U.N. Official Took $3 Million in Secret Gifts From Businessman

A high-ranking United Nations official secretly took $3 million in gifts from a British businessman while he steered more than $58 million of the organization’s money to the man’s companies, according to a ruling from an internal U.N. court.

The decision provided a potential answer to a question that has baffled the organization since news broke in 2022 of Vitaly Vanshelboim’s disastrous investments: Why did a 20-year veteran of the United Nations defy auditors and common sense by entrusting his agency’s entire investment portfolio to a man he purportedly met at a party?

The court found last week that Mr. Vanshelboim, a Ukrainian, had committed fraud and “blatant misconduct” by failing to disclose the gifts from the businessman, David Kendrick. It said Mr. Vanshelboim had received interest-free loans, home repairs, a new Mercedes and a $1.2 million sponsorship for his teenage son, who was a tennis player.

“This is insane, how is this possible,” the son wrote back to his father at the time, according to an email cited in the court ruling. “I’m not even a good tennis player yet.”

“Part of my job is to make insane things happen,” Mr. Vanshelboim replied, the court said.

The United Nations now says that all $58 million that Mr. Vanshelboim’s agency entrusted to Mr. Kendrick has been lost. Mr. Vanshelboim was fired last year, fined a year’s pay and ordered to repay all the money lost through the United Nations’ dealing with Mr. Kendrick.

He appealed those penalties, but the court largely rejected his arguments, saying he had to pay $58 million or lose his U.N. pension. Mr. Vanshelboim declined to comment. Mr. Kendrick did not respond to a request for comment on Tuesday.