 "Photo: BORIS BERDICHEVSKIY I THE TICKER")
At the Behind the UN Oil-for Food Scandal, it was "lunch for food and talking for food" as Andrew Levine, former deputy counsel for the Independent Inquiry Committee into the United Nations Oil-for-Food Program, pointed out.
On Thursday, Apr. 6, the Robert Zicklin Center for Corporate Integrity held its last event in this year's Ethics Week, Behind the UN Oil-for-Food Scandal with guest speaker Andrew Levine. Levine addressed the political complexity of the OFFP and the problems the program faced in the presentation that was comprised of a great number of questions from the audience that guided the overall direction of the presentation.
In the early 1990s, the United Nations were under pressure to lessen human suffering in Iraq and were trying to deal with the malnutrition issue. Consequently, the UN designed the oil-for-food program, which Iraq was not receptive to until 1995. The money from the oil sales taking place under this program was to be put towards buying humanitarian goods for Iraqi people.
The Iraqi government had some concerns and in order to go through with the program, they wanted to make sure they had control. Compromises were made and while Iraq chose parties who were to buy the oil and parties from whom they would buy humanitarian goods, an appointed 661 committee was to approve the prices of oil and approve the contracts of the transactions.
To emphasize certain structural limitation, Levine quoted the chair of this committee stating that the extent of his authority was to say, "yes" when the committee already agreed to do something. It is as Levine stated, "No one at the UN was trying to make a program landing money in Hussein's hands, but he needed authority to agree to the program."
In 2004, the United Nations put together an Independent Inquiry Committee with the staff of 75 persons of 20 different nationalities to look at instances of mismanagement and fraud in the Oil-For-Food program in Iraq. The staff split into teams and these different teams focused on a variety of issues.
The committee did not have any subpoena power or law enforcement power, only power to investigate and publish and so they needed a great amount of cooperation in order to do their job. According to Paul A. Volcker, the chair of the committee, "The degree of scrutiny the UN opened itself up to was truly unprecedented…and the investigation of this magnitude was bound to find mistakes."
The committee interviewed a lot of people and during this inquiry a lot of backchannel negotiations, unsuccessful bribing, side trade and smuggling were brought to the surface. The committee also found that the companies who, in fact, participated in the program were not necessarily the companies who were assigned. Iraq created front companies to get money back such as inland transportation companies.
In other cases, Iraq would undercharge companies for the oil but wanted the margin to come back to their pocket in form of a surcharge. A lot of companies when interviewed by the committee asked, "If we cooperate, can we get our money back?" The victim, however, was the Iraqi people, who were robbed of the money that was to be allocated towards their needs.
The main problem with the oil-for-food program was that it was truly established as a temporary six-month program that was subject to renewal rather than the seven-year long program it was. He stated that the program provided more goods than relief effort. "Because this is a temporary program the kind of aid provided is not the aid you would provide in a long term program," Levine explained. He emphasized that in the mist of all the investigations, the 70 percent of good that the program had done should not be forgotten.
Levine pointed out that there is a different attitude about oversight when planning a six-month program because there is a certain reluctance to give money towards oversights rather than other pressing issues. "[The oversight of the program] was a very tricky balancing act and that there was abuse isn't surprising, but the extent of it is," Levine stated.
According to Levine, the main vulnerabilities of oversight were inadequate follow-ups on audit and oversight as a whole. Levine believes that watertight monitoring was needed. He said, "If you know the flashpoints from the onset, you have the capacity to monitor those weaknesses."
However, it was difficult to create a water-tight program with a rift between the member states over sanctions enforcement program and with other tensions within the committee. The program also received a lot of criticism concerning the number of auditors, but according to Levine even if the number of auditors was increased, it would not have helped because they were looking at the wrong things.
"[The role of the committee], most importantly in my view, was to give some thoughts about the future of the UN," shared Levine. According to him, the United Nations should try to learn from this situation and deal with its weaknesses in planning and in oversight as well.
At the moment, different nations involved in the UN Oil-for-Food Scandal are conducting independent investigations into the matter. Anyone interested in the Independent Inquiry Committee's reports and findings can visit their Web site, www.iic-offp.org.
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