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UN Belatedly Admits It Still Gets Satyam Services Through ICC, Cover-Up Alleged

Byline: Matthew Russell Lee of Inner City Press at the UN: News Analysis

UNITED NATIONS, March 5 -- The UN on Thursday acknowledged that it still receives services from Satyam, the so-called Indian Enron, through the UN-affiliated International Computing Center. On Tuesday, UN Associate Spokesman Farhan Haq responded to Inner City Press' question on this point with a statement that "we were informed by our Procurement Division that Satyam was suspended in January... A communication has been sent to the UN procurement system (including peacekeeping missions) and the procurement extranet site is now updated."

    Inner City Press asked Haq if the UN Procurement Division covered the UN-affiliated ICC, and Haq indicated that it did. He then called Inner City Press' questions "obnoxious." Later on Tuesday, a more senior UN official told Inner City Press that the UN does, in fact, continue to receive services from Satyam through the ICC, which is not covered by the UN Procurement Division. After more inquiries, on Thursday Haq's Office sent Inner City Press the following:

Subj: your question on computing/Satyam
From: unspokesperson-donotreply [at] un.org
To: Inner City Press
Sent: 3/5/2009 11:12:15 A.M. Eastern Standard Time

We have received further information concerning links with Satyam, concerning the International Computing Centre (ICC), whose procurement activities are done independently of the UN Secretariat.

The UN Secretariat has several projects underway with the International Computing Centre (ICC) that involve Satyam. Satyam is engaged as a sub-contractor of ICC. The Secretariat does not have any direct contract with Satyam for these projects. In light of recent developments concerning Satyam, we asked ICC to find a replacement for Satyam as soon as possible.

  While we will continue to cover if and when this replacement actually happens, the series of events, including the inaccurate answer that was only corrected after questioning deemed "obnoxious," has led two well-placed sources with intimate knowledge of the UN system's procurement activities to call this either a Spokesperson's Office cover-up, or intentionally incorrect answers by the UN Procurement Division.

  The question arises, and is being pursued, who in the UN Procurement Division gave the incorrect information about the ICC and Satyam, and on whose orders. Watch this site.

   Back in January, the UN told Inner City Press that "Satyam has been suspended from the UN Secretariat vendor database. The information has been communicated to the UN procurement system and the UN Global Marketplace. Ongoing contracts with Satyam are currently under assessment."

  At the noon briefing on March 3, Inner City Press asked Ms. Okabe, does the UN receive computer services through the International Computing Center from Satyam, the so-called Indian Enron? Ms. Okabe said that while she didn't "have the guidance" with her, an answer had been sent to Inner City Press earlier in the day. Video here, from Minute 12:59.

UN's Ban and computers: Satyam through the UN's ICC not shown

   Haq's March 3 response to Inner City Press' questions about the UN-affiliated ICC and Satyam also stated

UNDP's most recent contract with Satyam was signed in December 2007 for consulting work on its information systems. The contract went through the normal competitive process. This contract was set to expire after one year (November 30 2008).  In October of 2008, media articles appeared on irregularities in Satyam's work with the World Bank.   UNDP approached the World Bank and Satyam proactively to find out the details of the alleged irregularities.  As a result of these conversations, UNDP took a decision not to renew Satyam's contract and began to evaluate the phase out while minimizing the risks to our information systems.  UNDP currently has 11 Satyam technical consultants working on its information systems.

UNDP does not manage the UN Global Marketplace (UNGM), it is managed by UNOPS.  We are in the process of having the misleading or erroneous information contained on IAPWG's site removed as it unfortunately creates this perception.  UNDP can flag vendors in the UNGM should it experience problems and is currently in the process of doing so.  It is worth noting that UNDP's review of the published World Bank list of barred vendors did not turn up Satyam's name, in spite of such references in the media to Satyam having been debarred.  

In light of the most recent information regarding Satyam, UNDP, like many other companies and organizations, will not be continuing its business with them and is currently looking for a replacement.

   So while UNDP like the ICC has been asked to is "currently looking for a replacement," sources raise the following additional questions: what is the visa status of the Satyam employees currently working for UNDP (and the UN and ICC)? Does UNDP (and the ICC) pay individuals for their services, or pay Satyam?  Developing...

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Watch this site, and this Oct. 2 debate, on UN, bailout, MDGs

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