http://www.tehrantimes.com/Descripti...&Cat=2&Num=006

Scandal-tainted Wolfowitz backed friend for Iraq contract in '03


WASHINGTON (New York Times) -- Paul D. Wolfowitz, while serving as
deputy secretary of defense, personally recommended that his
companion, Shaha Ali Riza, be awarded a contract for travel to Iraq in
2003 to advise on setting up a new government, says a previously
undisclosed inquiry by the Pentagon's inspector general.

The inquiry, as described by a senior Pentagon official, concluded
that there was no wrongdoing in Mr. Wolfowitz's role in the hiring of
Ms. Riza by the Science Applications International Corporation, a
Pentagon contractor, because Ms. Riza had the expertise required to
advise on the role of women in Islamic countries.

The investigators also found that Mr. Wolfowitz, now president of the
World Bank, had not exerted improper influence in Ms. Riza's hiring.
Earlier this week, Science Applications International said an unnamed
Defense Department official had directed that she be hired. She had
been a World Bank employee for five years at the time.

Mr. Wolfowitz's office said it could not comment on the latest
disclosure. Ms. Riza's lawyer, Victoria Toensing, did not respond to a
request for a comment.

The disclosure of Mr. Wolfowitz's role in Ms. Riza's contract in 2003
provides a new indication of his involvement in her employment, at a
time when the World Bank's board is investigating his role in
arranging for a large salary increase, a promotion and a transfer for
Ms. Riza when he came to the bank in 2005.

The disclosure also came on a day of swirling pressure at the bank,
where the 24-member executive board met into the evening to discuss
the situation amid mounting calls for Mr. Wolfowitz's resignation.

Bank officials, speaking on the condition of anonymity because they
were divulging proceedings that were not supposed to be made public,
reported that the rift between employees and the president had become
a major distraction from their work, with some employees wearing blue
ribbons in a display of defiance against his leadership. "People feel
paralyzed," one official said. "No one is doing any work at all. This
genie can never go back to the bottle."

As the board met, officials said a separate review was being conducted
by the vice presidents, who oversee specific countries, regions and
subject matters, and who were polling their staffs. The overwhelming
sentiment, officials said, was that Mr. Wolfowitz should step down.

In another sign of crumbling support, bank officials and others said
that a consensus had emerged among European officials involved with
the bank that Mr. Wolfowitz had lost his ability to lead the
institution, not so much because of the issue of Ms. Riza but because
of other policy disputes over the last two years.

The meeting of the board was called by the panel's most senior member,
Eckhardt Deutscher, of Germany. There was no sign of what the board
would do, but Mr. Deutscher gave a speech on Thursday to a German
foundation offering a strong though oblique criticism of Mr.
Wolfowitz. "The World Bank needs a strong leadership with compassion,
integrity and vision," Mr. Deutscher said in the speech, to the
Friedrich Naumann Foundation. "The governance structures need a
fundamental reform. And lastly, the World Bank needs credibility,
credibility, credibility."

Bank officials said Mr. Deutscher, who has worked closely with Mr.
Wolfowitz on developing the bank's anticorruption policies, now favors
having him step down, a consensus already reached by Britain, France,
the Netherlands and the Nordic countries.

A senior European official involved in the bank said Mr. Deutscher was
"leading the charge" for a change in leadership and trying to assert
the board's role, effectively wresting control from Mr. Wolfowitz.
"For the moment, the view among the Europeans is, 'Let's continue the
discussions, and it is up to the dean to express what the concern is,'
" this official said, speaking about Mr. Deutscher. "It is in
everybody's interest to avoid bringing this to a head."

On the matter of the contract for Ms. Riza in 2003, the Pentagon
inspector general's office opened a review in March 2005, two years
after the invasion of Iraq and one year after it began a sweeping
investigation into contracting practices during the early chaotic
months of the war.

The Pentagon official who disclosed details of the inquiry agreed to
answer questions on the condition of anonymity because it involved the
role of senior officials in recommending individuals.

The official said the relatively small contract came under scrutiny
only when a Pentagon investigator noticed Ms. Riza's name and recalled
that she was romantically linked to Mr. Wolfowitz. The investigator
deemed the matter was worth opening an inquiry, because the type of
contract called specifically for it to be assigned to Ms. Riza. But a
more formal investigation was not instigated, he said, because "it was
determined that Ms. Riza was uniquely qualified to fill the contract
requirements."

Investigators also determined that "the recommendation of individuals
does not constitute any misuse of office," the official said in
describing the findings of the inspector general. "Nobody violated or
misused their office." Nevertheless, the inquiry found that Ms. Riza
"was recommended by Wolfowitz as well as others, in verbal form," the
official said.

It was not clear how Mr. Wolfowitz's verbal recommendation was relayed
through the Pentagon hierarchy and nascent occupation authority and
then to the contractor, which is known as SAIC.

Earlier this week, a spokeswoman for SAIC said the company was told to
contract with Ms. Riza by an official in the office of the under
secretary of defense for policy, then headed by Douglas J. Feith.

But on Thursday, Pentagon officials, clarifying the source of the
contract, said it was managed through the Office of Reconstruction and
Humanitarian Assistance, then headed by Jay Garner, a retired Army
three-star general. General Garner said in an interview that he did
not remember Ms. Riza's playing any role in advising the American-led
occupation.

The World Bank board is also examining the contract to see if it
complied with bank rules requiring employees to get permission for
outside consulting work when it might conflict with their duties at
the bank. At the time of the contract, it was against bank policy to
have dealings with Iraq, on the ground that it was a country under
foreign military occupation.