Disappearance of $6.6 billion in Iraq can’t be shrugged off

It didn’t take long for an Iraqi government official to raise the stakes in the great mystery of the U.S.-led Iraq war: What happened to the $6.6 billion that was meant to pay for the reconstruction of the country? In all, $20 billion in cash — wrapped bricks of $100 bills — was flown from the Federal Reserve repository in New Jersey to Iraq during the first year of the invasion that toppled Sad-dam Hussein.

The money had come from Iraqi oil sales, surplus funds from the U.N’s oil-for-food program and seized Iraqi assets. The administration of former President George W. Bush justified the use of the money by saying it was dedicated to the rebuilding of the infrastructure, including roads, bridges and water and sewer systems, and the reconstruction of schools. The 2003 U.S.-led invasion resulted in widespread destruction, especially in the major population centers, such as the capital, Baghdad.

The country is recovering.

The disappearance of the $6.6 billion was revealed last week when the U.S. Defense Department conceded that after years of audits and investigations there is no clear answer to the question: What happened to those airplane loads of cash? But for the first time time, federal auditors are suggesting that some or all of the cash may have been stolen, not just mislaid in an accounting error, according to the Los Angeles Times.

The Times reported that Stuart Bowen, special inspector general for Iraq reconstruction, said the missing $6.6 billion may be “the largest theft of funds in national history.”

The theft of such a staggering sum might seem unlikely, but U.S. officials aren’t ruling it out, the paper stated. Some U.S. contractors were accused of siphoning off tens of millions in kickbacks and graft during the post-invasion period, especially in its chaotic early days. But Iraqi officials were viewed as prime offenders.

But given that the money actually belonged to Iraq, the speaker of the parliament, Osama al-Nujaifi, told the Al Jazeera network that the amount of money unaccounted for by the U.S. government is $18.7 billion, rather than $6.6 billion.

Reimbursement

Because the American government was responsible for managing the Iraqi money, al-Nujaifi made it clear that the Iraqi government isn’t going to settle for a “We don’t know what happened to the funds” from Washington. And, there is every indication that the Iraqis intend to push the issue of reimbursement. In other words, Baghdad wants Washington to come up with the lost cash.

According to the Times, Iraqi officials argue that the U.S. government was supposed to safeguard the stash under a 2004 legal agreement it signed with Iraq. That makes Washington responsible, they say. Abdul Basit Turki Saeed, Iraq’s chief auditor, has warned U.S. officials that his government will go to court if necessary to recoup the missing money.

“Clearly Iraq has an interest in looking after its assets and protecting them,” said Samir Sumaidaie, Iraq’s ambassador to the United States.

With the stakes so high, it’s not enough for the Pentagon and auditors to suggest that the American taxpayers, who would ultimately be on the hook for any repayment to Iraq, will simply have to concede that the truth of what happened will never be known.

The idea that individuals could steal plane loads of money and not be called to account is unacceptable. There must be a further investigation.