More questions for Cotecna and Company

Writing on the opposite page, Robert Massey, CEO of Cotecna Inspection SA, responds to some of the serious questions that have been raised about his firm’s performance in overseeing the U.N.-administered oil-for-food program in Iraq. In his Op-Ed, Mr. Massey makes a number of important, valid points about the need for the press and lawmakers to be careful about getting the facts straight before they level charges of wrongdoing against businesses like Cotecna. That said, Mr. Massey has only begun to respond to the many questions that need to be fully answered about Cotecna’s work in Iraq.

From 1995 to 1997, Kojo Annan, the son of embattled U.N. Secretary-General Kofi Annan, was employed at Cotecna, which had been inspecting humanitarian goods imported by Iraq with U.N.-administered proceeds from its oil sales. He served as a consultant until 1998. U.N. officials had claimed that that’s when the payments from Cotecna to Kojo stopped. Then, in November, we learned that the payments had not ended in 1998 after all. In fact, Kojo Annan continued to receive up to $2,500 a month from Cotecna until February 2003 as part of a “no compete” agreement.

Had Cotecna’s administration of the oil-for-food program gone smoothly, Kojo Annan’s relationship with the firm would have likely been a minor issue, a historical footnote. Unfortunately for everyone concerned — in particular for the Iraqis who were cheated out of billions worth of food and other humanitarian aid they were to have received from sales of Iraqi oil — that was not the case.

In February 1999, Cotecna started work in Iraq authenticating freight shipments arriving under oil for food. And the company’s stewardship was marred by problems. In his Op-Ed, Mr. Massey alludes to one of the problems documented in an April 2003 audit of Cotecna’s work on the program undertaken by the U.N. Office of Internal Oversight Services: the failure to post inspectors at certain sites around the clock. Mr. Massey appears to suggest that this was a misunderstanding that was eventually resolved. But this was just one of many problems highlighted in the OIOS audit, which goes on for more than 20 pages criticizing the failure of the U.N.’s Office of the Iraq Programme to adequately monitor Cotecna’s work.

The audit, for example, says that shortly after Cotecna signed the $4.8 million contract, U.N. officials authorized $356,000 worth of extra costs that should have been paid by Cotecna — not by the United Nations, which was using money that belonged to the Iraqi people. The fee paid to Cotecna was inappropriately raised from $499 per man per day to $600. Checkpoints had inadequate numbers of inspection agents. There were myriad instances of “unprofessional conduct”by Cotecna. And this is just a partial listing of the problems mentioned in the OIOS audit.

In the coming days, we hope that more answers will be coming from Cotecna, Kofi Annan, former OIP boss Benon Sevan (who, according to Iraqi records, was benefiting from illicit oil sales) and everyone else who had a hand in the mess that was the oil-for-food program.