UNITED NATIONS – The United Nations fought off criticism yesterday over its reimbursement of Benon Sevan’s legal fees in the oil-for food scandal. The Independent Inquiry Committee led by a former Federal Reserve chairman, Paul Volcker, took an unusual step in challenging a U.N. statement that indicated the reimbursement was done on behalf of those investigating the scandal.

The committee’s spokesman, Michael Holtzman, said the U.N’s rationale is incorrect. The committee did agree to allow Mr. Sevan to be accompanied by a lawyer, he said, but that “was not motivated, as suggested by the U.N.’s statement, by a desire to induce Mr. Sevan to cooperate.” At no time has the committee “proffered an opinion on the payment of Mr. Sevan’s legal costs.”

“We boobed, we got it wrong,” Secretary-General Annan’s chief of staff, Mark Malloch Brown, acknowledged, explaining that the error was made as the result of a hurried effort to address press questions. “You asked, we disclosed,” he said. “There was no effort to cover up.”

More criticism of the handling of Mr. Sevan’s legal expenses yesterday came from the American Mission to the United Nations, which issued a strongly critical statement, as did Iraqi ambassador Samir Sumaidaie. Members of the Security Council sought “further clarifications,” according to a council diplomat.

Despite continued assertions by U.N. spokesmen that no money has yet been paid to Mr. Sevan or his lawyers, the American Mission’s spokesman, Richard Grenell, hinted that some money might have already been paid, and should be returned. “It may be appropriate to cease advancing any additional fees [to Mr. Sevan] and seek the return of fees advanced, if any were disbursed,” Mr. Grenell told The New York Sun.

Spokesman Fred Eckhard was adamant, stating “in clear and unambiguous terms,” that the office of legal affairs has not authorized any payments to Mr. Sevan. Mr. Malloch Brown said that the United Nations is still assessing whether it should stick by an “oral agreement” made to Mr. Sevan in order to ensure his cooperation with the Volcker committee.

Details of the agreement by Mr. Annan to cover legal fees for Mr. Sevan, the central figure in the oil-for-food san dal, were the chief items of interest at Mr. Malloch Brown’s press conference and among U.N. diplomats.

American diplomats were not quick to let the U.N. off the hook. “We are disappointed the arrangement was not made earlier,” Mr. Grenell told the Sun. The U.N. needs to “look hard” at the findings of the Volcker commission, he said.

In Washington, a senior member of the House International Relations Committee, Ileana Ros-Lehtinen, a Republican of Florida, yesterday released a statement denouncing the U.N.’s “wholesale lack of institutional transparency and accountability.” She added that “it is imperative that we closely examine” the $1.2 billion plan to refurbish the U.N. compound and the construction of a 35-story, 900,000-square-foot annex. The plan, and its excessive budget, is also being criticized by New York legislators.

Separately, a scandal at the U.N. involving Mr. Annan’s son Kojo intensified yesterday upon new revelations on meetings between Kofi Annan and top officials of Cotecna, the Swiss based company that paid Kojo Annan up to $300,000.

Mr. Malloch Brown attempted to address concerns on both scandals in the same press conference yesterday, a week before Mr. Volcker’s team is expected to release its findings on the Cotecna issue. Even if Kojo Annan’s motives are questioned, his father remains in the clear according to Mr. Malloch Brown. “That’s going to create a very different situation, but for Kojo, not for the secretary-general,” he said. Mr. Malloch Brown believes that Mr. Volcker’s committee “will clearly vindicate [Kofi Annan].”

He explained that the three meetings that Mr. Annan had with members of the Massey family, the principal owners of Cotecna, began in an innocent “afternoon tea in Davos,” where “a lot of bored important people are milling around.” Mr. Malloch Brown confirmed that another meeting occurred later at Turtle Bay, and a third after Cotecna got a U.N. contract.

Members of the Massey family were at the time under indictment for their dealings with the Bhutto government in Pakistan, and were looking for business. But Mr. Malloch Brown was adamant that none of the meetings with the secretary-general had anything to do with the U.N. contract to be the principal shipping inspector for the oil-for-food program.