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. Last Updated: 07/27/2016

World Bank Broadens Inquiry Into Wolfowitz

WASHINGTON -- The World Bank's board said Friday that it had ordered an ad hoc group of its members to "urgently" conduct a far-reaching investigation into bank president Paul Wolfowitz's involvement in arranging the compensation and promotion package for his companion, who is also a bank employee.

The board did not set a time frame for the committee's deliberations, but bank officials said an announcement could come within a few days. The board has also postponed a nine-day trip to Mongolia and the Philippines set to start this week, bank officials said.

The directors are divided over whether Wolfowitz should continue to lead the anti-poverty institution. U.S. officials, who hold sway because the United States is the bank's largest shareholder, have expressed support for Wolfowitz. But in its statement, the board reiterated its "great concern" over the matter.

In a separate statement, Wolfowitz said he, "welcomes the decision of the board to move forward and resolve this very important issue."

He said again that he did not intend to resign.

The board, which met for more than nine hours on Thursday and early Friday, widened the investigation beyond the possible violations of staff rules committed by Wolfowitz when he outlined a transfer and career plan for Shaha Riza, a woman to whom he is romantically linked.

Before he assumed the presidency in June 2005, Wolfowitz offered to recuse himself from personnel decisions concerning Riza, but not from "professional contact" with her.

The board's ethics committee rejected the offer. It instructed him to arrange a departure package for her with the personnel department, including a one-step promotion and a one-time raise.

Wolfowitz worked out the details of her compensation and directed the personnel manager to implement them. They included a promotion and salary increase, plus a guaranteed increase for each of the next five years and another promotion upon her return, pending endorsement by a panel approved by Riza.

In a related matter, the Pentagon released parts of a 2005 inquiry that found Wolfowitz had also been involved in Riza's career advancement while he was serving as deputy defense secretary.