Annan lashes at critics on Iraq oil, food scandal
(Agencies)
Updated: 2004-04-29 09:29

U.N. Secretary-General Kofi Annan on Wednesday called "outrageous and exaggerated" accusations that U.N. staff allowed corruption by Saddam Hussein's regime, and rejected conflict-of-interest charges involving his own son.

UN Secretary General Kofi Annan makes a point during a news conference at U.N. headquarters in New York, April 28, 2004. Annan warned the U.S. led administration in Iraq that the use of military force in civilian areas would make it harder to successfully end the occupation.  [Reuters]

In his strongest comments to date on the burgeoning U.N.-run oil-for-food scandal, Annan said U.N. officials were blamed for Saddam's smuggling of oil and a variety of other misdeeds that they had no way of controlling.

"We had no mandate to stop oil smuggling," Annan told a news conference. "They were driving the trucks through northern Iraq to Turkey. The U.S. and the British had planes in the air. We were not there."

He called some of the comments he read "constructive and thoughtful." But he said: "Others have been outrageous and exaggerated. In fact, when you look at it, if you read their reports, it looks as if the Saddam regime had nothing to do with it. They did nothing wrong. It was all the U.N."

"Why is all this being dumped on the U.N.?," Annan asked, recalling the supervisory role of the Security Council.

"Of course the member states are not coming out saying we had a role or we had an oversight responsibility. "So all was dumped on the secretariat," he said.

The General Accounting Office, the investigative arm of Congress, says Iraq was estimated to have smuggled $5.7 billion in oil outside the U.N. program. It said Iraqi elites pocketed another $4.4 billion by illegal surcharges on oil.

The U.N.-run oil-for-food program, which began in late 1996 and closed last year, allowed Iraq to sell oil and buy civilian goods to ease the impact of 1991 Gulf War U.N. sanctions on ordinary Iraqis.

Annan said that if corruption against any U.N. official proved true, he would not hesitate to lift diplomatic immunity. He has appointed a three-member panel, led by former Federal Reserve Chairman Paul Volcker, to probe the allegations.

Among media charges was a conflict of interest because Annan's son worked for the Geneva-based firm Cotecna. The company in December 1998, was awarded contract to monitor Iraqi imports under the oil-for food program after a British firm withdrew its agents because of U.S. bombing.

Kojo Annan joined the company as a trainee in Geneva in December 1995 and then worked in Nigeria and Ghana. He submitted his resignation on December 15, 1997, which went into effect on February 28, 1998.

Annan said his son had joined Cotecna "before I became secretary-general, as a 22-year old trainee" and went to work in West Africa.

"Neither he nor I had anything to do with the contract with Cotecna," Annan said. "That was done in strict accordance with U.N, rules and financial regulations."

Most of the misdeeds in the scandal were reported over the years to a Security Council committee that supervised the program, particularly the smuggling of oil, surcharges from oil dealers and shoddy goods Baghdad had ordered. But political divisions often prevented action.

New since the fall of the Saddam are lists of bribes to government officials, firms and groups around the world of oil vouchers they could sell. On the list is Benon Sevan, the head of the oil-for-food program, who has vigorously denied it.

On Wednesday, John Ruggie, a Columbia University professor and former U.N. adviser, questioned whether some of the charges had an anti-U.N. agenda in testimony to the U.S. House of Representatives International Relations Committee.

He said the U.N. Security Council had oversight of the program and approved some 36,000 contracts.

"Yet, as best as I can determine, of those 36,000 contracts not one -- not a single solitary one-- was ever held up by any member on the grounds of pricing," he said.

Because support for the sanctions was rapidly eroding, Ruggie said "it seems reasonable to infer that the U.S. and Britain held their noses and overlooked pricing irregularities in order to keep the sanctions regime in place."

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