UN Secretary General Kofi Annan discusses the latest report on the UN oil-for-food scandal at a press conference in New York
Chip East  /  Reuters
U.N. Secretary General Kofi Annan discusses the latest report on the investigation into the United Nations oil-for-food program on Tuesday.
By Anchor
NBC News
updated 3/29/2005 3:43:14 PM ET 2005-03-29T20:43:14

Secretary-General Kofi Annan was cleared Tuesday of interfering in the awarding of a contract in Iraq to a firm that employed his son but he was faulted for not probing possible conflict-of-interest properly.

The independent inquiry, led by former U.S. Federal Reserve chairman Paul Volcker, released its second interim report on the oil-for-food program, this time focusing on Annan and his son, Kojo, who worked for the Swiss firm Cotecna.

NBC News’ Carl Quintanilla reports on the mood at the United Nations after the release of Volcker's latest report and what the future holds for the U.N. Secretary-General.

The Volcker report clears Kofi Annan for blame for any personal wrongdoing  and clears him of blame for his sons actions. But, what will the fallout be for Annan?  
It is important to remember that it clears him only to the extent that it says there is no evidence that he influenced the contracts. Volcker was adamant in saying that this is all they could find. No one is giving him complete absolution, but the report simply said there is no evidence to suggest that he did anything wrong.

Politically the fallout for Annan really depends on which side you are on. All of his supporters say that it backs up his claim that he was involved in no wrongdoing. His critics however continue to call out for his resignation. They say that anyone who failed to properly follow-up on an inquiry is not the person you want reforming the U.N. in the wake of their human rights scandals and other scandals.

The report basically cleared Annan of evidence of any corruption allegations, but it was critical of Annan’s oversight of the whole $64 billion oil-for-food program. Will there be further calls for Annan’s resignation?
It is likely that anyone who was already calling for Annan’s resignation will see this as more fuel to add to the fire, not necessarily because he was found to have done anything wrong, but because he wasn’t.

That means politically, it is difficult to see how he can lead a charge toward higher integrity and higher ethical standards for the U.N., especially since this report is not done and the investigation continues.

How will these latest findings affect the future of the U.N.?
The mood at the U.N. is probably one of resignation. Delegates and people who work for the U.N. all admit, and have admitted, that it needs basically to be rebuilt in terms of its ethical guidelines. The human rights allegations have been damaging, the oil-for-food scandal has been damaging.

The perception of it at this point is one that is in need of major repair, say its critics and even some of its supporters. So, there is a sense that even after the Volcker report is done, they have a long, hard road ahead.

What is the mood at the U.N. today?    
Well, of course, the U.N. is notoriously secretive and private. It will take time for delegates to respond to the Volcker report. Annan has made a statement in which he says the inquiry has cleared him of any wrongdoing. That was expected. But, the report is still too fresh to notice any tangible change of mood at the U.N. today. 

What’s next for Kojo Annan? Volcker said the next part of the report will continue to investigate him?
At this point he is essentially out of reach. He is a Nigerian citizen. At the press conference, it was suggested to Volcker that he subpoena him. Volcker’s response was, “I don’t think that will do much good for a Nigerian citizen.”

So, the investigation into Kojo continues. He has not given an interview to the commission since October, so it’s hard to imagine an instance where he would in the near future. The commission will continue to investigate just exactly how much money he was paid. At this point, they really don’t know the precise number on that. 

What was the attitude of the press toward Volcker regarding his report?   
In terms of the press questioning, it has been a bit of, “Come on Volcker, what are you saying? You’re saying that Annan knew his son worked there, but never got involved in the bidding war?” But, Volcker’s stance has been very much to the letter of the report. They are not characterizing whether Annan is politically healthy at this point or not. They are just saying what they typed in the report.

You get the sense that the press still is in search of some kind of "smoking gun."

But, Volcker’s response has been very cold and very precise. They clearly don’t want to be seen as indicting Annan, even informally and jeopardizing his stance at the U.N. They also don’t want to jeopardize the credibility of the report by making it seem that it was motivated politically in any way.   

Carl Quintanilla is an NBC News correspondent.

Video: Annan faulted

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