NEW YORK (AP) – Investigators probing the U.N. oil-for-food program said Tuesday that Secretary-General Kofi Annan didn’t interfere in the awarding of a contract to a company that employed his son but criticized the U.N. chief for not properly investigating possible conflicts of interest.

A defiant Annan said “Hell no” when asked at a news conference if he would resign, noting the report’s findings that he committed no wrongdoing.

“After so many distressing and untrue allegations have been made against me, this exoneration by the independent inquiry obviously comes as a great relief,” he said.

Although the report did not completely vindicate the secretary-general, the investigation led by former U.S. Federal Reserve Chairman Paul Volcker said there was insufficient evidence to show that he was aware of the bid.

Still, the report raised questions about when the secretary-general learned about the December 1998 contract to the Swiss firm, Cotecna Inspection S.A., and strongly criticized the destruction of documents by his former chief of staff that could have shed light on the oil-for-food scandal in Saddam Hussein’s Iraq.

The independent inquiry, released Tuesday, faulted Annan for conducting a one-day investigation into the matter, saying it should have been a more rigorous, independent probe. It also accused the company, Cotecna Inspection S.A., and Annan’s son, Kojo, of trying to conceal their relationship after the firm was awarded the contract.

At a separate news conference after the report was released, Volcker said the investigation found no evidence that Kofi Annan improperly influenced the process by which Cotecna was selected for an inspection contract under the oil-for-food program, or that he tried to influence it.

Kojo Annan worked for Cotecna in West Africa from 1995 to December 1997, and then was a consultant for the firm until the end of 1998 – when it won the oil-for-food contract. He remained on the Cotecna payroll until 2004 on a contract to prevent him from working for a competitor.

Kofi Annan expressed deep disappointment with his son’s involvement.

Although Tuesday’s report found no wrongdoing by Kofi Annan, it clearly faulted the secretary-general’s management of the world body and his oversight of the oil-for-food program.

The $64 billion oil-for-food program was the largest U.N. humanitarian aid operation, running in 1996-2003. Saddam’s government was allowed to sell oil in exchange for humanitarian goods as an exemption from U.N. sanctions imposed after Iraq’s 1990 invasion of Kuwait.

In a bid to curry favor and end sanctions, Saddam allegedly gave former government officials, activists, journalists and U.N. officials vouchers for Iraqi oil that could then be resold at a profit. U.S. congressional investigators say Saddam’s regime may have illegally made more than $21 billion by cheating the program and other sanctions-busting schemes.

The report is the second issued by Volcker’s team. It coincides with allegations of sex abuse by U.N. peacekeepers and of sexual harassment and mismanagement by senior U.N. staff, and comes a week after Annan called for the biggest overhaul of the United Nations in its 60-year history.

“I think we all share the hope and confidence that the results of our investigation … may contribute to the larger objective of a reformed U.N., a U.N. capable of commanding and maintaining the support of its member states and the public at large,” Volcker said.

Some critics, including several U.S. lawmakers, have been calling for Annan to resign. Even before the report was issued, Sen. Norm Coleman, R-Minn., reiterated his call for Annan to “put the interests of the U.N. ahead of his personal interest” and step down.

Volcker’s Independent Inquiry Committee found that Kojo Annan was not forthcoming with either his father or the committee and accused him of consistently trying to hide the nature of his relationship with Cotecna. It said an investigation was continuing into Kojo Annan’s dealings with the program.

“I love my son and have always expected the highest standards of integrity from him,” a visibly sober U.N. chief said. “I am deeply saddened by the evidence to the contrary that has emerged and particularly by the fact that my son had failed to cooperate fully with the inquiry.”

In a letter annexed to the report, Kojo Annan’s lawyer, William R. Taylor, rejected any claim that Kojo Annan had not been wholly cooperative with the committee. But Taylor admitted he had not told his father the entire truth.

“He regrets the embarrassment that omission caused to his father and to the United Nations and accepts responsibility for it,” Taylor wrote.

The Volcker report said that while Cotecna “generally has cooperated” with the investigation, the committee “concludes that Cotecna has made false statements to the public, the United Nations, and the committee.”

After a British newspaper, The Sunday Telegraph, reported the link between Kojo Annan and Cotecna in January 1999, the report said, “Cotecna disguised its continuing relationship with Kojo Annan by routing the payments that were made to him” through three different companies, in response to instructions from the secretary-general’s son.



Associated Press reporters Desmond Butler and Nick Wadhams contributed to this report.


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