Corruption in the UN, Part X

Corruption in the UN, Part X
2011 (continued)
“[The Global Fund to Fight AIDS, Tuberculosis and Malaria], … championed by celebrities and
world leaders, is considering scaling back its groundbreaking philosophy of full transparency about how
it spends billions of dollars in health care in poor countries. Its decision could have broad consequences
for the ways international aid groups operate. …
On Wednesday, the fund's board will discuss proposals to shorten investigations and to change the
way its financial losses are presented. …
The Global Fund's internal watchdog, [John Parsons], warns the board that a move toward less
transparency ‘could be interpreted negatively and as a purposeful effort to suppress material information.’
… The Ethiopian president of the board, [Tedros Adhanom Ghebreyesus], says … ‘Even the mere
appearance of suppression of information is unacceptable.’
Meanwhile, the revelations from Parsons' team of 30 investigators and auditors are creating deep
tensions within the fund. … The losses now total almost $53 million from fraud, undocumented
spending and ineligible expenses, according to the progress report and other unpublished documents
provided by senior fund officials. Parsons says active investigations are uncovering more.”
John Heilprin, “Global Fund rethinks transparency”, Associated Press, May 11, 2011.
[Note: if accepted, this timorous retreat by a leading aid fund (although it is not the
“groundbreaker” in transparency that it believes it is) would be a bleak day for accountability
and transparency in an increasingly corrupt world. For more on the rapid evolution of this
crisis, see Overview Quotes XXX, items 1770a-c, and XXXI, items 1865a-b.]
“A federal judge in New York has issued an order that could lift the U.N.’s long-recognized
diplomatic immunity in the United States involving contract disputes. …
Kahraman Sadikoglu, a Turkish billionaire businessman … is suing the U.N. Development Program
(UNDP) for $150 million. … [He] was hired by the UNDP to clear the Iraqi harbor of Um Qasr, Iraq’s largest
port in 2003. … [Despite the chaos and terror of the early years of the invasion, Sadikoglu was able to raise
the ships and open the harbor.] He has fought since that time to be paid for the work.
According to a former UN legal expert, [the case] could open up the floodgates for hundreds of
similar lawsuits. ‘It is not unusual for the U.N. to play these kinds of games with contractors. They try to
frustrate them at every turn so they give up and go away,’ he said. …
[Some] organizations now mockingly say the UNDP acronym really stands for ‘U.N. Don’t Pay.’
UNDP has since rebuffed efforts to reach a settlement, rejected the idea of arbitration, and has even refused
to accept notice a lawsuit had been filed.”
Ed Barnes, “Contract Dispute With United Nations Could Lead to End of Diplomatic
Immunity, foxnews.com , May 25, 2011.
“A former employee of the United Nations (U.N.) was arrested today for allegedly obtaining more
than $100,000 in salary payments as a result of holding jobs at the U.N. and the National Labor
Relations Board (NLRB) at the same time. ...
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The indictment alleges that between the middle of April and the end of September 2009, [Jeffrey K.]
Armstrong was an employee of both the U.N. and the NLRB, receiving more than $100,000 in salary
payments from the two entities. Armstrong allegedly concealed his dual employment from both employers
by, among other things, dissuading NLRB personnel from contacting his supervisor at the U.N., submitting
incomplete or inaccurate employment forms to the NLRB, and causing to be mailed to the NLRB false
correspondence suggesting that he no longer worked at the U.N.
In addition, Armstrong allegedly submitted medical leave documentation to the U.N., indicating that
he was unable to work and was undergoing medical treatment, despite his full-time employment at the
NLRB. According to the indictment, Armstrong failed to notify his superiors at both entities of his concurrent
employment.
If convicted, Armstrong faces 20 years in prison and a fine of $250,000 on each wire fraud
count.
“Former United Nations employee charged in connection with a $100,000 fraud scheme
involving concurrent jobs”, U.S. Department of Justice, Office of Public Affairs, June 30,
2011.
[Note: the U.S. handles such behaviour in a much more decisive way than the
UN’s “impunity” culture and “legal eagles” would have, for a fairly senior post (assistant
chief of the Security Service responsible inter alia for all physical security of U.N. facilities
in New York City.)]
“The [U.S.] government charged Armor Holdings on Wednesday with participating in a bribery
scheme that helped it supply $7.1 million in body armor for use by U.N. forces. ... The company
agreed to pay $16 million in parallel settlements with the Justice Department and the Securities and
Exchange Commission. ...
