- 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.
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- 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.
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- 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.
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- The CPA was terminated at the end of July to make way
for an interim Iraqi government, which is in turn scheduled to be replaced
by an elected body early in 2005.
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- "We are requesting a full, written account of the
8.8 billion dollars transferred earlier this year from the CPA to the Iraqi
ministries, including the amount each ministry received and the way in
which the ministry spent the money," said the letter.
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- The senators also requested that the Pentagon designate
a date by which it will install adequate oversight and financial and contractual
controls over money it spends in Iraq.
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- They accused the CPA of transferring the "staggering
sum of money" with no written rules or guidelines to ensure adequate
control over it.
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- They pointed to "disturbing findings" from
the inspector general's report that the payrolls of some Iraqi ministries,
then under CPA control, were padded with thousands of ghost employees.
They refer to an example in which CPA paid the salaries of 74,000 security
guards although the actual number of employees could not be validated.
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- The report says that in one case some 8,000 guards were
listed on a payroll but only 603 real individuals could be counted.
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- "Such enormous discrepancies raise very serous questions
about potential fraud, waste and abuse," added the letter.
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- This is not the first time that U.S. financial conduct
in Iraq has come under fire, specifically over funds slated for reconstruction
after the U.S.-led attack in March 2003, which then went unaccounted for.
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- In June, British charity Christian Aid said at least
20 billion dollars in oil revenues and other Iraqi funds intended to rebuild
the country have disappeared from banks administered by the CPA.
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- Watchdog groups have complained before about the opaque
nature of the CPA's handling of Iraqi money and the lack of transparency
of U.S. and Iraqi officials.
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- Halliburton, a giant U.S. company that has been awarded
8.2 billion dollars worth of contracts from the Defense department to provide
support services such as meals, shelter, laundry and Internet connections
for U.S. soldiers in Iraq, has been targeted for allegedly overcharging
for those services.
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- "Continued failures to account for funds, such as
the 8.8 billion dollars of concern here - and the refusal, so far, of the
Pentagon to take corrective action are a disservice to the American taxpayer,
the Iraqi people and to our men and women in uniform," the senators
wrote.
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- Groups critical of the lack of transparency in the CPA's
spending have been particularly angry that the authority used Iraqi money
to pay for questionable contracts -- some awarded without a public tendering
process -- with U.S. companies.
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- Washington initially restricted the most lucrative reconstruction
contracts in Iraq to gigantic U.S. firms that appeared able to reap huge
profits, fueling accusations the Bush administration was seeking to benefit
a select few U.S. companies rather than find the best, and possibly the
cheapest, options to help rebuild Iraq.
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- After loud complaints, the contracting process was officially
opened to firms from other nations, but many of them still insist they
are not competing on a level playing field with U.S. businesses.
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- A Pentagon spokeswoman told IPS that the CPA administered
the money transparently and that Iraqi ministries used the eight billion
dollars in ways that directly "benefited the people of Iraq."
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- "The CPA provided these funds to Iraqi ministries
from the Development Fund for Iraq through a transparent and open budget
process," said Lt Col Rose-Ann L Lynch of the Office of the Assistant
Secretary of Defense for Public Affairs. "This is Iraqi money -- revenue
from such sources as oil sales -- not U.S. funds."
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- The official added that the money was used to pay the
salaries of hundreds of thousands of government employees, teachers, health
workers, administrators and government pensioners, as well as to fund the
Iraqi Defense ministry and police forces.
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- © Copyright 2004 IPS - Inter Press Service
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