OIOS-20061207-01


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United Nations
FFICE OF
NTERNAL
VERSIGHT
This Report is protected und
er the provisions of
ST/SGB/273, paragraph 18, of 7 September 1994
ERVICES
NITED
TAFF
EMBERS
Case nos. PTF/007/06; PTF/022/06; PTF/047/06
This Investigation Report of the Procur
ement Task Force of the United Nations
Office of Internal Oversight Services is provided upon your request pursuant to
paragraph 1(c) of General Assembly re
solution A/RES/59/272. The Report has
been redacted in part pursuant to para
graph 2 of this resolution to protect
confidential and sensitive information.
OIOS transmission of this Report does
not constitute its publication. OIOS does not bear any responsibility for any
December
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INTRODUCTION...................................................................................................................
..........1
ALLEGATIONS....................................................................................................................
............2
APPLICABLE UNITED NATIONS REGULATIONS, RULES, AND CONTRACT
PROVISIONS.....................................................................................................................
...............2
RELEVANT CONCEPTS OF
CRIMINAL
LAW..........................................................................5
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XIII.
CONCLUSIONS....................................................................................................................
..........65
XIV.
RECOMMENDATIONS................................................................................................................
.67
XV.
APPENDIX A.....................................................................................................................
..............69
XVI.
APPENDIX B.....................................................................................................................
..............70
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The Procurement Task Force (the Task
Force) was created on 12 January 2006
to address all procurement matters referred to
the Office of Internal Oversight Services
(the OIOS). The creation of the Task Fo
rce was the result of perceived problems in
procurement identified by the Independent
Inquiry Committee into the Oil-for-Food
Programme, and the arrest and conviction of
Procurement Officer Alexander Yakovlev.
Under its Terms of Reference, the Task
Force operates as part of the OIOS, and
reports directly to the Unde
r-Secretary-General for the OIOS. The remit of the Task
Force is to investigate all procurement cases
, including all matters involving procurement
bidding exercises, procurement staff and ve
ndors doing business with the United Nations
(the United Nations or the
Organisation). The Task
Force investigations have
focused upon a number of procurement cases
, including cases involving companies doing
business with the Organisation. Some of thes
e matters are particularly complex and span
This Report focuses on procurement cases
concerning the soli
execution of food rations contracts involving
the Subject Company, including a contract
as a contract for provision of food rations
to the United Nations Mi
Contract no. PD/C0286/03 between the United Natio
ns and the Subject Company for Provision of Food
Rations to the United Nations Mission in Liberia (10 December 2003) (signed by Kiyohiro Mitsui and
Subject Company Representative 6); Contract no. PD/C0310/03 between the United Nations and the
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LLEGATIONS
This Report addresses the procurement
processes and award to the Subject
Company of contracts of signifi
cant value concerning the prov
ision of food rations to the
United Nations Missions in Liberia and Eritr
Congo contract Request for Proposal 558.
ID/OIOS Case nos. 723/05, 720/05, and 722/05; Task Force Case no. PTF/007/06.
.; ID/OIOS Case nos. 307/05, 696/05, 697/05, and 766/05.
ST/SGB/2006/4 (1 January 2006) (containing revised ed
ition of the Staff Regulations). Throughout this
Report, references to earlier editions of the St
aff Regulations will be made where applicable.
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Regulation 1.2(b):
[s]taff members shall uphold
the highest standards of
ST/SGB/2006/4, reg. 1.2(b) (1 January 2006). This is
a long-standing provision of the Staff Regulations.
See, e.g., ST/SGB/1999/5, reg. 1.2(b) (3 June 1999).
ST/SGB/2006/4, reg. 1.2(e) (1 January 2006). This is
a long-standing provision of the Staff Regulations.
See, e.g., ST/SGB/1999/5, reg. 1.2(e) (3 June 1999).
ST/SGB/2006/4, reg. 1.2(g) (1 January 2006). This is
a long-standing provision of the Staff Regulations.
See, e.g., ST/SGB/1999/5, reg. 1.2(g) (3 June 1999).
ST/SGB/2006/4, reg. 1.2(l) (1 January 2006). This is
a long-standing provision of the Staff Regulations.
See, e.g., ST/SGB/1999/5, reg. 1.2(l) (3 June 1999).
ST/SGB/2002/1 (1 January 2002).
United Nations Procurement Manual, Rev. 3 (August 2006) (hereinafter 2006 Procurement Manual);
United Nations Procurement Manual Rev. 2 (January 2004) (hereinafter 2004 Procurement Manual).
2006 Procurement Manual, sec. 4.1.5(4)(a). The 2004 Procurement Manual contained a similar
provision. 2004 Procurement Manual, sec. 4.1.5(4)(a).
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treatment to an individual or entity by acceptin
g offers or gifts and hospitality or other
similar considerations.
Section 4.2(2):
[i]t is inconsistent that a Pr
ocurement Officer . . . accepts
any gifts from any outside source regardless
of the value and regard
2006 Procurement Manual, sec. 4.2(1). The 2004 Procurement Manual contained a similar provision.
2004 Procurement Manual, sec. 4.2.1(1).
2006 Procurement Manual, sec. 4.2(2). The 2004 Procurement Manual contained a similar provision,
stating that [i]n principle, UN
staff members shall not accept any honours, decorations, favour, gift or
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[t]he Contractor shall perf
orm its obligations under this
Contract with due diligence and efficiency and in conformity with sound professional,
administrative, and financial practices.
[t]he Contractor shall act at all times so as to protect, and
not be in conflict with, the interests of the UN,
and shall use its best efforts to keep all
costs and expenses at a reasonable level.
[t]he Contractor warrants that no official of the United
Nations has received or will be offered by th
e contractor any direct
or indirect benefit
arising from this Contra
ct or the award thereof. The Contra
ctor agrees that breach of this
provision is a breach of an esse
ntial term of this Contract.
[t]he Contractor may not
communicate at any time to any
other person, Government or
authority external to the UN,
any information known to it
by reason or its association with the UN which
has not been made public except with the
authorization of the UN; nor
shall the Contractor at any time use such information to
[a]ny dispute, controversy
money or property by means of false or
or property by means of false or fraudulen
n sums of money under
contracts with the
United Nations not properly due and owing to them; and
Liberia contract, art. 18.1 (entitled G
eneral Obligations of the Contractor).
., art. 18.2 (entitled General Obligations of the Contractor).
., art. 27 (entitled Officials not to Benefit). A si
milar provision is contained in the Eritrea contract.
Eritrea contract, art. 25 (entitled
Officials not to Benefit).
Liberia contract, art. 34.2 (entitled Confidential
Nature of Documents). A similar provision is
contained in the UNMEE contract. Eritrea contract
, art. 34.2 (entitled Confidential Nature of
Documents).
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The Task Force investigators interviewe
r of United Nations
staff members in the Procurement Service,
the Department of Peacekeeping Operations
also conducted with former United Nations
staff members in various locations throughout
the world. Interviews also were conducted
with officers, agents, and employees of
the Subject Company, the Subject Parent
Company (the Subject Parent Company),
IHC, and various other vendors doing
business with the Organisation. In addi
tion, the Task Force interviewed three
confidential informantsreferred to as C
I-1, CI-2, and CI-
3, respectivelywho
provided relevant and probative evidence, but
expressed reasonable concerns about being
identified in this Report.
The Task Force investigators collecte
d and reviewed extensive documentation,
including procurement files; contracts; bids
and requisitions of th
vendor registration files; minut
es of the Headquarters Comm
ittee on Contracts (HCC);
background material concerning UNMIL; teleph
one records, where av
ailable; personnel
files; electronic evidence; a
nd financial records. During th
e course of the investigation,
the Task Force employed forensic recovery met
hods that allowed for the identification of
valuable evidence. As part of the invest
igation, the Task Force investigators visited
UNMIL. Additionally, a significant volume of records was obtained from the Subject
Certain files, such as the procurement r
ecords, were found to be in disarray and
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system and ability to issue subpoenas, limited
cooperation from relevant parties, and the
fact that several key witnesses with knowledge
of the events disc
Mr. Yakovlev and a number of former
Subject Company employeescould not be
interviewed.
Mr. Yakovlev, the case Procurement Officer
this Report, resigned from th
e Organisation on 21 June 2005.
Subsequent to his
resignation, he was arrested and pleaded gu
ilty to conspiracy, wire fraud, and money-
laundering charges in the United States District
Court, Southern District of New York,
stemming from investigations
into the Oil-for-Food Programme
. The investigations by
the Independent Inquiry Committee into th
e Oil-for-Food Programme and the United
States Attorneys Office for the Southern Dist
rict of New York revealed that since 2000,
almost US$1.3 million had been wired into an
account controlled by Mr. Yakovlev, in the
name of Moxyco Ltd. at the Antigua Over
seas Bank, Antigua, West Indies. Over
US$950,000 of these payments came from various
companies that collectively won more
than US$79 million in United Nations contracts.
As part of his guilty plea, Mr. Yakovl
ev entered into a cooperation agreement
with the United States Attorneys Office, S
outhern District of New York. Under this
agreement, he is required to offer all assistan
ce to the United States authorities in their
ongoing investigations. As a result of his
status as a prospective United States
government witness, prosecutors are unwillin
g to allow the Task Force access to Mr.
Yakovlev until such time as he has testifie
d in related matters. The Task Force has
accepted the offer of the Assistant U.S. Atto
rney to pose written questions to Mr.
Yakovlev through his office. However, no resp
onse has been received as of the date of
this Report. As far as the
Task Force is aware, Mr. Yakovl
ev has not come forth with
any information or allegation invol
ving the Subject Company and IHC.
Following the opening of this investiga
tion, the Task Force was contacted by the
Subject Parent Company and its legal ad
(Freshfields), who offere
d their cooperation with the
Task Forces investigation.
