A report by a special committee of The World Bank Group, released Monday, questions Gibson, Dunn & Crutcher’s review of World Bank president Paul Wolfowitz’s transfer of his girlfriend, Shaha Riza, to a high-paying job at the U.S. Department of State. That transfer has mushroomed into a scandal threatening to cost Wolfowitz his job.
Documents released by the bank show that Wolfowitz asked Gibson to review the deal in the summer of 2005. A Gibson, Dunn team, including Theodore Olson and Eugene Scalia, concluded that the contract was “a reasonable resolution of the perceived underlying conflict of interest.” But on May 15 a special committee of the bank charged with investigating the scandal concluded that the limited and after-the-fact review by Gibson “is squarely at odds with the high degree of . . . concern for the interests of” the World Bank, which is required by the institution’s rules. Gibson, Dunn declined to comment.
Wolfowitz acknowledged his relationship with Riza, a senior communications officer at the bank, before he arrived in June 2005, according to bank documents. World Bank rules state that there is a conflict of interest whenever there is a sexual relationship between a staff member and a supervisor.
Wolfowitz proposed to resolve the conflict by recusing himself from personnel matters relating to Riza. The bank’s ethics committee rejected that proposal as insufficient and suggested that Riza be transferred. The committee then took the unusual step of asking Wolfowitz to help implement the transfer.
Three days later, Wolfowitz sent a human resources executive a letter dictating the terms of Riza’s reassignment: Riza would be transferred to an “outside institution of her choosing”; she would be given a promotion; she would receive an immediate salary increase of almost $50,000 and annual 8 percent increases thereafter; and she would be promoted again upon her return to the bank at the end of Wolfowitz’s term. The next day Wolfowitz sent a memo to the ethics committee saying that the situation had been resolved.