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As IMF Chief Strauss-Kahn Is Arrested, Denials of Rule-breaking Recalled, Immunity & Air France Arrangement Questioned

By Matthew Russell Lee

UNITED NATIONS, May 15 -- With Dominique Strauss-Kahn of the International Monetary Fund having been detained and then this morning arrested for sexual assault allegedly committed in the Sofitel near Times Square, attention has turned to the IMF's failure to discipline him for what its Executive Board called a “serious lapse of judgment” in 2008.

  In this case, IMF spokesman William Murray has been quoted that the IMF “has not immediate comment” on the arrest or charges.

  IMF staff, too, have been defensive about Strauss-Kahn and his compliance with rules. Inner City Press covers the IMF as well as the wider United Nations, and on March 17 Inner City Press asked the IMF to respond to what sources described as a pattern in which “DSK gets friends and family hired by IMF affiliates.”

  At that time, the IMF answer other of Inner City Press' questions, while ignoring this one. Two weeks later, Inner City Press asked:

Sent: Thursday, March 31, 2011 9:58:14 AM
To: IMF, Media Briefing Center

Again, Please state whether Dominique Strauss Kahn has any relatives working in the World Bank or other UN affiliated organizations, and if so why this does not run afoul of anti nepotism rules and principles? From: Matthew Russell Lee Media Outlet: Inner City Press

This time, the question drew a quick answer, albeit a dismissive one, from Mr. Murray:

From: Murray, William [at] mf.org
Date: Thu, Mar 31, 2011 at 10:22 AM
Subject: FW: Question Received (3/31/2011 9:58:14 AM)
To: Matthew Russell Lee [at] InnerCityPress.com

Matthew,

He has no relatives on the staff of the IMF. Given the premise of your question, let me note that the Bank and UN are wholly separate institutions from the IMF, with no fiscal or managerial connections. At the IMF we certainly have nepotism rules, and they have not been violated in any way.

But does the IMF have rules, that they require not be violated?

 It's now reported that Strauss-Kahn “has an arrangement with Air France that allows him to get on any flight and sit in first class.” What kind of arrangement is that? Who paid for it, and how much did they pay? Inner City Press has asked three spokespeople of the IMF, including Mr. Murray. Watch this site.


Strauss-Kahn with Ben Ali of Tunisia: one fell, now will the other?

Footnote:  Inner City Press has been asked how, if Strauss-Kahn as an IMF official has a form of immunity, he could be detained, questioned and arrested by the New York Police Department. (The IMF has a history of citing immunity, for example for Paul Ross in Pakistan, click here.)

  Earlier this year, Inner City Press (un) covered the case of a French diplomat who was arrested for attempted purchase of cocaine and resisting arrest, but was later allowed to flee the country before trial.

  The practice is to allow one such flight - but the person is not supposed to re-enter the United States -- which, in the cocaine case, has in fact happened, which neither the French government nor US State Department have yet explained, click here. Watch this site.

* * *

IMF Promotes Bank Mergers, Says Bigger is Better, Politics & Portugal Dodged

By Matthew Russell Lee

WASHINGTON DC, April 15 -- The International Monetary Fund is unabashedly promoting the takeover of small banks by large ones, claiming that its own work in “Emerging Europe” since the financial meltdown shows that communities are better served by large banks, even if based far away or in other countries.

  IMF European Department Director Antonio Borges told reporters on Friday that Belgium was smart to have pushed Fortis to being acquired by BNP Paribas. He urged more such mergers.

  Inner City Press asked Borges if the IMF proposed any safeguards at all, given that concerns exist that when a local bank is acquired by one based far away, there will be less reinvestment and accountability.

  Borges, while calling this an “interesting question,” bragged that the IMF organized a coordinated effort to get large banks to treat communities, particularly in Emerging Europe, fairly, and that this had worked. See IMF transcript, below.


