Oil-for-food head resigns before explosive report

Benon Sevan

NEW YORK - The former head of the scandal-tainted oil-for-food programme has resigned from the United Nations, hours before he is expected to be accused of getting kickbacks from the US$67 billion ($98.3 billion) operation.

A UN-established Independent Inquiry Committee, led by former US Federal Reserve Chairman Paul Volcker, plans to release today its third interim report on allegations of corruption in the humanitarian programme for Iraq, which began in 1996 and ended in 2003.

Benon Sevan, the former executive director of the programme, is to be accused of getting cash for steering Iraqi oil contracts to an Egyptian trader and of refusing to co-operate with the Volcker panel, his attorney Eric Lewis said. Sevan has denied the allegations.

On Sunday, Lewis distributed a letter from Sevan, 67, to UN Secretary-General Kofi Annan resigning from his current job, which he was given after he retired.

The US$1-a-year post carries immunity and was meant to ensure he would co-operate with the probe. But Sevan may have preempted a dismissal from this arrangement as the United Nations in the past has taken action against staff fingered in the Volcker report.

Sevan blamed the secretary-general and his staff for not defending the programme and making him a scapegoat.

"I fully understand the pressure that you are under, and that there are those who are trying to destroy your reputation as well as my own, but sacrificing me for political expediency will never appease our critics or help you or the Organisation," Sevan wrote.

He said that the programme, which supplied food and other goods to 27 million Iraqis, was often caught between conflicting mandates given by the UN Security Council, which supervised it, and national interests of those trying to do business with Iraq.

The Volcker panel was commissioned by Annan to examine charges of corruption in the programme, which was designed to ease the impact on ordinary Iraqis of UN sanctions imposed in August 1990 after Baghdad's troops invaded Kuwait.

The panel, in a February 3 interim report, expressed suspicion about four payments, amounting to US$160,000, that Sevan had declared to the United Nations as funds from his now-deceased aunt.

But Sevan noted on Sunday it was not credible he that would have compromised his career for US$160,000 after handling billions of dollars in the programme.

"The charges are false and you, who have known me all these years, should know that they are," Sevan wrote to Annan, recalling the 40 years he had worked at the world body.

Lewis on Thursday began releasing Sevan's side of the story after receiving a letter from the Volcker panel outlining "adverse findings" that the report would contain.

Sevan, a Cypriot, is alleged to have taken bribes "in concert with" the brother-in-law of former Secretary-General Boutros Boutros-Ghali, Lewis said.

"The IIC claims that Mr Sevan received money from African Middle East Petroleum in concert with Fred Nadler, a friend, and a relative by marriage of Mr (Fakhry) Abdelnour, the principal of AMEP," Lewis said.

Nadler is the brother of Leia Boutros-Ghali, wife of the former secretary-general. Abdelnour, the owner of AMEP, is a cousin of Boutros-Ghali, UN chief from 1992 to 1996. Boutros-Ghali himself has been questioned by the panel but is not linked to the bribe allegations.

AMEP earned some US$1.5 million from oil allocations that the panel says Sevan steered to the Egyptian trading firm.

- REUTERS