According to the government, from 2001 to 2006, an Armor Holdings subsidiary and people acting on
its behalf made corrupt payments to a U.N. procurement official. More than $200,000 went to a
middleman, and part of that was to be forwarded to the U.N. insider, the government said. ... In return, the
unnamed U.N. official provided the prices included in closed bids submitted by other competitors, the
government said.
The Armor subsidiary provided a signed but otherwise blank bidding document so that an
intermediary could fill in the prices after learning the competing bids. [It] was also accused of cooking its
books to disguise the corrupt payments.
The bribery yielded profits of $1.6 million, the government said. ,,, U.N. spokesman Farhan Haq
said he thinks the U.N. official involved in the alleged bribery scheme has been convicted of a crime and
is in prison.”
David S. Hilzenrath, “Armor Holdings charged in U.N. bribery scheme”, Washington
Post/Bloomberg, July 14, 2011. [Note: in best evasive mode, the UN thinks that justice has
been done, and such things will not reoccur. Well, maybe, who knows? At least an SEC
official deplored “selecting body armor for peacekeepers ... by which company pays the best
bribes.”]
[A very detailed examination of poor UN oversight and accountability describes a major longterm program in Kosovo. The European Union injected a record amount of aid – more than two billion
euros – in the post-war recovery and state-building operation led, between 1999 and 2008, by the United
Nations Mission in Kosovo (UNMIK).
The results expected were not achieved, but this year the EU will spend an additional 70 million
euros to help Kosovo. However, it has no plan to dig further into the alleged misuse of European
taxpayers’ money that has been unresolved for the last 10 years.
Audit reports, criminal findings and judicial cases were hampered and not properly followed-up.
Discord between the E.U., who was supposed to provide the money, and the U.N., who was supposed to
manage it, led to much confusion and a serious lack of accountability and follow-up. .
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A new study by the European Network on Debt and Development shows that that most aid never
enters the economy of a developing nation, discusses the phenomenon of "Boomerang Aid", and brings a
strong message about donors’ co-responsibility to rethink their policies in making aid work.]
Stefano Valentino, “Kosovo. Probes into Misuse of EU Money Stall - Part 1, , and “EU
Cornered by UN Jurisdiction – Part 2, IPS/Freereporter, and Daan Bauwens, “Boomerang
aid enriches donors”, IPS, all three dated September 6, 2011.
“Equatorial Guinea this summer spent several times its yearly education budget to build a new
$800 million resort in which to house the presidents attending this summer's African Union summit.
Besides an 18-hole golf course, a five-star hotel and a spa, the country built a villa for each of the
continent's 52 presidents. Each one came with a gourmet chef and a private elevator leading to a suite
overlooking the mile-long artificial beach … [sculpted] especially for them.
Western diplomats say that the charm offensive worked … after Equatorial Guinea's notoriously
corrupt president, … Teodoro Obiang Nguema, … succeeded in getting the [summit] to pass a motion
calling on UNESCO to approve a prize named in his honor.
The $3 million prize was first proposed in 2008 and UNESCO initially agreed to create it, only to
suspend it as outrage erupted over the provenance of the money and accusations of abuses by Obiang
against [his] people.”
Rukmini Callimachi, “Tainted African ruler may get UN prize in his name”, Associated
Press, September 29, 2011. [Note: see also the item of October 19, 2011 below.]
[As noted in the IO Watch Programme Performance Update subsection on Whistleblowers, and socalled Internal Oversight, and its Archive section on Staff Self-defense, UN system staff worldwide who
attempt to report waste, mismanagement, and managerial abuse are consistently badly treated. They
can be given “summary dismissal” i.e., with no reasons given; abrupt reassignment to a very unpleasant
duty station; or loss of job, downgrading, or isolation, followed (if they protest) by years of usually-wasted
effort to obtain recompense for their suffering in a supposedly UN “internal justice” and appeals system.
Alternatively, a recent internet article notes that, to get rid of an aggrieved and stubborn staff
whistleblower who has a good (i.e., documented and embarrassing) whistleblower case, UN officials have
long offered a handsome (six-figure) “buy-out” payment if the staff member agrees to leave the UN but
not to pursue any future action against it.
The large sums involved in such back room deals come from a UN “slush fund”, which means that
UN corruption, waste, or mismanagement are covered up by paying out funds contributed by Member
States – certainly not for that purpose.]
“UN whistleblowers get salaries for silence”, by Tom McGregor @ DallasBlog.com,
October 1, 2011.
“With the Obama administration under pressure to cut costs, the US Mission to the UN on
Wednesday night threw a reception for members of the UN General Assembly's budget committee.
