Annan fires Joseph Stephanides for ‘serious misconduct’ linked to oil-for-food

Secretary-General Kofi Annan has decided to immediately dismiss Joseph Stephanides, a United Nations official who was linked to a tainted procurement process during the oil-for-food scandal, a spokesman for the world body announced today.

The action was taken “after a thorough review of all aspects of the case,” Stephane Dujarric told reporters in New York. He added that Mr. Stephanides, former Deputy Director of the Security Council Affairs Division, had been advised on Tuesday that he was being separated from service for serious misconduct, in accordance with UN Staff Regulations.

The Independent Inquiry Committee (IIC), commissioned by the Secretary-General to probe the oil-for-food programme in February, issued a report which found that a UN Steering Committee “prejudiced and pre-empted the competitive process in a manner that rejected the lowest qualified bidder” with the “active participation” of Mr. Stephanides. He was immediately suspended and given time to respond to the administrative charges against him as part of due process.

According to the IIC report, Mr. Stephanides violated procurement rules to enable Lloyd’s Register Inspection, Ltd. to secure a multimillion dollar UN contract under oil-for-food. While Mr. Stephanides acknowledged this to be a technical violation of the rules, he contended that he acted to benefit the UN by negotiating the lowest price and not for personal gain, the report says.

The IIC did not accept this explanation, noting that Mr. Stephanides “shared information with and enlisted the United Kingdom’s assistance in an effort to win the contract for Lloyd’s, not simply to obtain a better price from Lloyd’s for a contract award that already had been decided.”

The Committee said it did “not doubt the sincerity of Mr. Stephanides view that Lloyd’s was the best company for the contract or that this view was shared by high-ranking officials of the United Nations and some members of the Security Council,” but maintained that rules which should have been followed were not.

Mr. Annan’s decision to dismiss Mr. Stephanides brought to 40 the number of staffers who have been let go summarily since he became Secretary-General in 1997.

Mr. Stephanides, who also served as Chief of the Sanctions Branch, was suspended along with Benon Sevan, the former head of the oil-for-food programme. In its February report, the IIC, led by former United States Federal Reserve Board Chairman Paul Volcker, found that Mr. Sevan had repeatedly solicited allocations of oil under the programme. By doing so, the panel said he “created a grave and continuing conflict of interest.”

The report did not rule on whether the former oil-for-food chief had personally profited. Through his lawyers, Mr. Sevan has denied any wrongdoing.

Mr. Dujarric today indicated that with questions still open, formal action against Mr. Sevan is not imminent. “A decision has been taken to suspend actions against him until the Independent Inquiry into the oil-for-food programme has finished looking into Mr. Sevan’s activities,” he said.

The spokesman explained that “if administrative action is to be taken against Mr. Sevan then it would be taken as a whole, instead of piecemeal.”