Throughout the investigation Freshfields has
provided valuable assistance, documents,
and information to the Task Force.
The Subject Parent Company has further assisted
the Task Forces effort in contacting a num
ber of current and former Subject Company
employees. The Subject Parent Company has acknowledged errors in the manner in
which their business was conducted with the
Organisation. The Subject Parent Company
has stressed that whatever the shortcomings
identified in the management and control of
the Subject Company by the Subject Parent
Company, it has been thorough in conducting
Office of the Spokesman for the Se
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its own internal investigation, dismissing or
not renewing contracts of those it holds
accountable. The Subject Parent Company has a
sserted that it has implemented a regime
of control to minimize the risk, if not
ensure, this coul
The Task
Force has not been made aware of any ci
rcumstance to challenge this assertion.
A reliable supplier of high
quality food that satisfies
the requirements of the
United Nations is a prerequisite for effectiv
e operations of the United Nations missions.
The United Nations contingents, including tr
oops, often work under harsh and difficult
circumstances and the quality and reliability
of food supplies are important. In cases
involving large-scale missions,
such as UNMIL, food rations s
uppliers are contracted to
supply food to thousands of troops
in various locations. As
part of the bidding process,
prospective contractors are requir
a list of more
items. The total amount of the unit prices is
known as the ceiling man rate (CMR).
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Chart A: Chronology of Events for the
ULY
XPRESSION OF
NTEREST
SSUED FOR
IBERIA
RITREA
AND
ONGO
ONTRACTS
IBERIA
ONTRACT
ONGO
ONTRACT
RITREA
ONTRACT
12 September 2003
Request for Proposal
23 October 2003, 10:00 am
Bid Closure
16 September 2003
Request for Proposal
27 October 2003, 10:00 am
Bid Closure
23 September 2003
Request for Proposal
31 October 2003, 10:00 am
Bid Closure
23 October 2003, 11:00 am
Bid Opening
13 November 2003
Approval of HCC
Recommendation
14 November 2003
ESS Notified of Award
10 December 2003
Liberia Contract Signed
18 February 2005
ESS Signs Amendment 1
28 April 2005
ESS Signs Amendment 2
11 July 2005
ESS Signs Amendment 3
31 October 2003, 11:00 am
Bid Opening
18 December 2003
Approval of HCC
Recommendatio
27 October 2003, 11:00 am
Bid Opening
9 December 2003
Approval of HCC
Recommendatio
15 December 2003
ESS Notified of Award
16 and 27 January 2004
Eritrea Contract Signed
5 February 2004
ESS Signs Amendment 1
21 March 2006
ESS Signs Amendment 2
The Procurement Service at the Organi
sations Headquarters was principally
responsible for the procuremen
t exercises for the Liberia,
Eritrea, and Congo food rations
contracts. From October 2001 to late 2005, th
e Procurement Service was headed by Staff
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Member 4.
Mr. Yakovlev, a Field Supply Officer,
was assigned to the Liberia, Eritrea,
and Congo contracts as the
case Procurement Officer.
Mr. Yakovlev reported to his
supervisor, Staff Member 1, who in
turn reported to Staff Member 4.
According to
Staff Member 1, he and Mr. Yakovlev had
a strained relations
hip and were not on
speaking terms for several years before both
of them were assigned to the Field
Procurement Section in December 2002.
As the case Procurement Officer for the Li
Yakovlev was responsible for communicating
with the Subject Company. His main
contact at the Subject Company was Markus
Andreas Seiwert, know
n as Andy Seiwert,
the Subject Companys designated liai
Even though
Mr. Yakovlev was responsible for the day-
to-day communications
with the Subject
Company, Staff Member 4 and Staff Member
1, as senior Procurement Service staff
Staff Member 4 interview (19 June 2006). Prior to August 2004, Procurement Service was known as
Procurement Division. Joan McDonald memorandum to Andrew Toh (27 August 2004) (renaming the
Procurement Division into the Procurement Service).
However, for purposes of this Report, Procurement
Division and Procurement Service are refe
rred to as the Procurement Service.
Staff Member 4 interview (19 June 2006); Staff Member 1 interview (27 and 28 June 2006).
.; Staff Member 4 interview (19 June 2006).
Staff Member 1 interview (27 and 28 June 2006) (stating that he suspected Mr. Yakovlev was not
clean, and that Staff Member 4
moved Mr. Yakovlev to the Field
Procurement Sec
tion where it was
believed he could do the least damage).
.; Staff Member 4 interview (19 June 2006).
Staff Member 9 interview (22 August 2006).
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supervising the Food Cell and
reported to Staff Member
5. Staff Member 6 was later
replaced by Staff Member
17, the Chief Supply Officer.
UBJECT
The Subject Parent Company is the worl
ds largest foodservice company with
more than 400,000 employees in over 90 countries.
The Subject Parent Companys
annual revenue in 2005 exceeded
The Subject Parent
Company is also a
major franchisee of many well-known intern
The Subject Company is incorporated unde
r the laws of Cyprus and is a fully
Subject Parent Company.
Prior to September 2001, the Subject
Company was registered with the United Nati
ons under the names of
various subsidiary
companies, including the Subject Company Subsidiary 1, the Subject Company
Subsidiary 2, and the Subject Company Subsidiary 3.
On 25 September 2001, all the
Subject Company-related vendor registrations
were consolidated under the name of the
Since early 1990s, the Subject Parent Company and the Subject Company have
been awarded contracts for food rations in
various United Nations missions, including
Liberia, Eritrea, Burundi, Cyprus, East
Timor, Golan Heights, Iraq and Lebanon.
According to the Subject Parent Company, as of September 2006, the Subject Company
has received over US$234 million in payments
from the United Nations for nine food
A number of the Subject Co
mpany staff members were i
nvolved with the Subject
Companys United Nations contracts, including:
Staff Member 6 interview (18 March 2006).
The Subject Parent Company, Annual Report 2005, pp. 2-3.
., p. 1.
., pp. 10, 12.
The Subject Company Supplier Registration Form, p. 1 (10 September 2001); Freshfields letter to the
Task Force (28 April 2006); The Su
bject Company Request for Proposal Provision of Catering Services
to UNMIL RFP:MIL/RFP/05/517/IM (undated) (hereinafter the Subject Company Proposal for UNMIL
Catering Contract).
Lesley Gorman email to the United Nations (7 Sept
ember 2001) (identifying Ms. Gorman as the Subject
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his areas of responsibility, including United Nations food rations contracts. Subject Company
Representative 1 interview (27 June 2006).
Subject Company Representative 3 statement (23 January 2006) (stating that he took control of
operational issues in Liberia and Eritrea from Ma
y 2004); The Subject Company Proposal for UNMIL
Catering Contract, pp. 2-3 (containing Organization Chart The Subject Parent Company).
Subject Company Representative 5 statement (30 January 2006).
The Subject Parent Company, A
nnouncement in relation to the Subject Company/ES-KO and Supreme
(UN) Litigation (16 October 2006).
ES-KO v. The Subject Parent Co
mpany, the Subject Company, IHC
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It is not clear who currently
owns IHC, and company official
s have refused to disclose
the identity of th
In 2004, Subject Company Representative 4 initiated
consideration within the Subject Parent Co
Ezio Testa and Angelita Quintero
s interview (13 October 2006); Cl
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Some of these consultancy agreementsinc
luding those attached to the Liberia and
Eritrea contractswere also accompanied
by confidentiality agreements, further
and information provided by IHC:
Figure: The Subject Company-IHC Consultancy Agreement relating to tented camps
The consultancy agreements further provi
ded that the Subject Company was not
Figure: The Subject Company-IHC Consultancy Agreement relating to tented camps
In turn, the Subject Company would pay
IHC either a pre-arranged flat amount
tied to per man per day, or
The Subject Company-IHC Consu
ltancy Agreement relating to tent
ed camps contract for UNMIS
(signed by Mr. Seiwert and Mr. Testa on 29 Februa
ry 2004) (UNMIS is the United Nations Mission in
Sudan); The Subject Company-IHC Consultancy Agreem
ent relating to food rations contract for UNMIL
(signed by Mr. Seiwert on 8 October 2003 and by Mr. Testa on 7 October 2003); The Subject Company-
IHC Consultancy Agreement relating to food rations contract for UNMEE (signed by Mr. Seiwert and Mr.
Testa on 7 October 2003).
.; The Subject Company-IHC Consultancy Agreement relating to tented camps contract for UNMIS
(signed by Mr. Seiwert and Mr. Testa on 29 February 2004); The Subject Company-IHC Consultancy
Agreement relating to food rations contract for UNMIL (signed by Mr. Seiwert on 8 October 2003 and by
Mr. Testa on 7 October 2003).
See, e.g., The Subject Company-IHC Agreement relating to food rations contract for UNMIL (signed by
Mr. Seiwert on 8 October 2003 and by Mr. Testa on 7 October 2003).
The Subject Parent Company, The
Subject Company payments
to IHC (16 May 2006). The fact of the
Subject Company payments to IHC was confirmed to th
e Task Force from a number of sources. Subject
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Figure: Ezio Testa email to Andy Seiwert (10 June 2005)
On 22 June 2005, following the summer 2005
reports discussing IHC,
the United Nations suspended IHCs vendor
registration. According to information
obtained by the Task Force from a confidential
informant, shortly after the suspension of
IHC, all United Nations-related documents were shipped to IHCs offices in Milan, and a
decision was made that the Milan office woul
d deal with issues related to the United
Nations contracts.
As of the date of this Report, IHC remains on suspension.
UBMISSION
DJUSTMENT OF THE
UBJECT
OMPANY
UBMISSION AND
At the time of the events discussed here
the United Nations
Procurement Manual was in effect.
