NEW YORK — How widespread is the corruption at the United Nations? The multibillion-dollar Iraq Oil-for-Food (search) scandal was just the beginning.

Now the issue is becoming the scale of corruption in the U.N.'s normal operations — and which individuals and corporations are reaping the benefits of a network of bribery and conspiracy that investigators have just begun to uncover. So far, those identities are still a mystery — but perhaps not for much longer.

Last Friday, federal prosecutors in Manhattan indicted the head of the U.N.'s own budget oversight committee, a Russian named Vladimir Kuznetsov (search), on charges of laundering hundreds of thousands of dollars worth of bribes paid by companies seeking contracts with the United Nations.

Kuznetsov, who has pleaded innocent, allegedly took a cut so openly that he had part of it deposited into the United Nations' own staff credit union in New York.

Kuznetsov's arrest is the latest twist in the scandal involving the U.N. procurement department, which was the longtime post of Alexander Yakovlev (search), another Russian U.N. official recently fingered by U.S. federal investigators.

On Aug. 8, Yakovlev pleaded guilty to federal charges of corruption, wire fraud and money laundering, after a FOX News investigation revealed his unauthorized ties with a U.N. contractor, IHC Services, and details leading to his secret offshore bank account. Federal investigators have now alleged that from 2000 on, Yakovlev did at least some of his grafting in partnership with Kuznetsov, transferring bribe money to him via the Antigua Overseas Bank in the West Indies. Allegedly the bribe money was obtained in exchange for providing inside information to companies seeking U.N. contracts.

The Yakovlev-Kuznetsov scandal joins a growing list of cases of U.N. misconduct, waste, theft and abuse. They include bribe-taking under Oil-for-Food, sexual abuse of minors by peacekeepers in West Africa, sexual and financial misconduct — including outright larceny — at U.N. offices in Geneva, and business ties between the son of Secretary-General Kofi Annan (search) and one of the Oil-for-Food inspection firms hired with Yakovlev's input, Swiss-based Cotecna Inspection (Cotecna has denied any wrongdoing).

In yet another scandal that emerged just last week, the United Nations disclosed that its Ukrainian peacekeeping contingent in Lebanon, including the commanding officer, has engaged in "significant financial misconduct" — though the world body has refused to provide details of what was done wrong or how much money was involved.

Amid all this, the U.N. procurement scandal at headquarters stands out as especially important, because the graft is not confined to any one program, but radiates from the United Nations' administrative core. Kuznetsov held an influential post in which he passed judgment on line items in the U.N. budget. Yakovlev, who held various portfolios in procurement during his 20-year career, dealt with contractors operating in places as far-flung as Africa, Asia and the Middle East. He even managed the architectural contract for the U.N.'s proposed $1.2 billion renovation of its Manhattan headquarters.

While there is no proof that in every case Yakovlev solicited bribes, there is by now enough evidence to invite investigation into all contracts he dealt with. Secretary-General Annan has ordered a review of the procurement department and put the organization's new controller in charge, but has not lifted the secrecy behind which Yakovlev operated in the first place. The investigation, according to a U.N. spokesman, is "ongoing."

The amounts at issue in this alleged Russian bribery ring are quite likely far larger than the "several hundreds of thousands" so far cited by federal investigators. The most recent report from Paul Volcker's Oil-for-Food investigation dwelled at length on Yakovlev's failed attempt in 1996 to solicit a bribe related to an Oil-for-Food contract. But Volcker also noted in passing that Yakovlev had received more than $950,000 in bribes from companies that "collectively won more than $79 million in United Nations contracts and purchase orders."

Volcker did not elaborate, presumably because the graft involved U.N. activities outside his Oil-for-Food mandate. But the hundreds of thousands that according to federal investigators allegedly passed from Yakovlev to Kuznetsov via secret bank accounts in the West Indies hint at a pie even bigger than $79 million.

(The Volcker committee is slated to deliver its main report on Oil-for-Food on Wednesday. Read more by clicking here and read the preface to the report by clicking here.)

Procurement and budgeting corruption may escape Volcker's scrutiny, but they are central to the mandate of Annan.

This scandal touches on almost everything the secretary-general is supposed to control. It is by way of procurement contracts, for goods and services ranging from cappuccino and paper clips at U.N. headquarters, to air freight services and food rations for peacekeeping troops worldwide, that the United Nations spends the billions contributed every year by member states — of which U.S. taxpayers provide the largest slice.

Originally posted by ronnierocketAGO:
I support the U.N. the dream as it was created in 1945, but now its a corrupted entity that needs to get cleaned up soon!