Sarah Baxter in Washington
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THE British woman at the centre of a scandal that could force Paul Wolfowitz to resign as president of the World Bank has said that she is a victim of the controversy and that she was forced to change jobs against her wishes because of their romantic relationship.
Shaha Ali Riza, a bank official who was moved to the State Department with a large pay rise after Wolfowitz’s appointment, revealed her distress in a memo to an investigating committee.
“I have now been victimised for agreeing to an arrangement that I have objected to and that I did not believe from the outset was in my best interest,” she wrote.
Riza, a Libyan-born British citizen who was educated at Oxford, had worked for the World Bank for seven years when Wolfowitz became president. She had been his girlfriend for several years but bank rules forbid office romances. When she was transferred to the State Department she was awarded a pay increase of more than $60,000 to $193,590, more than the salary of Condoleezza Rice, the secretary of state.
Riza has told friends she is being used by employees of the bank to get at Wolfowitz, a former US deputy defence secretary who was one of the architects of the Iraq war.
In her memo to the bank’s committee, Riza complained about “vicious public attacks” and “personal pain and stress that my son and I have been subjected to, and the damage that this whole episode has caused me professionally, personally and psychologically”.
Wolfowitz’s hold on his job was slipping this weekend as finance and development ministers gathered in Washington for the World Bank and International Monetary Fund’s spring meetings. The bank’s 24 executive directors are expected to meet again today to decide whether to reprimand him or demand his resignation.
Hank Paulson, the US treasury secretary, offered only tepid support for Wolfowitz, saying he would not comment on what the board should decide. “This should not be read as any lessening of the United States’ support for Paul Wolfowitz,” he said. Pressed to endorse Wolfowitz’s continuing tenure he added: “I said what I said.”
Some ministers believe that Wolfowitz can no longer command the moral authority to demand an end to nepotism in the financial affairs of developing countries that he has criticised for corruption and poor governance.
Heidemarie Wieczorek-Zeul, the German development minister, said he should consider his position: “He has to decide for himself whether, in regard to this mistake, he can credibly fulfil his duties.”
One US administration official suggested that he might resign: “He could decide that his relationship with the staff and the board is so soured that he doesn’t have the trust he needs to go forward.”
Documents released by the bank last week revealed that Wolfowitz, 63, was directly involved in negotiating his girlfriend’s job transfer and pay package.
Two months after arriving at the World Bank he wrote a memo to the bank’s vice-president of human resources with the instruction: “You should accept immediately her offer to be detailed to an outside institution of her choosing, while retaining bank salary and benefits.”
Riza went to work with Elizabeth Cheney, the vice-president’s daughter, at the State Department, fuelling accusations of favouritism.
It is an uncomfortable charge for Wolfowitz, who arrived at the bank determined to root out graft involving loans to developing nations.
He declared that the bank’s mission was “to send children to school, to help mothers to be healthier, to provide jobs for poor people, not to have resources siphoned off”.
Contracts worth hundreds of millions of dollars were suspended, leading some officials to accuse him of overstretching the mark.
Wolfowitz said last week that he had been wrong to influence decisions about Riza’s job. “I made a mistake, for which I am sorry,” he said.
Employees of the bank chanted for Wolfowitz to “resign, resign, resign” when he appeared before a meeting of the staff association. But some employees said they were embarrassed by the student-like demonstration.
David Frum, a former speechwriter for President George W Bush, said Wolfowitz might have become involved in the details of Riza’s job transfer because he feared that she would be adversely affected by her relationship with him.
Wolfowitz is the latest neoconservative to run into trouble after “Scooter” Libby, Dick Cheney’s former aide, was found guilty of perjury.
Michael O’Hanlon, a foreign policy expert at the Brookings Institution in Washington, said: “It was amazing that the Bush administration would put a guy who was a symbol of American arrogance in charge of a multilateral institution.”
O’Hanlon recalled that Robert McNamara, the defence secretary during the Vietnam war, had also become president of the World Bank. “Why should the reward for losing a war be getting the leadership of the bank?” he asked. Wolfowitz may be reflecting this weekend that it has not proved to be much of a reward.
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