According to Staff Me
mber 3, the Bid Opening
Official at the bid opening ceremony for the Li
bids received by the Procurement Service we
re time stamped upon rece
ipt, and placed in
a secured room locked with an electronic mechanism until the scheduled opening time.
Only authorized staff had
access to the secured room.
The purpose of this exercise was
Company Representative 3 statement
(23 January 2006); Subject Compan
y Representative 7 interview (4
July 2006); Subject Company Representative 2 interview (4 July 2006).
Ezio Testa email to Andy Seiwert (10 June 2005).
CI-3 interview (4 October 2006).
Jayantilal Karia memorandum to Directors and Chiefs of Administration at Offices Away from
Headquarters, International Tribunals and
Peacekeeping Missions (25 October 2005).
United Nations Procurement Manual, sec. 7 (31 March 1998) (hereinafter 1998 Procurement Manual).
Staff Member 3 interview (5 June 2006); 1998 Procurement Manual, sec. 7.02.02.
.; Staff Member 3 interview (5 June 2006).
Staff Member 4 had access to both locks.
Id.
Staff
Member 2, Chief SSS, and Diana Mills-Aryee, Team L
eader General Administration, were authorized to
open the lower lock.
Id.
Two duly authorized Bid Opening Of
ficials for the Libe
ria contract, Staff
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to protect the integrity of th
e process, and ensure a fair
selection based upon objective
criteria devoid of any improper influence.
As discussed below, these honorable goals
A few minutes before the scheduled bi
d opening time, the proposals were
collected by the Bid Opening Officials from
the secured room and brought to the bid
opening room in preparation for the proposal opening ceremony.
All bids were
recorded publicly at the place and tim
e specified in the invitation to bid.
The ceremony
names on the invitee list.
opened during the public opening ceremony.
As soon as the bid opening was conclude
d, the sealed financial proposals,
cards needed to be simultaneously slid through the upper and lower locks.
Thus, the Bid Opening
Officials were to be accompanied by eith
er Staff Member 2 or Ms. Mills-Aryee.
Id.
.; Staff Member 18 interview (15 November 2006); 1998 Procurement Manual, sec. 7.09.02.
., sec. 7.03.01.
.; Staff Member 3 interview (5 June 2006).
.; Staff Member 18 interview (15 November 2006).
.; 1998 Procurement Manual, sec. 7.04; Staff Member 4 interview (19 June 2006); Staff Member 3
interview (5 June 2006).
.; Alexander Yakovlev email to Ellen Aamodt (23 October 2003) (sending technical proposals for the
Liberia contract to DPKO for technical evaluation).
Staff Member 4 interview (19 June 2006).
. (stating that before the end of 2004, there was no
formal procedure in place for opening of financial
proposals).
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without anybody having knowledge thereof.
As explained below, this is exactly what
occurred in respect to the Li
beria and Eritrea contracts.
UBJECT
DJUSTMENT OF
INANCIAL
In anticipation of the open
ing of the proposals for the
Liberia, Eritrea, and Congo
contracts, the Subject Company sent a team of
three staff members and one consultant to
New York, including Mr. Se
iwert, Mr. Kerr, and two
other members that were
interviewed by the Task Force an
d are referred to as CI-1
and CI-2. Th
the Subject Companys team was to prep
are the financial proposals, and, as the
investigation has revealed, to adjust these documents to the extent necessary upon
During the course of
the investigation, the Task
Force interviewed CI-1 and
CI-2, two members of the Subj
ect Company team who particip
ated in the process. As
. (further stating that the proposal opening procedure was later changed and that financial proposals are
now kept in a secured room by someone other than the procurement officer involved in the procurement
exercise).
CI-1 statement (18 January 2006); CI-2 interview (24 October 2006).
.; CI-1 statement (18 January 2006).
.; CI-2 interview (24 October 2006).
CI-1 statement (18 January 2006).
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Manhattan offices or the IHC business premises
located just a short distance away. Mr.
Seiwert stayed in the Millennium UN Plaza
Hotel, located on the same block as the
Procurement Service offices.
On 22 October 2003, a da
y before the submission
deadline for the Liberia contract, the Subject
Company team purchased a printer, pre-
punched paper, and printer ink from a Staples
store and established a temporary office in
Mr. Kerrs hotel suite.
It was decided in advance that the Subject Company bid team
would await Mr. Seiwerts phone
call with inside pricing in
formation on the bid opening
day, and adjust the Subject Compan
Figure: Locations of The Roosevelt Hotel, Millennium UN Plaza Hotel, Procurement
Service offices, and IHC offices
On 23 October 2003, before the bid openi
ng procedure scheduled for 10:00 am,
.; CI-2 interview (24 October 2006); The Roosevelt Hotel Invoice (31 October 2003) (showing Mr.
Kerr as staying in the hotel from 21 October 2003 to 1 November 2003).
CI-1 statement (18 January 2006).
.; CI-2 interview (24 October 2006).
CI-1 statement (18 January 2006).
Procurement Service receipt for the Subject Comp
any financial and technical
proposals (23 October
2003) (showing that the proposals were received at 9:40 am); Liberia contract RFPS 550 (12 September
2003); Liberia Proposal Opening Ceremony List (2
3 October 2003); Staff Member 18 interview (15
November 2006).
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technical and financial proposals
were delivered to Mr. Yakovlev.
An email sent by
Mr. Yakovlev to Ms. Aamodt confirms that
Mr. Yakovlev was in possession of the
proposals no later than 11:41 am:
Figure: Alexander Yakovlev email to Ellen Aamodt (23 October 2006)
The investigation has revealed that Mr.
Seiwert was in contact with the other
members of the Subject Company team in the following few hours. Telephone records
Alexander Yakovlev email to Ellen Aamodt (23 Oc
tober 2003) (sending technical proposals for the
Liberia contract to DPKO for technical evaluation).
Telephone chronology (23 October 2003).
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Table A: Andy Seiwerts Telephone Calls on 23 October 2003
Calling
Call
Duration
Call Destination
11:04:581:52Ezio Testa/IHC Office (New York City)
11:07:099:14N/A
11:18:090:31N/A
11:19:0210:28N/A
11:48:491:41The Roosevelt Hotel (New York City)
11:57:430:39The Roosevelt Hotel (New York City)
11:58:284:00The Roosevelt Hotel (New York City)
12:03:230:45The Roosevelt Hotel (New York City)
12:54:070:30Douglass Kerr mobile
CI-1 confirmed that Mr. Kerr receive
d a telephone call from Mr. Seiwert
sometime after 11:00 am, providing him with the figures for the Basis of Provisioning A
and B (hereinafter BOP A and BOP B)
against which the Subject Companys prices
needed to be decreased in accordance
with the Subject Companys plan.
Based on Mr.
Seiwerts information, Mr. Kerr
and CI-2, in telephone consu
ltations with Mr. Swain at
the Subject Company offices,
proceeded to reduce the Subject Companys commodity
prices, and modify the transport and logistics
figures in order to secure the award of the
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the Subject Companys proposals
for Liberia, Eritrea, and C
ongo contracts were made in
Once the figures were changed, CI-1 pr
inted three copies of the modified
proposals, two for the United Nations
and an extra copy for Mr. Seiwert.
The paper
used for the modified proposals for Liberia an
exactly the same as
the paper used for the Subject Companys o
fficial financial propos
als and the modified
Calling
Time
Call
Duration
Call Destination
11:31:092:10Doug Kerr mobile
11:41:273:17Doug Kerr mobile
11:48:221:02Doug Kerr mobile
11:53:044:16Andy Seiwert voicemail
11:58:445:36Doug Kerr mobile
12:30:180:42Doug Kerr mobile
14:18:294:22
The Roosevelt Hotel (New York City)
14:19:130:15Andy Seiwert voicemail
14:24:050:10Andy Seiwert voicemail
On 27 October 2003, the Subject Company team bought additional office supplies
in the same Staples store where they had previously purchased the printer:
.; CI-2 interview (24 October 2006).
.; CI-1 statement (18 January 2006).
.; CI-2 interview (24 October 2006).
.; CI-1 statement (18 January 2006).
Telephone chronology (27 October 2003).
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According to CI-1, the Subject Company
also contemplated replacing the bid
documents for the Congo contract on 31 Oc
tober 2003, but it was d
ecided that it would
be unrealistic to sufficiently drop the submitted
prices to achieve the contract because of
higher risks associated with operating in Congo.
However, similar to the events on 23
numerous phone calls made
as well as the remaining team members in
The Roosevelt Hotel after the bid opening on
CI-1 statement (18 January 2006); CI-2 interview (24 October 2006).
Telephone chronology (31 October 2003).
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Table C: Andy Seiwerts Telephone Calls on 31 October 2003
Calling
Duration
12:04:085:01The Roosevelt Hotel (New York City)
12:15:401:30The Roosevelt Hotel (New York City)
12:35:085:53The Roosevelt Hotel (New York City)
12:41:110:45The Roosevelt Hotel (New York City)
13:23:4210:22N/A
13:36:390:47Ezio Testa/IHC Office (New York City)
13:37:450:44Ezio Testa mobile
13:43:200:23Ezio Testa mobile
13:45:190:23Ezio Testa mobile
13:47:410:23Ezio Testa mobile
13:52:280:52Ezio Testa mobile
13:53:340:41Ezio Testa/IHC Office (New York City)
13:54:251:43Ezio Testa mobile
13:58:012:05Ezio Testa mobile
11:00 am - Official Bid Opening
The numerous phone calls in the Table a
bove show that Mr. Testa was somehow
involved in the process. However, when
asked about the phone calls on that day, Mr.
Testa stated that the telephone calls were not
in regard to the Congo contract proposal.
However, Mr. Testa could not provide an
explanation for having nine telephone
conversations with Mr. Seiwert within
30 minutes on that very important day.
