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Wolfowitz: Confusion, not corruption
Times Online
Gabriel Rozenberg, Economics Reporter
April 14, 2007

The documents released yesterday by the World Bank will do little to appease Paul Wolfowitz's critics. But they also suggest that his woes stem far more from confusion and error on the bank President's part than from any corrupt motive.

More than 100 pages of documents show that on Mr Wolfowitz's personal direction his girlfriend was given increases that took her annual pay package to nearly $200,000 (£101,000) when she was reassigned from the World Bank to the US State Department. Ms Riza remained on the payroll during her external assignment, which was to forestall any conflicts of interest. But they also show the difficult position that Mr Wolfowitz faced when he took charge of the Bank on June 1, 2005.

Ms Riza was his partner when he joined the bank, and the documents show that during that first week Mr Wolfowitz asked the bank's ethics committee to guide him on the conflict of interest.

He suggested that he could recuse himself from "personnel decisions involving the staff member". The ethics committee sent draft advice on July 27 which recommended that Ms Riza be withdrawn from an application for promotion and be moved outside the bank. She should be promoted, in recognition of the disruption she had been caused, it said. A subsequent draft letter said that the ethics committee "cannot interact directly with staff member situations".

It was then on August 11 that Mr Wolfowitz gave his instructions to the bank's human resources division to promote Ms Riza and move her to the US State Department.

He added: "She is being forced into a situation with no precedent under Bank rules, practice or policy . . . I wish to reiterate [my] deep unhappiness with the whole way of dealing with a situation that I still believe . . . should have been resolved by my recusal."

But later that month the ethics committee said that its advice had been only in draft form, and that it would have been possible for Ms Reza to stay at the bank as long as she was not being supervised by Mr Wolfowitz. However, by October 24 it concluded that because an agreement had been reached "the committee concurs with your view that this matter can be treated as closed".

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