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World Bank Directors Reject Request From Wolfowitz's Attorney By William McQuillen
April 25 (Bloomberg)
-- World Bank directors rejected a request by President Paul Wolfowitz's lawyer to make a presentation when the lender's chief appears at a hearing to defend his decision to give his companion a pay increase.
A committee of the bank's board yesterday told Wolfowitz to appear before them today, also turning down a request for more time to prepare, said Robert Bennett, an attorney for Wolfowitz.
``This is outrageous conduct on the part of this institution,'' Bennett said in an interview last night. ``It's grossly unfair to Mr. Wolfowitz. To the world, it gives the appearance that he is being railroaded.''
Wolfowitz, who has rebuffed staff demands that he resign, is stepping up efforts to hold on to his job. He sent an e-mail to employees yesterday promising to address their concerns as he reorganizes management at the poverty-fighting institution.
A group of the bank's executive directors have been meeting to make recommendations on Wolfowitz's future to the full 24- member board. The directors have not provided a timeframe for their work. Wolfowitz, 63, has said he would ``accept any remedies'' proposed by the board.
Bennett said Wolfowitz initially offered to recuse himself from dealings with his companion, Shaha Riza, a request that was rejected by the board's ethics committee. His decision to promote Riza and assign her to the State Department was made with the approval of the committee, Bennett said.
Patience Sought
In his e-mail to staffers, Wolfowitz asked for ``continued patience'' while the board conducts its probe. He said he is looking for ways to better consult with bank vice presidents on how to reorganize his office and the role of his senior management team.
Wolfowitz, the former U.S. deputy defense secretary, has ruffled feathers among staff members with appointments of advisers recruited from the Bush administration. Kevin Kellems, his strategy director, is a former spokesman for U.S. Vice President Dick Cheney. Robin Cleveland, counselor to the president, was an associate director of the White House Office of Management and Budget.
Wolfowitz was selected to head the World Bank by President George W. Bush, in keeping with a practice that dates to the agency's founding in 1944. In the defense department, he was one of the key planners of the Iraq war, a role that has aroused ire among bank employees.
U.S. Democratic senators criticized Wolfowitz yesterday, expressing concern that he has damaged the institution.
`Sweetheart Deals'
``With all the poverty and misery in the world, the president of the World Bank spends his time getting sweetheart deals,'' Barbara Mikulski, a Maryland Democrat on the Senate's foreign operations subcommittee, said in an interview in Washington. ``I think it's very, very, very troubling.''
The Bush administration has shown repeated support for Wolfowitz.
``I have a high regard for Paul Wolfowitz,'' Treasury Secretary Henry Paulson told reporters yesterday in Mexico City. He repeated that he backs the ``process'' set up by the bank's board to address Wolfowitz's actions. ``That shouldn't be taken as a lessening of support for Paul Wolfowitz,'' he added.
Paulson was in Mexico for meetings with President Felipe Calderon and Finance Minister Agustin Carstens. He declined to comment on whether he discussed Wolfowitz's future with Carstens.
White House Deputy Press Secretary Dana Perino has said Bush has ``confidence'' in Wolfowitz.
Senator Patrick Leahy, a Vermont Democrat who chairs the foreign operations subcommittee, drew a comparison between Wolfowitz and Attorney General Alberto Gonzales. Both men have received expressions of confidence from Bush.
`Different View'
The ``president has a different view of what he has confidence in than I do,'' Leahy, whose committee oversees funding for the World Bank, said yesterday.
Gonzales has been under fire over the dismissal of eight U.S. attorneys. House and Senate committees are investigating whether the firings were for improper political motives.
Senator John Kerry, the Democratic Party's nominee for president in 2004, last week called on Wolfowitz to resign after he ``cast a cloud'' over the bank.
Three months after becoming president in June 2005, Wolfowitz sent Riza, 52, on assignment to the State Department to comply with rules forbidding one partner from reporting to another. Riza, who stayed on the bank's payroll, received a promotion and a 36 percent pay increase.
European nations including the Netherlands, Luxembourg, Switzerland and France have been critical of the decision.
Seeking Clarification
``The matter must be clarified in full and those that represent the different groups in the World Bank must act accordingly,'' Luxembourg Finance Minister Jean-Claude Juncker said April 20 after chairing a meeting with his euro-region counterparts.
Canadian Finance Minister Jim Flaherty, whose country's vote on the World Bank board also represents Ireland and the Caribbean, called for the board to avoid a rush to judgment.
``We all agree in due process and making sure that the board follows the process and fairly considers all the documents, not just some of the documents, and listens to the arguments that are being presented and then comes to a conclusion,'' Flaherty said in Ottawa yesterday.
Wolfowitz may struggle to isolate the investigation from the bank's work. The controversy overshadowed the semiannual gathering of the bank's 185 member-nations earlier this month and continues to preoccupy executives. A group of seven board members scratched a nine-day trip to Mongolia and the Philippines that was scheduled to start late this month.