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UN needs overhaul in procurement, UN watchdog says

The head of a UN inspection office said the world body needed a "major overhaul" of how it procures US$1.9 billion in goods annually and called for less secrecy about probes of staff and companies involved.

Commenting on the conviction of a former UN purchasing official on Thursday, Undersecretary-General Inga-Britt Ahlenius said a Procurement Task Force that reports to her was reviewing contracts worth US$1 billion for waste and fraud and had opened 140 cases.

"It is difficult to rely on the system when it comes to procurement," Ahlenius, head of the Office of Internal Oversight, told a news conference. "In my view, there is a need for a major overhaul of the procurement system in the organization."

With evidence collected by the Task Force, the procurement official, Sanjaya Bahel, 57, was convicted in Manhattan federal court on charges of bribery and fraud. He was accused of steering millions of dollars in UN contracts to Indian companies in exchange for cash and discounts on two luxury apartments. He faces up to 35 years in prison.

The Bahel case had been investigated by Ahlenius' predecessor, who had himself been under investigation, but was dropped for lack of evidence in 2004.

Ahlenius was appointed to her post in April 2005.

Ahlenius said she asked a EU office to review the case because the initial investigation "wasn't thorough enough." The Task Force, created a year ago, held its own probe and handed files to US prosecutors.

But Ahlenius avoided questions on investigations now underway, some already reported in the press, as well new completed reports, saying she was forbidden to do so by the UN General Assembly.

"I think the secretiveness that is held by this organization serves us poorly," Ahlenius said, urging patience because "change will come."

She said the UN was not protected enough from "corrupt vendors" and was "a victim" of unscrupulous firms and vendors.

Ahlenius said the UN needs to improve senior management in the procurement department, improve risk assessment and institute policies, processes, checks and balances to guarantee proper handling of purchasing operations and ensure effective monitoring.

Robert Appleton, head of the task force, said that not all his cases involved bribes but firmss making "false representations" or operating through intermediaries.
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