UNDP's Dark Secrets: Unregistered Funds And Systemic Corruption

(MENAFN- AzerNews) An audit by the UNDP Office of Audit and Research has unveiled serious legal and financial violations within the United Nations Development Program's (UNDP) Azerbaijan Country Office. The findings, which reveal issues of transparency, mismanagement of funds, and potential corruption, raise significant concerns about the office's operations.

Unregistered grants and lack of oversight

The audit revealed that in 2023, the UNDP Azerbaijan Country Office allocated $754,570 in grants to 23 non-governmental organizations (NGOs) for 29 projects. However, these grants were transferred to personal accounts via contracts with LLCs or individuals connected to the NGOs, bypassing Azerbaijani laws requiring the registration of such funds. The recipients' identities remain undisclosed, sparking further scrutiny.

Additionally, the office allocated $2.6 million-$1.3 million for enhancing NGO capacities and $1.3 million for expanding a mine action program. However, as with the earlier grants, the recipients and their roles remain ambiguous in the audit document. Such actions, according to the audit, violate national laws on grant registration and expose funds to risks of fraud and misuse.

Corruption concerns and inflated expenditures

The audit also highlighted swelling expenses within the Azerbaijan Country Office, with development activities costing $15.2 million in 2023-a 12% increase from the previous year. Coupled with a projected $30 million budget deficit for 2021–2025, these figures point to possible financial mismanagement. The audit classified the grant management practices in Azerbaijan as “critically negative,” warning of reputational risks and fiduciary lapses.

Moreover, concerns extend to initiatives such as the Women's Resource Centers, which reportedly received $92,000 for basic training programs for women affected by war. However, the lack of clear accountability or transparency regarding the project has drawn criticism. The director of one center allegedly barred Azerbaijani state inspectors from entering, further deepening suspicions.

Ignoring local laws

The audit also spotlighted UNDP's controversial stance regarding Azerbaijan's territorial integrity. In 2022, during an international conference on post-conflict reconstruction in liberated territories, the Azerbaijan Country Office was the only international organization that refused to visit Shusha-a symbolic city of Azerbaijan's sovereignty. This decision was perceived as disrespect for the country's territorial integrity.

In light of these revelations, Azerbaijani authorities have reportedly initiated investigations into the NGOs and LLCs involved. President Ilham Aliyev recently addressed the broader issue of illegal grants, emphasizing the monitoring of foreign donor activities, particularly funds channeled through unofficial means. Speaking in a January 7, 2025, interview, he condemned programs aimed at“brainwashing” Azerbaijani youth and fostering betrayal through unregistered foreign grants.

The audit findings raise critical questions: Why has the Azerbaijan Country Office ignored UNDP headquarters' recommendations to address legal violations since 2019? What purpose do these grants serve if not transparently legalized? And who within the office will be held accountable for these breaches?

These revelations cast a shadow over the credibility of UNDP's operations in Azerbaijan and highlight the urgent need for systemic reforms to restore trust and ensure compliance with both UN and national standards.

Local Azerbaijani media outlets and agencies have sent a inquiry regarding the issue.

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