Both CI-1 and CI-2 informed the Task Fo
rce that they regarded the events in
October 2003 described above as
strange and irregular.
The Task Force views these
events as corrupt, and constituting criminal act
s. However, both CI-1 and CI-2 asserted
that neither of them openly discussed the pur
pose of the exercises wi
th Mr. Kerr or Mr.
Seiwert. Mr. Kerr specifically instructed C
I-2 to mind his own bus
iness and not concern
himself with anything else.
According to both of these confidential informants, Mr.
Nevertheless, CI-1 stated that it was
clear to him that financial bid documents
were changed after the official bid subm
achieving the most
proposals were also altered in
at least three other instance
s, including the procurement
exercise for the Sudan contract in December 2004.
According to CI-1, the Subject
Companys bid centre sometimes
prepared several copies of
financial proposals on loose
Ezio Testa and Angelita Quintero
s interview (13 October 2006).
CI-2 interview (24 October 2006).
CI-1 statement (18 January 2006).
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best fitting proposal would be utilized.
According to CI-1, the Subject Company
did not keep copies of the original
unmodified financial proposals. CI-1 expl
ained that Mr. Kerr was paranoid that
financial proposals might fall in the hands of
. Mr. Testa confirmed that the
Subject Company had a paperless motto with regard to keeping its
proposals. Ezio Testa and Angelita Quinteros interview (13 October 2006).
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the Procurement Service.
The second
report included a
string of emails
originating from Mr. Yakovlev and sent to Mr
. Seiwert. Mr. Yakovlevs email contained
internal United Nations records describing
the Subject Companys performance failures
with regard to the food rations contract
for the United Nations Operation in Burundi
Figure: Alexander Yakovlev email to Andy Seiwert (27 April 2005)
Mr. Yakovlevs email was subsequently
forwarded by Mr. Seiwert to Mr.
Figure: Andy Seiwert email to Ezio Testa (27 April 2005)
Some of the documents attached to Mr.
Yakovlevs email were marked strictly
HCC Presentation (6 November 2003).
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Figure: United Nations Operation in Burundi, The Subject Company Contractor
Performance Report (22 February 2005)
(attached to Mr. Yakovlevs email dated 27
Documents obtained from the Subject Pa
rent Company representatives confirm
the Subject Companys access to
confidential internal United Nations information and
documents that were not available to other ve
ndors. For instance, an email sent by Mr.
Testa to the Subject Company on 16 July
2003almost a week before an Expression of
. . .
Figure: Ezio Testa email to Adrian Dyer (17 July 2003)
Another email sent by Mr. Seiwert reflects that almost two weeks before the
official issuance of the Request for Propos
al (RFPS) for the Li
Subject Company had already obtained copies
of correspondence from the DPKO to the
Ezio Testa email to Adrian Dyer (17 July 2003); Request for Expression of Interest (22 July 2003). Mr.
Dyer was one of the Subject Company managers.
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Procurement Service containing information
about troop numbers and troop locations in
Figure: Andy Seiwert 9 email to Lesley Gorm
an (1 September 2003) (attaching internal
United Nations documents re
garding planning for UNMIL)
Documents in the possession of the Subj
ect Company show that the companys
access to confidential internal United Nations
information was not restricted to UNMIL-
related materials. The records obtained
by the Subject Company included confidential
internal United Nations documents re
Figure: Christian Saunders email to Clemens Adams (21 March 2005) (located among the
These materials were obtained primarily by Mr. Seiwert.
However, because of
Mr. Seiwerts disappearance, the Task For
ce has been unable to obtain Mr. Seiwerts
explanation as to how he came to possess thes
e confidential United Nations materials.
Andy Seiwert email to Lesley Gorman (1 September 2003).
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The Task Force, as well as the Subject
Company and representatives from ES-KO and
Supreme, have expended significant effo
rt to locate him, to no avail.
However, Subject Company Represen
tative 4 informed the Task Force
investigators that when he previously as
ked Mr. Seiwert about
confidential United
Nations documents, Mr. Seiwert replied:
[Subject Company Representative 4] I
probably got [them]. I dont remember.
According to Subject Company
Representative 1, Group Chief Executive of th
e Subject Parent Company, when he asked
Mr. Seiwert to comment on this matter as part of the Subject Parent Companys internal
tegorically denied any wrongdoi
ng and promised to provide
Several Subject Company staff members
confirmed having obtained confidential
documents, including not only internal Un
ited Nations records, but commercially-
sensitive documents provided to the United
Nations by other vendors as well. Subject
Company Representative 7, th
e Subject Companys Projec
contract, asserted that he
received an induction package
on his arrival at UNMIL in
December 2003.
Amongst the documents in the package was the HCC presentation for
extracts of the ES-KO pricing schedule for its interim contract for UNMIL.
This
information was of significant advantage and va
lue to the Subject Company as it assisted
d pricing data and information that was
Subject Company Representative 4
interview (28 November 2005).
Subject Company Representative 1 interview (27 June 2006).
Subject Company Representative 7 interview (4 July 2006).
Subject Company Representative 4
interview (28 November 2005); Subject Company Representative 5
interview (30 January 2006); Staff Member 1 interview (27 and 28 June 2006); The Subject Company
Organisation Chart (undated).
Subject Company Representative 2 interview (4 July 2006).
Id
Subject Company Representative 4
interview (28 November 2005).
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not public from the staff of the Procurement Service.
Subject Company
Representative 4, however, offered that th
e Subject Company never paid anybody for
information or to get a contract; instea
d, the Subject Company won as the lowest
Subject Company Representative 4 told th
e Task Force inves
tigators: Yes, we
See, e.g., Liberia contract, art.
34.2 and Eritrea contract, art. 34.2.
Ray Smith email to Alexander Yakovlev (18 November 2003).
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. . .
. . .
Figure: Ray Smith email to Alexander Yakovlev (18 November 2003)
Later on that same day, Mr. Dovgopoly
sent a reply email to Mr. Smith,
. . .
Figure: Dmitri Dovgopoly to Ray Smith (18 November 2003)
Following Mr. Dovgopolys email, ES-KO e
regard to information on bid awards obtained
Dmitri Dovgopoly email to Ray Smith (18 November 2003).
Ray Smith email to Dmitri Dovgopoly (20 November 2003).
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Figure: Ray Smith email to Dmitri Dovgopoly (20 November 2003)
The HCC had just deliberated on
November 2003.
When interviewed about this incide
nt, Staff Member 4 stated that as
soon as the Subject Company was notified of
the award, the Procurement Service should
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Based on the available eviden
ce, and particularly in light of the fact that both
Staff Member 4 and Staff Member 1 held, at
the time, reservations
about Mr. Yakovlevs
Such efforts were pursued and achieved, as was confirmed by Mr. Seiwert in
correspondence with Mr. Swain following the aw
ard of the Sudan food rations contract.
In his email, Mr. Seiwert stated that [m]
any people have stuck their necks out for us,
[including] Alex Yakovlev, Christian
Saunders, Dmitri Dovgopoly, Andrew Tow [
Ian Divers and Clemens Adams. Mr. Seiwert
stated further: You may have noted that
we have not heard much from Staff Member 7
lately . . . took a bi
t longer than I thought,
Subject Company Representative 4
interview (28 November 2005).
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Figure: Andy Seiwert email to Len Swain (1 January 2005)
The Task Force investigators questi
oned the United Nations staff members
mentioned in Mr. Seiwerts email. Each deni
ed providing confidential information to the
Subject Company, and could not
offer an explanation for Mr. Seiwerts statement that the
Procurement Service officials had stuck thei
r necks out for us. Staff Member 8 said
that he had never stuck out his neck for anyone.
Staff Member 7 replied that she
would have preferred if the email read th
at she has disappeared from face of the
earth.
Staff Member 9 stated that he had never been approached by the Subject
Company.
However, Staff Member 4 stated that
Staff Member 8 interview (17 May 2006).
Staff Member 7 interview (10 April 2006).
Staff Member 9 interview (11 April 2006).
Staff Member 4 interview (19 June 2006).
Staff Member 1 interview (27 and 28 June 2006).
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feel that we should . .
In one such email addressed to Subject
Company Representative 3, Mr. Seiwert
wrote: Alex is acutely aware
friends
.
any Representative 3 (21 January 2005)
Subject Company Representative 3, wh
en asked by the Task Force for an
ked Mr. Seiwert who our friends were.
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Subject Company Representative 6 recalle
Subject Company Representative 6
statement (10 January 2006); Staf
f Member 4 interview (19 June
2006); Staff Member 1 interview (27 and 28 June 2006).
.; Staff Member 4 interview (19 June 2006); Subj
ect Company Representative
6 statement (10 January
2006).
Staff Member 5 interview (31 March 2006).
Staff Member 13 interview (19 September 2006).
Staff Member 19 interview (21 September 2006) (Staff Member 19 worked as a resident auditor in
UNMIL); Staff Member 20 interview (9 September 2006
) (Staff Member 20 worked as an associate auditor
in UNMIL); Farid Hykal interview (27 September 2006) (Mr. Hykal is a warehouse owner in Liberia)
(stating that Staff Member 5 never approached him with any offer to change warehouse costs); Staff
Member 21 interview (20 September 2006) (Staff Member 21 worked as an auditor in UNMIL). Forensic
analysis of electronic material showed no evid
ence to support Subject Co
mpany Representative 5s
allegation against Staff Member 5. When interviewed by the Task Force, Subject Company Representative
5 did not provide any information regarding this incident. Subject Company Representative 5 statement
(30 January 2006).
. (describing Staff Member 5 as very rude
about how the Subject Company was operating in
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Company Representative 5 understood this
to mean that ES-KO was paying Staff
Member 6 for her support.
