A senior officer in the Oil-for-Food scheme who banked almost $1 million in bribes was today facing 60 years in prison after becoming the first official to admit his role in the scandal which threatens the highest echelons of the United Nations.

Alexander Yakovlev, a key UN procurement officer, received more than $950,000 in a bank account in Antigua from companies that won more than $79 million in UN business through its largest humanitarian programme.

He was arrested yesterday after the UN agreed to waive his diplomatic immunity. He pleaded guilty to three counts of money laundering, wire fraud and conspiracy that each carry a maximum sentence of 20 years. The guilty plea suggests that Mr Yakovlev could strike a bargain to give information about other UN officials in return for a reduced sentence.

The UN’s inquiry into the Oil-for-Food scandal also concluded in a report published yesterday that the head of the scheme took nearly $150,000 (£84,000) in bribes.

Benon Sevan was accused of receiving the cash for steering Iraqi oil contracts to a firm run by a brother-in-law and a cousin of Boutros Boutros Ghali, the former UN chief.

The charge of outright corruption came in the report by the UN inquiry led by Paul Volcker, the former chairman of the US Federal Reserve. The findings rocked the UN, where officials initially dismissed the Oil-for-Food scandal as a vendetta by right-wing American politicians angered by UN opposition to the war in Iraq.

Mr Volcker’s findings suggest that Saddam Hussein’s government was successful in effectively bribing the head of the Oil-for-Food programme for the entire six years of its existence. The Volcker commission said that Mr Sevan, who had been struggling after losing on the stock market, received $147,184 in cash from December 1998 to January 2002.

The money came from oil sales by a Panama-based company, African Middle East Petroleum (AMEP), which was run by Dr Boutros Ghali’s relatives.

But the company was only able to get the contracts — and pay the kickbacks — because Iraq had allocated the oil to Mr Sevan. The report found that Mr Sevan had conspired with AMEP’s owner, Fakhry Abdelnour, a cousin of Dr Boutros Ghali, and an AMEP officer, Fred Nadler, the brother of Dr Boutros Ghali’s wife, Leia.

It concluded that "Mr Sevan corruptly benefited from his request and receipt of Iraqi oil allocations and that Mr Nadler and Mr Abdelnour financially benefited from and assisted in Mr Sevan’s corrupt activity".

The report did not mention Dr Boutros Ghali but said there was no evidence that other members of the Sevan or Nadler familes "acted in a way that was wrong or improper". According to the report, AMEP bought and resold 7.3 million barrels of Iraqi oil allocated to Mr Sevan for a $1.5 million profit.

About $580,000 was then transferred from AMEP to Mr Nadler’s account under the name of Caisor Services in Geneva. Nearly $150,000 was deposited in cash in the Sevans’ New York bank accounts.

According to one witness, Mr Nadler allegedly told his money managers that, in the words of the report, "there was no possibility that anybody would prove that he had given any money to Mr Sevan as it was all cash withdrawals — there was no paper trail".

Mr Sevan denies any wrongdoing and said that the cash deposits came from an aunt in his native Cyprus and that he declared them on his UN tax returns, a claim the Volcker inquiry rejects. Now in Cyprus, Mr Sevan resigned on Sunday from the $1-a-year retainer he has received from the UN since retiring in 2003. Mr Volcker said that Mr Sevan was the subject of a criminal inquiry and that he should be stripped of diplomatic immunity.

Separately, the Volcker committee also found that Mr Yakovlev had solicited a bribe from a company seeking an oil-inspection contract in Iraq, although it is not clear the money was paid. Mr Yakovlev, a Russian, resigned after it emerged that he had got his son a job with a UN contractor.

Mr Yakovlev is the first UN official to plead guilty to fraud in the Oil-For-Food scandal because one of the US charges against him relates to providing inside information to a company seeking a UN oil-inspection contract in Iraq.

A report is due next month on the business dealings of Kojo Annan, the son of Kofi Annan, the UN Secretary-General.

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