Russia resisting Annan's oil-for-food appointment

UN Kofi Annan has chosen the former US Federal Reserve chairman Paul Volcker to head an independent panel investigating corruption in the UN oil-for-food program, but an objection by Russia may keep him from accepting the job.

UN said Friday that Volcker, 76, had been selected for the panel along with Mark Pieth, 50, a Swiss law professor with expertise in investigating money laundering and economic crime, and Richard Goldstone, 65, a South African judge who was chief prosecutor for the international criminal tribunals for the former Yugoslavia.

But the nominations stalled Friday when Russia said it would not agree to a Security Council resolution that Volcker said he needed to give him the authority to conduct the wide-ranging inquiry that Annan was seeking.

"We understand the reputation of the secretariat is in question, but we do not think it is possible to adopt a resolution on the basis of mass media reports," said Sergei Trepelkov, spokesman for the Russian mission.

Those reports, published first by an Iraqi newspaper in January and more widely in the international press since then, listed companies and individuals as recipients of illegal allocations of oil. Forty-six of them were Russian, including Vladimir Titorenko, a former Russian ambassador to Baghdad, and Nikolai Ryzhkov, a member of Parliament. In a statement at the time, the Russian Foreign Ministry denied any wrongdoing by Russians.

According to a report by the General Accounting Office in Washington last month, the government of former Iraqi president Saddam Hussein skimmed more than US$10 billion from the UN-monitored $67 billion program from 1997 to 2002.

Among those named in documents that emerged in Iraq was Benon Sevan, a career UN official who headed up the oil-for-food program and allegedly accepted oil allotments himself. He has denied the charges in a written statement.

The documents also showed that Kojo Annan, the secretary-general's son, was a consultant for Cotecna, a Swiss company contracted by the program. UN officials say an investigation in January 1999 by Joseph Connor, then the undersecretary general for management, showed that no one handling the contract was aware of the affiliation.

The Security Council began the oil-for-food program in December 1996 to let Iraq sell oil to ease the impact of the sanctions imposed after the Persian Gulf War in 1991. The proceeds were to go for the purchase of food and other goods, but they ended up funding an open bazaar of payoffs, favoritism and kickbacks with systematic smuggling, illegal surcharges and inflated port fees.