Billions in Iraqi Oil Revenues Missing - Tilted Forum Project Discussion Community

Booboo · 10-22-2004, 12:54 PM

http://www.truthout.org/docs_04/101604C.shtml

Quote:

Auditors Can't Account for Iraq Spent Funds
By Larry Margasak
The Associated Press

Friday 15 October 2004

Washington - U.S. and Iraqi officials doled out hundreds of millions of dollars in oil proceeds and other moneys for Iraqi projects earlier this year, but there was little effort to monitor or justify the expenditures, according to an audit released Thursday.

Files that could explain many of the payments are missing or nonexistent, and contracting rules were ignored, according to auditors working for an agency created by the United Nations.

"We found one case where a payment ($2.6 million) was authorized by the CPA (Coalition Provisional Authority) senior adviser to the Ministry of Oil," the report said. "We were unable to obtain an underlying contract" or even "evidence of services being rendered."

In a program to allow U.S. military commanders to pay for small reconstruction projects, auditors questioned 128 projects totaling $31.6 million. They could find no evidence of bidding for the projects or, alternatively, explanations of why they were awarded without competition.

The report was released by Rep. Henry Waxman of California, ranking Democrat on the House Government Reform Committee and a leading critic of reconstruction spending to rebuild Iraq.

"The Bush Administration cannot account for how billions of dollars of Iraqi oil proceeds were spent," Waxman said. "The mismanagement, lack of transparency, and potential corruption will seriously undermine our efforts in Iraq. A thorough congressional investigation is urgently needed."

The audit was performed by the accounting firm KMPG for the International Advisory and Monitoring Board, created by the United Nations to monitor the stewardship of Iraqi funds.

The report monitored spending by the Coalition Provisional Authority, the U.S.-run governing agency which went out of existence in June; Iraqi ministries; the Kurdish Regional Government and Iraqi provisional governments. It covered the period from January to June this year.

In the CPA programs, "We found 37 cases where contracting files could not be located," the auditors said. The cost of the contracts: $185 million. In another 52 cases, there was no record of the goods received for $87.9 million in expenditures.

In a military commanders' program to buy back weapons, $1.4 million was spent from a fund that specifically prohibited such expenditures, auditors said.

Iraq's Ministry of Finance maintained two sets of accounting records, one manual and one computerized.

"A reconciliation between these two sets of accounting records was not prepared and the difference was significant," the report said.

Auditors questioned why checks were made payable to a U.S. official - a senior adviser to the Iraqi ministry of health - rather than to suppliers.

Other questions were raised about funds provided by the U.S.-run governing authority to Kurdish officials in northern Iraq. In one instance, auditors were given a deposit slip that showed the transfer of $1.4 billion to a Kurdish bank. Auditors said they were denied access to accounting records and were unable to verify how - or if - the money was spent.

Just some more information that I think people will find interesting... just putting out here to see what kind of comments you guys and gals have.

james t kirk · 10-22-2004, 01:08 PM

The more things change, the more they stay the same.

How did Pete Townsend put it, "Meet the new boss, same as the old boss"

pan6467 · 10-22-2004, 01:08 PM

Things just keep getting stranger and stranger in this election. On both sides you see almost as much corruption as you do good. It's just bizarre.

onetime2 · 10-24-2004, 09:44 AM

Keeping track of funds during a war is not exactly easy. Hell, our government(s) can't even keep track of funds here at home. The Newark, NJ school region could not account for $1 billion a few years back. Is it fraud? Is it illegal? Was it stolen? We have no idea because we do not require sufficient accountability in virtually all spending related to our government. Not being able to track something does not immediately mean that something bad is going on but it certainly raises questions.

Want to talk about the need for closer accounting? Great. I'm right there with you. But it needs to be at a much grander scale than just at the Iraq level. Even if we had outstanding practices here at home under near perfect conditions, I would be inclined to give some benefit of the doubt to the administrators dealing with a situation as complex as Iraq. I have little doubt that there are payouts going to curry political favors and it's not quite like you can ask for a receipt from the recipient.

