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More US Money Wasted in Iraq, Audit Finds
By Emad Mekay
Inter Press Service
Wednesday 31 January 2007
Washington - Dozens of millions of dollars originally slated for the reconstruction
and security of Iraq have been squandered on luxury items like an Olympic-sized
swimming pool, VIP trailers, and buildings that were never or rarely used, a
U.S. government watchdog says.
In eight new audits carried out over the past quarter alone, the U.S. Special
Inspector General for Iraq Reconstruction (SIGIR) Stuart Bowen indicated that
"corruption continues to plague Iraq" and that "the security
environment has continued to deteriorate."
The audits, submitted to Congress Wednesday, reviewed U.S. efforts to support
the capacity development of Iraq's ministries, as well as the State Department's
management of funding for Iraqi police training, a study of medical equipment
purchased to support the primary healthcare centres, and a statistical summary
of security costs for major U.S. contractors in Iraq.
Among the examples of waste documented in the 579-page report is that as part
of a contract awarded to DynCorp International between July 2004 and June 2006,
the State Department paid 43.8 million dollars for manufacturing and temporary
storage of a residential camp that has never been used.
That sum included 4.2 million dollars for unauthorised work that included relocating
the residential camp to outside of the Adnan Palace grounds, building an additional
20 VIP trailers, and constructing an Olympic-size swimming pool on the palace
grounds.
The State Department may have also spent another 36.4 million dollars on weapons
and equipment, including armoured vehicles, body armour and communications equipment,
that cannot be accounted for because "invoices were vague and there was
no backup documentation".
The audit also found that a project for the Baghdad Police College suffered
a variety of shortfalls, including poor construction quality, budget overruns
and the delivery of unfinished facilities.
"Anticorruption institutions in Iraq are fragmented, and there does not
appear to be an internal Iraqi consensus about how these institutions should
interact," said the report.
The report also pointed a finger at the deteriorating security situation, saying
it is "hindering progress in all reconstruction sectors and threatening
the overall reconstruction effort."
It concludes that infrastructure security remains vulnerable. Power lines are
attacked regularly, and the northern oil pipelines are largely inoperable because
of sabotage. Iraqi repair crews are frequently unable to work because of repeated
attacks.
The investigation faulted "inconsistent coordination" among the many
U.S. agencies supporting Iraq's reconstruction for hampering the effective execution
of U.S. assistance.
The report comes at a particularly sensitive time for President George W. Bush,
who is asking the U.S. Congress to approve 1.2 billion dollars in new money
for the reconstruction of Iraq.
On Jan. 10, President Bush presented a new strategic direction for U.S efforts
in Iraq, which includes more U.S. investment in Iraq's economic recovery.
It comes also at a sensitive time for other international donors such as the
United Nations, the World Bank and Iraq's regional neighbours.
The United States is trying to convince them that Iraq, because of the security
situation, requires a "new phase of investment" through the International
Compact for Iraq. But corruption and waste have undermined reconstruction efforts
in the occupied nation since 2003, with a long list of reports documenting the
abuses.
In December, the Government Accountability Office, the watchdog arm of the
U.S. Congress, released a report which found multiple deficiencies in the Army's
oversight of contractors in Iraq, including "limited visibility over contractors,"
lack of "adequate contractor oversight personnel," and "little
or no training on the use of contractors."
The now defunct Coalition Provisional Authority also delivered more than 8.8
billion dollars in cash to Iraqi ministries but several later audits found there
was virtually no tracking of this money, much of which went to "ghost employees."
Members of Congress here have been seeking information on contracts entered
into by the Bush administration for reconstruction and development work in Iraq,
including several billion-dollar contracts with a subsidiary of Halliburton
Corporation.
Some U.S. lawmakers have raised concerns about the process of awarding and
overseeing government contracts, including questions about the apparently inflated
prices charged by Halliburton to import gasoline from Kuwait into Iraq and Halliburton's
admission of kickbacks to company officials.
SIGIR investigators say they are still working on 78 open investigations, including
23 cases under direct Justice Department supervision, implying the possibility
of major criminal charges.
Since the invasion of Iraq in March 2003, the Bush administration has spent
more than 30 billion dollars in U.S. taxpayer funds and another 20 billion dollars
in Iraqi funds under its control for the reconstruction effort. The war in general
has reportedly cost more than 450 billion dollars.
Many lawmakers here, however, say that despite the vast expenditures, the reconstruction
effort has produced little of lasting value either for the U.S. or for Iraq.
Democratic Representative Henry Waxman, who has been particularly vocal in
his criticism of waste in Iraq, will convene a hearing next week about fraud
and corruption there. Paul Bremer, former head of the Coalition Provisional
Authority, has been asked to testify. Stuart Bowen and Timothy Carney, Coordinator
for Iraqi Transitional Assistance, are also expected to appear.
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