UN Headquarters Renovation: No Accountability Without Transparency

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Chairman Coburn, Ranking Member Carper, Senators, thank you for the invitation to testify here today. As a journalist, I have spent almost 25 years covering international affairs, much of that in Asia, Latin America, the former Soviet Union and the Middle East. I am currently based in New York, where in recent years I have focused on the United Nations.

I wish I had better news to report. In its secrecy, lack of accountability, and what has been possible to discern of the resulting waste, abuse and corruption, the UN bears a much closer resemblance to some of the despotisms I have covered than to any open and responsible democratic system.

One often hears it argued that while the UN may be flawed, it’s all we’ve got — and that all human institutions are prone to at least some waste, abuse and corruption. True. But there are degrees of fraud, duplicity and secrecy. There are some systems with built-in checks and balances that tend to favor disclosure and accountability. There are others in which there are no genuinely effective corrective mechanisms, and the institutional arrangements reward those most adept at abusing, defrauding and exploiting the system for personal gain – whether that be in the form of money, patronage and so forth.

The immediate difficulty in even understanding the depth of the problems at the UN is the astounding lack of transparency. What tends to happen is that while the general opportunities for wasteful or abusive or corrupt activity may be obvious – as was the case with some of the elementary scams under Oil-for-Food – the UN withholds from the public the specifics that would allow documentation of individual cases of wrong-doing. Under Oil-for-Food, for instance –which I cite because it was in many ways a fractal of the UN system — it was possible to see from generic UN documents that Saddam Hussein with UN approval was doing an oddly large number of deals buying “detergent” from such terrorist-linked nations as Saudi Arabia, Syria, Yemen and Sudan. Or that under this relief program meant to be dealing with end-users of oil and good-faith suppliers of relief goods, there seemed to be an overly cozy relationship between Saddam and such financial havens as Liechtenstein, Cyprus, Panama and Switzerland. But the UN concealed virtually all the details that might have allowed further insight.

May I also offer the reminder that the UN Secretariat, which hired the inspectors, processed the contracts, and was tasked and paid $1.4 billion to monitor the integrity of this program, in shutting down its role in Oil-for-Food in November, 2003, mentioned not a word about the graft. Secretary-General Kofi Annan praised the program, and in particular his handpicked director, Benon Sevan. And when allegations of deep corruption erupted in the press, in early 2004, Mr. Annan’s first response was to delegate the investigation in-house to the UN’s secretive Office of Internal Oversight Services, or OIOS, which had already failed to stop the perversion of the program.

It was only after Congress scheduled hearings, in the wake of damning press reports, based on confidential documents found in Baghdad and leaked to the media, that Mr. Annan conceded the need to authorize an “independent” investigation. This led to the $35 million investigation under Paul Volcker, which reported signs of rampant corruption among some of the UN agencies working under Oil-for-Food in Iraq; described at length the derelictions and substandard performance of Mr. Annan, his deputy and his chief-of staff, in overseeing the program; and alleged that Mr. Annan’s handpicked director of Oil-for-Food, Benon Sevan, had taken $147,000 in payoffs on some of Saddam’s oil deals, linked in various ways to family members of former UN Secretary-General Boutros Boutros-Ghali. (Mr. Sevan and Mr. Boutros-Ghali have denied any wrongdoing).

The result: Apart from a former special adviser to Mr. Annan, under investigation in France, not one UN staff member has faced charges related to Oil-for-Food. No one has even been fired (Mr. Annan wrongly fired one staffer who was later reinstated). Mr. Sevan was allowed to leave the country during the investigation – while the Secretary-General’s office assured the press there was no cause for concern, or the Volcker Committee would surely let us all know. Mr. Sevan has never faced charges and since last year has been living as a free man in his native Cyprus, on full UN pension.

When I asked the Secretary-General’s office some weeks ago if the UN along with providing Mr. Sevan with full pension had paid Mr. Sevan’s moving expenses from New York back to Cyprus, I was told this was a personal matter, and therefore confidential.

That is an oddly protective and secretive reality, much at odds with Mr. Annan’s promise back in 2004 of transparency and accountability in the Oil-for-Food saga. Speaking on May 2, 2004, on NBC’s “Meet the Press,” Mr. Annan assured his audience that “We are protecting all the material for the investigation” (while, in fact, as the Volcker inquiry later discovered, Mr. Annan’s then chief-of-staff Iqbal Riza immediately after the launch documents potentially relevant to the inquiry). Mr. Annan went on to promise, in reference to the Volcker investigation, that “if their findings were to conclude that any UN staff member had been engaged in this corruption, he or she will be dealt with severely, their privileges and immunities will be lifted so that if necessary they will be brought before the court of law and dealt with in addition to being dismissed.”

Mr. Volcker did, indeed, report findings that Benon Sevan “corruptly” profited from Oil-for-Food. There was no severe dealing whatsoever. Within months, the Secretary-General’s public version of this had evolved into the sort of statement Mr. Annan made in London this past February and has since repeated in a variety of venues: “If there was a scandal” it involved “only one staff member… maybe… .”

I cite this in some detail because it is typical of the ways in which the UN obfuscates, evades, denies, promises transparency and accountability – and then brazenly declines to deliver, or be held to account.