Credit where credit is due....


The Philadelphia Inquirer has at last let its readers know about the U.N. scandal:

At least eight official investigations have begun into the largest financial rip-off in history: preliminary estimates from the GAO point to $10 billion skimmed or kicked back or otherwise stolen in the United Nations dealings with Saddam Hussein.

Seeking to manage the news of the scandal, U.N. Secretary-General Kofi Annan appointed former Fed chairman Paul Volcker to head an internal investigation. That seemed to slam the door on U.N. cooperation with truly independent inquiries, but Volcker last week announced that "appropriate memorandums of understanding with a number of official investigatory bodies are in place or in negotiation."

To overcome criticism like mine of his committee's lack of subpoena power or ability to take testimony under oath, Volcker has hooked up with Robert Morgenthau, the Manhattan district attorney, who has been prosecuting two men in an unrelated distressed debt case at BNP Paribas; that's the French bank the U.N. used for its oil-for-food letters of credit. That grand old prosecutor has a staff skilled at following money and has sitting grand juries available to encourage truth-telling.

Bless William Safire for continuing to pursue a story which is really the scandal of the year. (Unless, of course, the non-reporting of it is considered a bigger scandal than the scandal itself. It might be!)

UNSCAM has received so little coverage that few Americans know about it at all. Repeatedly, I expressed my outrage over the Inquirer's non-reporting, and, while I have been generally unsatisfied (I did get a call from editor Carl Lavin), at least they have run Safire's column.

Part of the problem may be that there's enough blame to go around to trigger a bipartisan-style coverup:

The U.N. has stonewalled three committees of the U.S. Congress, refusing to reveal its 55 internal audits, claiming that our State Department's members on the U.N. "661 committee" had approved all kickback-ridden contracts.

But State has been slow-walking congressional requests for documents that reveal its own poor oversight and that embarrass the U.N., which it now wants to placate. State could impede the hunt overseas through mutual legal-assistance treaties, and can continue to diddle the House committees of Henry Hyde and Chris Shays, but our diplomats cannot evade chairman's letters from the Senate PSI.

Who else is on the trail of the skimmed billions, much of it owed to those Kurdish Iraqis shortchanged by U.N. dispensers of largesse? Playing catch-up to Morgenthau, a U.S. attorney in New York has subpoenaed records of several American oil companies; our Treasury Department charged a couple of minor players with illegal transactions with Iraq.

Meanwhile, back in Baghdad, where much of the grandest larceny ignored by the U.N. originated, the investigation by the old Governing Council was stopped by Paul Bremer because its leaks alerted the world and upset the U.N. The search for damning documents was relaunched under non-Chalabi auspices, but the chairman of Iraq's Supreme Audit Board, Ihsan Karim, was killed on his way to work two weeks ago. Criminal enterprises have heavy money at stake in this.

Volcker, still in a start-up stage after four months, assures the Wall Street Journal he hired a great senior staff. But one is Richard Murphy, former ambassador to Saudi Arabia and a veteran Arab apologist on TV. Will he prevail on Jordan's king to get the Philadelphia Investment Corp. in Amman to open its files about financing favored "beneficiaries"? Or dare to demand the United Arab Emirates order its Al Wasel and Babel trading company to explain the lucrative electrical projects that had nothing to do with food?

State Department? Oil Money? Do I smell the beginnings of a bipartisan aroma?

Bear in mind that with a scandal of this magnitude, what's being exposed at this early stage in the heavily-stonewalled investigations may be the equivalent of a few bare skeletal parts being exposed just on the surface of a mass grave.

My thanks to the Philadelphia Inquirer for having the courage to run this piece.

I only hope the digging doesn't stop, because if history teaches one thing, it's that bipartisan coverups work.

posted by Eric on 07.13.04 at 09:36 AM

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