Before UNDP Meeting, North Korea Reaches out to G-77 and Deal for Silence Reached, Unless a "Wrinkle"

Byline: Matthew Russell Lee of Inner City Press at the UN: News Analysis

UNITED NATIONS, January 15, 11:10 am, updated here -- The night before the expected showdown on North Korea and audits at the UN Development Program's Executive Board meeting, a deal was reached, Board diplomats say. Under the deal, according to one of its proponents, UNDP would suspend its programs in North Korea pending an audit. The diplomats predicted that unless any "wrinkles" emerge when the agenda item is called later this morning, the United States will not speak on the item. With a whimper, not a bang, one observer mused.

            A delegate from Lebanon provided a different perspective on the process. North Korea made a pitch to the Group of 77 organization of developing countries, rallying support to the idea that suspension and an audit would create a precedent for further "politicization" of development and of UNDP. This too appears to have had its effect.

            A diplomat seen as demanding reform pointed out that even if the audits are done by the same Board of Audit which previous concealed the North Korea - UNDP internal audits of 2004, 2001 and 1999, this time that Board is led by France, which has said it can and does use outside counsel and auditors. It is said that between Ban Ki-moon's Friday announcement of urgent worldwide inquiry into all activities of UN funds and programs and his Monday narrowing of scope, agencies and diplomats complained of the dangers of a full external audit. And so this deal, which as of 11 a.m. in the press gallery appears to be on track. We'll see -- it sounds as if the sides' understandings or spin of any deal are quite different.

UNDP & flags

            Also seen from the bleachers, to which the working press was confined, was a team from UNDP's Communications Office, including a blond woman accused by an Executive Board member's spokesperson of seeking to eavesdrop of what the spokesperson was saying. Notes were being taken, and spin was being prepared. It has twice been announced that UNDP's Ad Melkert -- who is said to have led the overnight negotiations, rather than Administrator Kemal Dervis -- will take media questions after the morning's session.

Update of 4:45 p.m. -- The fix in fact was in, or was finalized between 12 noon and 12:30. Ad Melkert read out a statement, and the chairman banged the gavel to approve it. Only then did the speechmaking start, following by two Q&As at the Security Council stakeout. And they will be reviewed, on this site, after UNDP makes available information it said it would, including on the specifics of the Nationally Executed programs it has allowed in North Korea, and after a few further inquiries. Watch this site -- new update at midnight, click here to view.

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On UN Reform, Grandstanding and Apathy, on UNFPA at Least, Despite Tax Evasion on Milk and Cars, UNDP to Follow

Byline: Matthew Russell Lee of Inner City Press at the UN: News Analysis

UNITED NATIONS, January 24 -- While the UN Development Program scandal and why Ban Ki-moon so quickly scaled back his announced investigation were discussed Wednesday at the UN's noon press briefing, downstairs on similar issues lethargy and grandstanding slipped back in.

            At the Executive Board meeting, the UN Population Fund's country programs including in North Korea were up for debate -- except that there was none. It required five countries' request to get a country plan discussed. On UNFPA's North Korea plan, only the United States and Japan spoke up. Afterward Inner City Press trailed a U.S. representative into the hall and asked, "Is it that the U.S. couldn't get three more votes?"

            "I wasn't in there when it happened," the representative answered. Journal jeremiads have many after-the-fact parents, but failure like this is an orphan.

            After the U.S. and Japan spoke -- followed by Moldova on the topic of Transdniestria -- it was announced that Thoraya Ahmed Obaid, director of UNFPA, saw nothing in what was said to respond it. Among the things said was a call that internal audits of UNFPA, of the type Inner City Press quoted from in yesterday's story, click here to view, should be made available to the public. No comment on that?

Thoraya Obaid up against the wall, no comment

            At the UN's noon briefing, Inner City Press asked what had happened, to have Ban Ki-moon scale his January 19 call for a worldwide, external inquiry into all funds and programs back to his Jan. 22 recitation that the same old board of auditors will review three and only three issues with regard to North Korea. Video here, from Minute 9.

