UN OVERSIGHT: CONFLICT OF INTEREST INVESTIGATION

UNCLAS USUN NEW YORK 001344

SIPDIS

SIPDIS

E.O. 12958: N/A
TAGS: AORC ASIG KUNR UNGA
SUBJECT: UN OVERSIGHT: CONFLICT OF INTEREST INVESTIGATION
IN PENSION FUND



1. SUMMARY: This report, which was requested by USUN under
the provision that allows Member States to obtain copies of
OIOS reports, details the findings of an OIOS investigation
launched in response to the allegations of two UN Joint Staff
Pension Fund staff members that procurement irregularities
occurred in information technology services, including
conflicts of interest and waste of resources. The
investigation found multiple instances of procedural
violation in procurement by several UNJSPF staff members, and
while the investigation concluded that it did not constitute
a conflict of interest, they did say that the situation
created the appearance of a conflict of interest which has
been damaging to the organization. END SUMMARY.


2. Instances of procedural violation included a failure to
hold competitive bidding for multiple information technology
contracts, instead awarding direct contracts to a consultant
company. On occasions where competitive bidding was held,
this consultant company again was awarded multiple contracts,
through irregular processes lacking transparency.


3. UNJSPF staff justified the awarding of contracts through
non-competitive bidding processes as due, initially, to time
constraints, and after the initial contracts were awarded, to
the desire not to lose money and time in the transitioning
process to another company once the consultant company had
begun work. As a result, contracts were often extended.


4. A previous working relationship between the Pension Fund
Information System officer and the president of the
consultant company was not communicated to the Procurement
Department. This pension fund officer was highly involved in
the recommendation, evaluation, bidding and documentation
processes for the consultant company,s work for the UNJSPF,
and though he/she was not found to receive any personal
financial gain from the contracts, the perception of
favoritism led to mistrust by staff members, and a perception
of conflict of interest.


5. This situation went unchecked due to many procedural
violations by other staff members, including a failure to
independently obtain information on the consultant company
before accepting the information system officer,s
recommendations, a failure to compare their fees to those of
similar companies, and allowing the extension of several
contracts beyond their original mandate, again without a
competitive bidding process.


6. UNJSPF management questioned the motives of the two staff
members who made the accusations, stating that these
individuals had personal interests against the management
motivating their complaints, including pending appeals
against management, or beliefs they had previously been
treated unfairly.


7. CONCLUSION: While no conflict of interest was found
between the IMSS Officer and the consultant company, multiple
procedural violations by several staff members regarding the
awarding of information technology contracts to this company
has caused the perception of a conflict of interest. As a
result, the OIOS has called for the consultant company to not
be offered more work for the UNJSPF, for action against many
UNJSPF staff for violating procedure, for intervention by the
OHRM staff to ensure fairness in future decision-making, and
finally, for preventing situations which both lead to a
conflict of interest, or the perception of a conflict of
interest.


8. COMMENTS: Despite the OIOS, finding that no actual
conflict of interest took place, the consequences of the
perception of conflict of interest are nevertheless serious;
it is thus important that the accountability measures
recommended in the report be fully implemented. END COMMENTS.
BOLTON