US Ambassador for Management Joseph M. Torsella … told the well dressed crowd that every dollar
wasted is a lost opportunity for the world's poor. …
Amid the veal meatballs and pasta there was some serious talk of management change. A
longtime staff expert lobbied two members of the Advisory Committee on Administrative and Budgetary
Questions that jobs that are given out politically should be disclosed as such, so that sham recruitments
are not held. … Admit that these jobs are given out by nationality, the reformer pleaded, but let the others be
given cleanly.
An ACABQ member nodded, then extensively greeted another Under Secretary General. The
reformer shook his head: it is this incestuous world that stops reform. …
The reformer was still preaching, how Fifth Committee members, and those leaving ACABQ, are
given jobs in the UN system to make them vote for the budget. Will Torsella get into this? We’ll see.”
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Matthew Russell Lee, “At US budget bash for UN diplomats, meatballs & dreamers, reform
on calendar?”, Inner City Press, October 12, 2011.
“Equatorial Guinea's President Teodoro Obiang Nguema Mbasogo lost his latest bid to
establish a UNESCO life science prize in his own name, following protests by human rights advocates
and anti-corruption groups that the government had squandered the country's oil-riches to fund the lavish
lifestyle of his relatives.
Today, [he] offered his response, appointing his son Teodoro Nguema Obiang Mangue, who has
become an international symbol of the regimes excesses, as his country's envoy to UNESCO.
The younger Obiang, who … currently serves as Equatorial Guinea's minister for agriculture and
forestry, has been the target of criminal investigations in [France, Spain, and today by the U.S. Justice
Department.] …
‘He is known for his lavish, jet-setting lifestyle and love of luxury vehicles, which contrast sharply
with the low living standards of the majority of the inhabitants of Equatorial Guinea,’ Human Rights Watch
stated. The Equatorial Guinean government has repeatedly denied the charges of corruption. …
[A legal expert] said he believes that the move to accredit the young Obiang at UNESCO is aimed at
immunizing him from prosecution in a French court. ‘My take is this is an attempt to make a creditable
claim of diplomatic immunity.’”
Colum Lynch, “World's richest minister of agriculture and forestry now a UNESCO envoy”, Foreign
Policy, Turtle Bay, October 19, 2011.
.
“[A screening of the new Hollywood ‘Whistleblower’ movie] at U.N. headquarters recently turned
heated. Secretary-General Ban Ki-moon opened a panel discussion by noting ‘much progress since this
dark period portrayed in this film,’ while also acknowledging there is more work to be done.
But Larysa Kondracki, the movie's director, quickly contradicted him, saying, ‘situations have
escalated and if you read the news today there are a lot more movies to be made.’ …
[Since 2006, the UN has documented allegations of ‘sexual exploitation and abuse’, which have
dropped … [from 127 in 2007 to 85 in 2010.] … But, Madeleine Rees, [a retired UN senior human rights
official], says ’Without real institutional changes you can't make much difference.’ ... In September 2011, the
U.N. Dispute Tribunal ruled she was unlawfully pushed out of [her Geneva job for objecting to sexual
harassment in Bosnia-Herzogovina.] …
[Ms. Kondracki], … noted that top officials in U.N. headquarters should be scrutinized just as
carefully as peacekeepers … [in the field.] … ‘We have videos of high-level diplomats walking around
U.N. headquarters with people they purchased,’ she said during the forum.
By that point in the discussion period, Ban had left the room.”
Amy Lieberman, “’Whistleblower' screening disturbs peace at U.N.”, womensenews.org,
October 24, 2011.
“Rajat Gupta is one of the American elite. He has sat on the boards of Goldman Sachs and
Procter & Gamble. For years he led McKinsey, a global consultancy. In 2005, when Kofi Annan was
secretary-general of the United Nations, he made Mr Gupta his “special adviser for management
reform”.
His connections have now landed him in trouble. … Mr Gupta faces the possibility of time in jail,
…charged with five counts of securities fraud and one count of conspiracy, … [which he denies.] …
One mystery in cases such as these is motive. Mr Gupta was a wealthy man already. … The
assumption that people commit insider trading to make money may itself be wrong. A 2009 study of insider
training to make money … found that a majority of executives convicted of insider trading were the
best-paid employees at their firms. Friendship and ego may matter more than money.”
“Rajat Gupta. Another trial. American regulators charge another bigwig with insider
trading”, The Economist, October 29th, 2011.
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[This story is a reminder that Kofi Annan is a very wealthy man, with two UN pensions, many
awards, and endless very-well-paid public speeches (for up to $160,000 each). It also brings back memories
of his amazingly quick Nobel Peace Prize award and diplomatic “rock star” status, (at least until the
UN’s Irag Oil-for-Food Programme debacle). He was even described as being ‘saint-like’, having ‘great
moral stature’, and as being a prominent member of the global ‘jet set.’ As one adoring article in 2002 put
it]::
‘New Yorkers, competing to lure Kofi Annan to their dinners and benefits, are making him the
most sociable, plugged-in United Nations secretary general this city has ever known.
