Friday, January 21, 2005


..and now for the rest of the story

Finger Pointing Dirty Politics Iraqi Style: Via New York Times

Earlier this month, according to Iraqi officials, $300 million in American bills was taken out of Iraq's Central Bank, put into boxes and quietly put on a charter jet bound for Lebanon.

The money was to be used to buy tanks and other weapons from international arms dealers, the officials say, as part of an accelerated effort to assemble an armored division for the fledgling Iraqi Army. But exactly where the money went, and to whom, and for precisely what, remains a mystery, at least to Iraqis who say they have been trying to find out.

The $300 million deal appears to have been arranged outside the American-designed financial controls intended to help Iraq - which defaulted on its external debt in the 1990's - legally import goods. By most accounts here, there was no public bidding for the arms contracts, nor was the deal approved by the entire 33-member Iraqi cabinet.

On Friday, the mysterious flight became an issue in this country's American-backed election campaign, when Defense Minister Hazim al-Shalaan, faced with corruption allegations, threatened to arrest a political rival.

In an interview on Al Jazeera television, Mr. Shalaan said he would order the arrest of Ahmed Chalabi, one of the country's most prominent politicians, who has publicly accused Mr. Shalaan of sending the cash out of the country. Mr. Shalaan said he would extradite Mr. Chalabi to face corruption charges of his own.

"We will arrest him and hand him over to Interpol," Mr. Shalaan thundered on Al Jazeera. The charge against Mr. Chalabi, he said, would be "maligning" him and his ministry. He suggested that Mr. Chalabi had made the charges to further his political ambitions.

Mr. Chalabi first made the allegation against Mr. Shalaan last week, on another Arabic-language television network. He said there was no legitimate reason why the Iraqi government should have used cash to pay for goods from abroad. He implied that at least some of the money was being used for other things.

"Why was $300 million in cash put on an airplane?" Mr. Chalabi asked in an interview this week. "Where did the money go? What was it used for? Who was it given to? We don't know."

The $300 million flight has been the talk of Iraq's political class, and fueled the impression among many Iraqis and Western officials that the interim Iraqi government, set up after the American occupation formally ended in June, is awash in corruption. It is not clear whether the money came from Iraqi or American sources, or both.

"I am sorry to say that the corruption here is worse now than in the Saddam Hussein era," said Mowaffak al-Rubaie, the Iraqi national security adviser, who said he had not been informed of the details of the flight or the arms deal.

That charge is echoed outside of Iraq as well. Isam al-Khafaji, the director of the New York-based Iraq Revenue Watch, said corruption had become an "open secret" within the Iraqi government.

"There is no legal system to bring charges against anyone not following the rules and not abiding by the law, especially if you're a powerful politician," Mr. Khafaji said. "That's the tragedy of Iraq: Everyone runs their business like a private fiefdom."

Mr. Shalaan did not respond to several requests for an interview, but one of his aides insisted that the arms deal was legal and that the money had been well spent.

Reached by telephone in Lebanon, the aide, Mishal Sarraf, said the arms deal had been approved by four senior members of the Iraqi government, including Prime Minister Ayad Allawi and Mr. Shalaan. He said it had been carried out quickly because of the urgency of the guerrilla war. He said he had not realized that the deal had been done in cash.

"We don't want to hide anything," Mr. Sarraf said.

He said the armaments themselves had been manufactured in Poland, the Czech Republic, Turkey, Ukraine and the United States. He said the money had bought armored personal carriers, tanks and even Humvees.

Mr. Sarraf refused to say who received the money, saying it was too dangerous.

"They could be killed," he said.

Read the rest.

Posted By: Redneck Texan