WASHINGTON - A World Bank committee investigating accusations of nepotism against bank president Paul Wolfowitz has found he "clearly" breached rules, a European source said Tuesday.
"The committee concluded clearly that Mr. Wolfowitz did not respect the rules," the source, with knowledge of the situation and speaking on condition of anonymity, told AFP.
Wolfowitz, whose two years at the helm of the bank charged with fighting global poverty have been marked by controversy, is fighting allegations that he improperly orchestrated a substantial promotion and pay raise for his companion, Shaha Riza, a fellow bank employee.
US President George W. Bush's administration Tuesday renewed its support for Wolfowitz, but said it would stay out of any discussions on his future at the institution.
"The conversations right now are not between the administration and the World Bank, they're between Mr. Wolfowitz and the World Bank and I think it's proper to let the process work itself out rather than trying to insinuate ourselves into it," White House spokesman Tony Snow said.
"We still support president Wolfowitz," he added, but dodged a question as to whether Bush was still insisting that Wolfowitz, a former Pentagon deputy and an architect of the Iraq war, stay at the head of the development lender.
"These are conversations really that have been conducted at the World Bank. The president is not getting directly, personally involved to my knowledge."
The scandal has rocked the 185-country multilateral institution for nearly a month and threatens to undermine the bank's six-decade-old mission to fight global poverty.
The World Bank's board of directors, dominated by the United States, Japan and European powers, appointed a small investigatory panel to examine the accusations against Wolfowitz, who has been widely criticized by bank employees for favoritism in bringing in senior aides from the Bush administration who lacked development experience when he joined the bank in June 2005.
According to documents released by the bank, Wolfowitz personally ordered a pay package worth nearly 200,000 dollars for Riza, a bank staffer in the communications service.
The package included an immediate 60,000-dollar pay increase and guaranteed promotions, eventually taking her up to the highest career rank of vice president, once she returned from an outside assignment to the US government.
Riza stayed on the World Bank payroll during her external assignment from its Middle East arm to the State Department, which was designed to prevent conflicts of interest after Wolfowitz took charge of the bank in June 2005.
The ethics investigatory committee completed its work late last week and has transmitted its findings to Wolfowitz, who was supposed to respond by Tuesday, the European source said.
"The report was communicated to Mr. Wolfowitz Sunday night. He has until today to respond. The two documents then will be transmitted to the directors," the source said.
No detail, however, was provided about when the directors would meet to discuss the panel's findings and Wolfowitz's response.
"This discussion is not on the agenda of Tuesday's board meeting," the source said.
US officials complained Tuesday that public attacks on the former US defense official were undermining the bank's work.
"The focus here really should be on poverty alleviation and the core mission of the bank," State Department spokesman Sean McCormack said when asked about concerns that the controversy could discourage governments from donating badly needed funds to the institution.
"The issue of development and poverty alleviation around the world is too important to allow us to be distracted by these proceedings that are ongoing internally to the World Bank," McCormack said.
"Everybody's focus should be on how best to do this and let the World Bank internal proceeses play out as they will," he said.
05/08/2007 15:43 GMT