Wolfowitz's intervention broke bank rules, panel finds

Published May 8, 2007

WASHINGTON - A special panel has found that World Bank president Paul Wolfowitz broke bank rules in arranging a pay package and promotion for his girlfriend, the Associated Press reported Monday, citing a person familiar with the report.

Wolfowitz was presented with the findings by the special bank panel investigating his handling of the 2005 promotion and pay raise of bank employee Shaha Riza.

The person familiar with the findings confirmed violations were cited but did not provide details. The person spoke to the Associated Press on the condition of anonymity because the report has not been released.

World Bank officials were bracing for a finding that Wolfowitz may have breached conflict of interest rules in arranging the pay package for Riza.

The controversy over Riza's pay package has spurred calls for Wolfowitz' resignation. He is fighting to hold on to his job.

The special panel, which has been meeting over the last several weeks, met again Monday and sent a report of its findings to Wolfowitz, according to people familiar with the inquiry. Wolfowitz will be given a chance to weigh in before the report is forwarded to the bank's board.

Wolfowitz' attorney, Robert Bennett, said his client was being given 48 hours to respond, which he called "unreasonable and unfair." He said they had requested to have until next Monday.

White House spokesman Tony Fratto offered a fresh endorsement of Wolfowitz on Monday. "The president continues to strongly support Paul Wolfowitz and believes he should continue to lead the World Bank, " Fratto said, adding, "we have not seen the committee's report."

By tradition, the World Bank has been run by an American. President Bush tapped Wolfowitz, a move that was approved by the bank's board.

The developments come as a top adviser to Wolfowitz, Kevin Kellems, said he is leaving the institution. "Given the current environment ... it is very difficult to be effective in helping to advance the mission of the institution, " Kellems said.