Subject Company Representati
ve 5 further described Staff
Member 6 as very obstructive towards th
e Subject Company and a strong supporter of
Contrary to Subject Company Repr
esentative 5s assertions, however,
Subject Company Representative 7, a form
er Subject Company Project Manager for
UNMIL, described Staff Member 6 as de
manding and difficult, but professional.
Subject Company Representative
7 further stated that Staff
Member 6 relied heavily on
contract terms and requirements and insisted
on exact compliance with the terms of the
Subject Company Representative 5 conceded that he had no actual
proof that Staff Member 6 had any improper involvement with ES-KO.
The Task Force was unable to identify any evidence showing any improper
conduct on the part of Staff Member 6
ONNECTIONS WITH
AKOVLEV AND OTHER
ATIONS
TAFF
The Task Force investigators interviewed
Mr. Testa as well as Ms. Quinteros of
IHC. During the course of the interview, Mr. Testa admitted that a number of United
Nations staff members provided
him with confidential information and documents as a
courtesy, but Mr. Testa refused to id
entify the procurement staff within the
Organisation to whom he was referring.
Mr. Testa admitted that he thereafter provided
at least some of these documents to the Subject Company.
In that regard, Mr. Testas remarks have
been independently
corroborated by the
Task Force. For example, the Task Force
obtained a copy of an email sent from Mr.
Testa to Mr. Seiwert forwarding an RFPS for an
UNMIS fuel contract in advance of its
Subject Company Representative 7 interview (4 July 2006).
. (stating that Staff Member 6 taught him how to provide products that one was contracted for).
Subject Company Representative 5 statement (30 January 2006).
Ezio Testa and Angelita Quintero
s interview (13 October 2006).
Ezio Testa email to Andy Seiwert (10 May 2005).
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Figure: Ezio Testa email to Andy Seiwert (10 May 2005)
When presented with this email, Mr. Te
sta claimed he no l
onger recalled with
whom he had lunch referred to in the email, or the contents of the lunch discussion.
Ezio Testa and Angelita Quintero
s interview (13 October 2006).
.; Ezio Testa email to Andy Seiwert (10 May 2005) (forwarding a copy of RFPS 794 and stating
please find new RFPS ready to be launched).
Ezio Testa and Angelita Quintero
s interview (13 October 2006).
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product had great potential and
Obviously more
Ezio Testa email to the Ta
sk Force (16 October 2006).
Ezio Testa and Angelita Quintero
s interview (13 October 2006).
The Task Force email to Ezio Testa (16 October 2006); Ezio Testa email to the Task Force (16 October
2006).
Angelita Quinteros interview (29 September 2006); Ezio Testa and Angelita Quinteros interview (13
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troubling, the evidence also demonstrates th
at Mr. Yakovlev and Mr
corrupt practices involving important Un
ited Nations business and procurement
IHC, as a vendor doing business with the United Nations, acted in violation of the
United Nations general contract policy a
oviding Mr. Yakovlev
with direct benefits. Even more signifi
a engaged in corrupt
practices by bestowing pers
onal benefits upon a procurement officer and providing
employment to his son at the time when
the company was doing business with the
vendors participating in bi
dding exercises in which Mr.
Yakovlev was the assigned Procurement Officer
United Nations, United Nations Year of Dialogue Among Civilizations Giandomenico Picco,
http://www.un.org/Dialogue/Picco.html; Mary Camper-Titsingh, Roosevelt Islands Gianni Picco
Recounts His Hostage Rescues in a New Book,
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responsible for the general ove
rview of companys work a
nd fulfilled an operational
role, which he defined as introducing IHC to other companies.
At the time of Mr. Piccos appointment
ny confidential United Nations materials with Mr. Testa.
Mr.
Picco further stated to the Task Force i
nvestigators that he was unaware of IHCs
relationship with the Subject Company.
United Nations documents or information with Mr. Testa. However, Mr. Piccos
involvement with IHC as the Chairman of the
Board of Directors while
he was serving as
the Chairman of the IHCs Board of Directors)
, Giandomenico Picco interview (23 October 2006)
(admitting that he did not formally separate from IHC Services until mid-2000).
ProcurePlus Database, Reports on IHC (14 November 2006) (showing the total value of IHC contracts
to be over US$15 million); Ezio Testa and Angelita Quinteros interview (13 October 2006).
Giandomenico Picco interview (23 October 2006).
See, e.g., ST/SGB/1999/5, regs. 1.2(o) and 1.2(m) (3 June 1999); ST/SGB/1999/12, rules 301.4(a) and
301.4(b) (28 June 1999).
Vevine Stamp memorandum to Christian Saunders (5 September 2003).
. (attaching Liberia contra
ct Statement of Work).
Liberia contract Statement of Work, Estimated Troop Strengths and Deployment Schedules.
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Figure: Liberia Contract Statement of Work, Estimated Troop Strengths and
Prospective contractors were further re
quired to tender a maximum unit price per
troop for supplying food rations, the CMR, which
consisted of the sum
of all unit prices
., Part II Specifications for the
Supply of Dry and Frozen Food.
UNMIL Abstracts of Bids, Annex B.
Liberia contract
Statement of Work.
Liberia Proposal Opening Ceremony List (23 October 2003); Vevine Stamp memorandum to Christian
Saunders (27 August 2003).
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Liberia contract RFPS 550.
Liberia Proposal Opening Ceremony List (23 October 2003).
1998 Procurement Manual, sec. 8.03.01.
Clemens Adams memorandum to Christian Saunders (5 November 2003).
Headquarters Committee on Contract
s presentation (6 November 2003).
Staff Member 8 interviews (12 April and 9 May 2006); Headquarters Committee on Contracts
presentation created by Alexander
Yakovlev (6 November 2003); Staff Member 8 memorandum to Staff
Member 4 (5 November 2003).
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many as 15,000 troopsa criticism that would
have equally applied to the Subject
Company:
Figure: Excerpt of the official DPKO technical evaluation (removed from the official
presentation given to the HCC)
When the Task Force investigators showed
the different versions of the Technical
Evaluation to Staff Member 8
and Staff Member 10, both stated
that they were not aware
that an altered Technical Evaluation
document was presented to the HCC.
Both Staff
Member 10 and Staff Member 8 stated that
the Procurement Serv
ice was supposed to
provide the DPKO with a copy of its
proposed HCC presentation prior to its
submission.
This, however, was not done.
Staff Member 10, referring to the
report of October 2005,
ironically remarked to the Task
Force investigators that the
Subject Company must have seen th
Staff Member 4, who electronically appr
oved Mr. Yakovlevs draft presentation
to the HCC, was not aware of the difference
between the official technical evaluation and
the one presented to the HCC.
Similarly, Staff Member 1
. (containing original technical evaluation);
Headquarters Committee on
Contracts presentation
created by Alexander Yakovlev (6 November 2003) (containing altered technical evaluation).
Staff Member 8 interviews (12 April and 9 May 2006
); Staff Member 10 interviews (24 February and 1
March 2006).
.; Staff Member 8 interviews (12 April and 9 May 2006).
.; Staff Member 10 interviews (24 February and 1 March 2006).
.; Staff Member 4 interview (19 June 2006) (statin
g that it was unusual that DPKO was not informed
about the pre-clearance of
the HCC presentation).
Staff Member 1 interview (27 and 28 June 2006).
Staff Member 10 interviews (24 February and 1 March 2006).
UNMIL Abstract of Bids (undated
); Alexander Yakovlev email to Joao Marcedo (11 November 2003).
.; UNMIL Abstract of
Bids (undated).
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and IHC officials, as well as the fact that
Mr. Yakovlev prepared the HCC presentation
for the Liberia contract, and indeed clarifie
d questions asked by the HCC, the Task Force
finds that it is reasonable to conclude th
at Mr. Yakovlev altered the HCC presentation.
The significance of the fact
that the DPKOs Technical Ev
aluation was altered became
clear when the Subject Company,
in justifying its
later request for an
increase in the
warehouse costs, relied on the fact that
its proposal was based on 6,000 troops and not on
15,000 troops. This was the exact concern ex
pressed in the DPKOs
original Technical
The recommendation of the HCC for award of
the Liberia contract to the Subject
Company in the not-to-exceed amount of
approximately US$62 million was approved on
13 November 2003.
The following day, Mr. Yakovlev
notified the Subject Company
The Task Force has noted that the name
of the contracting party to the Liberia
contract is the Subject Company Subsidia
ry 4, rather than the Subject Company.
The
Task Force confirmed that the Subject Compan
y Subsidiary 4 is not a registered United
Nations vendor.
Staff Member 10 of the DPKO told
the Task Force that it was the
responsibility of the Procurement Service as
the contracting authority of the United
Approval of Liberia contract HCC/03/78 recommendation (13 November 2003).
Alexander Yakovlev facsimile to Allan Vaughan (14 November 2003); Staff Member 8 interviews (12
April and 9 May 2006); Staff Member 13 interview
(19 September 2006); Staff Member 5 interview (31
March 2006); Staff Member 4 interview (19 June 2006) (stating that it was unprofessional that the Subject
Company was informed about the contract
award before UNMIL was informed.)
Liberia contract. The Procurement Service and DP
KO staff members interviewed by the Task Force
had not noticed the discrepancy. Staff Member 2 in
terview (27 June 2006); Staff Member 1 interview (27
and 28 June 2006).
Procurement Service email to the Task Force (3 May 2006).
Staff Member 10 interview (24 February 2006).
.; Staff Member 8 interviews (12 April and 9 May
2006); Staff Member 7 inte
rview (10 April 2006).
Staff Member 4 interview (19 June 2006).
1998 Procurement Manual, sec. 14.04.
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Staff Member 1 stated that he di
d not review the Liberia contract.
He added
that as the supervisor of Mr. Yakovlev, he wa
s responsible for initialing the last page of
Staff Member 1 argued that the lack
of his initials was indicative to him
that he was deliberately sidelined by Mr.
