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Iraqi "Lost" Money Haunts Bremer: Report

Iraqi "Lost" Money Haunts Bremer: Report

CAIRO, July 7, 2005 (IslamOnline.net) – The disappearance of over 8 billion dollars of money that was supposed to be spent on rebuilding war-scattered Iraq under the US-led Coalition Provisional Authority (CPA) by the time Paul Bremer left his post as head of the authority is still an open case, a leading UK paper reported Thursday, July 7.

Calling it the ‘extraordinary scandal of Iraq's missing billions’, The Guardian said that Bremer maintained one slush fund of nearly $600m in cash for which there is no paperwork: $200m of it was kept in a room in one of Saddam's former palaces.

Millions of dollars in cash went missing from the Iraqi Central Bank. Between $11m and $26m worth of Iraqi property sequestered by the CPA was unaccounted for. The payroll was padded with hundreds of ghost employees. Millions of dollars were paid to contractors for phantom work, the paper added.

The article’s writer Ed Harriman said US Defense Secretary Donald Rumsfeld and Bremer have made sure that the so-called reconstruction of Iraq is paid for by the "liberated" country, by the Iraqis themselves.

"The 'reconstruction' of Iraq is the largest US-led occupation program since the Marshall Plan with the difference that the US government funded the Marshall Plan."

According to the paper, when Bremer arrived in Iraq after the official end of war, there was $6bn left over from the UN Oil for Food Program, as well as sequestered and frozen assets, and at least $10bn from resumed Iraqi oil exports and the US Congress also voted to spend $18.4bn of US taxpayers' money on the redevelopment of Iraq.

However, by June 28 last year, when Bremer left Baghdad two days early to avoid possible attack on the way to the airport, his CPA had spent up to $20bn of Iraqi money, compared with $300m of US funds, The Guardian said.

“So, where did the money go?” asked the paper.

The schools, hospitals, water supply and electricity, all of which were supposed to benefit from these funds, are in ruins, the British daily said.

The inescapable conclusion is that many of the American paying agents grabbed large bundles of cash for themselves and made sweet deals with their Iraqi contacts, it added.

It further charged that beside Bremer disappearing fund, another 19 billion new Iraqi dinars, worth about £6.5m, was found on a plane in Lebanon that had been sent there by the new Iraqi interior minister.

One ministry claimed to be paying 8,206 guards, but only 602 could be found and one American agent was given $23m to spend on restructuring; only $6m is accounted for, the paper said.

"In the absence of any meaningful accountability, Iraqis have no way of knowing how much of the nation's wealth is being used for reconstruction and how much is being handed out to ministers' and civil servants' friends and families or funneled into secret overseas bank accounts."

Mentality

The "financial irregularities" described in audit reports carried out by agencies of the American government and auditors working for the international community collectively give a detailed insight into the mentality of the American occupation authorities and the way they operated, according to the daily.

"Truckloads of dollars were handed out for which neither they nor the recipients felt they had to be accountable."

The auditors have so far referred more than a hundred contracts, involving billions of dollars paid to American personnel and corporations, for investigation and possible criminal prosecution.

They have also discovered that $8.8bn that passed through the new Iraqi government ministries in Baghdad while Bremer was in charge is unaccounted for, with little prospect of finding out where it has gone.

A further $3.4bn appropriated by Congress for Iraqi development has since been siphoned off to finance "security".

The auditors found that the CPA didn't keep accounts of the hundreds of millions of dollars of cash in its vault, had awarded contracts worth billions of dollars to American firms without tender, and had no idea what was happening to the money from the Development Fund for Iraq (DFI), which was being spent by the interim Iraqi government ministries, the paper said.

"Grateful"

This lack of transparency has led to allegations of corruption, the paper said.

An Iraqi hospital administrator told The Guardian that when he came to sign a contract, the American army officer representing the CPA had crossed out the original price and doubled it.

The Iraqi side protested that the original price was enough. The American officer explained that the increase (more than $1m) was his retirement package.

When the Iraqi Governing Council asked Bremer why a contract to repair the Samarah cement factory was costing $60m rather than the agreed $20m, the American representative reportedly told them that they should be grateful the coalition had saved them from Saddam.

Click here to read The Guardian complete report.

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