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Weapons of Mass Destruction (WMD)

PRESS CONFERENCE BY CHEF DE CABINET ON OIL-FOR-FOOD PROGRAMME INVESTIGATION

Department of Public Information . News and Media Division . New York

8 August 2005

Following is a near-verbatim transcript of today’s press conference by Mark Malloch Brown, Chef de Cabinet.

Mark Malloch Brown: Let me just quickly read a statement first.

The Secretary-General this morning received the Third Interim Report from the Independent Inquiry Committee into the United Nations “oil-for-food” programme from Chairman Paul Volcker and his two fellow IIC members Richard Goldstone and Mark Pieth. He is deeply concerned by the conclusions it reaches about Benon Sevan, the former Executive Director of the United Nations Office of the Iraq Programme and Alexander Yakovlev, a former United Nations procurement officer.

The IIC has recommended that the Secretary-General accede to any properly supported request from an appropriate law enforcement authority for a waiver of immunity from criminal prosecution for both Mr. Sevan and Mr. Yakovlev. The Secretary-General, as he has made clear many times, will do so.

With specific regard to Mr. Sevan, the United Nations is already cooperating with inquiries from the Manhattan District Attorney and is in the process of replying to a request for cooperation from the United States Attorney for the Southern District of New York. With regard to Mr. Yakovlev, the United Nations Office for Internal Oversight Services (OIOS) last month contacted the United States Attorney for the Southern District of New York to alert them that internal, ongoing investigations of Mr. Yakovlev had turned up prima facie evidence of criminal wrongdoing and has shared that evidence with the United States Attorney’s office.

With respect to broader United Nations procurement practices, following a series of reforms put in place since the late 1990s, the United Nations recently commissioned an independent review of procurement practices from the United States National Institute of Governmental Purchasing. That review, which was completed last month, strongly supported the thrust of the reforms and made a number of additional technical recommendations. As part of its investigation of Mr. Yakovlev, OIOS will separately make recommendations for further reforms, particularly regarding strengthened supervision and controls over individual procurement officers. The Secretary-General intends to act expeditiously to implement those recommendations.

The Secretary-General also notes the IIC’s commitment to publish its comprehensive report in early September including recommendations for action. That report will include an overall assessment of the oil-for-food programme and specific conclusions about the role of the Security Council, the United Nations Secretariat and the Secretary-General and United Nations agencies. He very much looks forward to that report, not least in the strong expectation that it will clear up any remaining questions concerning his own conduct.

Now let me just add one sort of late-breaking note. We have in the last hour been contacted by the United States Attorney for the Southern District and been requested to waive Mr. Yakovlev’s immunity. The Secretary-General has done that within the last few minutes. We believe Mr. Yakovlev is already in custody.

Thank you.

Questions and Answers

Question: I have a technical question about immunity since, as of yesterday, none of these are United Nations employees. Do they even have immunity?

Malloch Brown: Immunity covers in this case the period in which the acts of those who were accused of took place. So, immunity is extremely relevant and the waiving of it important for proceeding with court action against both of them.

Question: So, although not mentioned in this report, a central United Nations figure in this report, in the sense that two of his relatives are mentioned in this report. Is there any thinking about doing anything about Boutros Boutros-Ghali?

Malloch Brown: Let us wait and see what the final report has to say about his role.

Question: Isn’t it a bit absurd for the United Nations to give us all these answers about waiving immunity when the United Nations is complicit in helping Benon Sevan get out of this country, get out to Cyprus, which doesn’t extradite its nationals. Once we had been told that he was employed on this $1 a year which maintained his immunity because he was cooperating with the inquiry. Now we learn he hasn’t been helping with the inquiry. Isn’t the UN complicit in helping him get away with it?

Malloch Brown: You use the word “complicit” a lot in that question. We certainly were not complicit in him going to Cyprus and...

Question: Were you not able to require him to remain cooperating with the inquiry and remain in the country? You are paying him a retainer, are you not able to tell him where he should be?

Malloch Brown: I think, for those listening and watching this, we should all remind ourselves we had a technical arrangement with him to give him a dollar a year to allow him to remain in the country under a diplomatic visa to cooperate. That did not give us any control over this retired staff member and was not required to go...

Question: [inaudible] neither remained in the country nor cooperate.

Malloch Brown: Do you want answers or are you going to...?

