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Wolfowitz Complains of 'Smear Campaign' Before World Bank Panel

World Bank President Paul Wolfowitz decried what he called a "smear campaign" against him and told a special bank panel that he acted in good faith in securing a promotion and pay raise for his girlfriend.

In a prepared statement to the panel, Wolfowitz said the institution's ethics committee had access to all the details surrounding the arrangement involving bank employee Shaha Riza, "if they wanted it."

Wolfowitz told the panel that: "I acted transparently, sought and received guidance from the bank's ethics committee and conducted myself in good faith in accordance with that guidance."

The special bank panel is investigating Wolfowitz' handling of the 2005 promotion of bank employee Riza, who was scheduled to appear later in the day.

The controversy has prompted calls for Wolfowitz's resignation. The bank's 24-member board is expected to make a decision in the case this week.

Wolfowitz lamented that the controversy over the pay package was part of an effort to oust him from the office, which he has held for nearly two years.

"The goal of this smear campaign, I believe, is to create a self-fulfilling prophecy that I am an ineffective leader and must step down for that reason alone, even if the ethics charges are unwarranted," Wolfowitz said.

He vowed to fight for his job. "I will not resign in the face of a plainly bogus charge of conflict of interest," he said.

Bush: Keep Him On

President George W. Bush said Monday that Wolfowitz "ought to stay" in his job amid questions about Wolfowitz' role in securing the promotion and pay raise for his girlfriend.

"My position is that he ought to stay. He ought to be given a fair hearing. And I appreciate the fact that he has advanced -- he's helped the World Bank recognize that eradication of world poverty is an important priority for the bank," Bush said when asked about the controversy during a joint appearance with European leaders.

$60,000 Pay Hike

Riza already worked at the bank when Wolfowitz took the job. She was assigned duties outside the bank to avoid a conflict of interest, although she remained on the bank's payroll. Riza had earned close to $133,000 as a communications adviser in the bank's Middle East department. After she was moved to the new assignment at the State Department in 2005, she was getting paid $193,590.

Wolfowitz, who took over the bank on June 2005, has said he erred and has apologized for his handling of the Riza's pay package. He said he had asked to be recused from the matter, took the issue to the ethics committee and had followed the committee's advice to promote and relocate her. Prior to joining the World Bank, which fights global poverty Wolfowitz was deputy U.S. defense secretary.

The promotion and pay package has spurred allegations that Wolfowitz showed favoritism and has led to calls for his resignation from many of the bank's staff, the European Parliament, aid groups, former bank officials and some Democratic politicians. President George W. Bush has repeatedly expressed confidence in Wolfowitz. The United States the bank's largest shareholder and the U.S. president traditionally selects the bank president.