Additionally, as the pace of expenditure ramps up I suspect there to be more incomplete accounting rather than less. Whether it's Bush or Kerry in charge, the upcoming expenditures will see more of the same. Could it be done better? Perhaps. But I am not about to assume the worst based on the scant information presented about this situation.

host · 10-24-2004, 01:17 PM

Quote:

Originally Posted by onetime2

Keeping track of funds during a war is not exactly easy. Hell, our government(s) can't even keep track of funds here at home. The Newark, NJ school region could not account for $1 billion a few years back. Is it fraud? Is it illegal? Was it stolen? We have no idea because we do not require sufficient accountability in virtually all spending related to our government. Not being able to track something does not immediately mean that something bad is going on but it certainly raises questions.

Want to talk about the need for closer accounting? Great. I'm right there with you. But it needs to be at a much grander scale than just at the Iraq level. Even if we had outstanding practices here at home under near perfect conditions, I would be inclined to give some benefit of the doubt to the administrators dealing with a situation as complex as Iraq. I have little doubt that there are payouts going to curry political favors and it's not quite like you can ask for a receipt from the recipient.

Additionally, as the pace of expenditure ramps up I suspect there to be mor
incomplete accounting rather than less. Whether it's Bush or Kerry in charge, the upcoming expenditures will see more of the same. Could it be done better? Perhaps. But I am not about to assume the worst based on the scant information presented about this situation.

Before you posted your above opinion to this thread, did you do
a search to find any corroborating or contradictory information to the article
posted by booboo? If it was your money that was unaccounted for, and you
read the initial article and the article below, would you react by posting

Quote:

But I am not about to assume the worst based on the scant information presented about this situation.

Is <a href="http://www.iraqrevenuewatch.org/">http://www.iraqrevenuewatch.org/</a>
just a partisan facade created to discredit and embarass the Bush
administration?

Quote:

<a href="http://www.washingtonpost.com/wp-dyn/articles/A38768-2003Oct16.html">http://www.washingtonpost.com/wp-dyn/articles/A38768-2003Oct16.html</a>
Minding Iraq's Business

By David Ignatius
Friday, October 17, 2003; Page A29

The Bush administration has at last succeeded in getting a United Nations mandate for its effort to rebuild Iraq. But unless it addresses some financial details, it will have trouble persuading donors to share the financial burden of occupation and reconstruction.

The administration's breakthrough at the United Nations was to win support from Russian President Vladimir Putin. Once the Russians had defected to the U.S. side, the French and Germans realized they were isolated in their anti-Americanism and finally climbed on board.

But the financing of occupation remains murky. And unless the administration changes its policies, it stands open to the charge -- which can be heard in every souk and mosque around the world -- that the United States invaded Iraq only to control its oil.

The financial problems are detailed in a confidential report prepared this month by the Iraq Revenue Watch. I'd never heard of the group until somebody slipped me a draft copy of its study, but it turns out to be funded by billionaire George Soros and his Open Society Institute. Because Soros has been a critic of U.S. policy in Iraq, this is hardly a disinterested analysis, but it makes some telling points.

It's a complicated story, and even the most dedicated Iraq watchers may find it small potatoes. But for some Europeans, it documents what they see as a U.S. effort to control Iraqi finances -- and keep the goodies for America and its friends. Moreover, the issue is likely to be a bone of contention when the United States and major European countries gather next week in Madrid for an Iraq donors conference. So bear with a bit of technical explanation:

Iraq's oil revenue now goes into the Development Fund for Iraq, which was created last May by the U.N. Security Council to replace the old oil-for-food program. That fund is supposed to be audited by a body called the International Advisory and Monitoring Board, which would represent the United Nations, the World Bank, the International Monetary Fund and the Arab Fund for Economic and Social Development.

But thus far, U.S. occupation chief Paul Bremer has delayed establishing this watchdog group, apparently because he believes that its "special audit" powers are too far-reaching.

Rather than being under international oversight, Iraq's oil income and other assets have been controlled by an obscure body called the Program Review Board, which reports to Bremer's Coalition Provisional Authority. The 11-member board includes only one Iraqi.

The board is spending Iraq's money freely, mostly to support aspects of the occupation. The board's own documents show it approved about $1 billion in spending between Aug. 12 and Sept. 2, according to the Soros-backed study.

"To date, [Development Fund for Iraq] funds have been used to pay Iraqi public sector salaries, to compensate families for the loss of members by actions of Coalition Forces, and the day-to-day functioning of the Iraq Governing Council and Ministries," the study contends.