Question: You are telling me that was a point of the arrangement, but now it turns out that he neither remained in the country, nor did he cooperate. Why did the United Nations maintain this fiction of the dollar a year for so many months, enabling him to get out of the country and get away with it?

Malloch Brown: It was not a fiction, it allowed him to remain here to answer the questions both of the IIC and others who sought to get to the bottom of this. It did not prevent him, as a retired United Nations official who was under no expectation of coming to work every day, from leaving. The United Nations is not a State, it doesn’t control borders, it cannot compel people to stay in one place and...

Question: ...for immunity, which was what he did, which enabled him to leave the country.

Malloch Brown: You know, if you don’t mind, this is a press conference and, therefore, others have a right to ask questions, and, I expect, others would also enjoy the right to hear answers.

Question: You haven’t mentioned Michael Wilson and the e-mail. Questions again about what did the Secretary-General know about his son’s involvement with Cotecna. There are going to be fresh questions about his involvement. What does he say to these renewed questions?

Malloch Brown: I think he is disappointed that this issue was raised in this report, because it was raised and not answered. In the last report, as Mr. Volcker himself said today, there were two-and-a-half charges, if you like, which they addressed as regards the Secretary-General. The first was: did he influence the awarding of the contract to a firm where his son worked? And they concluded he didn’t. Mr. Volcker reaffirmed today in his press conference that there was nothing to lead them to re-visit that finding. A second finding was: was the initial internal investigation that the Secretary-General commissioned adequate, at the time, or several years later, to conclude that that had not happened? Mr. Volcker repeated again this morning that it was not, and the Secretary-General has always acknowledged that, which was why he established the IIC.

The other half-a-finding, as again Mr. Volcker in his own words described it today, was: was the Secretary-General aware that his son’s firm was bidding for this work? That is obviously much less of a charge than the one, did he influence, of which he remains absolutely cleared. As the Volcker report implies when it says they have received denials from many of those involved, the Secretary-General believes that no meetings such as that described by Michael Wilson took place. Other members of the Secretary-General’s entourage have also confirmed that they have no recollection of such meeting.

I think it is a pity that this issue was raised in this report, leading to you, very reasonably, putting that question here today. I think it would have been better if this matter could have been left until September and the answers provided at the same time that the questions were raised. Therefore, the Secretary-General is anxious to get to the closure of this, for final answers to be delivered, so that this matter can be cleared up once and for all.

Question: Mr. Volcker, in describing that e-mail, said it clearly raises further questions. Could you describe how the latest meeting between the Secretary-General and the Volcker-Committee went, how much they queried him about that e-mail, and also, separately, how concerned you are in terms of the timing of the next report, with the Summit being so close?

Malloch Brown: On the meetings between the Secretary-General and Mr. Volcker, I understand –- I was not at them myself –- that the Secretary-General answered very fully all the questions that were raised. I can only speak to his feelings after them, which was he felt he’d cleared the air and given satisfactory answers to the questions that were raised. As to the timing of the report –- it is clear today that Mr. Volcker again confirms that we should expect it in early September. Frankly, on balance, that is a good thing, for two reasons. One: it will clear up this business that is the subject of the last couple of questions. It won’t leave the Secretary-General going into the Summit with this unresolved cloud over his head of what did he know when.

Second, I think it is important, because, as both Sevan and Yakovlev cases demonstrate, there remains a real need for serious, deep-rooted management reform of our Organization. That does not yet seem to be fully accepted by all Member States. There is, in the drafting of the declaration of the Summit, still a lot of political pushing and shoving from all sides on the “Management Reform”. Maybe, Mr. Volcker can give us what is needed to lift this issue above politics and to say: this United Nations that we all believe in badly needs the strengthening of its management systems. I think his report will be an eloquent demonstration of that and may help, frankly, in some ways to tee up the Summit. Having said all of that: would you want a report of this raining on your parade just a couple of weeks before a global summit? In an ideal world, no, but oil-for-food is not part of an ideal world.

Question: What is your sense of the fact that Mr. Yakovlev is in custody and that there are also investigations into conflict of interests of his son working for a contractor, and what it says about the Organization that he indeed siphoned off more than a million dollars into an off-shore bank account?

Malloch Brown: It says that parts of our procurement system are not working and that we need to have the OIOS look at why there were those breakdowns of supervision and control and to correct them. At the same time that we may debate with you issues of individual wrongdoing and responsibility, I think we share absolutely with you the import of your question. This is an Organization that needs major management reform.

