U.N. Auditors Find Development Program Broke Rules in Offering Aid to North Korea
By George Russell
Fox News
June 1, 2007
NEW YORK — Did the United Nations Development Program, the U.N.’s multibillion-dollar development flagship, break its own rules in offering assistance to the dictatorship of Kim Jong Il?
The long awaited answer, offered up by the U.N.’s own Board of Auditors, is a clear "Yes" — though UNDP itself quickly spun the answer as a vindication.
The long-awaited and controversial audit of United Nations operations in North Korea has concluded that, in line with accusations first raised by a senior U.S. diplomat, the United Nations Development Program and other agencies contravened their own regulations in hiring local staff nominated by the dictatorial North Korean government, and in making unauthorized hard currency payments to the Kim Jong Il regime.
The auditors, who stressed that their work was only a preliminary investigation, also declared they were unable to determine the total amount of unorthodox payments that had made. They lacked access to documentation from the U.N.’s offices in North Korea, a frequent observation throughout their report, and even lacked access to the cashed checks involved in the transactions. The auditors also were refused access to North Korea by the Kim Jong Il regime, which refused to cooperate in the investigation.
Paradoxically, the results of the audit immediately were hailed as a vindication by the UNDP, the United Nations’ flagship development organization, which has been largely responsible for running U.N. operations in North Korea.
The UNDP claim was that the report did not specifically support all the charges originally raised last January by U.S. Ambassador to the U.N. Mark Wallace, citing unpublished previous U.N. audits, that tens of millions of dollars in UNDP spending might have been misappropriated by the Kim Jong Il government as a result of the UN’s unorthodox policies in North Korea. Among other things, Wallace declared that it was “impossible” for the U.N. aid agency to verify whether its funds “have actually been used for bona fide development purposes or if the DPRK [North Korea] has converted such funds for its own illicit purposes.”
According to UNDP spokesman David Morrison, the latest audit findings are still under review by the U.N. development organization, which plans to file a formal response. But Morrison declared that the latest audit findings explicitly ruled out the possibility that there had been any diversion of UN funds to North Korea’s nuclear weapons program, and, contrary to U.S. Ambassador Wallace’s January assertions, said that UNDP officials had in most cases been able to visit UN development projects in North Korea to determine that money had been properly spent. “the money went where it was intended,” he said.. Moreover, he claimed, the audit confirmed that there were only “modest” levels of funding involved.
In fact, the specific language of the audit did not necessarily support Morrison’s assertion, especially insofar as the auditors declared they had not even had access to the checks used to pay North Korean staffers or other bills. Morrison’s arguments about the “modest” size of UNDP payments were also immediately contested by a U.S. official, speaking on background, who pointed out that the report tallied more than $72 million in spending by various U.N. agencies in North Korea from 2002 to 2006, and the list of agencies was far from inclusive. (The latest audit specifies thaht UNDP processed payments on behalf of all the mentioned agencies.) During that period, UNDP and one of its subordinate agencies operated anywhere from 28 to 41 projects in North Korea.
