IRAQ: Cronyism and Kickbacks (or thieves and carpetbaggers)
http://www.corpwatch.org/article.php?id=13160para 4: They claim that 143 water and sanitation projects had been completed by July 2005, but the GAO is not convinced, pointing out that the officials ‘could not document the location, scope and cost of these projects’, and that ‘reporting only the number of projects . . . provides little information on . . . the amount and quality of water reaching Iraqi households.’
para 5: Millions of Iraqis now have mobile phones, but they don’t have clean water, the streets are awash with sewage, the electricity often fails and most hospitals are in a terrible state.
para 6: The Iraqi public has not been getting value for money, while myriad contractors, bureaucrats and politicians – American and Iraqi – have been getting stonkingly rich, a situation that the CPA fostered.* When the auditors first commented on the CPA’s lack of accountability, its boss, Paul Bremer, bullishly replied that their report ‘does not meet the standards Americans have come to expect of the inspector general’.
para 7: The auditors’ investigations into financial abuse under Bremer’s CPA in Iraq’s South-Central region found hard evidence of mendacity and theft. ...More interesting is Robert Stein...Stein has been convicted of fraud and sued for embezzlement in previous business dealings with the US military in the States. He is a private contractor. It’s odd that he, rather than a federal employee, was put in charge of a reconstruction kitty of some $82 million in cash. Stein kept the value of the contracts he awarded and the payments he authorised just below the threshold above which more senior approval was required, or submitted them on forms intended for smaller sums. Because he was spending Iraqi money, he was not subject to the tight federal standards that would have applied had he been spending American taxpayers’
para 8: In return for allegedly granting Bloom’s companies contracts, including to build a police academy at Babylon and ‘to rehabilitate’ the Karbala library, Stein and his wife are accused of receiving $683,284.93 from Bloom. Some $267,000 was transferred into their personal bank accounts. Other payments went directly to creditors in Stein’s hometown of Fayetteville, North Carolina: $36,348 to jewellers, $140,000 to a local real estate firm, more than $100,000 to local car dealerships. Credit card bills, local and federal taxes, a $10,000 Treasury bill and $200 owing on a court settlement were paid. Stein’s position at CPA regional headquarters appears to have offered him the opportunity to tidy up his domestic finances. To Bloom he must have seemed an excellent business partner, often authorising cash payment for the total value of contracts the same day they were signed.
para 10: Buried in one of the appendices of an earlier SIGIR audit (of April 2005) is a report that the division level agent for South-Central Iraq was fired by Bremer’s Baghdad office on 30 May 2004. That agent was Robert Stein. Yet he was allowed to carry on. ‘The division level agent made or authorised disbursements in the amount of $1,496,562 after his authority to make cash disbursement was revoked,’ the appendix says. He also approved funding of $499,000 for a ‘project modification’ and an electronic fund transfer of $300,423 on 28 June, the day the CPA closed.
para 13: It appears that CPA officials handed stacks of $100 bills to local dignitaries and others whose support they wanted and whose intelligence they needed, to dispose of as they saw fit. The ‘reconstruction’ projects seem to have been part of a ‘hearts and minds’ campaign and it may never have been intended that the funds be properly accounted for. A woman from al-Hillah told me that $100,000 designated for a local women’s centre with which she was involved was handed over to a local dignitary who, she alleges, used it to finance his election campaign. The money came from the Development Fund for Iraq: it was, in other words, Iraqi money handed over to the Americans under UN Security Council Resolution 1483 to be spent ‘in a transparent manner to meet the humanitarian needs of the Iraqi people’.
para 15: They also found that the US embassy can’t account for all the contractual commitments made with $2.8 billion of Iraqi funds which were handed over to it during the first half of 2005.
and on and on and on
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