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Weapons of Mass Destruction (WMD)

SLUG: 2-323465 UN/OIL FOT FOOD (L-only)



TITLE=UN/Oil For Food (L-O)

NUMBER=2-323465 (CQ)





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HEADLINE: U.N. Official Predicts Annan to be Vindicated in Oil-For-Food Probe

INTRO: A senior U.N. official predicts the Volcker Commission investigating the Iraq oil-for-food scandal will clear Secretary-General Kofi Annan of wrongdoing. From U.N. headquarters, VOA's Peter Heinlein reports, however, that Mr. Annan's son, Kojo Annan is expected to come in for severe criticism.

TEXT: U.N. chief of staff Mark Malloch Brown Wednesday confirmed a British newspaper report that Secretary General Annan had met several times in 1997 and 1998 with top officials of the Swiss firm Cotecna. The meetings came at roughly the same time as Cotecna was awarded an oil-for-food contract worth about 60-million dollars.

The newspaper also reported that Mr. Annan's son, Kojo Annan had received more than 300-thousand dollars in payments from Cotecna. The younger Mr. Annan worked for Cotecna in Africa in the mid-nineties, and has previously admitted that the company kept on paying him 25-hundred dollars a month until early last year.

The Volcker Commission, which Mr. Annan appointed to look into allegations of corruption and mismanagement in the 65-billion dollar oil-for-food program, is due to issue a report next week. The report will focus on the question of whether the secretary-general or his son acted improperly.

But despite the latest revelations, chief of staff Malloch Brownb staunchly maintained the secretary-general's innocence.


At the moment we have story of a son who is being investigated for his actions, and they will have to be judged on their own rights as to whether they were appropriate or not. The second phase of the story is, are they in any way linked to wrongdoings by the secretary-general, and we stand by it that we believe on Tuesday the secretary-general will be exonerated of any wrongdoing.

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Mr. Malloch Brown pointed out that Kojo Annan had previously admitted misleading his father about his relationship with Cotecna. The staff chief suggested that the Volcker Commission would judge the younger Annan's activities harshly.

Kojo Annan, however, has previously denied helping Cotecna win the oil-for-food contract, and Cotecna officials say they did not take advantage of Kojo Annan's access to the secretary-general.

On a related matter, U.N. officials confirmed that the secretary-general approved a decision to use thousands of dollars from Iraqi oil revenues to pay legal fees of former oil-for-food program chief Benon Sevan. In a report issued in February, the Volcker Commission concluded that Mr. Sevan had "seriously undermined the integrity of the United Nations" by improperly steering lucrative oil-for-food contracts to friends.

A U.N. spokesman Tuesday said the decision to pay the fees had been made to get Mr. Sevan to cooperate with the investigation. Within hours, however, the Volcker Commission issued a terse statement saying the spokesman's explanation was wrong.

Chief of Staff Malloch Brown admitted the mistake Wednesday, saying "we boobed. We got it wrong". He said the agreement to pay Mr. Sevan's legal fees was cancelled the day the Volcker Commission found him guilty of improprieties.


Benon has been subject to the interim findings of 30-million dollar, 65 investigator investigation, which says, in it's view, assignments.neb-wire

he's guilty, not necessarily of criminal wrongdoing, but guilty of major breaks of the staff rules.The day the Volcker report came out, our presumption is this investigation which the secretary-general commissioned is right, the burden is on Mr. Sevan to prove otherwise, and he has an internal justice process to allow him to do that.

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Iraq's U.N. ambassador Wednesday described the decision to use oil-for-food money for Mr. Sevan's legal fees as "scandalous". In a written statement, Ambassador Samir Sumaidaie said the credibility of the United Nations had been called into question. He urged the Security Council to intervene to reverse the decision. (Signed)


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