After that, because the UN is not saying, its share of the bounty is anybody's guess.
When Claudia Rosett, of The Wall Street Journal, began looking into the Oil for Food program, she soon came up with one explanation: many of the suppliers, like the Jordanian manufacturer of school desks listed on contract records, simply did not exist.
As Rosett has noted, Cotecna was responsible for approving "tens of billions worth of supplies inbound to a regime much interested in smuggling, and evidently accustomed to dealing in bribes and kickbacks".
Evidence of probity, however, is as hard to find as those notional school desks from Amman.
The suspicion is that those deals, perhaps the overwhelming majority, were nothing but scams and shams. Remember how opponents of the war kept citing the hundreds of thousands of Iraqi children dying for want of medicines?
Well, Oil for Food was supposed to guarantee that those supplies arrived. Apparently few did.
Again, the UN's stonewalling makes it hard to determine exactly how much was fleeced, but there are some tantalising hints. Before Oil for Food was handed over to Iraq, the UN conducted an urgent, last-minute review of thousands of contracts.
Rosett calls it a "house cleaning", but whatever description is used, some 1500 supplier contracts - one in four - were immediately suspended or banned outright from further participation.
So where did the money go? Into Saddam's pocket is a good guess, with lesser amounts creamed off by the operators of front companies, smugglers and, perhaps, even UN officials.
According to the best estimate of the non-partisan US Government Accounting Office, Oil for Food generated at least $10 billion for Saddam's family, and a further $1 billion to pay the 1000-plus UN bureaucrats who were supposed to be keeping it honest.
Again, the focus is on Kofi Annan, who helped set up Oil for Food in 1997 and installed his close friend and fellow diplomat Benon Sevan as its director. Last week, with Rosett's series igniting a firestorm over the UN, Mr Sevan was not answering his phone. According to a UN spokesman, he is using up accumulated leave before retiring.
For his part, a po-faced Mr Annan now concedes "it is highly possible there has been quite a lot of wrongdoing", and has authorised an internal investigation.
Neither Rosett nor congressional investigators hold much hope it will be more than a whitewash. The UN has other matters it would much prefer to talk about, like a $1.2 billion interest-free loan from Washington to renovate its decaying New York HQ
. George Bush has rejected the request, saying the UN could have the money at the standard interest rate charged to American home buyers.