U.N. Official Charged in Money Laundering
A Russian official who chairs the U.N.’s powerful budget committee was charged Friday with helping a U.N. procurement officer launder hundreds of thousands of dollars in bribes for a share of the money.
The FBI arrested Vladimir Kuznetsov, a Russian Foreign Ministry official and the elected chairman of the United Nations budget advisory committee, in a Thursday night raid outside a steakhouse in the Bronx. Secretary-General Kofi Annan waived Kuznetsov’s diplomatic immunity so he could be arraigned Friday.
For the record:
12:00 a.m. Sept. 7, 2005 For The Record
Los Angeles Times Wednesday September 07, 2005 Home Edition Main News Part A Page 2 National Desk 1 inches; 58 words Type of Material: Correction
An article in Saturday’s Section A about a United Nations official who had been charged with money laundering said that another official had been fired. In fact, Stefan Vassilev, director of the U.N. Development Program’s Moscow office, has been put on administrative leave pending the result of an investigation into $1.2 million that disappeared from the Moscow office.
It is the second time in a month that the U.S. attorney’s office has charged a Russian official at the U.N. with money laundering. The first official, Alexander Yakovlev, pleaded guilty last month to soliciting nearly $1 million in bribes from companies bidding for U.N. contracts.
U.S. and U.N. investigators said they had discovered $1.3 million in a secret bank account held by Yakovlev in Antigua and had traced about $950,000 to firms that won U.N. contracts outside the defunct oil-for-food program for Iraq. A separate inquiry, led by former U.S. Federal Reserve Chairman Paul A. Volcker, into corruption in the oil-for-food program has accused Yakovlev of seeking a bribe from a Swiss company bidding for a U.N. contract to inspect oil deliveries in Iraq.
The indictment against Kuznetsov charged that he found out about the secret payments in 2000, and arranged to receive a share in a bank account in Antigua, which added up to hundreds of thousands of dollars over five years. As chairman of the General Assembly’s budget advisory committee, he oversaw the auditing of U.N. contracts and other financial matters.
There may be more arrests coming, said FBI spokesman Jim Margolin.
“This is part of an ongoing investigation,” Margolin said. “There’s always the possibility of additional subjects being charged or additional charges.”
On Thursday, the U.N. Development Program announced that $1.2 million had been stolen from its office in Moscow by staff between 2000 and 2004, and that the head of the office, Stefan Vassilev, had been fired as a result of an investigation begun in June. The cases are not known to be connected, but diplomats in U.N. hallways Friday spoke of the unraveling of the remnants of a Soviet-era network at the world organization.
During the Cold War, the Soviet Union used the U.N. as a key site for intelligence gathering, said Pedro Sanjuan, an American who, as political affairs director, was at the U.N. at U.S. behest from 1983 to 1993 to “spy on the spies.”
Key political spots in the Secretariat are reserved for Russians, and a loose network of former KGB officers remains at the U.N., Sanjuan said.
“The U.S. has been trying to break the hold that the Russians had on certain positions. I don’t think that you can say today that the Russian government is still engaged in the same kind of pernicious espionage, but they still control positions of power.”
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