European countries have criticized what they say is a lack of transparency in the fund's activities. "The international community knows nothing about the fund's management," contended one unnamed "Security Council diplomat" who is quoted in the study. "We know that $1 billion went into it from the U.N. Oil-for-Food Program in May. Since then, that money has disappeared, and there are rumors that the current balance is zero."

The dispute about the fund may seem trivial, given the larger issues at stake in Iraq. But European countries are citing the transparency problem as a reason why they won't commit more money to Iraqi reconstruction. The Europeans have said they will initially pledge just $233 million, and they are insisting that this money be distributed by a trust that is separate from the U.S.-administered Development Fund for Iraq.

"Without change, U.S. authorities in Iraq are likely to find themselves increasingly isolated as international donors lose confidence in the CPA's effort to stabilize and rebuild Iraq," argues the Soros study.

Oversight of Iraq's oil revenue is addressed in a few sentences of fine print in the original U.S resolution on Iraqi reconstruction that was presented to the United Nations. But the issue deserves more attention than it has received. Without it, the transparency problem could undermine the U.N. resolution passed yesterday with such fanfare, and all the progress it promises.

The right answer, it seems to me, is not to give more power to Europeans, still less to an unwieldy board made up of grandees from the IMF and World Bank. Instead, the goal should be to give more financial power to Iraqis, as soon as is practical. It's their oil, their money and, ultimately, their responsibility to rebuild Iraq.

hammer4all · 10-24-2004, 01:25 PM

Quote:

WASHINGTON — A comprehensive examination of the U.S.-led agency that oversaw the rebuilding of Iraq has triggered at least 27 criminal investigations and produced evidence of millions of dollars' worth of fraud, waste and abuse, according to a report by the Coalition Provisional Authority's inspector general.

The report is the most sweeping indication yet that some U.S. officials and private contractors repeatedly violated the law in the free-wheeling atmosphere that pervaded the multibillion-dollar effort to rebuild the war-torn country.

More than $600 million in cash from Iraqi oil money was spent with insufficient controls. Senior U.S. officials manipulated or misspent contract money. Millions of dollars' worth of equipment could not be located, the report said.

Iraq Funds Are Focus of 27 Criminal Inquiries

Quote:

WASHINGTON - Three U.S. senators have called on Defense Secretary Donald Rumsfeld to account for 8.8 billion dollars entrusted to the Coalition Provisional Authority (CPA) in Iraq earlier this year but now gone missing.

In a letter Thursday, Senators Ron Wyden of Oregon, Byron L Dorgan of North Dakota and Tom Harkin of Iowa, all opposition Democrats, demanded a "full, written account" of the money that was channeled to Iraqi ministries and authorities by the CPA, which was the governing body in the occupied country until Jun. 30.

The loss was uncovered in an audit by the CPA's inspector general. It has not yet been released publicly and was initially reported on the website of journalist and retired U.S. Army Col David Hackworth.

'Staggering Amount' of Cash Missing In Iraq

Quote:

More disturbing news from Iraq: Now United Nations auditors are complaining the Bush administration is holding back information concerning more than $1 billion in reconstruction contracts awarded to several well-connected American firms without competitive bidding.

The complaints come from the International Advisory and Monitoring Board -- a bookkeeping creation of the UN Security Council that includes members from the International Monetary Fund and the World Bank. The board was set up to make sure Iraq's oil revenue would be handled in proper fashion throughout the American occupation.

Bush Cronies Profit from War in Iraq While Our Soldiers Die Every Day

Quote:

WASHINGTON, Dec. 11 — A Pentagon investigation has found evidence that a subsidiary of the politically connected Halliburton Company overcharged the government by as much as $61 million for fuel delivered to Iraq under huge no-bid reconstruction contracts, senior military officials said Thursday.

The subsidiary, Kellogg, Brown & Root, also submitted a proposal for cafeteria services that seemed to be inflated by $67 million, the officials said. The Pentagon rejected that proposal, they said.

U.S. Sees Evidence of Overcharging in Iraq Contract

Quote:

WASHINGTON - The US Army Corps of Engineers waived a requirement last month that a Halliburton subsidiary provide price and costing data for fuel supplied by a Kuwaiti company despite charges by Pentagon auditors that the US government was being overcharged.

Lieutenant General Robert Flowers, commander of the Army Corps of Engineers, signed the waiver only a week after President George W. Bush declared that the Texas-based energy giant should repay the government if it overcharged for the fuel.

