- The Washington Times - Tuesday, February 1, 2005

The man handpicked by the United Nations to investigate the Iraq oil-for-food scandal should have disclosed his membership in a U.N. advocacy group, the president of the group said yesterday.

Paul A. Volcker failed to disclose his membership in the United Nations Association of the United States (UNA-USA) in his biography, which is posted on the Web site of the investigating body, known as the Independent Inquiry Committee (IIC).

“The question is whether he put it in his bio,” UNA-USA President William H. Luers told reporters and editors of The Washington Times. “And I think, on balance, he probably should have.”

He added that Mr. Volcker didn’t try to “consciously conceal anything” and, instead, omitted his membership on UNA-USA and about 19 other “boards he thought were uninteresting to the rest of the world.”

Mr. Volcker, chairman of the Federal Reserve under Presidents Carter and Reagan, was appointed in April by U.N. Secretary-General Kofi Annan to lead the investigation into abuses of the program under which Saddam Hussein’s regime was allowed to sell oil to purchase food and medicines for Iraqi civilians. The IIC has said it will reveal its interim findings tomorrow.

Mr. Volcker also has been criticized for his involvement in a Canadian power company tied to two French businesses reportedly linked to the oil-for-food scandal. The IIC responded by outlining Mr. Volcker’s position from 1988 to 1997 as a member of the International Advisory Council of the Power Corporation of Canada.

According to Fox News, the Canadian firm had close ties with the Banque Nationale de Paris Paribas (BNP), which handled all oil-for-food transactions and has been heavily implicated in the scandal, and with Total, a French oil company involved with the Iraq program.

Dismissing the notion of a conflict of interest, the IIC said Mr. Volcker “had no stock holding or business relationship” with the Power Corporation of Canada. It said that although the corporation, through part ownership of the Swiss company Pargesa, had financial ties with Bank Paribas, they were liquidated before Paribas announced its 1999 merger with BNP.

UNA-USA also reportedly received significant funding from BNP, but Mr. Luers pointed out that Mr. Volcker, who lives in New York, “is on boards all over the city, all over the country” and that he chose to list only those boards on which he was active.

“He is not an active member of our board — he’s off the board now,” Mr. Luers said. “He hasn’t attended a board meeting for two years.”

The IIC said the Canadian power corporation indirectly had a 3.6 percent holding in Total before the Paribas-BNP merger, which occurred after the seventh and final meeting of the advisory council, on which Mr. Volcker sat.

Since the council’s last meeting, Mr. Volcker “does occasionally pursue his avocation of salmon fishing with Canadian friends, sometimes including a Power Corporation executive,” the IIC said.

The oil-for-food program was developed to allow humanitarian relief from U.N. sanctions imposed on Iraq after the 1991 Persian Gulf War. Investigators have said abuses of the program resulted in as much as $67 billion worth of fraud.

Mr. Volcker’s is one of several ongoing investigations into the extent to which money was illegally diverted by Saddam and others. Other inquiries are being conducted by members of the U.S. Congress.

In a six-page report yesterday, the Heritage Foundation, a conservative Washington think tank, said Mr. Volcker’s role in UNA-USA “brings into question whether or not the committee can be relied upon to investigate the United Nations objectively.”

Mr. Luers said Mr. Volcker’s failure to disclose his UNA-USA membership “doesn’t detract from the reputation of a man who has done so many things with integrity over so many years.”

“He is a skeptic,” Mr. Luers said. “Although he believed in the U.N. — and still does — he knows they’ve got problems. And most of our board feels that.”

• Researcher John Sopko contributed to this report.


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