It wasn't a serverance package. Riza was seconded to the US State Department as a World Bank employee in order to get around the fraternization problem. No one is complaining about that.
The problem is that Wolfie arranged for her to get salary increases way above the normal scale, while dispensing with any regular process of performance-based salary review.
Palast has a nice take on Wolfowitz, here. I recall Wolfowitz repeating the same talking points about "Iraqi Oil Pays For War" on a CSPAN show before the war, which points were apparently part of Congressional testimony.
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