            "That's just the first step," the spokesman answered, adding that the UN's Warren Sach -- who readers will last remember dodging phone calls about wasteful spending at the Vienna Cafe -- and "at least one auditor" will be taking questions on Friday. We'll be there.

   Inner City Press also asked the new spokesman for the General Assembly President if either the Secretary General has spoken with her about the upcoming audit and inquiry. Video here, from Minute 37:57. "No, I don't think that came up," the spokesman said. But they met, or took another photo, on Tuesday...

            Meanwhile, UNFPA spokesman Abubakar Dungus has ostensibly gone missing. On Monday he emailed Inner City Press promising answers on that day, to questions about UNFPA's payments in North Korea and elsewhere, and policy on audits. But Monday passed without a single piece of information. Inner City Press called and emailed again, and repeated the process on Wednesday. Now Mr. Dungus has deployed an auto-respond message that he is out until Thursday (after the UNFPA votes). But a number of Mr. Dungus' own colleagues concede that he is around. So why the hiding? Where are the answers? One production wag muttered that Mr. Dungus has left a big news hole.

            We'll use the opportunity to provide further detail on a UNFPA issue previously alluded to: the "post-facto approval" for the purchase of 4 million cans of baby milk for $6.3 million on behalf of the Egyptian Ministry of Health and Population.

            The Contract Review Committee recites that concerns were expressed "to the Egypt UNFPA Representative as to whether or not UNFPA should be buying baby milk at all and whether this was within the mandate of the fund. [Nevertheless] Hooweget International was selected to supply the baby milk at a total cost of Euro $4,883,284.50... The funds were converted into USD dollars by the UNDP Treasury and placed into UNFPA bank account." Of course, "the usual applicable fee for third party procurement services of 5%" was collected. The quid pro quo, as with much of what UNDP does, was the evasion of applicable taxes...

            Here's another tax evasion scheme, by an individual lists as joint UNDP / UNFPA: Alaadin Morsy. Mr. Morsy was confronted with a threat of prosecution concerning "the vehicle that you imported when you were first place on the ATR Project in Egypt... the vehicle was imported for your personal use without paying customs duties to the Government of Egypt.  If you were employed for less than three years on the project, you were obligated to either re-export the vehicle or pay the customs duty that would have been owed when you imported the car in 2002. Your employment with the project was terminated after one year and you should have taken one of these two action. To the best of our knowledge and that of the Ministry of Foreign Trade and Industry and the Egyptian Customs Authority, you have not done so. Mr. Tim S. Buehrer of the Secretary-General's office has stated that he has contacted you on numerous occasions concerning this matter but that you have not responded."

            Ah, UNFPA and UNDP. The latter will be the topic in Conference Room 2 on Thursday, and Inner City Press will be there. Watch this space.

At UNOPS, Side Deals for Danish Relocation, Mattsson and Dalberg and the DSA Farming of Vitaly Vashelboim

Byline: Matthew Russell Lee of Inner City Press at the UN: News Analysis

UNITED NATIONS, January 23 -- The UN Office of Project Services is two years late in certifying its financial statements. As new UN Secretary General Ban Ki-moon calls for an "urgent, system wide and external inquiry into all activities done around the globe by the UN funds and programs," UNOPS stands out for not even having a certified audit in place.

            An investigation of UNOPS by Inner City Press has found a hotbed of favoritism, of supervisors distracting line employees from their logistical tasks in support of such efforts as mine removal, and of financial mismanagement hidden from the Executive Board.

            Last January, the Board was told that UNOPS wanted to move its "headquarters functions" from New York to Copenhagen. Bids had been selected, not only by Denmark, but also France, Germany, Italy and Spain. (Dubai later joined the bidding.) Denmark was selected, sources say, due to the inclusion in its package of a "transition fund," which UNOPS insiders call no more than a slush fund for management. The quid pro quo was a requirement that 120 jobs be moved to Copenhagen, a condition not disclosure to the Board one year ago, and resulting in disruption of such functions as mine removal now.