Sometimes that translates into as many as five nights out a week, he says. That is on top of
all those official lunches, diplomatic receptions and traveling: 20 countries so far this year.
[He] has a striking partner in his wife, Nane Lagergren, a lawyer and artist … ‘She's just
blossomed to be the first lady of the world’ [said a friend.] …
‘I think he believes, quite rightly,' Sir Brian [Urquhart] said, 'that the UN … needed to reach out
to people beyond the diplomatic circle. All of that diplomatic wining and dining is a relic of a
completely different time."
Barbara Crossette, "Outside UN, a secretary so social", New York Times, May 30, 2002.
[Note: see also the IO Watch UN Hall of Shame, Kofi A. Annan, pp. 11-12; its Six Black
Holes subsection on Opacity and dissembling, the PDF, pp. 8-9; and Overview Quotes VIII,
items 434a-b.]
[A followup article contains a fascinating insight on life at the very top of the wealth pyramid
where Mr. Gupta and Mr. Annan live. In a related, preceding trial, a recorded tape excerpt from the main
person in the case stated about Mr. Gupta that]:
“He’s enamoured with [super-private equity fund head Henry] Kravis , and I think he wants to be in
that circle.’
‘That’s a billionaire circle, right?. Goldman [Sachs] is like the hundreds of millions circle,
right? And I think here he sees the opportunity to make $100 million over the next five or 10 years
without doing a lot of work.’”
“Spotlight on former McKinsey chief”, Financial Times (UK), October 28, 2011.
“The Global Fund to Fight AIDS, Tuberculosis and Malaria, … investigating its own losses in grant
money, said Tuesday that 12 more probes had turned up an additional $20 million of mismanagement,
alleged fraud and misspending. …
Earlier probes by the fund's … inspector general's office had detected about $53 million in losses. …
The fund's board chairman Simon Bland told The Associated Press it has now reviewed about oneseventh of $14 billion in grants disbursed. …
Completion of the latest investigations and audits was delayed until after the end of a six-month
review of the fund's financial controls by an outside panel. … In January, the AP reported that the fund was
bleeding tens of millions of dollars to mismanagement and corruption, prompting Germany, the European
Commission and Denmark to withhold a collective $457 million (euro 315 million) in funding. Spain, Italy,
Japan and Ireland also delayed committing to 2011 pledges. …
Since the panel's report, Germany released half of its $285.7 million pledge. … [Japan paid the
Global Fund part of its 2011 contribution, and the European Commission and Denmark may release their
2011 pledges soon.]”
John Heilprin, “Global health fund probe uncovers $20m in losses’, Associated Press,
November 1, 2011.
[An entry at www.undpwatch.blogspot.com of November 24, 2011 states that ‘At UNDP
transparency on expenditures related to Regional Kings is zero - $$millions spent for extravagant
travels, hotels, dining & corporate cards”. It presents cheerful photographs of UNDP’s five Regional
Directors, and notes that their yearly salaries are $250,000 (before ‘perks.’)
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In pursuit of UNDP’s now publicly-trumpeted transparency and accountability policies, it then asks a
series of interesting questions about the “Regional Kings”: their ethics compliance with Financial
Disclosures; their 2010-2011 travel details and costs, including ‘official dining’ and car rental and chauffeur;
their total charges on Corporate Credit cards; total charges for UNDP provided cellphone; organigramme of
their office staff employed; and a list of consultants and details of their work and cost in the 2010- 2011
biennium.]
[The General Assembly’s Sixth Committee has recommended a draft resolution to the Assembly
on the criminal accountability of United Nations officials and experts on mission, in a process which
began in 2005.
It states inter alia that the Assembly is ‘Deeply concerned by reports of criminal conduct’, … and
‘Reaffirming the need to ensure that all United Nations officials and experts on mission function in a manner
that preserves the image, credibility, impartiality and integrity of the United Nations.’
It strongly urges States to ensure that crimes by United Nations officials and experts on mission do
not go unpunished and to consider establishing, jurisdiction over such crimes by their nationals serving as
UN officials or experts.
The resolution calls on the Secretary-General to inform States of their nationals alleged to be
involved in a crime, to indicate their efforts to investigate such cases, and, as appropriate, to prosecute
serious crimes.
It further emphasises that the United Nations should take no action that would retaliate against or
intimidate United Nations officials and experts on mission who report allegations [i.e., whistle-blowers.]