Question: We have the Volcker report and the investigation. We have the Colman’s investigation, Henry Hyde’s investigation, the Attorney-General’s investigation. Do you believe that all these investigations and the corruption in the oil for food programme have seriously damaged the United Nations reputation, and if so, how do you think the United Nations can recover from this? Do you believe that reforms alone can repair the damage?

Malloch Brown: Well, I think these investigations have done a lot of damage, unevenly across the world, in some places more than others. But the fact is, they are investigations triggered by failings and, therefore, you can’t blame the investigations. We think the antidote to them is effective reforms. If we have a complaint, it is that they have looked perhaps too narrowly at the wrongdoings of a couple of United Nations staff members –- vital though those are, because a single dollar lost to corruption is a dollar too much if you’re handling international public monies -- and have not looked more widely at the extraordinary network of companies across the world who were profiting every day on a scale, a huge multiple of the benefits to any United Nations official, and have not looked more widely at the role of sanctions and the political decision-making behind it, which created also sort of patterns of advantage to certain countries.

So we complain that this focus on the little black dot at the middle of this has missed the much wider circle of problems that have not perhaps been addressed.

We also, of course, regret, as Mr. Sevan put it in his letter released to all of you late last week, the very real achievements of this programme also get overlooked. And you know, we put out to you, the United Nations press corps repeatedly the fact sheets on what happened to nutrition, the successes in preventing the import of materials to create WMDs. But rarely, if ever, do you include that in your reporting of this story.

Question: Some of us have. A couple of quick technical questions. First, what is the act of lifting diplomatic immunity? Is it just a letter, who does it go to, how does that work? Second, does Mr. Sevan’s status change with his letter of resignation? And also, could you explain to people outside the United Nations how someone can resign from a job that they’d already retired from?

And third of all, is there any response from the Secretary-General about the letter itself? I mean, there were some pretty emotional thoughts expressed.

Malloch Brown: Well, first, the act of waiving diplomatic immunity is indeed a letter back in response to, in this time, the United States Attorney for the Southern District, in which he requests us in writing to waive, and we write back, confirming that we have waived. It is then in all such cases followed by cooperation. And I think, I hope you’ve not all missed the point we are making, that while we had not shared this fact with you, we brought the case of Mr. Yakovlev to the attention of the District Attorney –- sorry the Attorney for the Southern District -- more than a month ago, and have already been sharing information that we had collected with his office. And so it’s not just the waiving of the immunity, it’s the active collaboration and sharing of the files, so that a criminal prosecution can follow on the investigation that we have undertaken.

On your second point, you know obviously there’s a little bit of schizophrenia in this room about what the dollar a year amounted to. In James Bone’s view it came with huge responsibilities for us to be able to control...

Correspondent: [inaudible] ...sorry, I’ve been insulted from the podium. I would like to have to have the right to respond [inaudible]. If I’m going to be insulted as schizophrenic, I’d like to respond.

Malloch Brown: Well, I think schizophrenic in the room. That was not -- there are two points of view in this room -- what did a dollar a year have with it responsibilities or not. I won’t quote James’ version of the responsibilities back to you, but to say that indeed, his letter of resignation had no pecuniary impact other than that he loses a dollar a year. But it does have several consequences. One, it ends the internal disciplinary procedure against him, which has been overtaken now by the prospect of criminal charges anyway. And secondly, it loses him the right to a G-4 visa, and therefore, if and when he returns to the United States to face criminal charges, it would have to be under other visa arrangements.

On the final point, the Secretary-General’s comments or reactions to the contents of Benon Sevan’s letter. Let me just make two points. I mean, you know, the Volcker report speaks for itself. It assembles a lot of evidence. If indeed a criminal authority decides that that evidence does make the case for a criminal investigation, and latter that leads to a criminal conviction, many of us will be very sad –- not just the Secretary-General, I would be included in that number and Benon’s many other friends and colleagues, because we hoped it was not going to be true. And of course, still there is no conviction. This was, as Mr. Volcker stressed this morning, a fact finding investigation –- not a judicial one.

