August 8, 2005
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REPORT: UN PROGRAMME OFFICIALS GAINED ILLEGALLY THROUGH BRIBES AND
The IIC is today
issuing its third
Interim Report. The Report records the Committee’s analysis and
conclusions with respect to:
the illicit activities of
Executive Director of the United Nations Office of Iraq
Programme, in concert with past or present
principals of African Middle East Petroleum Co., Ltd,
Efraim (Fred) Nadler and
the evidence that a United
Nations procurement officer, Alexander Yakovlev,
in concert with French businessman Mr. Yves
Pintore, actively solicited a bribe in connection with the Oil
for Food Programme (the
Programme) and otherwise presumptively
accepted illicit payments from other UN contractors outside the
The Committee’s first
two Interim Reports, issued on February 3 and March 29,
2005, considered the procurement practices of the United Nations in
awarding contracts to major contractors which were part of the
operational backbone of the Programme.
Matters reported in this third report are the result of investigations
relating to those same activities, but not complete at the time of
issuance of the first two Interim Reports.
findings based on the evidence presented in the Report are:
With respect to Mr.
Sevan, Mr. Nadler, and Mr.
Sevan corruptly and in concert with Messrs. Nadler and
Abdelnour derived personal pecuniary
benefit from the Programme through cash
receipts from the sale of oil allocated by Iraq to Mr.
Sevan and bought by African Middle East
Petroleum Co. Ltd. The participants had knowledge that some of the oil
was purchased by paying an illegal surcharge to Iraq in violation of
United Nations sanctions and rules of the
With respect to Mr.
Yakovlev and Mr.
Yakovlev, while responsible for the procurement of an
independent oil inspection company for the
Programme in 1996, purposefully, and in concert with Mr.
Pintore, participated in a corrupt scheme
to solicit a bribe from SGS, a bidder for that contract. In pursuing
this scheme, Mr. Yakovlev, again in
concert with Mr. Pintore, provided
confidential bid information, internal assessments, and selection
considerations to SGS in violation of the Charter of the United
Nations, and UN Regulations and Rules. (N.B. The Committee has no
evidence that SGS agreed to pay a bribe or paid a bribe.)
Concerning both Mr.
Sevan and Mr.
Yakovlev, the Committee recommends to the Secretary-General
that he grant a properly supported request or requests by law
enforcement authorities which are pursuing active investigations
within their jurisdictions, to waive their immunity for purposes of
criminal investigation and prosecution, giving due consideration to
the requesting authority’s commitment to reciprocal cooperation with
the Committee’s investigation.
Nadler, Abdelnour, and
Pintore, the Committee recommends that the
Secretary-General, upon receipt of an appropriate, properly supported,
request, make available the necessary information to assist law
enforcement authorities in the possible investigation and prosecution
of the three men, again with due consideration to the requesting
authority’s commitment to cooperation with the Committee’s
investigation. The Committee makes the same recommendation with
respect to any others who may be shown by continuing investigations to
have acted in concert with Mr. Yakovlev in
The Report also
responds to representations made by Messrs. Riza,
Robertson and Stephanides to the Committee
asking that adverse findings made against them in earlier Reports be
modified or reversed. In the cases of Messrs.
Riza and Robertson, after careful review, the Committee has
concluded that their findings and conclusions remain accurate and fair
from the evidence available. They have reached the same conclusion
concerning Mr. Stephanides as his
representations relate to Mr. Yakovlev.
The Committee has yet to review additional material submitted by Mr.
Stephanides’ counsel on matters other than
those which touch on Mr. Yakovlev.
According to Paul
Volcker, the Committee’s
Chairman,”These findings close several
avenues of inquiry developed in earlier Interim Reports. A much
broader report on the administration of the Oil-for-Food
Programme is in preparation, with the
expectation of release in early September. Before concluding its work,
the Committee also intends a more comprehensive listing of firms
participating in the Programme, either in
the purchase of oil or the sale of humanitarian goods, as well as a
more detailed analysis of the manner in which Iraq and
its vendors and oil purchasers manipulated the