State Dept. Supports Annan Probe

The State Department on Wednesday endorsed a Senate investigation into possible fraud in the U.N. oil-for-food program while sidestepping a senator's demand that Secretary-General Kofi Annan resign.

Meanwhile, the United Nations rejected the call for Annan to resign, saying no other country has asked him to step down and 2,700 U.N. staff members have signed a letter of support.

Sen. Norm Coleman, who is leading one of five U.S. congressional investigations into the U.N. oil-for-food program in Iraq, wrote in Wednesday's Wall Street Journal that Annan should step down because "the most extensive fraud in the history of the U.N. occurred on his watch."

U.S. State Department spokesman Adam Ereli backed congressional investigations of Annan and the oil-for-food program. But he sidestepped the issue of Annan's resignation, saying "that is not something, frankly, that is in front of us."

Outside the United States, the secretary-general appears to retain wide support among the 191 U.N. member states who elected him to a second five-year term in 2001. Russia, Britain, Chile, Spain and other nations on the U.N. Security Council strongly backed Annan in recent days.

"A few voices doesn't make a chorus," U.N. spokesman Fred Eckhard told reporters when asked whether he envisioned Annan stepping down. "He has heard no calls for resignation from any member state. If there's some agitation on this issue on the sidelines, that's fine. That's healthy debate. But he is intent on continuing his substantive work for the remaining two years and one month of his term."

Annan was doing just that on Wednesday, urging Wall Street financiers to support the global campaign to fight AIDS with money and expertise and preparing for Thursday's official launch of a report by a high-level panel recommending the most extensive reform of the United Nations since it was founded in 1945.

Eckhard said Annan's agenda for the rest of his term is to campaign for U.N. reform and fulfilling goals adopted by world leaders in 2000 including cutting in half the number of people living in dire poverty by 2015.

But the allegations of corruption in the oil-for-food program, which first surfaced in January, have escalated, embarrassing Annan personally and taking the spotlight off his agenda.

Two weeks ago, Coleman's Permanent Subcommittee on Investigations said it had uncovered evidence that Saddam Hussein's government raised more than $21.3 billion in illegal revenue by subverting U.N. sanctions against Iraq, including the oil-for-food program.

As CBS News correspondent Jim Axelrod reported, on Monday Annan said he was "very disappointed and surprised" that his son, Kojo, received payments until this February from a firm that had a contract with the oil-for-food program. The Swiss-based firm Cotecna Inspection said he was paid $2,500 a month to prevent him for working for any competitors in Africa after he left the company at the end of 1998.

Annan said he understood "the perception problem for the U.N., or the perception of conflict of interests and wrongdoing." But he reiterated that he has never been involved in granting contracts, to Cotecna or anyone else.

The secretary-general appointed former U.S. Federal Reserve chief Paul Volcker to head an independent inquiry into the oil-for-food program. He handed over all U.N. documents and ordered U.N. officials to cooperate.

Volcker wrote to Coleman two weeks ago saying his investigation won't hand over any documents or interviews until its own reports are issued starting in January. Coleman said this was another factor in asking for Annan's resignation.

Eckhard reiterated that until the Volcker investigation is completed, the secretary-general "will not rush to judgment and he urges others not to rush to judgment either."

Annan also has come under attack from the U.N. staff union for clearing U.N. watchdog Dileep Nair of any wrongdoing and U.N. refugee chief Ruud Lubbers of allegations of sexually harassing an American woman in his agency.

Last week, union leaders representing over 5,000 U.N. employees strongly criticized senior U.N. management. But Rosemarie Waters, president of the United Nations Staff Union, said members still have confidence in the secretary-general.

Eckhard noted Friday that more than 2,700 U.N. Secretariat staff had endorsed a letter supporting the secretary-general "at a time when the organization is facing allegations about its integrity." The e-mail letter, started by U.N. staffers, backs Annan's "balanced, fair and substantive approach."

Russia's deputy foreign minister Yuri Fedotov told the Interfax news agency that criticism of Annan "is without foundation" and "motivated by a desire to belittle the U.N.'s role as well as to undermine the foundation of the principles of multilateralism in international relations."

Annan "has done a lot to strengthen the authority of the world organization, intensify its role and raise the effectiveness of the steps being taken by the U.N. on the full range of issues in international life," Fedotov said Tuesday.

Britain's U.N. Ambassador Emyr Jones Parry said his country "gives its full support to the multilateral system, to the United Nations and to its secretary-general." Chile's U.N. Ambassador Heraldo Munoz strongly disagreed with Coleman's call for Annan's resignation, saying "we trust his leadership."