Finally, it requests the Secretary-General to report on implementation of this resolution, the number and
types of credible allegations, and any actions taken .]
“UN 6th Cmtt: Criminal accountability of United Nations officials and experts on mission”,
November 24, 2011. [Note: this firm resolution might finally force UN Secretariat action
to stop shameless abuses committed for over half a century in the field by UN peacekeepers,
mission staff, and even regular UN staff. See for example in the IO Watch Program
Performance Updates subsection on Refugee Sexual Abuses, Part I, April 2005, pp. 15-16;
Part II, March 24, 2005 page 2, 16 January 2007 page 5, and 26 October 2007 pages 5-6;
Part III, May 21, 2009 page 5; and, most recently, IO Watch Overview Quotes XXXIV,
items 2033, 2041, and 2081. Unfortunately, Ban Ki-moon and the Secretariat leadership are
suddenly moving aggressively toward more UN coverups and preservation of impunity.]
“An official with the Global Fund to Fight AIDS, Tuberculosis and Malaria said Thursday that it …
[must cease] giving new grants until 2014 because of global economic woes brought on by debt crises in
the U.S. and Europe. …
An independent panel recommended in September that the fund must adopt tougher financial
safeguards after … Associated Press articles in January about the loss of tens of millions of dollars in grant
money because of mismanagement and alleged fraud. … Germany, the European Commission and
Denmark withheld hundreds of millions of euros in funding, pending reviews of the fund's internal controls.
… Since its creation, the fund… has disbursed some $15 billion, … [including $650 million from
the Gates Foundation. It has] $4 billion on hand to meet all of its current commitments. ..
The board .. [is creating] a new general manager position after the panel found unhealthy friction
between [the executive director, Dr. Michel] Kazatchkine, and the fund's internal watchdog. …
[Earlier this month the fund] turned up an additional $20 million of mismanagement, alleged fraud
and misspending. Earlier probes had detected about $53 million in losses. … Some of the reports have led
to criminal cases.”
“Global Fund for world health halts new programs”, Associated Press, November 25, 2011.
[Note: this humiliating development certainly undermines trust in the UN’s field programme
management capacities and accountability.]
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A very detailed analysis of the Global Fund’s operations is provided in an excellent article by
Andrew Jack, “Combating disease: A stretched safety net”, Financial Times (UK),
November 28, 2011.
“A challenge to New York City's onerous rent control laws has been granted cert by the Supreme
Court according to the New York Times. The plaintiff … argues that the rent stablization laws amount to the
government taking his property without properly compensating him for it.
Rent stabilized tenants are paying 59 percent below market rates to live in controlled properties.
This is reminiscent of a famous scandal in which then-UN Secretary General Kofi Annan maintained a
riverfront rent-subsidized apartment in the Mitchell-Lama complex managed by New York City, designed to
provide assistance to ‘moderate’ and ‘middle-income’ families. Whatever salary Annan was making, it surely
didn't leave him in such poverty as to require a $10,000 subsidy from taxpayers.
Annan's case, however, was one in which he was bilking taxpayers by taking advantage of a
generous and poorly regulated subsidy. Thanks to rent control laws, private landlords are bilked by New
York City to the benefit of well-to-do tenants, hiding the difference between the market rate they are owed
and the rent they actually get paid.”
J. P. Freire, “Challenge to Manhattan's rent control laws goes to Supreme Court”, American
Spectator, December 21, 2011.
[Note: a reminder of the period when Mr. Annan, who
often lectured the world on obligations to the less fortunate, was caught up in the
mismanagement of the Iraq Oil-for-Food scandals and other awkward matters involving his
son and relatives.]
2012
.
[As UN senior managers’ impunity rolls merrily along, some staff in the UN’s Department of
Social and Economic Affairs propose a strong counter to bullying, wasteful, arrogant, and incompetent
managers.
They suggest: getting 50%+ of staffers in a unit to sign a joint complaint against the manager; then
depositing the claims for 30 days each with Ethics and Ombudsman (who will do nothing), then the
appropriate Human Resources desk, then -- while supporting complaints by copying all the files,
communications and financial transactions he/she signed off on, which they think were against UN rules and
regulations – to the unit’s Director, as preparations for the battles to come; and then to the top Department
levels, marked URGENT. Finally, call a staff meeting and demand the boss’s firing, while citing fear of
continuing to work for him, and of retaliation.
The key is that UN managers can easily destroy one or two staff protestors but cannot easily
survive themselves against a joint staff protest; thus the easier way is to get your boss out of the
way "FAST".]
“How-to guide for dummies: Ousting your boss at the United Nations (the sure way)”,
Reform U.N. DESA, at reformdesa.blogspot.com, 13 January 2012.
