Wednesday, September 21, 2005

 

What Has Happened to Iraq’s Missing $1bn?

Good citizens, here’s how we need to pay for the problems in this country ... get all the money back from Halliburton and it’s private contractors they’ve stolen in rebuilding Iraq.
Let’s add a special surtax on the 69% of our major corporations that pay no taxes in this country for the very country that has made them rich also all executives that have taken the same tack...
Then we need to take 40% tax of the major oil corporations profits, and sur charge the Saudi prince’s profits from the business with the Bush family and business friends in the oil cartel....
We could all get a nice tax from all the pharmaceuticals companies that do business here and nationalize all holdings and bank accounts and assets (that is if we can do it before the Chinese nationalize all corporations doing business in china, and they call up a demand payment of all the money we’ve borrowed to finance our national operating costs and they ask for payment in full)?
Just for fun check this one new revelation of the training of the Iraq police force and Army???

maybe the Brits have the Info???


What Has Happened to Iraq’s Missing $1bn?
By Patrick Cockburn
The Independent UK
Monday 19 September 2005
One billion dollars has been plundered from Iraq’s defense ministry in one of the largest thefts in history, The Independent can reveal, leaving the country’s army to fight a savage insurgency with museum-piece weapons.
The money, intended to train and equip an Iraqi army capable of bringing security to a country shattered by the US-led invasion and prolonged rebellion, was instead siphoned abroad in cash and has disappeared.
“It is possibly one of the largest thefts in history,” Ail Allawi, Iraq’s Finance Minister, told The Independent.
“Huge amounts of money have disappeared. In return we got nothing but scraps of metal.”
The carefully planned theft has so weakened the army that it cannot hold Baghdad against insurgent attack without American military support, Iraqi officials say, making it difficult for the US to withdraw its 135,000- strong army from Iraq, as Washington says it wishes to do.
Most of the money was supposedly spent buying arms from Poland and Pakistan. The contracts were peculiar in four ways. According to Mr. Allawi, they were awarded without bidding, and were signed with a Baghdad-based company, and not directly with the foreign supplier. The money was paid up front, and, surprisingly for Iraq, it was paid at great speed out of the ministry’s account with the Central Bank. Military equipment purchased in Poland included 28-year-old Soviet-made helicopters. The manufacturers said they should have been scrapped after 25 years of service. Armored cars purchased by Iraq turned out to be so poorly made that even a bullet from an elderly AK-47 machine-gun could penetrate their armor. A shipment of the latest MP5 American machine-guns, at a cost of $3,500 (£1,900) each, consisted in reality of Egyptian copies worth only $200 a gun. Other armored cars leaked so much oil that they had to be abandoned. A deal was struck to buy 7.62mm machine-gun bullets for 16 cents each, although they should have cost between 4 and 6 cents.
Many Iraqi soldiers and police have died because they were not properly equipped. In Baghdad they often ride in civilian pick-up trucks vulnerable to gunfire, rocket- propelled grenades or roadside bombs. For months even men defusing bombs had no protection against blast because they worked without bullet-proof vests. These were often promised but never turned up.
The Iraqi Board of Supreme Audit says in a report to the Iraqi government that US-appointed Iraqi officials in the defense ministry allegedly presided over these dubious transactions.
Senior Iraqi officials now say they cannot understand how, if this is so, the disappearance of almost all the military procurement budget could have passed unnoticed by the US military in Baghdad and civilian advisers working in the defense ministry.
Government officials in Baghdad even suggest that the skill with which the robbery was organized suggests that the Iraqis involved were only front men, and “rogue elements” within the US military or intelligence services may have played a decisive role behind the scenes.
Given that building up an Iraqi army to replace American and British troops is a priority for Washington and London, the failure to notice that so much money was being siphoned off at the very least argues a high degree of negligence on the part of US officials and officers in Baghdad.
The report of the Board of Supreme Audit on the defense ministry contracts was presented to the office of Ibrahim al-Jaafari, the Prime Minister, in May. But the extent of the losses has become apparent only gradually. The sum missing was first reported as $300m and then $500m, but in fact it is at least twice as large. “If you compare the amount that was allegedly stolen of about $1bn compared with the budget of the ministry of defense, it is nearly 100 per cent of the ministry’s [procurement] budget that has gone Awol,” said Mr. Allawi.
The money missing from all ministries under the interim Iraqi government appointed by the US in June 2004 may turn out to be close to $2bn. Of a military procurement budget of $1.3bn, some $200m may have been spent on usable equipment, though this is a charitable view, say officials. As a result the Iraqi army has had to rely on cast-offs from the US military, and even these have been slow in coming.
Mr. Allawi says a further $500m to $600m has allegedly disappeared from the electricity, transport, interior and other ministries. This helps to explain why the supply of electricity in Baghdad has been so poor since the fall of Saddam Hussein 29 months ago despite claims by the US and subsequent Iraqi governments that they are doing everything to improve power generation.
The sum missing over an eight-month period in 2004 and 2005 is the equivalent of the $1.8bn that Saddam allegedly received in kick- backs under the UN’s oil-for-food program between 1997 and 2003. The UN was pilloried for not stopping this corruption. The US military is likely to be criticized over the latest scandal because it was far better placed than the UN to monitor corruption.
The fraud took place between 28 June 2004 and 28 February this year under the government of Iyad Allawi, who was interim prime minister. His ministers were appointed by the US envoy Robert Blackwell and his UN counterpart, Lakhdar Brahimi.
Among those whom the US promoted was a man who was previously a small businessman in London before the war, called Hazem Shaalan, who became Defense Minister.
Mr. Shalaan says that Paul Bremer, then US viceroy in Iraq, signed off the appointment of Ziyad Cattan as the defense ministry’s procurement chief. Mr. Cattan, of joint Polish-Iraqi nationality, spent 27 years in Europe, returning to Iraq two days before the war in 2003. He was hired by the US-led Coalition Provisional Authority and became a district councilor before moving to the defense ministry.
For eight months the ministry spent money without restraint. Contracts worth more than $5m should have been reviewed by a cabinet committee, but Mr. Shalaan asked for and received from the cabinet an exemption for the defense ministry. Missions abroad to acquire arms were generally led by Mr. Cattan. Contracts for large sums were short scribbles on a single piece of paper. Auditors have had difficulty working out with whom Iraq has a contract in Pakistan.
Authorities in Baghdad have issued an arrest warrant for Mr. Cattan. Neither he nor Mr. Shalaan, both believed to be in Jordan, could be reached for further comment. Mr. Bremer says he has never heard of Mr. Cattan.

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