Another unfolding scandle that will prove to be interesting in the coming months. UN caves in on inquiry into its Iraq oil-for-food 'scandal'By Charles Laurence in New York, and Inigo Gilmore (Filed: 14/03/2004) www.telegraph.co.uk/news/main.jhtml...ml&sSheet=/portal/2004/03/14/ixportaltop.html The United Nations has bowed to international pressure to investigate allegations of corruption surrounding its oil-for-food programme, under which Iraqi oil was sold on behalf of Saddam Hussein's regime. The move follows claims that UN officials were caught up in a reward system set up by Saddam, which apparently granted proceeds from the sale of million of barrels of oil to friendly politicians, officials and businessmen around the world. Iraq's new governing council has hired the accountants KPMG and the international law firm, Freshfields Bruckhaus Deringer, to investigate claims that large sums of money - which should have been spent on food and medicine for ordinary Iraqis - were diverted through oil "vouchers" to line pockets abroad. In a letter to Kofi Annan, the UN Secretary General, an adviser to Iraq's interim governing council warns that the UN appeared to have "failed in its responsibility" to the Iraqi people and to the international community. "It will not come as a surprise if the Oil-for-Food Programme turns out to have been one of the world's most disgraceful scams, and an example of inadequate control, responsibility and transparency, providing an opportune vehicle for Saddam Hussein to operate under the UN aegis to continue his reign of terror and oppression," wrote Claude Hankes-Drielsma, a British businessman and former chairman of the management committee at Price Waterhouse accountants, on March 3. A senior UN official said last night that the international body's Office of Oversight Services in New York, had started to examine the administration of the programme and any UN role in the alleged corruption. A formal announcement of the internal inquiry is expected this week. Last month the UN denied accusations of corruption within its operations and demanded documentary evidence before it would act on the complaints.