But the second point, I think that the Secretary-General would want to make is that when you set up something like the IIC to investigate the conduct of your colleagues, you are then obliged to step back and not offer a defence of them. You must let the chips fall where they will, once you announce an investigation of this kind. So I think it’s very much the case that the Secretary-General would have been as pleased as anybody if Benon Sevan had been cleared. He now accepts that there is a high level of evidence that’s been assembled against him –- accepts it with great personal sadness -- but will continue, by waiving immunity if so requested, to ensure that justice is done, because that must prevail over any personal considerations.

Question: We were told almost daily at the noon briefing that Benon Sevan was making himself available to Mr. Volcker and yet, they do not seem to paint the same picture. How do you account for this discrepancy?

Malloch Brown: Well I would say that when you all first started asking that, we did informally check with the Volcker people who at that point, you know, did not raise with us the fact of... they had complaint at that time, that there was a lack of cooperation. And perhaps in order to protect their own process, they neither then nor subsequently had raised the issue of his non-cooperation. I think they perhaps thought it wasn’t our business. They had not wanted us to interfere in any way into this investigation and presumably they thought they should pursue that matter in their own way. So that news today was news to us as well as you.

Question: A couple of questions to clear up a few points, and sorry if you went through this. On Mr. Yakovlev, on the indictment, when you started talking to the United State’s Attorney’s Office for the Southern District a month ago, was it only in relation to oil-for-food or was it in relation to the other procurement allegations of possible misconduct? As far as you know, is the United States Attorney going to be investigating all of his conduct in that letter and has this letter that you talked about actually been sent? And [inaudible]...

Malloch Brown: Well look, on the first point, OIOS was investigating everything but oil-for-food, because it did not want to overlap with the investigation of the IIC. So it was investigating other allegations of procurement, corruption. And indeed, as you can see from the IIC report, there is no proof that money changed hands as regards oil-for-food, but it is –- appears evident that very large amounts of money changed hands, in excess of a million dollars, to do with other procurement.

As to the exact scale and scope, therefore, of the Southern District charges, I’m not sure whether they will or will not touch directly on the oil-for-food item.

On the status of the letters we received within the last hour, the letter from the United States Attorney’s Office and the Secretary-General approved a waiver in that, and you know, and literally, probably as we speak, a formal letter back confirming that from the Office of Legal Affairs is on its way out the door.

Question: I just wanted to go back to two things having been at Volcker’s news conference. When you were talking about what Volcker in terms of exoneration or non-exoneration, he, although he did say that initially the Secretary-General, well, that he had interpreted what he said about not having been involved in the conflict as an exoneration. At the end of that particular question, he said that he did not believe that the Secretary-General was exonerated, and that he saw that this was all still under investigation.

Malloch Brown: Well, I think again, I’m not sure exactly at what point you slipped in, but, you know, I think his comment referred to what he called the “half charge”, which was, was he aware that his son’s company, the Secretary-General’s son’s company, was a bidder for the Cotecna contract. I think he did make it clear that none of the new information touched on the bigger whole charge, if you like, if had the Secretary-General sought to influence it. He also referred to the fact that a lot of people involved had denied that any meeting had taken place, which is, you know, the key new piece of evidence which might have meant that the Secretary-General was aware of such a bid. Our regret is that this is brought up in this report in this sort of somewhat anecdotal rather than finished form, because we very much hope that when we weigh the different witnesses to this, that they will indeed, conclude, that the Secretary-General’s claim that he was not aware of this remains confirmed, and you know, roll on early September to get this finished once and all for all and behind us.

Question: You heard that Mr. Sevan complained about the Secretary-General. He said he was responsible for all these things [inaudible].

Malloch Brown: Well, it wasn’t the Secretary-General’s bank account into which cash was being paid. It was not the Secretary-General which sought oil concession for a company run by a friend. The Secretary-General extends great trust to those who work for him. He must, running an organization of this multibillion dollar size. And, ultimately, would be the first to say that the buck stops with him. But in any organization, where you have procurement by officers who are, when you have corruption by officers, the whole point is seeking to hide that from the chief executive. And, therefore, the critical thing is when there are stories of it that it is investigated, action is taken and reforms are made to stop it from happening again. And in that level, the Secretary-General is showing accountability.

Question: Last year, when this whole scandal broke, the Secretary-General said he could not believe that Benon Sevan could be guilty. There are reasons at this point to wonder about the Secretary-General, which is the reason it’s coming up. Would the Secretary-General be prepared to put out before the public his own bank accounts, in the same manner that we now have access to those of Benon Sevan? If there is nothing to hide, surely it would be no problem to simply publish those documents?

