World and Nation

World Bank Comm. Finds That Wolfowitz Violated Ethics, Rules

A World Bank committee charged on Monday that Paul D. Wolfowitz violated ethical and governance rules as bank president by showing favoritism to his companion in 2005. In response, the Bush administration mounted a last-ditch global campaign to save Wolfowitz from being ousted from office. On a day of rapid developments that intensified the furor over Wolfowitz at the bank, in the Bush administration, and at government ministries around the world, the special committee that has investigated his conduct in the last month issued a scathing set of conclusions that seemed certain to hasten a decision on Wolfowitz's fate.

The report charged that Wolfowitz broke bank rules and the ethical obligations in his contract, and that he tried to hide the salary and promotion package awarded to Shaha Ali Riza, his companion and a bank employee, from top legal and ethical officials in the months after he became bank president in 2005.

Summing up, the report said that Wolfowitz's behavior "placed himself, in a matter in which he had a personal interest, in opposition to the established legal framework of the institution he had been selected to head and in a conflict-of-interest situation even in the domain where he had proposed to recuse himself."

The committee, consisting of seven of the 24 members of the World Bank's board, did not make a recommendation about whether to remove or reprimand Wolfowitz, as it had planned to do. Instead, it called on the board to make its own decision in light of its conclusions.

But bank officials familiar with the mood of the board said it would have little choice but to punish Wolfowitz.

In the face of that storm, Treasury Secretary Henry M. Paulson Jr. was on the telephone during the day with counterparts in at least half a dozen countries to tell them that "these facts do not rise to the level of warranting dismissal," according to a senior Treasury official.

Until Monday, Paulson's conversations with finance and development officials, many of whom have told him they favor Wolfowitz's ouster, have been confined to urging that there be no "rush to judgment."

Vice President Cheney said in an interview with Fox News in Jordan before the special committee's findings were released that Wolfowitz was "one of the most able public servants I've ever known" and that "he's a very good president of the World Bank, and I hope he will be able to continue."

White House and Republican officials said that from the beginning, President Bush has seen the controversy over Wolfowitz as a proxy fight waged by liberals at the bank opposed to Bush's policies, and that they would not toss him or Attorney General Alberto R. Gonzales overboard just because administration opponents want them out.

Beyond pride and politics, administration officials said that having someone at the bank who is viewed as committed to combating corruption and waste in aid programs, and who commands the confidence of Republicans and conservatives, helps guarantee congressional funding for the bank's projects.