WASHINGTON: A World Bank committee investigating accusations of nepotism against bank president Paul Wolfowitz has found he “clearly” breached rules, a European source said on Tuesday.

“The committee concluded clearly that Mr Wolfowitz did not respect the rules,” the source said.

Wolfowitz, whose two years at the helm of the bank charged with fighting global poverty have been marked by controversy, is fighting allegations that he improperly orchestrated a substantial promotion and pay raise for his companion, Shaha Riza, a fellow bank employee. US President George W. Bush's administration Tuesday renewed its support for Wolfowitz, but said it would stay out of any discussions on his future at the institution.

“The conversations right now are not between the administration and the World Bank, they're between Mr Wolfowitz and the World Bank and I think it's proper to let the process work itself out rather than trying to insinuate ourselves into it,” White House spokesman Tony Snow said.

“We still support president Wolfowitz,” he added, but dodged a question as to whether Bush was still insisting that Wolfowitz, a former Pentagon deputy and an architect of the Iraq war, stay at the head of the development lender.

“These are conversations really that have been conducted at the World Bank. The president is not getting directly, personally involved to my knowledge.” The scandal has rocked the 185-country multilateral institution for nearly a month and threatens to undermine the bank's six-decade-old mission to fight global poverty.

The World Bank's board of directors, dominated by the United States, Japan and European powers, appointed a small investigatory panel to examine the accusations against Wolfowitz, who has been widely criticised by bank employees for favouritism in bringing in senior aides from the Bush administration who lacked development experience when he joined the bank in June 2005.—AFP