Wolfowitz support wanes as World Bank mulls his fate

WASHINGTON, May 16, 2007 (AFP) – World Bank directors were to continue talks Thursday on the fate of Paul Wolfowitz, amid reports the embattled president is negotiating an exit deal in which the bank would take some blame for the controversial pay raise he negotiated for his girlfriend. Pressure to end the controversy increased as White House support for Wolfowitz appeared to weaken, and as European countries pushed hard for his departure.

A source close to the bank said Wednesday that a deal being considered would have the bank recognize that it could have given him better guidance on avoiding a conflict-of-interest situation over the generous pay-and-promotion package he obtained for his companion, Shaha Riza, a fellow bank employee.

A scathing report released by an internal investigatory panel found that Wolfowitz violated bank rules in arranging the deal for Riza, but also said that the bank could have done better in advising him on the matter.

CNBC television business news reported that Wolfowitz’s high-profile Washington lawyer, Robert Bennett, and World Bank officials were in teleconference negotiations that have reached a “critical” stage.

The US government of President George W. Bush had been resolutely backing Wolfowitz — one of the key architects of the Ir