Yakovlev on this issue, which, according to.
Staff Member 1, was ty
pical of Mr. Yakovlev.
Staff Member 1 conceded that awarding
a contract to a different contractor than
the one submitting the proposal could cause
problems in the event of legal action.
Staff Member 2, who signed the contract
on behalf of the United Nations in the
absence of Staff Member 4, stated that the
mistake should have been corrected. Staff
Member 2 was also of the view that if
the performing party was not a party to the
contract, such a circumstance could have a poten
tial impact on the legal obligations of the
contracting parties. According to Staff Memb
er 2, if the contracting party did not have a
Certificate of Incorporation, the Un
ited Nations could be in trouble.
The Subject
Parent Company confirmed that the Subject
Company Subsidiary 4 does not exist as a
separate legal entity.
IBERIA
One of the fundamental principals of pr
ocurement within the Organisation is to
award contracts to the lowest technically-comp
liant bidder. With a keen awareness of the
possibility of seeking amendments to the
contract once it had been signed, the Subject
Company purposefully took advantage of this
option and falsely manipul
ated its prices in
a downward fashion to achieve the lowest fina
ncial bid, all the while planning to recover
equent amendments to the contract.
One of the emails obtained by the Task
Force describes the Subject Companys
strategy to utilize amendments to make up fo
r the losses which occurred as a result of
artificially lowered bid prices. This email re
fers to an RFPS for a food rations contract
for UNMIS. In this instance, the Subject
Company provided a CMR rate based on the
central warehouse located in Po
rt Sudan rather than in
Kosti, unlike other bidders.
Mr.
Yakovlev requested clarification from the S
Staff Member 1 interview (27 and 28 June 2006).
Staff Member 1 was in the office on 10 December
2003, the date of execution of the Liberia contract.
Staff Member 1 Attendance Record (1 January 2003 to
31 December 2003).
Staff Member 1 interview (27 and 28 June 2006).
. (stating that Mr. Yakovlev had the trend of going behind Staff Member 1s back directly to Staff
Member 4 to address certain matters without Staff
Member 1s involvement); Staff Member 1 interview
(22 November 2006); Staff Member 4 interview (19 June 2006) (confirming that Mr. Yakovlev approached
him directly without Staff Member 1s involvement).
Staff Member 1 interview (27 and 28 June 2006).
Staff Member 2 interview (27 June 2006).
The Task Force note-to-file (26 October 2006).
Alexander Yakovlev email to Andy Seiwert (10 August 2004).
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Companys original CMR rate.
In response to Mr. Yakovlev request, the Subject
Company confirmed that such a change would
affect their original CMR rate:
Figure: Andy Seiwert email to Alexander Yakovlev (12 August 2004)
Shortly thereafter, the following email was in
ternally circulated within the Subject
Company Management:
. . .
Figure: Andy Seiwert email to Douglas Kerr (12 August 2004)
Thus, it is evident that in this ci
rcumstance the Subjec
t Company planned on
using the warehouse location and pricing to
amend the contract and claim additional
costs. The emails above are particularly signi
ficant in light of the
fact that the Subject
Company was corruptly in posse
Alexander Yakovlev email to Andy Seiwert (10 August 2004).
Andy Seiwert email to Alexander Yakovlev (12 August 2004).
Andy Seiwert email to Douglas Kerr (12 August 2004).
ES-KO Price Proposal for Supply of Food Rations to the UN Mission in Sudan RFPS 592 (undated)
Andy Seiwert email to Alexander Yakovlev (12 August 2004).
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Subject Company Representative 3 statement (23 January 2006).
Subject Company Representative 7 interview (4 July 2006).
Subject Company Representative 5 statement (3 January 2006).
Staff Member 10 interviews (24 February and 1 March 2006).
Christopher Knight email to Staff Member 10 (16 June 2005).
Staff Member 10 interviews (24 February and 1 March 2006) (stating that the Subject Company tried
to exploit every perceived weakness of the contract,
especially in the Eritrea and Liberia food rations
contracts).
OIOS Procurement Audit Review.
Staff Member 1 interview (27 and 28 June 2006); Staff Member 4 interview (19 June 2006).
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not help wondering for whom Mr. Yakovlev was working.
He viewed the negotiations
as a mere formality and believed that an
outcome had already been agreed upon. Staff
Member 1 stated that he had a feeling
that the negotiations
were pre-cooked.
In light of the fraudulent scheme invol
ving the Subject Company, IHC, and Mr.
Yakovlev, as well as the Subject Companys
access to confidential
information, the Task
Force examined the circumstan
ces leading to the adoption of
Amendments to the Liberia
Amendment 1 of the Liberia contract pr
ovided for a troop strength increase from
6,000 to 14,500, with a correspond
ing increase in the wareh
ouse costs from US$73,661
to US$129,820 per month, effective 1 May 2004.
According to Staff Member 10, the Unite
d Nations would need to amend the
contract if the troop
number exceeded 14,500.
Staff Member 10 added that the
Statement of Work, which form
ed part of the Liberia c
ontract, provided for a troop
increase from about 6,000 to 14,500 within
two months, and it could therefore be
expected that the contract was awarde
d to the Subject Company on those terms.
In
fact, the troop strength rose dramatica
Staff Member 1 interview (27 and 28 June 2006).
Amendment 1 to Liberia contract (signed by Mr. Saunders on 19 April 2005 and by Mr. Seiwert on 18
February 2005).
Staff Member 10 interviews (24 February and 1 March 2006).
.; Annex A to UNMIL Rations SOW of the Liberia contract.
Staff Member 11 interview (4 April 2006); Sta
ff Member 5 interview (31 March 2006); SGS Nederland
B.V., Final Report Provision of Independent Inspection and Evaluation Services of the Contractors
involved with the United Nations Food Rations Contracts in Liberia, p. 15 (August 2004) (hereinafter
SGS Report).
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Figure: Increases in UNMIL contingent strength (5 December 2003 to 13 August 2004)
The Subject Company relied on the fact
that its proposal was based on 6,000 and
not 14,500 troops to justify its
request to increase the warehouse costs. The Subject
Vevine Stamp email to Alexander Yakovlev, Dmitr
y Dovgopoly, and Christian Saunders (8 December
2003).
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Figure: Vevine Stamp email to Alexander Yakovlev, Dmitry Dovgopoly, and Christian
Saunders (12 December 2003)
However, notwithstanding this obvious
and well anticipated fact, the Subject
Company based its proposal on a mere 6000
the DPKO from the start.
It was clear from the outset that the Subject Companys
proposal provided pricing for just 6,000 troop
s, whereas ES-KOs proposal provided
. . .
Figure: ES-KO financial proposal for Liberia contract bid (23 October 2003)
The Procurement Service staff, includi
ng Staff Member 1 and Staff Member 4,
failed to obtain fixed warehouse costs for 15,000
troops from the Subject Company. This
occurred even though Staff Member 4 recei
ved a memorandum from Mr. Adams of the
DPKO pointing out that certain proposals lack
ed information with regard to fees and
specified services, which may impact on a viable commercial evaluation.
The
Procurement Services failure to take this
into account effectively allowed the Subject
Company to avoid proper evaluation of its
warehouse costs against those of its
Staff Member 7 interview (10 April 2006);
Staff Member 11 interview (4 April 2006).
The Subject Company Pri
ce Proposal to Liberia contract, Cost
Summary Special Instructions (23
October 2003); ES-KO financial proposal for Liberia contract bid (23 October 2003).
Clemens Adams memorandum to Staff Member 4 (5 November 2003) (containing Technical Evaluation
for RFPS 550).
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invoices to the Procurement Service. Staf
f Member 4 and Staff Member 1 could not
recall what happened afte
Staff Member 1 c
onceded that fixed
costs for increased warehousing for troop stre
ngth of 15,000 should have been clarified
by the Procurement Service with the Subject
Company during the financial evaluation,
and incorporated in the contract.
He added that the Subject Company offered an
unrealistic price and then sought adjustment after the contract award.
This practice
Staff Member 1 could not
recall briefing Staff Member 4
on the issue, but denied agreeing to
an increase in warehouse costs.
Staff Member 1
conceded that UNMILs refusal to pay the
d more due diligence
on the part of the Procurement Service.
After the contract was signed, the S
ubject Company relied on the allegedly
unexpected increase in troop strength to justif
y its request for additional warehouse costs,
stating that its bid was based on 6,000 troops
and its warehouse cost
s therefore were no
Officials within the DPKO and
UNMIL refuted the Subject Companys
assertion, arguing that it was made clear in
the RFPS that troop strength would quickly
increase to 14,500.
The email below demonstrates that officials within UNMIL were
dissatisfied with the Subject Companys reque
st for an increase, and believed that the
Organisation would be rewarding the Subject
Company for its poor
planning. In their
view, the Subject Company would then be allowed an unfair advantage over competing
4. Procurement Task Force, Report
on Staff Member 4 (20 July 2006).
Staff Member 1 interview (27 and 28 June 2006).
Michael Dent letter to Christopher Knight (4 March 2005).
Staff Member 11 interview (4 April 2006); Sta
ff Member 10 interviews (24 February and 1 March
2006); Staff Member 7 interview (10 April 2006) (stating that the Subject Company should have planned
for warehousing to accommodate 15
,000 troops in
two months).
Christopher Knight email to Vevine Stamp (12 February 2005).
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Figure : Christopher Knight email to Vevine Stamp (12 February 2005)
The concerns expressed in Mr. Knights
s email were valid and appropriate.
However, DPKOs and UNMILs objections were overruled and Amendment 1 was
executed. UNMIL and the DPKO were troubl
ed by the decision of the Procurement
Service to authorize increased
warehouse costs for the Subjec
t Company as is evident in
the e-mail below:
Figure: Per Verwohlt email to Christopher Knight (22 April 2005)

that Mr. Yakovlev actively assisted
the Subject Company in securing the contra
ct amendment regarding warehouse costs.