Borges, invisible hand and safeguards on mergers not shown

  Inner City Press began to ask about attempts to encourage or require reinvestment, for example in the UK -- but moderator Simonetta Nardin said there was no time for follow up questions.

  Meanwhile, Borges took but refused to answer two questions about Portugal, citing an IMF policy against officials working on their own countries, and also claiming that the IMF does not get involved in politics. What -- encouraging bank mergers is not political? Watch this site.

From the IMF's transcript:

Inner City Press: you seem to be saying that bank mergers—small banks being bought by big ones sort of unqualifiedly may be a good thing. In some countries people think that local banks are more accountable, that if you move the assets to a faraway headquarters that there's less responsive. What do you say to that critique and is that something that the IMF takes any account of?

MR. BORGES: you ask a very interesting question, because this is a problem we were faced with over the last few years. In many of the countries of emerging Europe, you find banks that actually are owned by other banks elsewhere and there were concerns that, as there might be problems in the domestic countries of those banks that assets would be pulled out from emerging Europe and they might suffer. And the Fund, the IMF, invested quite a bit of effort to organize a coordinated effort on the part of all these banks to behave in the best possible interests of those economies, and I must say this was quite successful, because as a result, these countries are now recovering very well and their banks are operating well. So, if anything, the experience of emerging Europe demonstrates that having large, solid banks operate in your country may be an important source of stability if things are properly managed.

* * *

World Bank Can't Deal With Libya Rebels, Says Danger Drives It Out of Yemen

By Matthew Russell Lee

WASHINGTON DC, April 14 -- Minutes after Robert Zoellick touted the World Bank's engagement with civil society in the Arab world, Inner City Press asked him if the Bank has had any contacts with the Libyan Transitional National Council based in Benghazi.

  No, Zoellick answered, since its founding in 1944 the World Bank can deal “only with established governments.” He went on to describe World Bank assistance to those fleeing Libya, referring to a program with Bangladesh to get its nationals out and provide then assistance once back in Bangladesh.

But Bangladesh's Permanent Representative to the UN has told Inner City Press that most of his nationals remained trapped in Libya, unlike for example Belgium which immediately flew its 78 citizens out.

Zoellick implied that some part of the $500 million program just announced with Tunisia will help those fleeing Libya to that country. We'll see.

Inner City Press also asked Zoellick about Yemen, whether World Bank programs continue there and what it would take to change that -- that is, if there is a limit to the repression that the World Bank would accept.

Zoellick replied that nearly all of the World Bank's international staff have been removed from the country for safety reasons, although a “resident” remains to work on “the bank [or Bank?] brief” there. He mused that the World Bank likes to watch things, to be ready. But ready for what? Watch this site.


Click for Mar 1, '11 BloggingHeads.tv re Libya, Sri Lanka, UN Corruption

 Click here for an Inner City Press YouTube channel video, mostly UN Headquarters footage, about civilian deaths in Sri Lanka.

Click here for Inner City Press' March 27 UN debate

Click here for Inner City Press March 12 UN (and AIG bailout) debate

Click here for Inner City Press' Feb 26 UN debate

Click here for Feb. 12 debate on Sri Lanka http://bloggingheads.tv/diavlogs/17772?in=11:33&out=32:56

Click here for Inner City Press' Jan. 16, 2009 debate about Gaza

Click here for Inner City Press' review-of-2008 UN Top Ten debate

Click here for Inner City Press' December 24 debate on UN budget, Niger

Click here from Inner City Press' December 12 debate on UN double standards

Click here for Inner City Press' November 25 debate on Somalia, politics

and this October 17 debate, on Security Council and Obama and the UN.

* * *

These reports are usually also available through Google News and on Lexis-Nexis.

Click here for a Reuters AlertNet piece by this correspondent about Uganda's Lord's Resistance Army. Click here for an earlier Reuters AlertNet piece about the Somali National Reconciliation Congress, and the UN's $200,000 contribution from an undefined trust fund.  Video Analysis here

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