Posted on 01/23/2008 11:02:00 PM PST by TigerLikesRooster
UN programme paid company linked to N. Korean weapon sales
WASHINGTON - A UN anti-poverty programme in North Korea paid US$50,000 (S$71,543) to a company with ties to North Korean weapons sales and left itself open to exploitation by the communist-led country, according to a Senate investigation released on Wednesday.
The report by the Senate Permanent Subcommittee on Investigations takes issue with the operation of the UN Development Program in North Korea, which was suspended last year. The report alleges that the UNDP opened itself to abuse by, among other things, paying the salaries of local staff directly to the government without verifying how they were disbursed, even though the agency suspected that the government was 'skimming' money from the payments.
Citing wire transfers and other financial documents, the report also said that North Korea used a bank account reserved for UNDP funds to move US$2.72 million of its own money out of the country.
According to the report, North Korean government officials told Senate investigators the transfers were made soon after President George W Bush declared the country part of an 'axis of evil.' Officials of the communist country told the investigators the transfers were made through the UNDP account to avoid international scrutiny and possible sanctions that they believed were imminent, the report said.
The findings were scheduled to be discussed at a Senate hearing on Thursday.
Phone and e-mail messages left with the North Korean Mission to the United Nations were not returned on Wednesday.
The Bush administration said it is too early to remove North Korea from a US terrorism blacklist, a major demand by Pyongyang in international nuclear disarmament negotiations.
Some problems
Some of the problems identified in the report were covered by a UN audit last year, which found that the UNDP paid North Korean staff and suppliers in hard currency without approval and hired only government-approved staff in violation of UN procedures.
'But we went beyond that,' said Republican Sen Norm Coleman, the committee's top Republican.
'The North Koreans had set up what I call a money-laundering system,' he said, referring to the US$2.72 million in transfers. By using the UN seal of approval, clearly the hope was that it wouldn't attract any attention.'
UNDP officials, Mr Coleman said, 'let themselves be manipulated by a rogue nation.'
Mr Coleman also highlighted US$50,000 paid to Zang Lok Trading Co on behalf of other UN agencies. The report includes a letter from the US Mission to the United Nations, sent to the UNDP last year, that says 'Zang Lok has ties to a North Korean entity that has been designated under United States laws as the main North Korean financial agent for sales of conventional arms, ballistic missiles and goods related to the assembly and manufacture of such weapons.'
Zang Lok
The report said UNDP officials told the subcommittee the agency did not know, nor had it any way of knowing, whether Zang Lok is connected to North Korean weapons sales.
In a statement issued Wednesday in response to the report, the UNDP said it paid Zang Lok on behalf of two other UN agencies for computer equipment, which were received in 'good order.'
The UNDP added that it ceased doing business with Zang Lok after being notified by the US government about its ties to a 'designated entity.'
As to the US$2.72 million in transferred money, the agency said: 'UNDP is not happy that its name may have been used inappropriately by the North Korean government in connection with deceptive financial transactions. It has formally raised this matter with the North Korean government.'
The statement also notes that the Senate report does not conclude that these transfers could have been prevented had the UNDP been more vigilant.
'UNDP is also pleased to note that contrary to persistent allegations it has faced, the report finds that the US$2.72 million in question was not UNDP's money,' the agency said.
North Korea
The UNDP suspended operations in North Korea last year because the reclusive nation failed to meet conditions set following allegations by the United States that UN aid money was being diverted to Kim Jong Il's government. Among the conditions: that the UNDP no longer pay North Korean staff in hard currency and no longer employ North Koreans lent from government agencies.
Mr David Morrison, a UNDP spokesman, said in an e-mail that the agency has faced 'persistent and detailed allegations about funding diversion and misconduct in its former operations in North Korea. We collaborated fully with the subcommittee's investigation, and are gratified that the staff report contains no suggestion that these allegations can be substantiated.'
Subcommittee staffers confirmed that they received substantial cooperation but noted a passage in the report that said they were not given unfettered access to the UNDP financial system or original records or receipts. Because of that limited scope, they said, the report neither confirms nor denies allegations made by the United States.
A year ago, the United States accused the UNDP of funnelling millions of dollars in hard currency to North Korea with little assurance that Kim Jong Il would use the money to help his people, instead of diverting it to 'illicit purposes' including developing nuclear weapons.
The report noted that development projects in North Korea present daunting challenges but concluded: 'The North Korean government took advantage of the altruism that drives UNDP programs.' -- AP
Ping!
Is there anything that the UN can’t corrupt? It seems like it should be a rodeo event for them based on time....
The UN, right on time. It’s not a surprise—in any endeavor in which the UN is involved, consider whether there’s a way it can undermine the US and support a corrupt government, and it will happen. Kind of their version of The Field Of Dreams.
yitbos
If you offer broad support theres always missuse.
Same with the international food aids. They are diverted as military reserve stock or sold at the black market at high prices. UN initially vehemently denied the report of such practices.
At some point, giving benefit of doubt to repeat offenders would become the proof of sheer incompetence or criminal activities.
If we support them (with peanuts) they will exploit the supports - that’s nothing new.
I guess that’s a good way to create some traffic and exchange with that country.
It’s got to get into the heads of every north korean that there’s alternatives in lifestyle.
They do not want things to go into N. Korea via non-governmental channels. These days they are clamping down any commercial traffic which existed across Sino-N. Korean border. They also spurn any aid with thorough monitoring.
They only want to do things their way. Does not matter if ordinary N. Koreans die in large numbers. Actually they are taking their population hostage in order to exact no-strings-attached aids from outside. They are exploiting our concern and good will.
N. Korea is not DDR. The country is no different from Soviet Union in 1930's. You don't expect this regime to loosen its grip.
State control in N. Korea was only loosened because people starved to death en masse in 90's and the regime cannot feed its population, and let them fend for themselves. It allowed rudimentary commerce and market to sprout, and cross-border trade among Chinese and N. Koreans grew. Along with basic necessities, came S. Korean videos, movies, and cell phones.
The moment N. Korean regime feel that it has enough to last for a while, it will reimpose state control. That is pretty much what is happening now. The regime started to crack down on markets, prohibit people from doing any kind of business, trying to reinstate ration, and restrict the movement of population back to the level of old days.
If you want the regime to relent its grip, we have to make them feel the pressure. Not the complete shutdown but surely tightening the flow.
Kim Jong-il is playing the game of calculated brutality. He is like Hitler who boasted that the West cannot stomach the brutality he is willing to unleash.
A sad but rather true analogy.
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