Mr. Yakovlev made a number of false repr
esentations to UNMIL in support of the
Per Verwohlt email to Christopher Knight (22 Apr
il 2004). Per Verwohlt is a DPKO Logistics Officer.
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contract amendment. Although Mr. Yakovlev
sought confirmation of
warehouse costs in
order to present the case before HCC, the in
crease in warehouse costs was in fact never
presented to the HCC.
Further, in response to a Ma
rch 2005 query from UNMIL that
the Subject Company thought Amendment 1
was already approved, Mr. Yakovlev told
the Mission that the Subject Company was in
possession of only a draft of the proposed
amendment, pending confirmation from UNMIL,
and that in fact the amendment was not
However, Mr. Yakovlevs response was fa
lse in so far as he authorized the
increase as early as December 2004, and th
e Subject Company had already executed the
Amendment on 18 February 2005.
According to Staff Member 1, Mr. Yakovlev
effectively side-lined other Procurement
Service staff members from substantive
involvement in the Liberia contract amendment process.
The Liberia contract required UNMIL to
pay the Subject Company for services
rendered within 30 days of the invoice receipt.
However, the contract was amended to
allow for more favourable payment terms for the Subject Company. Amendment 2,
signed by the Subject Company on 28 April
2005 and by the United Nations on 9 June
2005, modified the payment terms to require
90% payment of the entire invoice sum
within seven days of presentation of the invoi
ce, with the balance to be paid within 30
The Subject Company presented a propos
al for changed payment terms to
UNMIL, claiming that it suffered from a ser
ious financial impact as a consequence of
delayed payments.
UNMIL, however, asserted that as of November 2004several
months prior to execution of Amendment 2its payments were timely, and previous
delays were caused in part by the Subject Companys poor performance and
The Subject Company confirmed that
it bore some of the responsibility for
Vevine Stamp email to Christopher Knight (15 February 2005).
Alexander Yakovlev email to Christopher Knight (18 March 2005).
Andy Seiwert email to Alexander Yakovlev (19 January 2005); Amendment 1 to Liberia contract.
Staff Member 1 interview (27 and 28 June 2006).
Liberia contract. The normal te
rms of payment by the United Nations are 30 days (or similarly
discounted payment terms if offered by bidder) upon satisfactory delivery of goods or performance of
services and acceptance thereof by the United Natio
ns. RFP 550, Annex A Terms of Conditions to
Submit Proposal, p. 2 (12 September 2003).
Amendment 2 to Liberia contract (signed by Mr. Seiwert on 28 April 2005 and Mr. Mitsui on behalf of
Christian Saunders on 9 June 2005)
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UNMILs delayed payments.
In early 2005, well before Amendment 2 was signed, the
Subject Company even expressed satisfactio
n with the processing
of payments by
The evidence suggests that the amendment favouring the Subject Company was
supported by the Procurement Service and
endorsed by Mr. Yakovl
ev. On 19 January
2005, just a week after the Subject Company sent
Figure: Andy Seiwert email to Alexander Yakovlev (19 January 2005)
One day after conveying his appreciati
on to Mr. Yakovlev, Mr. Seiwert reported
to Mr. Harris that we received the agreemen
ts for 90% prompt payment, on presentation
Meanwhile, officials within the DPKO solicited comments from other missions
regarding the proposed change in payment terms because such an alteration in practice
had serious implications for all missions.
On 11 February 2005, Mr. Divers informed
Mr. Saunders that missions did not support
the amendment since payments were
Subject Company Representative 2 interview (4 July 2006) (confirming that the Subject Companys
short-fall deliveries and incomplete paperwork co
ntributed to delays in UNMILs payments).
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effected expeditiously and within the contract terms.
Mr. Divers further added that
some missions have expressed concerns that
Ian Divers memo to Christian Saunders (11 February 2005).
Josef Aigelsreiter email to Vevine Stamp (12 July
2005); Staff Member 22 interview (16 March 2006).
Clemens Adams facsimile to Ronnie Stokes (2 August 2005); Staff Member 10 interviews (24 February
and 1 March 2006).
ES-KO Price Proposal Index (23 October 2003).
Staff Member 4 interview (19 June 2006) (acknowledg
ing that failure to consider the discount terms
proposed by ES-KO was a matter of concern).
Staff Member 1 interview (27 and 28 June 2006).
Staff Member 2 interview (27 June 2006).
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Amendment was not presented to the HCC
and consequently the approval of the
. (admitting that he should have been more careful); Frank Eppert routing slip to the Task Force (28
April 2006); Staff Member 10 interviews (24 February
and 1 March 2006) (stating that she considered the
amendment to be a material
change to contract terms).
Amendment 2 to Liberia contract
The Subject Company Pri
ce Proposal to Liberia contract, Cost
Summary Special Instructions (23
October 2003).
The Subject Company Financial Proposal to Liberia contract, Annex A Price List and Ceiling Man
Day rate (CMR), Destination Point: Monrovia, p. 4 (c
ontaining a reference to Code no. 7.04); Financial
Proposal of ES-KO for Supply of Food Rations, Price List and Ceiling Man Day Rate, p. 5 (23 October
2003) (quoting a fixed price of US$5.05 for the same food item).
Liberia contract Statement of Work
, Part II- Specifications for the Supp
ly of Dry and Frozen Food, p.
35 (September 2003).
Staff Member 15 interview (15 March 2006).
.; The Subject Company Invoice no. 329 (Delivery Date 2 April 2004); Subject Company
Representative 7 interview (4 July 2006). Subject
Company Representative 7 st
ated that the Subject
Company relented and delivered Lipton tea in res
ponse to Ms. Eleazars insistence that the Subject
Company comply with the Liberia
contract and deliver Lipton Tea as
specified in the contract.
Id.
Company Representative 7 further remarked that
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According to the Subject Company, the new pric
es were to apply re
commencement of the contract.
No justification for the increase was presented by the
Subject Company, as the contract required.
The increase resulted in an approximate
Procurement Service, objecting to the incr
ease as too excessive and recommending
Amendment 2 to Liberia contract; Tommy Jonsson letter to David McLean (26 August 2004)
(identifying Mr. Jonsson as OIC of Integrated Support Services at UNMIL).
The Subject Company Financial Proposal to Liberi
a contract, Cost Summary Special Instructions
(23 October 2003); Staff Member 8 interviews (1
2 April and 9 May 2006) (stating that it is the
responsibility of the Procurement Service to do mark
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was easier with signatures than Staff Member
4 who was more critical and careful,
kovlev manipulated Staff Member 4.
In July 2005, following di
The Subject Company Financial Proposal to Liberia contract, Cost Summary Ceiling Man Day Rate
(23 October 2003).
Liberia contract Statem
ent of Work, sec. 1.5.
Amendment 3 to Liberia contract (signed by Mr. Seiwert on 11 July 2005 and Mr. Mitsui on behalf of
Mr. Saunders on 15 July 2005)
Staff Member 10 email to Alex
ander Yakovlev (3 December 2003).
The Subject Company Financial Proposal to Liberia contract, Cost Summary Ceiling Man Day Rate
(23 October 2003); Staff Member 10 email to Alexan
der Yakovlev (3 December 2003); Staff Member 8
memorandum to Staff Member 4 (19 May 2004).
Staff Member 10 interviews (24 February and 1 March 2006).
ES-KO Financial Proposal for Supply of Food Rations for UNMIL, Cost Summary Delivery to
Sectors and Contingent Locations within Mission Area, (23 October 2003).
Staff Member 6 interview (28 March 2006); Staff
Member 5 interview (31 March 2006); Staff Member
9 interview (11 April 2006).
Staff Member 4 interview (19 June 2006); Clemens Adams memorandum to Staff Member 4 (19 May
2004).
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Staff Member 5 stated that when he received the first invoice from the Subject
Company he was shocked to see that the delivery cost was twice as much as normal.
Staff Member 5 explained that in the cas
e of the Liberia contract, delivery costs
amounted to 20% of the value of goods.
Normally such costs equal just 12%.
In
some instances, UNMIL was required to pay the Subject Company up to US$235 for
deliveries at locations 3 kilometer away.
Although the Subject Company provided th
e Procurement Service with a flat
DMR proposal in March 2004, no immediate decisi
transport costs the Subject Company charged for bread deliveries.
On 22 April 2005,
Staff Member 11 informed UNMIL that its proposal for all-inclusive transport DMR had
been overruled by the Procurement Service.
In June 2005, UNMIL urged the United
. . .
. . .
Figure : Christopher Knight email to Vevine Stamp (16 June 2006)
Staff Member 5 interview (31 March 2006).
Staff Member 15 (15 March 2006); Week 5-8 Bread Deliveries for Requisition period 30 January 2004
28 February 2004.
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Subsequently, the Procurement Servi
ce, the DPKO and the Subject Company
agreed to negotiate a DMR to address the problem of transportation charges.
While
the DPKO, in conjunction with the Procurem
ent Service, calculated a DMR of 67 cents
per man per day, the Subject Company pr
oposed 63 cents based on actual costs
incurred, and UNMIL cal
culated transport costs at a mere 22 cents.
The Subject
Companys proposal was nevertheless accepted by
the Procurement Service as fair, and,
under Amendment 3, the Subject Company wa
s paid an amount of over US$2 million,
covering a period of 1
January to 14 July 2005.
This included an additional charge for
bread deliveries, invo
iced by the Subject Company at
an amount of approximately
US$1.5 million.
As stated by Staff Member 9 a
nd Staff Member 7, the bread delivery
costs should have been an integral part
of the transportation costs and not charged
Staff Member 1 commented that delivery
costs were a problem from the start.