[Note: several times over the decades, funding problems have forced the UN to
make serious staff cuts. Top management has often responded by picking out
“troublemakers” to expel while zealously protecting themselves and their friends and cronies.
In 2012 the possibility of serious UN staff freezes and job cuts is reappearing, in an
age of global austerity. Well-prepared group action against bad managers certainly has more
potential for saving staff careers than individual actions, by putting bad UN bosses
themselves seriously on the defensive, where they belong.
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An old joke about senior managers’ aggressive self-protection in mass firings or
layoffs is that “We’re on alert. There’s a rumor that a staff member is still somewhere in the
building.” For more on this sudden new job and career threat, and past struggles and possible
protections, see the IO Watch feature on Staff Self-Defense.]
“Committed multilateralists are dedicated to reforming and strengthening, rather than
crippling and weakening, the [United Nations.] Ambassador Joseph Torsella, the Obama administration's
point man for UN management reform, explained what the United States is doing to shake up business as
usual in New York. Its point of departure … is that the United Nations is both ‘flawed’ and ‘indispensable.’ …
[Torsella identifies] ‘at least two UNs.’ …. [One] is composed of departments, programs and
agencies that deliver many essential services like peacekeeping and humanitarian assistance. But it is
also plagued by outmoded management systems, too little transparency and accountability, and mindboggling waste.
The other ‘UN’ is composed of 193 diverse and often fractious member states that too often
treat the world body as a spoils system, … [clinging to outdated blocs and playing] to the galleries with
irresponsible behavior. And predictably, the two ‘UNs’ tend to blame each other for their failures.
The United Nations is also trapped in the past, structured to address traditional dangers of interstate war, rather than the transnational threats - like ‘proliferation, terrorism, degradation and disease’ –
that dominate today's global security agenda. …
[The US reform agenda has] ‘four pillars’; thrift, accountability, integrity, and excellence.”
Stewart M. Patrick, “Obama's 4-part plan to fix the United Nations”, The Atlantic, January
24th, 2012. [Note: the full article, available by author and title via Google, contains an
excellent and detailed analysis of these four pillars, especially integrity, and what needs to be
done.]
“Two sacks of cocaine were accidentally delivered to the UN's New York headquarters after
apparently getting lost in the post.
The drugs, worth around $2 million, were hidden in hollowed-out books inside of bags that
carried the global body's famous blue emblem. Police said the sacks were shipped from Mexico but that
when parcel sorters in Ohio were unable to find an address on them they simply forwarded them to the UN.
Staff at the UN identified the bags as ‘obvious fakes’ after they triggered a security alert at the
Manhattan headquarters of the international forum. ‘The working theory now is that possibly it was never
meant to have left Mexico at all,’ [an official] said. ’Somebody in Mexico is probably in trouble now
having let a significant amount of cocaine out of their possession.’
‘It was not a diplomatic pouch. That I can say categorically,’ UN spokesman Martin Nesirky said.”
“Cocaine sacks accidentally shipped to UN HQ”, www.telegraph.co.uk, 27 January, 2012.
[Note: probably an accident, but perhaps not. The UN’s worldwide diplomatic
pouch system, with its immunity, has on various occasions led to insiders sending drugs,
precious relics, or other contraband through its channels. A major drug bust occurred
involving the UN pouch system in 2006, see Joseph Goldstein. via Google search, “U.N.
employee is charged with drug smuggling”, New York Sun, July 27, 2006.]
[The Government Accountability Project, founded in 1977 and located in Washington DC,
promotes corporate and government accountability by protecting whistleblowers, advancing occupational
free speech, and empowering citizen activists. It is the leading US whistleblower protection and advocacy
organization.
Recently the GAP has increasingly expanded its International Reform program efforts to
defend whistleblowers in judicial proceedings internal to the IGOs (the World Bank, Regional Development
Banks, the United Nations, and the the International Monetary Fund); give voice to their concerns; ensure
investigation of their disclosures; and promote the implementation of best practice free speech protections.
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Found at www.whistleblower.org, the quality of the GAP’s work and its growing impact are shown
by such recent articles as: Conflict of Interest in Management of Spanish Trust Fund at the IDB, and
Corruption at the Inter-American Development Bank: The Fox-In-The-Henhouse Syndrome.]
“[A] confidential study by the U.N.’s … Office of Internal Oversight Services, … [found the UN’s
payroll system] is a chaotic exception to the normal world of accounting, where books balance, who
works where is known, and big, inexplicable variations in payroll records get fast attention -- or else.
