Tuesday, February 22, 2005

Corruption in Iraq - File on 4


On February 1, BBC radio’s “File on 4” programme described the plundering of Iraq’s oil by the US government, its allies and big business.

Money that was supposed to be used to renew the infrastructure of the country and provide the country’s population with the necessities of life was simply stolen.

The programme reported the release last month of an audit of the management of Iraq’s oil revenues by the Coalition Provisional Authority (CPA). The survey, conducted by US government officials, found that $8.8 billion of Iraqi money remains unaccounted for. The US media largely buried the findings.

Dr. Reinoud Leenders, of the International Crisis Group, stated bluntly at the beginning of the broadcast, “We can only guess how much disappears in private pockets. I really fear that Iraq reconstruction will turn into one of the biggest corruption scandals in history.”

Dr. Isam al Khafaji, who worked with the US State Department before the war, described how businesses that were awarded contracts would subcontract out the work up to six times—allowing every layer to take their cut. In many cases, none of the firms ever began any of the contracted work.

“File on 4” focused on the case of the private US company Custer Battles. Allegedly the company committed a total of up to $50 million of fraud in Iraq.

The programme spoke to Marie de Young, who had worked as a logistics specialist for Halliburton. De Young turned whistleblower to expose the practices she witnessed in Iraq.

A report issued by a Congressional Committee on Government Reform concluded that Halliburton overcharged for the fuel in Iraq by $167 million, a mark-up of 90 percent.

The BBC pointed out that the most serious charges against Halliburton concern bribery. A State Department document to the US Embassy in Kuwait reported complaints from a leading oil contracting company. It stated, “It is common knowledge in Kuwait that Halliburton officers are on the take; that they solicit bribes openly; that anyone visiting their sea-side villas at the Kuwait Hilton who offers to provide services is asked for a bribe.”

Bribery charges have also been made against CPA officials. Claude Hankes-Drielsma, a British adviser to the Iraqi Governing Council, told the programme that some officials within the CPA demanded payment of up to $300,000 before awarding contracts.

When asked on the programme how high in the Coalition the “failings” went, Chief of Staff, Ginger Cruz said it went right to the top, to CPA chief Paul Bremer.

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