Wednesday, July 28, 2010

Pentagon can't account for $8.7 billion in Iraqi funds


Pentagon can't account for $8.7 billion in Iraqi funds

The reconstruction money was from oil revenue it was entrusted with between 2004 and 2007, according to a newly released audit that underscores a pattern of poor record-keeping.

July 26, 2010|By Liz Sly, Los Angeles Times
Reporting from Baghdad — The Defense Department is unable to properly account for $8.7 billion out of $9.1 billion in Iraqi oil revenue entrusted to it between 2004 and 2007, according to a newly released audit that underscores a pattern of poor record-keeping during the war.
Of that amount, the military failed to provide any records at all for $2.6 billion in purported reconstruction expenditure, says the report by the Special Inspector General for Iraq Reconstruction, which is responsible for monitoring U.S. spending in Iraq. The rest of the money was not properly deposited in special accounts as required under Treasury Department rules, making it difficult to trace how it was spent.
Though there is no apparent evidence of fraud, the improper accounting practices add to the pattern of mismanagement, reckless spending and, in some instances, corruption uncovered by the agency since 2004, when it was created to oversee the total of $53 billion in U.S. taxpayer money appropriated by Congress for the reconstruction effort.
"The breakdown in controls left the funds vulnerable to inappropriate uses and undetected loss," notes the audit report, a copy of which was obtained Monday by the Los Angeles Times.
Special Inspector General Stuart Bowen, who heads the agency, said repeated investigations have shown that "weak oversight is directly correlated to increased numbers of cases of theft and abuse."
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