Published on Wednesday, March 30, 2005 by the Boston Globe
Report Clears UN Chief of Corruption Allegations
But Annan is Faulted for Probe's Limitations
by Farah Stockman and Joe Lauria
UNITED NATIONS -- A UN-commissioned inquiry into allegations of corruption in the United Nations oil-for-food program found no evidence that Secretary General Kofi Annan used his political influence to help a company that employed his son win a $10 million-a-year contract in Iraq.
But the 90-page report criticized Annan for failing to fully investigate a potential conflict of interest concerning his son, Kojo Annan, and Cotecna the Swiss company that employed the younger man.
It also details far closer connections between Kofi Annan and Cotecna officials than have been disclosed previously, and raises unanswered questions about why Annan's ''chef de cabinet" directed that ''documents of potential relevance" to the investigation be shredded just one day after the Security Council established the independent inquiry.
The report reserves its harshest language for Kojo Annan, who, it says, used his political connections to explore oil contracts in Iraq and lied to investigators about hundreds of thousands of dollars in payments from Cotecna. The payments were made years after he told his father that he left the company.
According to the report, Kojo Annan charged Cotecna thousands of dollars in consultant's fees for trips he made to see his own father, including one charge of $17,000 for a six-day trip to Abuja, Nigeria -- ''during my father's visit," according to the invoice -- and a 15-day trip to the UN General Assembly in September 1998, during which he stayed at his father's home.
Kojo Annan, who has refused to cooperate with the investigation in recent months, also arranged a 15-minute meeting in September 1998 between his father and Cotecna's owner, which Kofi Annan did not initially disclose to investigators.
Annan has been under fire since a string of scandals came to light at the world body late last year, including allegations of sexual misconduct by UN peacekeepers. Yesterday, Annan told reporters that he was saddened by his son's role, but that his own ''exoneration by the independent inquiry obviously comes as a great relief."
When asked by a reporter if the embarrassing report might still prompt him to resign, Annan said, ''Hell, no."
But Senator Norm Coleman, a Minnesota Republican, renewed calls for Annan to step down.
''Kofi Annan is responsible for the failed management that resulted in the fraud and abuse of the oil-for-food program," Coleman said in a statement yesterday. ''His lack of leadership, combined with conflicts of interest and a lack of responsibility and accountability point to one, and only one, outcome: his resignation."
Yesterday's report is the second in a string of findings by former Federal Reserve chairman Paul Volcker into the oil-for-food program, set up during the era of sanctions against Saddam Hussein's Iraq to allow humanitarian goods into the country. The program was manipulated by Hussein to bribe foreigners and solicit kickbacks.
In December 1998, Cotecna was awarded a contract to inspect goods flowing into Iraq, despite widespread news reports of the company being under investigation for paying kickbacks to Pakistan's former leader Benazir Bhutto. Cotecna was the lowest bidder on the Iraq contract.
In 1995, Cotecna hired Annan's 22-year-old son, a recent college graduate, because it hoped to benefit from his political connections, the report states. Kojo Annan got the job shortly after his father spoke to Michael Wilson, a longtime family friend who was also a vice president of Cotecna, about the possibility of a job for Kojo.
In the initial stages of the inquiry, Kofi Annan told investigators that he had never met the owners of Cotecna until after the company received the contract. But after a review of computer records, investigators found that two previous meetings had taken place.
In February 1997, Annan had met Cotecna founder Elie Massey in Davos for cocktails, and on Sept. 18, 1998, they met again at his office in New York in a meeting arranged by Kojo. Both men say the Iraq contract was never discussed in either meeting.
The report details how Kojo Annan allegedly told his father about plans to explore an Iraq oil contract with a Lebanese business partner, and even introduced Annan to the partner at a meeting in South Africa. But Kofi Annan told investigators he didn't remember much about that talk with his son, and that he had always urged his children to stay away from United Nations contracts to avoid conflicts of interest.
The report also documented how Iqbal Riza, a top Annan aide, directed files to be shredded to make more office space shortly after the opening of the inquiry, even though Riza himself had directed others to preserve such files.
© 2005 the Boston Globe