US Army Waived Requirement on Halliburton Contract Despite Alleged Overcharging

Quote:

A Christian charity has accused the coalition authority in Iraq of failing to account for up to $20bn (nearly £11bn) of oil revenues which should have been spent on relief and reconstruction projects.

At the same time, the Liberal Democrats are demanding an investigation into the way the US-led administration in Baghdad has handled Iraq's oil revenues. The coalition is obliged to pay all oil revenues into the Development Fund for Iraq, but according to Liberal Democrat figures, the fund could be short by as much as $3.7bn.

Billions of Revenue from Oil 'Missing'

Is there a pattern here?

Willravel · 10-24-2004, 01:58 PM

The investigation won't be mentioned until after the election. I guarentee it.

Mephisto2 · 10-24-2004, 04:03 PM

Well, let's try to consider this objectively.

There is bound to be some corruption and probably even some nepotism in any such large scale operation as the invasion/subjugation/reconstruction of Iraq. Hard as it may be to accept, even Americans can be corrupt too!

Now what we really need to consider is whether there is a lot of this going on. That is, does the current environment created by the Bush Administration allow this to occur, tacitly approve of it or actively support it? My opinion is the latter.

Mr Mephisto

hammer4all · 10-24-2004, 05:29 PM

Does anyone find it ironic that a homeless person can be thrown in jail for steeling a loaf of bread yet we remain unconcerned when millions and billions of public dollars go unaccounted for?

10-22-2004, 01:08 PM	#3 (permalink)
pan6467 Lennonite Priest Location: Mansfield, Ohio USA	Things just keep getting stranger and stranger in this election. On both sides you see almost as much corruption as you do good. It's just bizarre. __________________ I just love people who use the excuse "I use/do this because I LOVE the feeling/joy/happiness it brings me" and expect you to be ok with that as you watch them destroy their life blindly following. My response is, "I like to put forks in an eletrical socket, just LOVE that feeling, can't ever get enough of it, so will you let me put this copper fork in that electric socket?"

10-24-2004, 09:44 AM	#4 (permalink)
onetime2 Junkie Location: NJ	Keeping track of funds during a war is not exactly easy. Hell, our government(s) can't even keep track of funds here at home. The Newark, NJ school region could not account for $1 billion a few years back. Is it fraud? Is it illegal? Was it stolen? We have no idea because we do not require sufficient accountability in virtually all spending related to our government. Not being able to track something does not immediately mean that something bad is going on but it certainly raises questions. Want to talk about the need for closer accounting? Great. I'm right there with you. But it needs to be at a much grander scale than just at the Iraq level. Even if we had outstanding practices here at home under near perfect conditions, I would be inclined to give some benefit of the doubt to the administrators dealing with a situation as complex as Iraq. I have little doubt that there are payouts going to curry political favors and it's not quite like you can ask for a receipt from the recipient. Additionally, as the pace of expenditure ramps up I suspect there to be more incomplete accounting rather than less. Whether it's Bush or Kerry in charge, the upcoming expenditures will see more of the same. Could it be done better? Perhaps. But I am not about to assume the worst based on the scant information presented about this situation. __________________ Strive to be more curious than ignorant.

10-22-2004, 01:08 PM	#2 (permalink)
james t kirk Junkie Location: Toronto	The more things change, the more they stay the same. How did Pete Townsend put it, "Meet the new boss, same as the old boss"

10-24-2004, 01:58 PM	#7 (permalink)
Willravel ... a sort of licensed troubleshooter.	The investigation won't be mentioned until after the election. I guarentee it.

10-24-2004, 04:03 PM	#8 (permalink)
Mephisto2 Junkie	Well, let's try to consider this objectively. There is bound to be some corruption and probably even some nepotism in any such large scale operation as the invasion/subjugation/reconstruction of Iraq. Hard as it may be to accept, even Americans can be corrupt too! Now what we really need to consider is whether there is a lot of this going on. That is, does the current environment created by the Bush Administration allow this to occur, tacitly approve of it or actively support it? My opinion is the latter. Mr Mephisto

10-24-2004, 05:29 PM	#9 (permalink)
hammer4all Insane	Does anyone find it ironic that a homeless person can be thrown in jail for steeling a loaf of bread yet we remain unconcerned when millions and billions of public dollars go unaccounted for?