United Nations Secretary General Kofi Annan has sacked a senior official accused of serious misconduct over Iraq's oil-for-food programme.
Joseph Stephanides denies any wrongdoing
Joseph Stephanides, who is alleged to have steered a lucrative contract to a British firm, is the first UN employee sacked over the scandal.
Mr Annan concluded that Mr Stephanides, of Cyprus, had breached UN staff procurement rules, a spokesman said.
Mr Stephanides, 59, rejected the charges and said he planned to appeal.
"I am very disappointed by this decision," the UN veteran of 25 years told the Associated Press news agency.
Mr Stephanides, who was head of the Security Council affairs division, said: "I look to the appeal process in the confident hope that justice will be made and I will be exonerated because I have committed no wrongdoing."
His lawyer told Reuters the decision to award the contract was made by Mr Stephanides' superiors.
The oil-for-food (OFF) programme, which was supposed to allow Iraq to buy humanitarian supplies with the proceeds of regulated oil sales during the sanctions of the 1990s, is subject to several investigations.
A number of individuals and businesses are accused of paying and receiving kickbacks for OFF contracts, or selling Iraqi oil themselves at a profit.
Mr Stephanides has been named by the UN inquiry into the scandal - by former US Federal Reserve Chairman Paul Volcker - for allegedly colluding in 1996 to help UK firm Lloyd's Register Inspection win a major inspection contract.
Joseph Stephanides (left) denies any wrongdoing
Mr Annan's spokesman Stephane Dujarric said Mr Stephanides was told of the secretary general's decision on Tuesday and "separated from service with immediate effect".
"There is no allegation of any criminal act. This is a disciplinary action for a breach of staff rules regarding procurement," he added.
The UN has also suspended disciplinary action against Benon Sevan, the former director of the OFF programme, for as long as he is still being investigated by Mr Volcker.
Mr Sevan is currently suspended by the UN.
He has been accused by the Volcker inquiry of helping a relative of Boutros Boutros-Ghali, the former UN secretary general, receive an allocation of Iraqi oil which could then be sold at a profit.
Mr Sevan denies the charges.