Billions likely wasted in Iraq work: US auditors

The Office of the Special Inspector General for Iraq Reconstruction Funds has spelled out a range of accounting weaknesses.

Washington: After years of following the paper trail of USD 51 billion in US taxpayer dollars provided to rebuild a broken Iraq, the US government can say with certainty that too much was wasted. But it cannot say how much.

In what it called its final audit report, the Office of the Special Inspector General for Iraq Reconstruction Funds on Friday spelled out a range of accounting weaknesses that put "billions of American taxpayer dollars at risk of waste and misappropriation" in the largest reconstruction project of its kind in US history.

"The precise amount lost to fraud and waste can never be known," the report said.

The auditors found huge problems accounting for the huge sums, but one small example of failure stood out: A contractor got away with charging USD 80 for a pipe fitting that its competitor was selling for USD 1.41. Why? The company`s billing documents were reviewed sloppily by US contracting officers or were not reviewed at all.

With dry understatement, the inspector general said that while he could not pinpoint the amount wasted, it "could be substantial”.

Asked why the exact amount squandered can never be determined, the inspector general`s office referred a news agency to a report it did in February 2009 titled "Hard Lessons”, in which it said the auditors much like the reconstruction managers themselves faced personnel shortages and other hazards.

"Given the vicissitudes of the reconstruction effort which was dogged from the start by persistent violence, shifting goals, constantly changing contracting practices and undermined by a lack of unity of effort a complete accounting of all reconstruction expenditures is impossible to achieve," the report concluded.

In that same report, the inspector general, Stuart Bowen, recalled what then-defence secretary Donald Rumsfeld asked when they met shortly after Bowen started in January 2004: "Why did you take this job? It`s an impossible task."

By law, Bowen`s office reports to both the secretary of defence and the secretary of state. It goes out of business in 2013.

Bowen`s office has spent more than USD 200 million tracking the reconstruction funds, and in addition to producing numerous reports, his office has investigated criminal fraud that has resulted in 87 indictments, 71 convictions and USD 176 million in fines and other penalties. These include civilians and military members accused of kickbacks, bribery, bid-rigging, fraud, embezzlement and outright theft of government property and funds.