Trouble and Trails at Turtle Bay

Journalist-Editor Claudia Rosett just lobbed a tasty "j'accuse!" at the UN, and Secretary Kofi Annan. Rosett, formerly on the Wall Street Journal's editorial board and now a fellow at both the Foundation for the Defense of Democracies and the Hudson Institute, peeks behind the kimono of the "Oil for Food" program, which supervised Iraqi relief from 1996 until the fall of Baghdad. Rosett's NRO article suggests that a firm receiving $6 million worth of UN contracts hired Kofi Annan's son Kojo as a consultant. Though tantalizing, the evidence is--so far--thin.

More importantly, Rosett confirms (see tpfp post 2/9 6:12pm) the Oil for Food program was corrupt to the core. And Rosett says the UN knew it--and has been frantically directing a cover-up since last spring:

Last May, shortly after the fall of Saddam's regime, the U.N. Security Council voted to end the Oil-for-Food program and gave the U.N. Secretariat six months to tie-up loose ends before handing over any outstanding import contracts to the U.S. Coalition Provisional Authority. With Saddam's regime gone as a contracting party, the U.N. began a frenzied process of "renegotiating" billions in contracts, basically winnowing out the graft component that Oil-for-Food had previously approved.

By the end of this sudden housecleaning, the U.N. had scrapped more than 25 percent of the contracts. . . For instance, . . . there is reference to the welding-machine contractor from Lebanon, "unwilling to accept the 10% deduction"; likewise the Belgian and Jordanian suppliers of medicine, both refusing a "10% reduction." In other cases there is a vaguer note, such as the Russian backhoe supplier, who "refused to accept extra fee deduction." Or the supplier of "fork lift and spares" from Belarus who "stated that the supply of remaining parts cannot be cost effective under the current circumstances." Asked to further explain these notations, an Oil-for-Food spokesman offers no comment except that all available information is already posted on the U.N. website.

Altogether, according to U.N. records, 728 previously approved and funded deals were "removed from the list of amendable contracts," a few because the supplies had already been delivered, but many because the contractors appear to have run for the hills. For instance, there's the Jordanian supplier of school furniture, whose contract was dropped during the U.N.'s post-Saddam frenzy of "prioritization" because the "Company does not exist and the person in charge moved to Egypt." Or the Russian supplier of "vehicle spare parts," who "could not be contacted despite all efforts." Or the Algerian seller of "adult milk" who "has no interest in renegotiation"; the Egyptian seller of "generator" for educational purposes, who "is not enthusiastic about proceeding with the amendment"; the Syrian seller of "laboratory equipment" who is "not possible to contact."

Another 762 contracts set aside indefinitely by the U.N., post-Saddam because of their "questionable utility" were deals for goods that sound handy and humanitarian enough on the generic U.N. face of it. These include medicine from China; sugar and ambulances from Egypt; laboratory materials and medical equipment from France; educational materials from Pakistan; wheat, medical equipment, and ambulances from Russia; and yet more wheat, from Saudi Arabia.

The UN ran this program. Though they claim not to have known about Saddam's 10-percent-overpricing-and-kickback scheme, the UN approved every contract. Hardly ignorant--they were Saddam's poodles:

The disturbing implication is that the U.N. -- while collecting a commission of more than $1 billion on Saddam's oil sales to cover its own overhead in administering Oil-for-Food -- was indifferent to Saddam's short-changing the Iraqi people, whose relief was supposed to be the entire point of the program.

Clearly, the UN never learned the lesson of Watergate: It's always the cover-up, not the crime.

But, overall, there's really no surprise here. Well, perhaps one: Why do liberals expect anything better from the UN bureaucracy?

Update:

Therese Raphael, editor of the WSJ Europe, names another name: Benon Sevan, director of the U.N.'s Oil-for-Food Program. In a publicly available article in the March 11th Wall Street Journal, Raphael quotes from an Arabic-language chart listing "Quantity of Oil Allocated and Given to Mr. Benon Sevan" from December 1996 through June 2003--and shows Sevan receiving at least 9 million barrels of oil. At $30 per barrel, that's worth $27 million, which (given the discounted contract amounts) might net between $3 and $10 million. Mr Sevan denies the allegation. Yet, curiously, Raphael notes that a "U.N. spokesman said yesterday that Mr. Sevan is on extended vacation until late April, after which he retires at the month's end."

How convenient. The UN gives its fox keys to both the Iraqi hen-house and a multi-lateral get-away car.

Like Rosett's National Review article, the WSJ story speculates about Secretary Annan's ties to Oil for Food contractor Cotecna:

One prominent former employee of Cotecna is Kojo Annan, Kofi Annan's son by his first marriage. The young Mr. Annan was employed by Cotecna in the mid-1990s. He reportedly continued a consultancy relationship with Cotecna through his Nigerian-based company. Philip Henebry, Cotecna's CFO, confirmed that Kojo Annan had been employed there, but would not confirm any dates. Asked how Cotecna was able to underbid competitors on the Iraq contract by as much as half, he replied that "We felt that the margins with competitors were very, very high."

Which explains why my trust in the UN is very, very low.