[A] forensic accounting expert asked by Fox News to examine the OIOS report … [said] ‘all of the
things identified point to a situation ripe for error and potentially for fraud. How do you get any assurance
that your calculations are correct? You would not think a multibillion-dollar organization would have this level
of discrepancy’ in its bookkeeping, he added.
[A UN spokesman declared] that the concerns had been taken care of. … The outside accounting
expert, … [however], found the management rejoinder ‘very lackadaisical.’ Simply put, he said, ‘they are
not going to invest in people doing it right.’ …
[The UN still awaits a sophisticated computer and software platform known as Umoja, now
slated for delayed completion in 2015, with a $312 million price tag, and still requiring connection to some
300 old systems].”
George Russell, “Internal study shows UN's payroll system adds to dysfunction that defines
Ban Ki-Moon tenure”, FoxNews.com, January 30, 2012. [For more on the Umoja mess,
see Overview Quotes XXX, item 1809.]
“Earlier this year, the Obama Administration trumpeted the recently passed United Nations
regular budget as a triumph of fiscal discipline. To some degree, it is justified in that claim, …
considering that the six two-year budgets between 2000 and 2011 saw the U.N. regular budget grow by an
astounding 114 percent over that period! …
[However]. the budget ‘cut’ … [did not permanently eliminate] any mandates, programs, other
activities, or permanent staff, … [and retained a 3 percent [salary] raise approved last summer.. …
Moreover, … the Secretary-General proposed eliminating 44 permanent posts, … [but actually added] more
than a score.
In short, the latest U.N. regular budget … avoided entirely the types of programmatic and structural
adjustments … [needed to constrain future budget growth. This is especially problematic], because
the [UN’s ACABQ] has calculated that 74 cents out of every dollar the United Nations spends is related
to personnel costs. …
[Without significant UN permanent post reductions] or eliminating the many outdated,
duplicative, or ineffective U.N. mandates … [and the associated staff], … real and lasting reductions in the
U.N. regular budget will remain out of reach.”
Brett Schaefer, “In the U.N. budget, personnel costs rule”, Heritage Foundation, February 3,
2012.
“Swiss Customs, working closely with French colleagues under the Swiss-EU anti-fraud agreement,
have uncovered a ring of cigarette smugglers who imported some 50,000 cartons of cigarettes into
France. The business is valued at CHF2 billion [US$2.2 billion] in lost tax monies.
A number of people have been taken in for questioning in relation to a series of crimes that used
UN employees who do not have diplomatic status but faked this to import quantities of the goods tax
free. UN employees with diplomatic status do not pay taxes on a number of goods.
An investigation carried out in Switzerland helped French police catch two French citizens driving a
van with 1,600 cartons of illegally imported cigarettes.”
Ellen Wallace,” UN employees targeted in cigarette customs swindle”, genevalunch.com, 1
March 2012.
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“Why is the UN so resistant to answering simple questions about who it hires and pays?
Since February 24, Inner City Press has … [sought information] about the financing of the mission of UN
envoy to Syria Kofi Annan. … He is already traveling to Cairo, and then Syria. Is his Foundation's senior
staffer Alan Doss, who left the UN amid a nepotism scandal exclusively reported by Inner City Press, now
getting paid by the UN?
Inner City Press also asked UN Spokesmen]: ‘Please confirm or deny that Maurice Strong has
been given a role for the UN on Rio + 20, .. [and travel costs, expenditures, and age rules that apply’ -- with
no response.]. …
Maurice Strong's website describes him as "Senior Advisor to the 2012 Rio+20 Summit." Strong left
the UN -- until this seeming return -- amid scandal: a large check for $988,885 written to himself, the Oil for
Food investigation, and the undisclosed hiring of his step-daughter Kristina Mayo, not unlike Alan Doss.
A senior UN official whom Inner City Press asked about Strong on Wednesday morning said,
increduously, "he's back? He's a crook! … Watch this site.”
Matthew Russell Lee, “As Maurice Strong returns as senior advisor, UN stonewalls on
Annan team, Doss”, Inner City Press, March 7, 2012.
[Note: For more on these former
senior UN officials and their past problems., see Kofi Anan and Maurice Strong in the IO
Watch UN (System) Hall of Shame, and Alan Doss in Overview Quotes XXI, item 1196.]
