The New York Times-20080125-Senators Criticize U-N- Program in North Korea- but Question Set of Accusations
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Senators Criticize U.N. Program in North Korea, but Question Set of Accusations
A Senate subcommittee criticized the United Nations Development Program in North Korea on Thursday, accusing it of lax management and poor accountability.
But the panel raised serious questions over accusations by the United States Mission to the United Nations that the agency had squandered millions of dollars there.
The panel, the Permanent Subcommittee on Investigations, concluded that the program depended excessively on staff members chosen by the North Korean government, that it broke its own rules in using foreign currency rather than local currency, and that it lacked sufficient administrative and fiscal controls and resisted auditing.
In a report, the subcommittee cited general management and operational deficiencies as leaving the agency vulnerable to manipulation by the North Korean government.
The program shut its operations in North Korea in March when the country resisted a decision by the development program to stop furnishing payments in hard currency and to stop making local hiring subject to government approval.
But much of the hearing on Thursday focused on charges made last year by Mark D. Wallace, an ambassador at the United States mission to the United Nations, in briefings for members of Congress, news outlets, the State Department and nations that finance the development program.
Mr. Wallace said then that $2.8 million of program funds had been sent to North Korean missions abroad for the purchase of buildings in Britain, France and Canada; that $2.7 million had been paid to a North Korean financial agent responsible for sales of missiles and arms; and that more than $7 million had been transferred to a North Korean committee it worked with.
Mr. Wallace compared the program to the scandal-ridden oil-for-food program in Iraq and suggested that the United Nations money might have ended up financing the North Korean nuclear program.
The subcommittee staff report on Thursday said that in fact the $2.8 million sent abroad to buy real estate was actually North Korean, not United Nations, money, and that the amount of money sent to the company suspected of financing arms was $52,000, not $2.7 million.
It also accepted the program's explanation that the link to arms sales of the suspect contact, the Macao-based Zang Lock Trading Company, had not been known at the time.
The report said the North Korean representatives had told the committee that their government used a United Nations bank reference as a way of avoiding detection at a time in 2002 when the country had just been labeled by President Bush as a part of the axis of evil and feared its power to transfer funds abroad would be restricted. The United Nations had no knowledge of the transaction, the report said.
At the hearing the chairman, Senator Carl Levin, a Michigan Democrat, pressed Mr. Wallace repeatedly to say whether, with what he knew now, he could still make the same charges he had made last year.
Mr. Wallace said that he did not know the specific amounts of money involved because of the difficulty of tracking transactions in North Korea, and added that they could be even higher than he had estimated.
In an interview outside the hearing room, Mr. Levin expressed frustration at the answer.
I gave him a chance on at least three occasions to acknowledge that some of the points that he made back in May were inaccurate at the time, perhaps based on information that he interpreted, but that nonetheless, he could not make those statements now, Mr. Levin said.
That doesn't mean he lied, Mr. Levin added. It does mean that he said things at the time that he now knows are not accurate.
In a separate interview, Mr. Wallace said he could not answer the question under oath because he was uncertain about the real figures, and he suggested the committee had been naive in its conclusions.
Disputing the subcommittee's finding that the $2.8 million sent abroad did not belong to the United Nations Development Program, he said: The documents say it's the U.N. imprimatur money. The North Koreans and now the U.N.D.P. say, 'Well, maybe those documents are not accurate.'
I didn't make those documents, the North Koreans did, and they want us to believe it is not U.N. money. If you want to give them the benefit of the doubt, I would submit that I have a bridge for you in Manhattan that I'd sell you for $2.7 million.
The ranking Republican on the committee, Senator Norm Coleman of Minnesota, said he thought the United Nations in North Korea had a keep your wallets open and your mouths shut attitude to the rest of the world.
He said the conduct of the program showed how rogue regimes try to manipulate the U.N. as much as they can, adding, If they were able to use U.N.D.P. as a cover to funnel money, what other rogue nations were able to subvert the system?
