UN will not pay for legal fees of official implicated in Iraq Oil-for-Food probe

The United Nations has decided that it is not appropriate to reimburse Benon Sevan, former head of the now defunct multi-billion dollar Oil-for-Food programme for Iraq, for legal bills stemming from his appearance before an independent inquiry committee probing charges of misconduct and mismanagement, a UN spokesman said today.

"This would be reviewed if he is later cleared of both internal breaches of UN rules and regulations and of any criminal wrongdoing," spokesman Fred Eckhard told the daily briefing on the eve of a new interim committee report on the employment of Secretary-General Kofi Annan's son, Kojo, by Swiss company Cotecna, which was awarded an Oil-for-Food contract.

Last Wednesday Mr. Annan's Chief of Staff, Mark Malloch Brown, told a news conference of an earlier decision taken on the advice of the UN legal office to cover some of the legal fees incurred by Mr. Sevan in connection with his appearance before the Independent Inquiry Committee (IIC) headed by former United States Federal Reserve Chairman Paul Volcker.

Mr. Sevan, who had retired from the UN but was kept on a salary of $1 a year to make him available to the IIC, had repeatedly raised the issue of compensation with the Secretary-General and former Chief of Staff Iqbal Riza. According to Mr. Malloch Brown, the reason the UN initially decided – on a strictly exceptional basis – to agree to Mr. Sevan's request was because "he was at the centre of this web that the panel was seeking to unravel; that his role came about because of his official responsibilities as Head of the Oil-for-Food programme, and that, therefore, any transgressions that had occurred, were related to his official duties."

That arrangement, however, was terminated after the IIC released on 3 February a first preliminary report that found Mr. Sevan had repeatedly solicited allocations of oil under the programme, by which then sanctions-bound Iraq was allowed to sell oil in exchange for humanitarian supplies, and by so doing "created a grave and continuing conflict of interest."

According to a letter made public Wednesday at UN Headquarters, Mr. Malloch Brown informed Mr. Sevan that in the light of the IIC's adverse findings, "we are no longer prepared to reimburse the cost of your representation before the IIC or any other legal costs incurred by you after 3 February 2005."

The new decision deals with the time prior to 3 February.