Job insecurity: U.N. chief awaits Iraq report
U.S. believes conclusions very damaging to Annan
NBC News and news services
Updated: 12:44 p.m. ET March 28, 2005
NEW YORK - United Nations Secretary-General Kofi Annan could see his job on the line when a report comes out Tuesday detailing his son's financial gain under the Iraq oil-for-food program that was administered by the world body during Saddam Hussein's regime.
The Bush administration believes the report is very damaging to Annan because the only possible conclusion is that he deliberately ignored his son's conflict of interest, a senior U.S. official, who was briefed on the report but has not seen it, told NBC News.
U.S. officials have been told by the investigators that Kojo Annan got close to $400,000 from Cotecna Inspection, the company he represented as it sought a program contract, the official said.
"How do you not know that your son is making all this money? How do you not know that your son is pushing Cotecna in meetings," added the official, who reflects the administration's viewpoint.
The secretary-general, his son, and Cotecna all deny any link between Kojo Annan’s employment and the awarding of the U.N. contract to the company.
Paul Volcker, the former U.S. Federal Reserve chairman appointed by Annan to investigate corruption in the program, is due to issue an interim report Tuesday that will focus on whether the secretary-general influenced the bidding process in the U.N.-administered program, which ran from 1996 to 2003.
Contract awarded in 1999
A big problem for the secretary-general is expected to relate to Kojo, who worked in West Africa for Cotecna, which received a lucrative contract from the United Nations for Iraq in early 1999.
The Wall Street Journal reported Friday that Annan would be faulted for not paying attention to conflicts of interest involving Kojo, who allegedly used his father's name and position for personal gains while with Cotecna.
At the same time, the panel is expected to conclude there is no evidence Annan rigged the U.N.'s procurement system or exerted undue influence over contractors or ever sought financial benefits, said the Journal, quoting people familiar with report's conclusions.
Annan's new chief-of-staff, Mark Malloch Brown, had earlier told reporters that while Kojo had admitted that "he misled his father" the secretary-general felt he would be "be exonerated of any wrongdoing."
Kojo Annan, who was a consultant for Cotecna until the end of 1998, had told his father he no longer worked for the firm in 1999. But he did not at first reveal that he continued to earn $2,500 a month from them from 1999 until February 2004 in return for not joining their competitors in West Africa.
Investigators seek payment info
A spokesman for Cotecna told Reuters that the Volcker inquiry had requested information on Kojo Annan's earnings and they had hired an auditor to trace all payments made to him.
Under the oil-for-food program, which handled some $67 billion, Iraq was allowed to sell oil to buy civilian goods in order to ease the impact of 1990 sanctions on ordinary Iraqis.
Former Iraqi President Saddam Hussein's government siphoned nearly $2 billion in kickbacks from companies conducting business under the program, according to a U.S. report.
In anticipation of Volcker's report, Annan recently shook up his top staff. But last week his new chief of staff had to defend a decision to have the United Nations pay at least $300,000 in legal fees of the fired U.N. official who had run the oil-for-food program.
The Bush administration has argued the United Nations is rife with bureaucracy and needs to be reformed, but feels Annan is too weak to carry out significant changes. But it's also been unable to find enough allies to confront Annan directly.
NBC's Andrea Mitchell as well as Reuters contributed to this report.