            Current UNOPS head Jan Mattsson previously served as the head of the UN Development Program's Bureau of Management, where as Inner City Press has reported, he handed out controversial contracts to Dalberg Global Development Advisors, whose founder Henrik Skovby worked for UNDP "both at their headquarters and in the field," and is still listed as a UNDP employee. (The lead person on Dalberg's advisory board, Sam Nyambi, lists his experience as having supervised 110 staff at UNDP and served as UNDP Resident Representative in Ethiopia.)

            Now it emerges that once Mattsson took over at UNOPS, he has also handed this agency's money to Dalberg. In an August 16, 2006 email to all UNOPS staff, Mattsson announced that Dalberg would be paid to "help us build a better UNOPS."

What could this Guatemalan kids do with Vitaly V.'s Daily Sustenance Allowance? See below.

            By most accounts, and as reflected by its inability to file certified financial statements, UNOPS has been in decline for years. It began as a unit of UNDP then spun off as independent, and proudly self-supporting. Then-chief Reinhart Helmke hung a banner at a staff retreat, "UNOPS, the One Billion Dollar Agency."

            Moving from the Daily News building to the Chrysler Building, money was overspent. Soon UNOPS was paying, it claimed, $20,000 per year for each computer terminal used, not including salary or benefits. An idea arose to relocate jobs out of New York. Proposals arrived from France and Germany, Italy and Denmark, talk of the Swiss and of Dubai. One year ago, the Board was informed that "headquarters functions" would be relocated, under a business case of cost-savings.

            Behind the scenes, interim Executive Director Gilberto Flores, who preceded Jan Mattsson, had cut a deal with Denmark: 120 jobs as a quid pro quo for, among other things, a transition fund with very few restrictions.  There was only one problem: the "headquarters function" remaining in New York did not add up to 120 jobs. And so a decision was made to relocate operating units as well, including those which service mine removers in the field.

            This being the UN, a veneer of participation was demanded. While behind closed doors Gilberto Flores declared he would never break his job commitment to the Danes, Ms. Roswitha Newels, who had made the misleading presentation to the Board, emerged to dialogue with staff. Facilitators arrived, ostensibly from UNDP's Management Change Team, run by one Tina Friis-Hansen. The facilitators' names were Georges Von Montfort and Lisa Rienarz.  (As it turns out, they are employees of Mattsson's favorite consultant Dalberg, and not UNDP staffers at all.) These facilitators nodded at angry staff talked, then mis-summarized the complaints to now-director Mattsson.  A proposal emerged to relocate personnel not only to Denmark but also Nairobi.

            With the staff more and more restive, Ms. Newels decided to commission a study to resolve the matter. Such studies require at least the veneer of objectivity. But Ms. Newels issued a sweetheart contract, which she only later entered in the system, to a close friend of hers, Ivo Pokorny.  For $700 a day, Mr. Pokorny produced a barely two and a half page memo, followed by a one page, hand-drawn chart. Requests to see Pokorny's final product have been rebuffed, as have question of when UNOPS will come clean to the Board, as well as file financial statements.

            UNOPS does appear, however, in the public audits of other UN agencies. The most recent public audit of UNICEF, for example, states that

"UNICEF is supporting construction projects for schools, health centers, and water and sanitation networks in Indonesia, Sri Lanka and the Maldives that represent an aggregate budget of $152.1 million. The three country offices have little experience, if any, overseeing major construction works. They entered into contracts with UNOPS (for permanent structures) and with IOM (for temporary schools in Indonesia) without clearing their clauses with the UNICEF senior advisor (Legal) resulting in the interesting of UNICEF not adequately safeguarded. For instance, the Indonesian school construction contract with UNOPS ($90 million) committed UNICEF to a set unit cost per building, over a three-year period, with no clause covering a rise in prices.... UNICEF failed to set up a consistent mechanism to follow up the implementation of the projects, monitor the work of the contractors and management the relationship with UNOPS." A/61/5/Add.2, page 42-43.

