Money for Nothing (American Conservative Mag-!!! -finds Iraq corruption)

Summary:

Polish helicopters purchased as part of a $300 million deal with arms maker Bumar Ltd. are found to be obsolete, largely unflyable, and are rejected by the Iraqis. The Polish Defense Ministry sells bullets at three times the normal international price. Five Polish peacekeepers are arrested for demanding $90,000 in bribes (as some British and American soldiers also demand bribes from shopkeepers and travelers). A Senior Interior Ministry official flys to Beirut in a helicopter accompanied by $10 million in newly printed Iraqi dinars, and stay in Beirut. Defense Minister Hazem Shaalan transferred $500 million to a bank account in Lebanon (for future weapons buying) and is now vacationing abroad (as in not returned to Iraq). Presidential Medal of Freedom winner Bremer's favorite at the Defense Ministry, Ziad Tareq Cattan, is responsible for a number of shady arms-procurement deals so bad by even Iraqi standards that a warrant has been issued for his arrest, which he avoids by staying with family in Erbil in Kurdistan. Bribes paid to government ministers exceed $10 million. Contracts written on a single sheet of paper move millions, are deemed completed, but there never was any performance- excused "due to security reasons". Bremer's more than $600 million cash slush fund disbursed with no paperwork, as in one U.S. contractor receiving $2 million in a duffel bag (Nearly $5 billion was shipped from New York in the last month of the CPA). Three-quarters of a million dollars known to have been stolen from an office safe, with $7 million in cash given to a US Official in the waning days of the CPA to spend "before the Iraqis take over.” Money literally disappearing in truckloads as the CPA distributed funds to contractors in bags off the back of a truck, and by helicopter as in the April 2004 delivery of $1.5 billion in cash to a courier in Erbil, in the Kurdish region, never to be seen again - and afterwards, no one was able to recall the courier’s name or provide a good description of him. Four U.S. armed forces regional commanders reconstruction projects funded as part of the Commanders’ Emergency Response Program with $600 million in cash now have no paperwork for 80% of the funds. After the CPA folded undocumented cash flow continued as over $1.5 billion was disbursed to interim Iraqi ministries without any accounting, and more than $1 billion designated for provincial treasuries never made it out of Baghdad; more than $430 million in contracts issued by the Petroleum Ministry were unsupported by any documentation, and $8 billion were given to government ministries that had no financial controls in place. Nearly all of it disappeared, spent on “payroll,” wages for “ghost employees” in the Ministries of the Interior and Defense. In one case, an Army brigade receiving money to support 2,200 men was found to have fewer than 300 effectives. The 602 actual guards at the Ministry of the Interior were billed as more than 8,200 for payroll purposes. Iraqi Airways with no planes or workers finds its 2400 ghost employees monthly payments so lucrative it was sold to a buyer said to be Pentagon favorite Ahmad Chalabi. Money designated for the development of a national army and police force actually goes to units that are exclusively Kurd or Shi’ite in expectation of a day of reckoning over the country’s oil supplies. Under Saddam there was only one hand out - Saddam's - now every hand is out.

And the only certified public-accounting firm used by the CPA to monitor its spending was a company called North Star Consultants, located in San Diego, which was so small that it operated out of a private home, which did not, in fact, perform any review of the CPA’s internal spending controls. In June 2005, Pentagon contracting officer Bunny Greenhouse told a congressional committee that the Halliburton $10 billion no-bid monopoly contract with the Army Corps of Engineers was the “most blatant and improper contracting abuse” that she had ever witnessed - earning her a subsequent demotion. Halliburton refused to permit independent auditing, offering its own internal “Tiger Teams” that stayed at the five-star Kuwait Kempinski Hotel while it was doing their audit whose problems if any were found are not discussed.

Meanwhile oil production, water supplies, and electricity generation are all at lower levels than they were when the U.S. took control in 2003, and daily life in Iraq is worse than it was under Saddam Hussein.



October 24, 2005 Issue
Copyright © 2005 The American Conservative
http://www.amconmag.com/index.html


Money for Nothing

Billions of dollars have disappeared, gone to bribe Iraqis and line contractors’ pockets.


by Philip Giraldi (Philip Giraldi, a former CIA Officer, is a partner in Cannistraro Associates, an international security consultancy)


The United States invaded Iraq with a high-minded mission: destroy dangerous weapons, bring democracy, and trigger a wave of reform across the Middle East. None of these have happened.

<snip>
The American-dominated Coalition Provisional Authority could well prove to be the most corrupt administration in history, almost certainly surpassing the widespread fraud of the much-maligned UN Oil for Food Program. At least $20 billion that belonged to the Iraqi people has been wasted, together with hundreds of millions of U.S. taxpayer dollars. Exactly how many billions of additional dollars were squandered, stolen, given away, or simply lost will never be known because the deliberate decision by the CPA not to meter oil exports means that no one will ever know how much revenue was generated during 2003 and 2004.

Some of the corruption grew out of the misguided neoconservative agenda for Iraq, which meant that a serious reconstruction effort came second to doling out the spoils to the war’s most fervent supporters. The CPA brought in scores of bright, young true believers who were nearly universally unqualified. Many were recruited through the Heritage Foundation website, where they had posted their résumés. They were paid six-figure salaries out of Iraqi funds, and most served in 90-day rotations before returning home with their war stories. One such volunteer was Simone Ledeen, daughter of leading neoconservative Michael Ledeen. Unable to communicate in Arabic and with no relevant experience or appropriate educational training, she nevertheless became a senior advisor for northern Iraq at the Ministry of Finance in Baghdad. Another was former White House Press Secretary Ari Fleischer’s older brother Michael who, though utterly unqualified, was named director of private-sector development for all of Iraq.

The 15-month proconsulship of the CPA disbursed nearly $20 billion, two-thirds of it in cash, most of which came from the Development Fund for Iraq that had replaced the UN Oil for Food Program and from frozen and seized Iraqi assets. Most of the money was flown into Iraq on C-130s in huge plastic shrink-wrapped pallets holding 40 “cashpaks,” each cashpak having $1.6 million in $100 bills. Twelve billion dollars moved that way between May 2003 and June 2004, drawn from accounts administered by the New York Federal Reserve Bank. The $100 bills weighed an estimated 363 tons.

Once in Iraq, there was virtually no accountability over how the money was spent. There was also considerable money “off the books,” including as much as $4 billion from illegal oil exports. The CPA and the Iraqi State Oil Marketing Board, which it controlled, made a deliberate decision not to record or “meter” oil exports, an invitation to wholesale fraud and black marketeering.

<snip>The contracts were especially attractive because no work or results were necessarily expected in return. It became popular to cancel contracts without penalty, claiming that security costs were making it too difficult to do the work. A $500 million power-plant contract was reportedly awarded to a bidder based on a proposal one page long. After a joint commission rejected the proposal, its members were replaced by the minister, and approval was duly obtained. But no plant has been built.
<snip>

:kick: :kick: :kick:

:wow:

After all they they had experience in managing "Oil-for-food" program

you're flat wrong.