“The Office of the United Nations High Commissioner for Refugees, or UNHCR, two years ago …
[held] a stockpile of $437 million in unspent cash, even as a U.N. auditing agency warned that its sloppy
handling of funds imperiled future contributions from U.N. member nations. …
The U.N.'s independent Board of Auditors … [found] ‘strong indicators of significant shortcomings in
financial management’, … ‘a major risk for UNHCR’, the auditors warned, ‘given the increasing pressures
on donors to justify why they provide public funds to international aid organizations.’ …
Among other things, the auditors' report notes: --UNHCR could not balance its many checkbooks;
… wasn't even prepared for its own audit; … ‘remains unable to gather and analyse basic management
information on its operations;’ … [or ‘the performance of its implementing partners;’ … ‘lack of transparency
in partner selection processes and the increased risk of fraud and corruption to which this exposes
UNHCR;’ … [serious delays ‘involving installation of a new, systemwide’ software system, known as Focus,
… [and creating a] lack of information that has affected hundreds of millions of dollars in UNHCR
spending. …
[UNHCR has not yet met] promised deadlines for a ‘measures taken’ report.”
George Russell, “United Nations High Commissioner for Refugees blasted for poor financial handling”, at
www.foxnews.com, then “World” , then “U.N.”, March 14, 2012.
“When private companies embezzle millions, it’s a reasonable bet … that someone will face
charges, and maybe do jail time. When … [multiple] UN agencies involved in the UN’s Oil-for-Food
program in Iraq stuffed their own administrative coffers with hundreds of millions of dollars meant to buy
relief supplies … no one faced prosecution. …
True, diplomatic immunity has a time-honored place in important matters of actual diplomacy. …
But a great many of the more reasonable-sounding aspects of the UN have … [been over-run by] the
astounding spread and sprawl of its globe-girdling bureaucracy. … [The ‘talking shop’ of] diplomats in 1945 is
by now a neo-colonial global empire, with its own envoys, outposts, and amorphous initiatives, …
spending … some $30 billion per year of other people’s money — and draped in immunity.
No big surprise that the UN is a chronic incubator of waste, fraud and abuse, which periodically
erupts into scandal when details seep out. Yet pathetically little actually gets done about it, and very rarely is
anyone punished.
All this makes UN-style immunity a highly attractive commodity. It’s a de facto license to fiddle
and defraud, if you can get it.”
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Claudia Rosett, “From UN immunity to license to defraud”, The Rosett Report, March 24,
2012.
“[Several members of Kofi Annan’s Syria technical team] … were former UN officials who left
the UN under a cloud of scandal. There was Alan Doss, who while the UN's top envoy to the Congo was
found to have urged UNDP to break its rules and give his daughter a job, and Nicolas Michel, who left as the
UN's top legal officer after admitting taking $12,000 a month from the Swiss government to pay for a Park
Avenue apartment while employed by the UN. ...
[The UN later announced that Doss was off the Syria team, and that Michel just a consultant], paid
only when used. … However, Martin Griffiths, the technical director of the Syria team, and] former executive
director of the Center for Humanitarian Dialogue based in Geneva, was forced to resign from CHD after a
CHF 3.8 million fraud was exposed in June 2010, and confirmed by KPMG.
A well placed diplomat … [said] ‘Griffiths could never have been hired for this. … But Kofi … [forced
him in with] a UN contract and pay for at least six months, no matter what happens with the Syria work.’"
…
We will have more on the team.”
Matthew Russell Lee, “Annan's Syria technical team led by executive who quit group CHD
amid embezzlement scandal”, Inner City Press, March 28, 2012.
“A battle waged by the U.N.’s top internal watchdog against fraud, waste and abuse, backed by
the U.S., to bring more daylight to the world organization’s internal operations has wound down.
[Putting the agency’s reports] on a public U.N. website, has been mired for months in the
quicksand of U.N. procedures by … developing-world countries, including Cuba and Nicaragua, with the
behind-the-scenes backing of China and Iran. …
The Office of Internal Oversight Services, or OIOS, … [is charged] with detecting waste, fraud and
abuse at the U.N. Secretariat, as well as examining U.N. programs in terms of their effectiveness -- overall, a
very tall order. … [for] a staff of about 120 … overseeing nearly $18 billion … [of expenditure for 2012-2013.]
… The OIOS documents have occasionally been revelatory. … On the record, Ban is firmly behind
the plan [for a public website. But … the previous OIOS chief] … [charged him] with “undermining” her
organization and exhibiting a "lack of responsibility. …
This time around, … Ban was conspicuously silent on the publication issue. … [The issue could
arise] again later this spring, but given the momentum lost … it could be a lot later.”
George Russell, “U.S. loses battle to make public internal U.N. reports on waste, fraud and
abuse”, FoxNews.com, April 10, 2012.
[Note: many UN Member States relish
opportunities to repeatedly torpedo proposals to finally establish serious UN accountability,
transparency, and integrity mechanisms.]
This topic continues in Corruption in the UN, Part XI, which follows
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