            As this interim profile of UNOPS should make clear, issues to be inquired into in the wake of the UNDP scandals should not be limited just to North Korea, or to hard currency, secondment and auditors' access. The problems at UNOPS are systematic and require full public review and disclosure, and then substantive action. This is what Ban Ki-moon called for on January 19, then appeared to turn away from on Jan. 22. With the poor and needy be served by reform and accountability of these agencies in charge of money to serve them? We'll see.

            Other UNOPS issues involve Daily Sustenance Allowance abuse and overpaying of Mattsson's deputy Vitaly Vashelboim. Mattsson brought Vashelboim to New York, and has now sent him back to Copenhagen (where Mattsson's yet to move).  The totals paid to Mr. Vanshelboim for multiple relocations, travel and Daily Sustenance Allowance are the subject of outrage even within UNOPS staff, who says that the Board of Auditors inquiry recently announced by Ban Ki-moon should act on them.  And what does Dalberg do for Mattsson? Inquiring minds want to know. But UNOPS.org does not list any media contact, and UNDP has still not responded to Inner City Press' January 16 questions about Dalberg and related policy issues.

            Documents, however, require no comment to report. Inner City Press has obtained a copy of a January 15, 2007 email from UNDP's Arne Christensen bragging that "UNDP / IAPSO has recently placed an order for several units of thermo vision equipment installed in mini-busses (surveillance equipment) for the State Border Guard Service of Ukraine... UNDP / IAPSO would be pleased to offer our expertise in procurement of material and equipment for border enhancement to other CO offices, as well as other UN offices involved in similar programs."

            Beyond the question, "what is UNDP doing buying surveillance equipment for Ukraine," we note that UNOPS in its search for survival is lobbying behind the scenes to acquire the "P" (procurement") from UNDP's IAPSO. But why would the UN system allow an agency which is so far delayed in filing its certified financials to acquire anything, or to continue to mislead its Board about a deeply flawed proposed move of core operating functions like mine removal to Denmark because of a secret slush fund deal? Developing.

  Because a number of Inner City Press' UNOPS sources go out of their way to express commitment to serving the poor, and while it should be unnecessary, Inner City Press is compelled to conclude this installment in a necessarily-ongoing series by saluting the stated goals of UNOPS and many of its staff. Keep those cards, letters and emails coming, and phone calls too, we apologize for any phone tag, but please continue trying, and keep the information flowing.

Other Inner City Press reports are available in the ProQuest service and some are archived on www.InnerCityPress.com --

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In Gaza Power Station, the Role of Enron and the U.S. Government's OPIC Revealed by UN Sources

UN's Corporate Partnerships Will Be Reviewed, While New Teaming Up with Microsoft, and UNDP Continues

BTC Briefing, Like Pipeline, Skirts Troublespots, Azeri Revelations

Conflicts of Interest in UNHCR Program with SocGen and Pictet Reveal Reform Rifts

UN Grapples with Somalia, While UNDP Funds Mugabe's Human Rights Unit, Without Explanation

UN Gives Mugabe Time with His Friendly Mediator, Refugees Abandoned

At the UN, Friday Night's Alright for Fighting; Annan Meets Mugabe

UN Acknowledges Abuse in Uganda, But What Did Donors Know and When? Kazakh Questions

In Uganda, UNDP to Make Belated Announcement of Program Halt, But Questions Remain (and see The New Vision, offsite).

Disarmament Abuse in Uganda Leads UN Agency to Suspend Its Work and Spending

Disarmament Abuse in Uganda Blamed on UNDP, Still Silent on Finance

Alleged Abuse in Disarmament in Uganda Known by UNDP, But Dollar Figures Still Not Given: What Did UN Know and When?

