Thursday, June 23, 2005

U.S. was big spender in days before Iraq handover

U.S. was big spender in days before Iraq handover
By Sue Pleming
Wed Jun 22, 2:06 AM ET

WASHINGTON (Reuters) - The United States handed out nearly $20 billion of Iraq's funds, with a rush to spend billions in the final days before transferring power to the Iraqis nearly a year ago, a report said on Tuesday.

A report by Democratic Rep. Henry Waxman (news, bio, voting record) of California, said in the week before the hand-over on June 28, 2004, the U.S.-led Coalition Provisional Authority ordered the urgent delivery of more than $4 billion in Iraqi funds from the U.S. Federal Reserve in New York.

One single shipment amounted to $2.4 billion -- the largest movement of cash in the bank's history, said Waxman.

Most of these funds came from frozen and seized assets and from the Development Fund for Iraq, which succeeded the U.N.'s oil-for-food program. After the U.S. invasion, the U.N. directed this money should be used by the CPA for the benefit of the Iraqi people.

Cash was loaded onto giant pallets for shipment by plane to Iraq, and paid out to contractors who carried it away in duffel bags.

The report, released at a House of Representatives committee hearing, said despite the huge amount of money, there was little U.S. scrutiny in how these assets were managed.

"The disbursement of these funds was characterized by significant waste, fraud and abuse," said Waxman.....