Malloch Brown: I think, you know, he also feels there is nothing to hide, but he is being dragged into extraordinary questions and allegations, which amount to an invasion of privacy by any standard. I am deeply sympathetic with the Secretary-General’s position, which is that allegations of this kind don’t give people the right to see every aspect of his personal and financial life. What he has done is shared every part of his financial records and past that the Volcker Committee has requested, with them. And I think this will allow a very clear determination by them as to whether or not, indeed, he has anything to hide. And I think that is a very reasonable way to meet the fullest standards of disclosure, while preserving privacy. You know, when this goes into a realm well beyond what the initial allegations are, because –- really -- I don’t think you have suggested that the Secretary-General has personally enriched himself from this.

There are limits. There are just limits, and the whole point of having three people of extraordinary integrity and independence, such as Mr. Volcker and his two co-panellists, is for them to determine whether in a case like this, the evidence holds up, or if there is a case to answer -- not to do through the pages of the press.

Question: Can you confirm that the Secretary-General has disclosed in full his financial holdings, bank accounts and other properties -- basically his full financial picture -- to the Volcker investigation?

Malloch Brown: Every piece of financial information that they have requested of him, including personal bank materials, he has, indeed, provided them with.

Question: Two questions: Does the Secretary-General still believe that he has been exonerated by the Commission? Has the United Nations conveyed to the Commission its view that not enough effort has been put into the broader picture of the programme?

Malloch Brown: On the first one, we come back to the “two and a half” charges of Mr. Volcker and on the big one: Did he seek to influence the contract for Cotecna in favour of his son. He believes he remains fully exonerated; that nothing has been raised which puts that in doubt. We believe Mr. Volcker has reconfirmed that today. On the smaller charge of “Did he know about the Cotecna bid in advance?” he is absolutely certain that he didn’t and he will be cleared of this, but he recognizes that the paragraphs and the (inaudible) today make it clear that he is going to have to wait until the final September report -- the big report at the end of September -- for the vindication he expects to get on that second, lesser point.

On your other point, we very much hope, again, that September will take a broader view. As Mr. Volcker said this morning, that it will look at the Security Council and the 661 Committee, that it will look at the broader political context. Unfortunately, it may not look at all aspects of subsequent oil-for-food money use in the CPA, because that is outside the mandate of the panel, but I think the broader the look, the broader the context setting, the better for us, because it will show that the United Nations programme was a small part of a much bigger problem. And, once you recognize that, you don’t just look exclusively at United Nations officials to try and assign culpability. You see that there were huge flaws in this programme and that the master at the centre of the web was not Benon Sevan. That spider was Saddam Hussein.

Question: (inaudible) on the issue of the CPA money with somebody else?

Malloch Brown: Well, we are members of the IAMB, the audit board that has been reviewing those programmes, and the audits done jointly by auditors commission, by ourselves, the IMF, the World Bank and I forget who else are members of that IAMB, have all indicated major, major problems with expenditures. And we don’t raise that to sort of try and turn the accusations to others, but to just give people a little bit of contextual understanding that running development programmes in Iraq in recent years has been a tough business for anybody trying to do it: for the American administration, as much as the United Nations.

Question: Two questions. One, you gave an update earlier as to Mr. Sevan’s whereabouts. Where is Mr. Yakovlev and would the United Nations waive his immunity?

Malloch Brown: Oh, you just came in. He is in custody.

Question: Also, about the e-mail, just to be clear: Is the Secretary-General maintaining that … (inaudible)

Malloch Brown: He is maintaining that meeting never took place.

Question: Regarding the IAMB -- the monitoring board -- you are sending mixed messages. On the one hand, you are highlighting its findings, and on the other hand, the United Nations is extraordinary unhelpful with the press regarding talking about that information. So that’s a little point.

Two questions. In light of the reaffirmation of the findings against Riza Iqbal, will the United Nations reconsider its ongoing relationship with him? And my second question is: There was a specific case mentioned in the report, whereby Fred Eckhard did the honourable thing and mentioned the case of surcharge, at which point Benon Sevan wrote back to him and expressed his problems in (inaudible) the Secretary-General’s efforts to elicit cooperation from Iraq. In the light of this, does that have any implications for the independence or at least the way in which the press office should be allowed to put out information to the press, even despite the reluctance of United Nations officials, which may, in some circumstances, reflect less than honourable motives?

