Posted on 12/28/2003 11:11:02 PM PST by Utah Girl
Iraq's interim trade ministry is investigating alleged corruption of up to $US40 million involving senior ministry officials, but has backed off initial claims that members of the US-led Coalition Provisional Authority (CPA) authority were implicated.
Trade minister Ali Allawi said that he discovered a month ago that a contract for wooden doors worth about $80 million had been manipulated.
Mr Allawi had said in an interview that members of the CPA were implicated but on Sunday night, following vehement CPA denials of involvement, said he was mistaken.
He said a UN agency, not the CPA, continued to run a program for importing construction material until the UN's withdrawal from Iraq after an August 19 bombing killed 22 people at its Baghdad headquarters.
Mr Allawi said people from that UN program "are probably indictable".
During the earlier interview, Mr Allawi had said: "There is strong evidence, indictable evidence, of the implication of certain individuals, senior management who have since been asked to leave, together with - unfortunately - figures in the CPA."
The CPA's spokesman, Charles Heatly, said he was aware of the trade ministry's investigation but he emphasised the CPA had no involvement in the contract and said the CPA applies "full transparency and accountability" to its contracting procedures.
"This contract was negotiated by the Ministry of Trade before the war under the UN-administered oil-for-food program," Mr Heatly said.
"I think a third of it was stolen," Mr Allawi said, specifically estimating that "probably around 30, 40 million" disappeared.
He said he has appointed investigative staff "to look at claims of large-scale corruption after April 9 and there are such incidents, I am afraid."
Mr Allawi was referring to the date US-led forces toppled the regime of former dictator Saddam Hussein.
Mr Allawi, who returned from his job as a London investment banker to take up his post in September, said the allegations mainly involve "contract manipulation and ... contract prioritisation" which he has asked a prosecutor to investigate.
He said a few "key individuals" were under investigation.
"If the evidence is confirmed then obviously I'll bring charges," he said.
It is not the first time contracts in Iraq have come under scrutiny.
The Middle East Economic Survey predicted earlier that it was increasingly unlikely Iraq's new mobile telephone service would be in place by year's end because of a Pentagon investigation into allegations of corruption in the awarding of the three licences.
Iraq's interim telecommunications minister, Haydar al-Abadi, said the corruption allegations were "a naked lie" exposed by the fact that he signed the licences last week and the companies were testing their networks.
He said neither the Pentagon nor any other agency had asked his ministry questions about the mobile phone deals.
"There is no such inquiry," he said.
In October, the British charity Christian Aid alleged $US4 billion in oil revenues and other Iraqi funds earmarked for the country's reconstruction had disappeared into "opaque" bank accounts administered by the CPA.
Paul Bremer, the top CPA civilian official, rejected those allegations and said all funds were being spent or transferred in a "completely transparent" way.
Mr Allawi said the latest allegations ran counter to the mentality he was trying to instil within his department.
"We are trying as much as possible to instil a culture of resisting corruption," he said.
The ministry is organising a public forum to create a non-governmental organisation that would combat the problem.
Once the watchdog has elected its own secretariat, the ministry will withdraw from the body, Mr Allawi said.
Mr Allawi said people from that UN program "are probably indictable".
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