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U.N. defends oil-for-food letter

The U.N.'s Benon Sevan.
United Nations
Benon V. Sevan
Paul Volcker

UNITED NATIONS (CNN) -- The United Nations has defended a letter sent by the head of its Iraq oil-for-food program telling a contractor not to release any documents related to the program without first consulting it.

The program is under investigation for massive corruption and mismanagement.

The letter, sent April 14 by an aide on behalf of U.N. oil-for-food head Benon Sevan to the manager of the Dutch company Saybolt, asks the company "to maintain the confidentiality of documentation and information relating to its services in connection with the program."

Saybolt was the independent inspection agency hired by the United Nations to monitor the loading of Iraq's crude oil at the two locations sanctioned by the program.

According to the letter, released Monday by the United Nations, a "governmental authority" had requested internal U.N. reports from Saybolt.

The letter says the request and any further requests for documentation or information should be referred to the United Nations.

A U.N. spokesman denied that this was part of a cover-up, and said the response was "standard procedure" that followed the normal U.N. legal practice on the work of contractors.

"This letter didn't say no, it just said consult us, consistent with our contractual requirements," said spokesman Fred Eckhard.

He said U.N. policy is that documentation held by contractors relating to U.N. business can be released only to the United Nations "unless otherwise authorized."

The letter also cites the need to have requests for documentation and information "addressed in an orderly and consultative manner" so as to "to avoid impeding" the U.N.'s independent investigation into the oil-for-food program, headed by former U.S. Federal Reserve Chairman Paul Volcker.

Oil vouchers

Volcker's committee is now in charge of the oil-for-food documents and could make a determination on releasing the documents, the United Nations said.

Sevan is among those accused of having received gifts of oil vouchers from Saddam Hussein.

His name appears on a list of 270 individuals, companies, organizations and political parties compiled from Iraqi Oil Ministry documents and printed first by the Arab newspaper Al-Mada.

The oil vouchers could be sold to middlemen for a large markup.

Sevan had planned to retire from his post at the end of May.

The United Nations on Monday said it will keep him on staff for a period of three more months as he works with the Volcker investigation.

A U.N. spokesman said Sevan will be kept on a "dollar a year retainer."

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