Strong Arm on Small Arms: Rift Within UN About Uganda's Involuntary Disarmament of Karamojong Villages

UN's Selective Vision on Somalia and Wishful Thinking on Uighurs

UN Habitat Predicts The World Is a Ghetto, But Will Finance Be Addressed at Vancouver World Urban Forum?

UN's Annan Concerned About Use of Terror's T-Word to Repress, Wants Freedom of Information

UN  Waffles on Human Rights in Central Asia and China; ICC on Kony and a Hero from Algiers

UN & US, Transparency for Finance But Not Foreign Affairs: Somalia, Sovereignty and Senator Tom Coburn

Human Rights Forgotten in UN's War of Words, Bolton versus Mark Malloch Brown: News Analysis

In Praise of Migration, UN Misses the Net and Bangalore While Going Soft on Financial Exclusion

UN Sees Somalia Through a Glass, Darkly, While Chomsky Speaks on Corporations and Everything But Congo

Corporate Spin on AIDS, Holbrooke's Kudos to Montenegro and its Independence

The Silence of the Congo and Naomi Watts; Between Bolivia and the World Bank

Human Rights Council Has Its Own Hanging Chads; Cocky U.S. State Department Spins from SUVs

Child Labor and Cargill and Nestle; Iran, Darfur and WHO's on First with Bird Flu

Press Freedom? Editor Arrested by Congo-Brazzaville, As It Presides Over Security Council

The Place of the Cost-Cut UN in Europe's Torn-Up Heart;
Deafness to Consumers, Even by the Greens

Background Checks at the UN, But Not the Global Compact; Teaching Statistics from Turkmenbashi's Single Book

Ripped Off Worse in the Big Apple, by Citigroup and Chase: High Cost Mortgages Spread in Outer Boroughs in 2005, Study Finds

Burundi: Chaos at Camp for Congolese Refugees, Silence from UNHCR, While Reform's Debated by Forty Until 4 AM

The Chadian Mirage: Beyond French Bombs, Is Exxon In the Cast? Asylum and the Uzbeks, Shadows of Stories to Come

Through the UN's One-Way Mirror, Sustainable Development To Be Discussed by Corporations, Even Nuclear Areva

Racial Disparities Grew Worse in 2005 at Citigroup, HSBC and Other Large Banks

Mine Your Own Business: Explosive Remnants of War and the Great Powers, Amid the Paparazzi

Human Rights Are Lost in the Mail: DR Congo Got the Letter, But the Process is Still Murky

Iraq's Oil to be Metered by Shell, While Basrah Project Remains Less than Clear

Kofi, Kony, Kagame and Coltan: This Moment in the Congo and Kampala

As Operation Swarmer Begins, UN's Qazi Denies It's Civil War and Has No Answers if Iraq's Oil is Being Metered

Cash Crop: In Nepal, Bhutanese Refugees Prohibited from Income Generation Even in their Camps

The Shorted and Shorting in Humanitarian Aid: From Davos to Darfur, the Numbers Don't Add Up

UN Reform: Transparency Later, Not Now -- At Least Not for AXA - WFP Insurance Contract

In the Sudanese Crisis, Oil Revenue Goes Missing, UN Says

Empty Words on Money Laundering and Narcotics, from the UN and Georgia

What is the Sound of Eleven Uzbeks Disappearing? A Lack of Seats in Tashkent, a Turf War at UN

Kosovo: Of Collective Punishment and Electricity; Lights Out on Privatization of Ferronikeli Mines

Abkhazia: Cleansing and (Money) Laundering, Says Georgia

Post-Tsunami Human Rights Abuses, including by UNDP in the Maldives

Citigroup Dissembles at United Nations Environmental Conference

Other Inner City Press reports are available in the ProQuest service and some are archived on www.InnerCityPress.com --

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