He was aware of correspondence and negotia
tions to resolve the problem and was
involved in finding a solution.
The matter was brought to a close by Subject Company
Representative 3 and Staff Member 4.
Similarly, Staff Member 4 could not e
xplain why the issue was not addressed
from the start as UNMIL had requested.
According to Staff Member 4, he was not
involved with the calculations, and the
Procurement Service relied on the DPKOs
calculations.
Staff Member 4 did not consider negotiating with the Subject Company
as essential as the United Nati
ons should have a fair relatio
nship with the Supplier, and
in Staff Member 4 view, a DMR of 63 cents
seemed reasonable compared with the 67
cent figure estimated by the DPKO.
As was the case with Amendment 2, Staff Member 2 signed Amendment 3
without a presentation to the HCC even though
he admitted that it constituted a material
Clemens Adams to Ronnie Stokes (20 July 2005).
DPKO, Transport Costs of Bread Deliveries (u
ndated); UNMIL, Transportation Costs of Bread
Deliveries (undated); Staff Member 9 interview (1
1 April 2006); Staff Member 17 interview (13 March
2006) (stating that UNMILs calculations of CMR of 22
cents based on real delivery costs, were rejected
by the Procurement Service and that UNMIL did not ag
ree with the DPKOs cost
calculation of 67 cents);
Staff Member 12 interview (14 March 2006); Staff Member 9 interview (11 April 2006) (stating that
UNMILs figure was too general and in the end it was decided to accept 63 cents); Ian Divers facsimile to
Ronnie Stokes (29 August 2005) (confirming that UNMILs proposal of 50 cents was rejected).
Ronnie Stokes facsimile to J.P. Mo
rgan Chase Bank (31 August 2005).
The Subject Company Invoice (7 June 2005).
Staff Member 9 interview (11 April 2006);
Staff Member 7 interview (10 April 2006).
Staff Member 1 interview (27 and 28 June 2006).
.; Subject Company Representativ
e 3 statement (23 January 2006).
Staff Member 4 interview (19 June 2006) (further st
ating that they failed to address the issue sooner,
probably because they were
overworked or because of
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change to the contract.
Staff Member 2 expressed re
Amendment 3 to Liberia contract; Frank Eppert routing slip to the Task Force (28 April 2006); Contract
Summary (4 August 2005); Staff Member 2 interview (27 June 2006).
Josef Aigelsreiter email to Vevine
Stamp (20 July 2005); Ian Divers facsimile to Ronnie Stokes (29
August 2005) (the Subject Company agreed to reduce thei
r initial offer to 56 cents
with effect from 15 July
2005).
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According to Subject Company Representative 2, [Mr.] Harris and
[Mr.] Seiwert would enforce deliverance of non-
compliant food and use Seiwert to pacify
In addition, the Subject Company offices in Liberia were understaffed
and lacked mechanical handling.
However, according to Subject Company
Representative 2, knowing that inspection of
its performance was im
minent, the Subject
Company made necessary preparations and the audit went well.
The July 2004 inspection of
the Subject Companys performance carried out by
SGS concluded that if current practices ar
e maintained and continue to improve, the
Contractor will be able to perform operations
in conformity with the Performance Level
Disappointingly, however, the Subj
ect Companys performance slipped
Figure : Evaluation of Contractors Perfor
mance for Consumption Periods 30 January
Subject Company Representative 7 interview (4 July 2006); Subject Company Representative 2
interview (4 July 2006); Michael Dent email to Andy
Seiwert (26 November 2004) (stating in reference to
the ongoing sensitivity of the Liberia contract that o
ur frustrations with the system and the previous
failures must on occasio
ns show through).
Subject Company Representative 2 interview (4 July 2006).
Subject Company Representative 7 interview (4 July 2006).
Subject Company Representative 2 interview (4 July 2006).
SGS Report, p. 33.
UNMIL, Evaluation of Contractors Performance for the Consumption Periods 30 January 2004 to 4
November 2004
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Staff Member 9 described the Subject Co
mpanys performance as messy, and
sufficiently deficient to have triggered
the issuance of a Notice of Cure by the
Procurement Service.
However, the Procurement Service was influenced by the
Subject Companys allegations against the DPKO staff.
Staff Member 8 stated that the
DPKO was put on the defensive by both th
e Subject Company and the Procurement
Service, specifically Mr. Yakovlev, who felt
that the DPKO was criticizing the Subject
Company and not adequately recognizi
ng the Subject Companys performance.
Staff
Member 4 supported Mr. Yakovlevs assessment in this regard.
Staff Member 8
further stated that Staff Memb
er 1 seemed to have sided with Mr. Yakovlev, who in Staff
Member 8s view never allowed an
ybody to properly supervise him.
In Staff Member
8s view, Mr. Yakovlev was extremely intel
ligent individual capable of effectively
The Task Force concludes that there is merit to the allegation that the Liberia
contract was drafted in an
ambiguous way, allowing for the effort to recoup sums of
money through subsequent amendments and la
ter charges. The Task Force further
concludes that Mr. Yakovlev
actively assisted in the execu
tion of the Subject Companys
scheme by purposefully favouring the S
ubject Company during the negotiation and
contract drafting process, contrary to the
interests of the Organi
sation. Mr. Yakovlevs
actions were carried out in the absenceif
Staff Member 9 interview (11 April 2006).
Staff Member 8 interviews (12 April and 9 May 2006).
.; Staff Member 1 interview (27 and 28 June 2006) (stating that he at all times had an excellent
relationship with the Subject Company); Staff Member 4 interview (19 June 2006) (stating that he did not
have a relationship with the Subject Company, but believed in being polite and working in a partnership
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The Task Force finds that the procuremen
t exercises held in connection with the
the process severely undermined by the nefa
rious actions of officials of the Subject
Company, IHC, and Mr. Yakovlev, the Unit
ed Nations Procurement Officer. The
Subject Company, through the collective effort of
a number of its officials, and with the
assistance of a procurement officer within
the Organisation, fr
audulently secured and
obtained sensitive and confidential United Nati
ons documents and financial information
and further disseminated confidential United
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information obtained by the Subject Company,
IHC, and Mr. Testa
were provided to
them by Mr. Yakovlev, the procurement officer
who was entrusted with the possession of
luable United Nations contracts through
fraudulent means, the Subject Company, and the
officials who participated in this effort
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identified herein, committed criminal acts. The Subject Company also violated, and
caused to be violated, United Nations pr
ocurement rules which prohibit the United
Nations vendors from engaging in corrupt prac
tices during the procurement process. The
conduct of the Subject Company caused financia
l loss to the Organisation in excess of
The Task Force concludes that by so
liciting, receiving, and exchanging a
significant number of conf
idential United Nations documents, IHC and the Subject
Company acted in an improper and unlawfu
l manner, and corrupted the procurement
exercise and the integrity of the procurement process.
IHC and Mr. Testa further compromised th
e integrity of the
procurement process
by engaging in a joint busines
s venture with Mr. Yakovlev.
This relationship existed
while IHC was acting as a United Nations contra
ctor and also an agent for a number of
United Nations vendors at a time when Mr. Yakovlev was serving as a United Nations
procurement officer and supervising procur
ement exercises when IHC represented a
vendor participating in a proc
urement exercise. During
this time, IHC provided Mr.
The Task Force concludes that by favouring the Subject Company in the
procurement process, and by committing the ac
ts described above, Mr. Yakovlev violated
the Staff Regulations 1.2(b) and 1.2(e), as we
ll as Procurement Manua
l Sections 4.2(1),
in that he failed to act in the best intere
sts of the Organisation, and failed to uphold the
At the present time, the Task Force has not identified evidence of payments to Mr.
Yakovlev by either IHC or the Subject Comp
any for the information provided to them.
However, without full ability to subpoena an
d obtain all relevant
financial records, and
the fact that IHC refused to disclose its relevant bank account records, the Task Force
cannot reach a conclusive view on this issue.
The Task Force concludes that Staff Member 4 and Staff Member 1 did not
exercise proper care in the execution of the
Liberia contract, placing
the Organisation at
Liberia contract, arts. 18.1, 18.2, 27, and 34.2; Eritr
ea contract, arts. 18.1, 18.2, 25, and 34.2; See, e.g.,
2006 Procurement Manual, secs. 4.3(2)(a) and 4.3(2)
(c); 2004 Procurement Manual, sec. 4.2.5(2)(iii).
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financial risk. Further, St
aff Member 4 and Staff Member
1 did not properly supervise
Mr. Yakovlev, a shortcoming that contributed
to the Subject Comp
achieving these contracts to the
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The Task Force recommends that appropriate
action be taken with regard to Staff
Member 1s failure to exercise proper care in
respect to the evalua
tion of the food rations
ea, and the Democratic Republic
The Task Force recommends that appropriate
action be taken with regard to Staff
Member 2s failure to exercise proper care in
respect to the evalua
tion of the food rations
ea, and the Democratic Republic
The Task Force recommends that appropriate
action be taken with regard to Staff
Member 4s failure to exercise proper care in
respect to the evalua
the food rations contracts for Liberia, Eritre
a and the Democratic Republic of the Congo,
ll management of the Procurement Section
at the time. In that regar
d, this Report supplements the
Task Forces Report on Staff
Member 4 dated 20 July 2006, and recommends that the 20 July 2006 Report on Staff
t should be made available to
the Administrative Law Unit of the Offi
ce of the Human Resources Management.
Procurement Task Force, Report on
Staff Member 4 (20 July 2006).
OIOS
UBJECT
AND
EDACTED AND
TRICTLY
ONFIDENTIAL
____________________________________________________________________________________________________________
OIOS
UBJECT
AND
EDACTED AND
TRICTLY
ONFIDENTIAL
____________________________________________________________________________________________________________

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