A U.N. Agency Gives $2 Million to Kim Jong-Il
By Benny Avni
April 25, 2007
The New York Sun
Original Source: http://www.nysun.com/article/53136
UNITED NATIONS — The agency that has until recently coordinated all U.N. activities in North Korea will transfer its remaining assets in the country — estimated at $2 million — to the Kim Jong-Il government, after Pyongyang this week requested that the agency's two remaining officials there leave the country.
The United Nations Development Program asset-transfer amounts to a gift to the communist regime, but it also may hinder an audit that was ordered by Secretary-General Ban soon after the UNDP program was suspended after allegations of irregularities in its operations emerged in press reports.
Transferring assets worth millions to the communist regime occurred as North Korea failed to meet a Sunday deadline it had agreed to for the transfer of details of its nuclear weapons program in return for economic assistance.
On Monday, the president of Pyongyang's Presidium of the Supreme People's Assembly, Kim Yong Nam, visited Syria, where according to the state-run news agency there, Sana, he discussed with Syrian officials the bilateral relations between the two friendly countries and means of boosting and developing them.
Separately, Mr. Ban, who in January had ordered the system-wide audit of all U.N. agencies dealing with North Korea, was also in Syria yesterday.
The standard procedure is, when we close a project, we transfer the title to the equipment to the host country, a UNDP spokeswoman, Christina LoNigro, told The New York Sun yesterday, when asked why assets were transferred to North Korea.
But a day earlier, a spokeswoman for the United Nations, Michelle Montas, told reporters that the World Food Program, which still operates in North Korea, has agreed to provide storage and support for current UNDP office assets, as well as to make any necessary further payments on behalf of UNDP. She assured reporters that all UNDP records are secured.
Pyongyang requested the asset transfer on Monday, even though most of the UNDP projects in the country have not been completed. The agency's board of directors has suspended all its projects after American allegations that the agency has broken some of its own rules while operating in North Korea.
Out of the 36 projects that were active in the country, 14 actually closed down, according to a source familiar with the program, who asked not to be named. To assist the U.N. audit, two staffers remained at the Pyongyang office to assure the integrity of the evidence.
But on Monday Ms. Montas told reporters, At the request of the Democratic People's Republic of Korea authorities, UNDP will withdraw its remaining two international staff members from Pyongyang on 3 May.
On April 23, the North Korean coordinator with the agency, Ri hung-Sik wrote a letter addressed to one of the two remaining UNDP officials in the country, Vineet Bahtia. In the letter, seen by the Sun, he asked the two U.N. officials to leave and make sure that all the assets be transferred to the government before your departure.
The removal of the remaining personnel from the UNDP Pyongyang office, and the subsequent transferring of assets to the government — including sensitive UNDP data — may well pose problems for auditors attempting to find out whether any violations of the agency's rules might have occurred.
Mr. Ban ordered a system-wide audit on January 19, after a report under the headline Cash for Kim appeared in the Wall Street Journal. 
At the time, the new secretary general said that all U.N. agencies would immediately be audited and reevaluated.
His spokespersons then quickly retracted the statement, saying that the agency-wide probes would begin only after the completion of the UNDP audit in North Korea.
U.N. officials said at the time that the audit of the UNDP activities in North Korea would last 90 days. More than three months later, however, when asked on Monday when results of the audit would become available, Ms. Montas told the Sun, This is going on right now. I cannot answer that question.
Some of the UNDP assets transferred to the North Korean government are itemized in a document seen yesterday by the Sun, which lists all equipment valued at less than $2,500 a piece. These assets amount to $452,000, according to agency spokespeople, who were unable to account yesterday for other larger assets.
But other agency sources estimate all the UNDP assets in North Korea at $2 million.
In addition for the list seen by the Sun, these assets include such large items as hydro-power stations costing $250,000 each, a number of generators worth $80,000 each, and a fleet of 36 cars.
The list of the items under $2,500 includes a large number of laptop and desktop computers, mass storage devices, flash memory cards, external hard disks and other computer equipment that may carry data crucial for conducting the audit.
Another question revolves around three bank accounts used by the UNDP in local Pyongyang institutions.
Those accounts carried local transactions, which according to the agency's Web site have amounted to $47 million in the last ten years. If the accounts were to close, auditors might be unable to access crucial information there either.
But Ms. LoNigro, the UNDP spokeswoman, told the Sun yesterday that the bank accounts have not been formally closed, adding that they will be kept on low balances so auditors could have access to them.