Malloch Brown: Gosh, Mark. Well, let me just say first on the case of Mr. Riza. Or Riza Iqbal, as he’s become known … I thought maybe if we listed him differently in the Directory, you wouldn’t find him under the new name formulation. Let me just say that what Mr. Volcker says is ... I think that he actually implicitly narrows the findings somewhat by confirming that he didn’t mean to impugn Mr. Riza’s motives or suggest that Mr. Riza had been trying to interfere with the inquiry.

But he did assert again that this was imprudent of Mr. Riza and I think that is a word I’ve used in responding on behalf of the Secretary-General at that time. It was clearly imprudent. But it doesn’t rise, as we’ve said before, to a higher level of having breached the Staff Rules. So, I don’t think there’d be any reason to change that. Because, as I say, if anything, I hope Iqbal Riza today feels a little bit better than he did yesterday, in that the exchange between him and Mr. Volcker brings a little more clarity and narrowing of this charge against an extremely honourable friend and colleague of all of us.

On the second issue, on the role of the Spokesman’s Office, obviously it is the Spokesman’s Office…it speaks for the Secretary-General and offers commentary and official positions. But you know, we are combining … and, therefore, I’m not sure it will ever live up to your desires for spontaneous free speech. It would lose, in a sense, a lot of its news-breaking character if it just reported anything, anytime. It’s our voice but let me, in regard to the point you make, draw attention to the whistle-blowing policy that we put out in draft some time ago. We received an awful lot of animated comment from staff members and are bringing it back to the Management Committee to finalize the policy in the next few weeks.

Because I think what again, like with so much of the management reforms we’ve been talking about, this whole episode demonstrates is the need for a strong whistle-blower protection, so that indeed if there are guilty secrets in the Organization, they don’t stay secret for long.

Question: So far many secrets had surfaced and been known differently. Do you have any information in advance of all the facts about this matter? Could I ask you, so far, how much of the Iraqi money has been wasted on this problem?

Spokesman: Do you mean on the investigation?

Question: Yeah.

Malloch Brown: Thirty-five million dollars is what..

Question: And before that?

Spokesman: Thirty-five million dollars is the budget for the IIC.

Malloch Brown: I’m sorry. I don’t think we seem to be answering the question.

Question: The oil-for-food. Definitely, you have information from the beginning. How much of that money has been wasted …

Malloch Brown: Let’s wait for Mr. Volcker in early September. I think the fact is that, in terms of the nutritional status of Iraqis and preventing weapons of mass destruction, theprogramme was broadly a success. And, where money was subverted from those purposes, it was very largely, I think the numbers we’re seeing -- 99 per cent -- largely, diverted to Saddam Hussein and a network of commercial partners, who were politically connected around the world. It was not diverted to the United Nations or its officials.

Question: Did you have an opportunity to share the thoughts with the Secretary-General about his personal, what is his personal thinking actually about this investigation, in the way $35 million has been spent on this while Africa is starving. And frankly, what are your personal thoughts on this? And especially, we did have the problem of Srebrenica and it was not addressed with this kind of attention and this kind of allocated funds. What do you think?

Malloch Brown: Well you know both Srebrenica and Rwanda were the subject of similar independent investigations. I think they were lapses, they were policy failures, which did not require the massive forensic investigation that has undergone here. But I think they were given the same political priority and the Secretary-General demonstrated at least as much openness about accepting their findings as he has here. So, I think the political cost of both was as high as this one.

But I think you do make an important point. I mean, there is a little bit of a feeling frankly, on the part of all of us… I don’t put words in his mouth so maybe I should attribute and say this that my own feelings are, you know the Volcker investigation has been highly professional, it’s a first-class, very large group of investigators. It’s gotten all the money it’s asked from us to do a first-class investigation. It has established that one UN official apparently stole something in the order of $160,000 and indeed, as now established, there was also corruption in our procurement system.

But we wish that governments had been as willing to turn their own shortcomings in this programme, put them under the microscope for the same kind of examination of how they and their national companies behaved during this period, as we have. We feel we led, we opened the books, we allowed everything to be investigated and, as a consequence, perhaps inevitably, take the brunt of the press attention of it. Whereas those who’ve kind of stayed in the shadows, who’ve not had a Volcker to investigate their own politicians’ and diplomats’ and companies’ involvement in this programme, have got away a little bit more lightly, a lot more lightly. And there’s a certain sort of injustice in that but it’s perhaps one that is inevitable and we have to live with.

