This is an amazing story. It looks mighty familiar.
From The Sunday Times March 11, 2007 http://www.timesonline.co.uk/...
A former Iraqi defence minister whose 10 months in office coincided with the disappearance of more than $800m (£400m) from the ministry’s coffers is living openly in Amman and London despite a warrant for his arrest.
Hazem Shaalan, a small businessman in London until Saddam Hussein was ousted in 2003, rose in a year to one of the most important jobs in the interim government that ran Iraq from 2004 to 2005.
A cool $80 million a month.
He left Baghdad before the next government discovered that a fortune had been looted from his ministry’s account in what one senior investigator has called "one of the largest thefts in history".
Check out this awsome excuse.
"There is nearly $800m we never received," he said over cups of sweet tea brewed by his bodyguard. "These $800m were never at any time received by the Ministry of Defence, nor were they spent by the Ministry of Defence."
Documents obtained during an official Iraqi investigation and seen by The Sunday Times suggest otherwise.
The article has a lot more detail about the money transfers.
they believe that most of it went on weapons deals in which the ministry was supposed to acquire expensive, modern equipment but bought cheap, substandard items instead, with the difference in price being pocketed along the way.
In one example, the latest MP5 American machineguns were ordered at a cost of $3,500 each. But what was delivered were Egyptian copies worth $200 per gun...
"We got scrap metal in return. This is not just about fraud. The substandard equipment that the army received meant soldiers died as a result.
One Iraqi official claimed last week that the missing money would have paid for 11,000 schools or 500 hospitals.
Did it go back to our arms dealers? Did we really want to rebuild Iraq or did we want to arm them?
The person with overall ministerial responsbility was Shaalan, who had made a relatively meagre living from property deals and part-time journalism in Britain before the war and enjoyed a meteoric rise after the US-led invasion toppled Saddam.
Having worked on the fringes of Iraqi exile politics in London, he was initially appointed by the Coalition Provisional Authority (CPA) as governor of Qadisiyah province, where he evidently impressed American officials. Although he comes from a prominent Shi’ite clan, he won plaudits for his fierce opposition to fundamentalist Shi’ite factions[IRAN].
When the provisional authority handed over to Iraq’s interim government in 2004, the transition was chaotic and the new administration riddled with favouritism.
Shaalan became defence minister without any experience in security or managing a large organisation. Soon after his appointment he wrote to the prime minister, Iyad Allawi, asking for an increase in his ministry’s budget, which had been set at $450m, on top of $8-$10 billion the Americans spent separately that year on training and equipping the Iraqi army.
...In a memo signed by Shaalan he said there were "a number of secret contracts the amounts of which cannot be made public", and other contracts "which require immediate expenditure". In the same memo he demands "tax exemption for secret contracts". The finance ministry was instructed to allocate the $1.7 billion for the creation of the rapid deployment divisions and to place it at the disposal of Shaalan’s ministry.
Shaalan’s memo was dated August 29. Two days later Jumaili incorporated the Flowing Spring company with assets of $2,000. Within months the company was doing deals for the ministry and hundreds of millions of dollars were flowing into his personal account.
Looks like the Katrina relief. How did this man, a part time journalist, become defense minister? Looks like Brownie all over, with a little Cheney to boot.
Jumaili forged an alliance with Ziad Cattan, an Iraqi with dual Polish citizenship. Cattan was appointed head of military procurement at the ministry, even though he appears to have had no credentials for the job. He had run a pizza parlour in Poland while Saddam was in power, and had a small used car business in Germany.
He later admitted to an American newspaper: "Before, I sold water, flowers, shoes, cars – but not weapons. We didn’t know anything about weapons."
Cattan turned to Flowing Spring to provide the Iraqi army with arms and other equipment. He agreed contracts worth more than $1 billion with Flowing Spring and other companies controlled by Jumaili.
There was little or no competitive tendering. The contracts, some of which the Ministry of Defence never saw, even allowed Jumaili to determine what was delivered at his own discretion.
Yep I thought I herd this story before. Only this is just an 11th of the $8.8billion that went missing.
I guess I was wrong that $8,800,000,000 was just the start.
http://www.corpwatch.org/... originaly in LA Times. November 6th, 2005
All told, nearly $1 billion worth of contracts were signed with Jumaili's companies, according to the audit. Cattan said Jumaili charged 1% for his services. If true, Jumaili could have earned up to $10 million in fees. Jumaili could not be reached for comment.
U.S., Iraqi and coalition officials said they didn't know about the enormous cash transfers until after one especially large shipment of $300 million became public last winter, when ministry officials were spotted loading bags stuffed with $100 bills onto a flight to Jordan.
Here is a link to http://www.youtube.com/...
60 minutes interview this story.
http://www.cbsnews.com/...
broke this story months ago...but it looks much worse now.
One of the people praised in former U.S. Ambassador L. Paul Bremer's memoirs is a major suspect in the case. Ziad Cattan was in charge of military procurement
Add this to a long list of investigations. Is 2yrs long enough?