Wolfowitz Blames the Bank

By Peter S. Goodman
Washington Post Staff Writer
Friday, May 4, 2007

World Bank President Paul D. Wolfowitz, struggling to preserve his job in the face of an ethics controversy, yesterday urged a committee investigating his conduct to clear him of wrongdoing and disregard accounts that he has not been truthful.

In a 10-page statement addressed to the chairman of the investigating committee, Wolfowitz reiterated his assertion that he was merely following the instructions of the bank's ethics committee when he arranged a job transfer and substantial pay raise for his companion, Shaha Riza, shortly after arriving at the bank.

But in a new characterization, Wolfowitz asserted that the ethics dispute, far from an indictment of him personally, amounts to a shared institutional breakdown. He portrayed the crisis as a misunderstanding -- the product of decent intentions gone awry, combined with vague and dubious bank rules.

"While I am prepared to acknowledge that we all acted in good faith at the time and there was perhaps some confusion and miscommunication among us, it is grossly unfair and wrong to suggest that I intended to mislead anyone, and I urge the committee to reject the allegation that I lack credibility," Wolfowitz wrote. "Rather than attempt to adjudicate between our conflicting interpretations of the events that occurred here, the board should recognize that this situation is the product of ambiguous bank rules and unclear governance mechanisms."

Wolfowitz's latest statement was submitted to the committee in rebuttal to those made this week by the bank's former general counsel, Roberto DaƱino, and its former ethics committee chairman, Ad Melkert. In testimony, they contradicted Wolfowitz's defense, asserting that he personally directed the raise for his companion without informing the ethics panel of the details.

Their portrayals are the center of a report being drafted by the investigating committee that will conclude Wolfowitz breached his contract, broke ethics rules and undermined the credibility of the bank, according to three senior bank officials who spoke on condition they not be named because they are not authorized to speak for the board.

The committee is expected to complete its report today, then submit it to the bank's governing board, which will deliberate next week and consider what action to take -- perhaps censuring Wolfowitz, asking for his resignation or voting to fire him.

Some bank officials noted that Wolfowitz's rebuttal amounts to the fourth strategic tack he has adopted since the scandal broke last month: After initially denying wrongdoing, he apologized and asked for forgiveness. Then he retained a high-profile lawyer, Robert S. Bennett, returning to the assertion that he is guilty of nothing. Now he is essentially arguing that the case is murky and that blame resides with the institution.

"It's a last-ditch effort to save face," said Beatrice Edwards, international program director at the Government Accountability Project, a bank watchdog group. "There's been a parade of witnesses saying that Wolfowitz knew exactly he was doing, and these people are credible."

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