Top officials at the United Nations Palestinian refugee agency engaged in “sexual misconduct, nepotism, and abuse of authority for personal gain” while the body struggled with an unprecedented funding crisis, a damning report has alleged.

UN investigators are now scrutinising the allegations within the internal ethics review, which suggests serious abuses at the highest levels of the United Nations Relief and Works Agency (UNRWA), including the organisation’s commissioner general Pierre Krahenbuhl.

The report obtained by French news agency AFP claims that Mr Krahenbuhl was involved romantically with a colleague who was appointed in 2015 to a newly created role of senior advisor to the commissioner general after an “extreme fast-track” process.

This enabled her to join him on business class flights across the globe, the report claimed.

Mr Krahenbuhl’s deputy is separately accused of bullying staff and manipulating the system to find a well-paid job for her husband during the agency’s 2018 financial crisis after the US, UNRWA’s biggest donor, cut all aid.

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A third senior official is described in the report as acting like a “gangster” and a “thug” and also of bullying employees.

The deputy left UNRWA last Thursday for what the agency said were “personal reasons”.

UNRWA said the third official was recently “separated from the agency as a result of inappropriate behaviour” linked to the investigation.

Mr Krahenbuhl said in a statement to AFP that “if the current investigation ... were to present findings that require corrective measures or other management actions, we will not hesitate to take them”.

A spokesperson at UNRWA told The Independent they were unable to respond to the specific allegations as the investigation is ongoing and no findings have been shared with them.

UNRWA said that Mr Krahenbuhl had instructed staff to fully cooperate once learning the investigation was underway.

“The agency cannot comment on an ongoing investigation, and everything circulating now, including in the media, are ‘allegations’ and not findings,” the spokesperson said.

“If the current investigation – once it is completed – were to present findings that require corrective measures or other management actions, we will not hesitate to take them.

“In the meantime, the agency is confronted and continues to actively deal with an extraordinary array of challenges and pressures.”

UNRWA defended its work, saying that due to the complexity of the political environment it operates in it is constantly under scrutiny. An external group of independent experts rated several areas of their work as “highly satisfactory”, the spokesperson added.

Palestinian men carry bags of flour outside an aid distribution centre run by UNRWA (Getty) (SAID KHATIB/AFP/Getty Images))

But the allegations deal a tricky blow as UNRWA struggles during one of its toughest periods yet.

The agency currently offers support to more than five million Palestinian refugees in Gaza, the West Bank, Syria, Lebanon and Jordan, most of them descendants of the 700,000 people who were forced from or fled their lands during the 1948 war which surrounded the creation of Israel.

Among UNRWA’s vital services are schools, medical and food programmes as well as financial support.

Last summer, the US, its single largest financier, slashed all of its funding, accusing it of perpetuating the Israeli-Palestinian conflict, and causing a $446m (£360m) budget deficit which it managed to overcome.

It forced the organisation, which employs around 30,000 mostly Palestinian people, to beg for additional donations from Europe and the Gulf.

Its UN mandate is also set to be debated later this year.

The report outlined an organisation led by a small number of mostly foreign senior leaders who centralised power, while disregarding UN checks and balances.

Most of the time it felt like working for a private company, not the United Nations Former UNRWA official

After the financial crisis began, Mr Krahenbuhl allegedly set up a fund-raising unit outside of the traditional mechanisms that “reportedly raised only modest amounts”, but allowed him to continue travelling with his partner, the report said.

His deputy, who allegedly secured a job for her husband, also apparently cut those who disliked her practices out of decision making, the report added.

AFP reported that a senior UNRWA figure was fired in early July after claiming to have spent several years trying to raise ethical concerns.

UNRWA said she was “separated” following a different investigation unrelated to the internal report, calling it a “stand-alone case of misconduct”.

She claimed she was fired for retaliation and is appealing.

“Most of the time it felt like working for a private company, not the United Nations where we are supposed to comply with strict rules and regulations”, she told AFP.

The UNRWA spokesperson said that the organisation would continue to protect its services and ensure its schools open in time for the new autumn term.

“We will do so with resolve, humility and passion,” the statement added.