Question: Is that the perspective of the Secretary-General?

Malloch Brown: I think that’s probably fair to say. He shares that regret that it has to be this way. But he recognizes that’s the way the world is.

Question: Two quick questions. Since you mentioned this whole shopping for prosecutor for Yakovlev, how did you pick the Southern District as opposed to other prosecutors? Also, is there another one, are you still shopping for a prosecutor for Sevan as well? And the second question, since you said that Iqbal Riza probably is feeling better, I guess Stephanides must feel a little bit better.

Malloch Brown: Look, on the first question, OIOS … it’s whole purpose as an independent investigator is that even I don’t get told before they go to collaborate with national criminal authorities. So I am not privy to why they chose the Southern District over the Manhattan District Attorney. I’m just not sure. But there’s been very good cooperation and collaboration and I think both sides are pleased with the progress.

I think in the case of Mr. Sevan, we’ll have to wait and see. I mean, the IIC has now made its case. The document is a public document available to any criminal authority that wishes to take it up and proceed. We’ll have to see who chooses to pick up that baton and come forward with criminal charges.

On your second point on Stephanides, as you know, the IIC sort of makes two points, that the concerns with Yakovlev do not, in their view, interfere with the basic finding they made against Stephanides, which did not rest on the Yakovlev involvement in the Saybolt and SGS procurement, but the later Lloyd’s procurement. And so, at this point, as they make it clear, they don’t see that the finding is compromised, but they also indicate that in the light of this and in the light, I understand, of also new submissions by Stephanides and his lawyer, they want to take an opportunity to make sure that, in the same way, two others had appealed their adverse findings, Mr. Riza and Mr. Robertson, that similarly Mr. Stephanides is given the same opportunity and that they will come to full conclusion on that in the early September report.

Question: The (inaudible) of Stephanides I suppose to Riza and the other ones that you didn’t do anything .. and you fired him. Are you reconsidering your (inaudible)

Malloch Brown: We will wait to see the report, but Volcker makes clear at this moment that that original finding has not been compromised but watch this space. We’ll have a final word on this in early September and we’ll be watching that space and we’ll be watching to see what happens, but until that point, we are not reconsidering the finding.

Question: On OIOS, which has come under a lot of criticism itself, is the UN satisfied that it’s the main organ which should be now investigating procurement here, and would you be considering another possible outside investigation of UN procurement practices? And you yourself raised the frustration with what the members are willing to accept in terms of revamping management. Are there any specifics of things that you think they’re waffling over and is OIOS independence one of them?

Malloch Brown: Well, it is indeed. I had pointed out that, as part of our own internal management reforms, we had had the US National Institute of Governmental Purchasing review our procurement department and that review was completed at the end of June. It endorsed the direction that that procurement reform was taking but proposed a series of further technical reforms which we are going to implement.

Secondly, OIOS clearly has unearthed that we have not cracked the problem of adequate supervision of the procurement officers. By all accounts, they have individually too much discretion and authority on their own and, hence, the need to improve the control environment under which they operate. Moving from that to the management reforms, it’s two points. One, for goodness sake, let’s rescue management reform from this status of political football. Let’s agree, wherever we are in terms of the debates about the other reforms, about the need to have a well run, modern Secretariat with the kind of accountability and transparency and performance benchmarks that all of us, as tax payers in some jurisdiction or another, should expect of the UN. It’s something that should be above politics and yes, one of the very specific reforms that we are calling for is strengthening of the OIOS, more resources for it, more independence, reporting to an independent international audit board to make sure that there is no interference in the scope of its investigations or its findings.

All these are very logical responses to what these scandals have exposed and it should be taken out of the politics of the Summit and the General Assembly and be something that 191 Member States should gladly sign up for, which is the kind of management reform that gives the Secretary-General the reform of management, financial and personnel rules but also strengthens the system’s accountability through enhancing the authority of the OIOS. I don’t know how much more else has to go wrong for Member States to stop playing politics with this issue of management reform.

Question: You didn’t answer about the independent inquiry of procurement.

Malloch Brown: Well, I did, I just told you that there was one. You heard me.

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For information media • not an official record



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