Sloppy management, corruption permeate United Nations Inspector's office recovers $30 million of waste, fraud

November 02, 1997|By NEW YORK TIMES NEWS SERVICE

UNITED NATIONS -- Three years after the United Nations established an inspector general's office to combat waste and fraud, a clearer sense of the scope and style of corruption within the organization is beginning to emerge. So is an understanding of why it is often difficult to detect and stop.

On Thursday, Undersecretary General Karl T. Paschke, the German foreign service officer who has directed the anti-corruption office since its founding, released his third annual report.

It reveals a pattern of sloppy management in which contracts are awarded and money disbursed without reference to the organization's financial regulations or accepted rules of accounting.

The report describes a world of petty criminality, where cash sometimes seems to be sitting around for the taking.

In this freewheeling atmosphere, diverting money is relatively easy, the report demonstrates. At a news conference Thursday, Paschke emphasized that a major priority for his office's investigations is procurement. Contracts for catering, food purchases and air-charter services seem to be particularly prone to abuse, he said. Overseas, sweetheart deals involving friends and relatives abound.

Individual acts of corruption within the U.N. system rarely involve large sums of money, despite what some critics of the organization charge. But collectively, they add up.

Paschke said that his office had recouped about $30 million for the United Nations over the past year, in addition to the unknown amount it had saved by discouraging crimes through increased inspections.

In his work, Paschke faces serious and entrenched problems. U.N. offices around the world, beginning with the organization's European headquarters in Geneva, often seem to think that New York rules do not apply to them. "This is one area United Nations reform needs to address vigorously," he wrote in the report.

There is almost never a paper trail in U.N. transactions. In many distant missions, account books are kept carelessly if at all. Memos are not filed; instructions are often unwritten. The kind of investigations that the U.S. Congress and Justice Department can carry out by studying documents would be virtually impossible in most cases at the United Nations.

Paschke's office has begun prosecuting officials, in national courts when possible, to show that diplomatic immunity is no protection in serious cases.

Departments and branches audited by his investigators are taking action rather than ignoring warnings as they did in the past, the report says.

Nevertheless, the 1997 report from Paschke's office to the General Assembly contains ample evidence that the job of cleaning out the corners of the organization is a big one. Among the cases this year are:

In Angola: "Acceptance of delayed, defective and short supplies from a vendor resulted in excess payments of $288,000 and losses of $980,000. There were also serious irregularities noted in the contracting of an aircraft. Internal control weaknesses resulted in extensive abuse of communications facilities. The mission paid $667,00 for stevedoring charges in connection with the sea lift, which should have been the responsibility of the vessel operators."

In Haiti: "An audit of communications disclosed that a telephone technician had provided unauthorized international access to some staff members and, in some cases, inappropriately reduced telephone charges."

In Palestinian refugee camps: "Funds were being siphoned off through the submission of false medical reimbursement claims."

Pub Date: 11/02/97

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