- The Washington Times - Saturday, February 5, 2005

The 219-page interim report on the U.N. Oil for Food Program, which was released late Thursday by the panel headed by former Federal Reserve Chairman Paul Volcker, constitutes yet another disturbing indictment of the program.

In some ways, the timing of the report by Mr. Volcker’s Independent Inquiry Committee, which provides more details of malfeasance, could not be better: U.N. Secretary-General Kofi Annan, the United Nations Association and members of the congressional Democratic leadership have launched a vigorous counterattack in recent weeks in an effort to salvage the United Nations’ reputation, which has been badly tarnished by the oil-for-food scandal. The crux of their argument is that manipulating the Oil for Food Program wasn’t terribly important, because it was just one of the ways in which Saddam Hussein flouted international sanctions dating back to 1991, and that Washington had sometimes opted for strategic reasons not to try to force the U.N. Security Council to act against sanctions-busters, including Russia, Turkey and Jordan. Because this sometimes happened, the argument goes, American policy-makers today have no legitimate right to question the performance of Mr. Annan or the United Nations in managing the program.

While it is certainly true that Saddam began flouting sanctions long before the program was created in late 1996, Mr. Annan’s defenders overlook the reality that the problem became much worse between 1997 and 2003 as a result of policies instituted by Mr. Annan. Claudia Rosett of the Foundation for the Defense of Democracies notes that in January 1997, when Mr. Annan became secretary-general, Oil for Food was just a temporary program, permitting Saddam to sell limited amounts of oil in order to purchase relief supplies for Iraqis. But Mr. Annan successfully recommended that the Security Council expand the program — and with it Saddam’s ability to amass illicit revenues in order to bribe journalists and foreign politicians, and possibly finance terrorism and reconstitute his weapons programs. According to Senate investigators, from 1997 to 2003, Saddam’s oil smuggling reached more than $1.5 billion per year — more than double the level from 1991 to 1996. Since the fall of Saddam two years ago, Mr. Annan has expressed astonishment about the scandal. But back in March 2000, the secretary-general was actually boasting to the Security Council of his managerial success in consolidating and more closely monitoring the oil-for-food program.

As the Volcker panel shows, however, there were plenty of problems with Mr. Annan’s handling of the program, one of which was his selection of Benon Sevan to manage it. Mr. Sevan, the report says, received $160,000 in questionable payments even as he was soliciting business under the program for a firm called Africa Middle East Petroleum Co. (AMEP), a company with which he had close ties. The report said that Mr. Sevan’s actions “presented a grave and continuing conflict of interest, were ethically improper and seriously undermined the integrity of the United Nations.” The report outlines how Mr. Sevan used his influence to persuade Iraq to sell more than 7 million barrels of oil to AMEP. At a minimum, the report raises still more questions about managing the program not only in Saddam’s Iraq but inside the United Nations as well.

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