"The office was closed precisely for that reason," said another U.N. official with extensive knowledge of the program. "With no operations in place, first of all, you have no claim to get auditors into the country. Second, it will take months and months to get documentation out of the office there, to transfer to somewhere else like New York."

The U.N. sources who spoke about the development operations in North Korea requested anonymity either for fear of retribution or because of the diplomatic sensitivity of the subject.

The saga of the UNDP in North Korea joins a list of other episodes in which critics have complained that the United Nations is a sprawling bureaucracy with few safeguards and little accountability. The Bush administration has been particularly outspoken about the United Nation's need for reform.

The Oil-for-Food scandal, which erupted in 2004, involved corruption in a program designed to provide humanitarian aid for Iraqis, whose country faced economic sanctions. Ultimately, it emerged that the program had resulted in $1.8 billion in kickbacks and surcharges paid to Saddam Hussein's regime.

Ban, a South Korean who took office in January, has sought to present himself as a fresh-faced reformer.

All this occurs against the backdrop of intensifying talks with Pyongyang over its nuclear weapons capacity, the most recent of which took place last week in New York. Last month, the United States and four other nations signed a deal with North Korea promising aid in exchange for the shutting down of a nuclear reactor and a series of steps toward disarmament and normalized relations.

A spokesman for the U.S. mission to the United Nations, Richard Grenell, said the United States supports the audit going forward to find out the extent of the problems at the UNDP office in Pyongyang. North Korean officials could not be reached.

Despite the closure of the UNDP office in North Korea, the audit is moving ahead. U.N. officials say they expect the audited documents to show not only the hard currency transfers to representatives of Kim's government, but also the inability of staff on the ground to confirm that the money was going to its programs.

According to sources familiar with UN operations in North Korea, the international staff of the development program and other UN agencies were not allowed to leave the compound without a government escort.

They were not allowed to go outside Pyongyang without receiving special permission from the military at least a week in advance. They were not allowed to set foot in a bank. And under no circumstances were they allowed to make unrestricted visits to the projects they were supposed to be funding.