Video: Is corruption undermining Iraq effort?

By
NBC News Investigative Unit
updated 7/30/2007 8:56:03 PM ET 2007-07-31T00:56:03

Supplies and medicine in strife-torn Baghdad's overcrowded hospitals have been siphoned off and sold elsewhere for profit because of corruption in the Iraqi Ministry of Health, according to a draft U.S. government report obtained by NBC News.

The report, written by U.S. advisers to Iraq's anti-corruption agency, analyzes corruption in 12 ministries and finds devastating and grim problems. "Corruption protected by senior members of the Iraqi government," the report said, "remains untouchable."

One potential problem is in the office of Prime Minister Nouri al-Maliki, according to the report.

The report said that "the prime minister’s office has on a number of occasions intervened on cases involving political supporters."

An al-Maliki adviser acknowledged to NBC that the problem of corruption in Iraq is "huge," but denied that al-Maliki's office has intervened in investigations. He said the prime minister is working hard to minimize the problem.

The draft report obtained by NBC said the Iraqi Ministry of Health, which oversees the country's hospitals, is in the "grip" of the Mahdi Army, the anti-American militia run by Shiite cleric Muqtada al-Sadr.

"Contract fraud and employee theft of medicines, food, vehicles are viewed by investigators as the greatest problems," the report said, adding that "military sources have reported that the Mehdi Army [sic] finances operations from diverted medicines."

Corruption 'widespread'
In the Ministry of Oil — the most important agency for Iraq’s economy — the report said "corruption is a major problem" when it comes to refined oil products, such as gasoline and kerosene. The report said corruption in the oil ministry is partly to blame for lines of cars stretching for miles as Iraqis wait hours to fill up their tanks.

An entire battalion of Iraqi police "was found to be nonexistent" and corruption in the army is "widespread," with ghost employees and a shortage of supplies, according to the report.

The report also cites alleged favoritism and selective prosecution.

The draft report cited an incident at the Ministry of Oil that implicated the Shiite minister and four other officials, including one Sunni. The other three officials were reportedly Shiites, who were "the only ones capable of giving testimony against the minister."

The minister, the report said, then used a technicality in Iraqi law to exempt the three Shiites from prosecution so that only the Sunni went to prison.

That technicality he allegedly used is a Saddam Hussein-era law known as Article 136B that was lifted when Americans first occupied the country. The statute was reinstated by the Iraqi government.

'Get out of jail free card'
The law allows the prime minister to exempt Cabinet ministers from prosecution and allows ministers to exempt their employees from prosecution.

"This is tantamount to a get out of jail free card," Stuart Bowen, the special inspector general for Iraq reconstruction, told NBC.

Bowen pointed to the oil ministry case involving the three Shiites as a stark example of the problem. "It exposes the arbitrariness of Article 136B," he said.

Bowen said the provision "essentially acts as a bulwark against effective enforcement. If a minister wants to protect an employee from corruption charges, simply by fiat that minister can do so."

The top Iraqi anti-corruption investigator, Judge Rahdi al Rahdi, told NBC that "in many important cases, ministers did not give us the permission to take their employees to court, the prime minister's office did not give us permission to take ministers to court."

Rahdi said the total amount of missing money involved in his investigations into government misconduct is $11 billion.

Corruption is so serious that it is difficult for the government to function, according to Ali Allawi, a former Iraqi government minister.

"There's a serious problem in the Ministry of Oil," Allawi said, "There's a serious problem in the Ministry of Health. There's a serious problem in the Ministry of Trade, and really, there's a serious problem in every government department."

Americans 'must grin and bear it'
Allawi, who has written a book called “The Occupation of Iraq: Winning the War, Losing the Peace,” said corruption has shattered any faith in government. "In some cases there is ... despair that ... corruption has destroyed the ability of the government to provide services," he said.

The draft report obtained by NBC outlines some devastating cases in Iraq, like a "guns for cash scheme with the Mehdi Army" involving a candidate for the head of Iraqi intelligence.

On top of the troubles of the current oil minister, the report said a former acting minister of oil was indicted — a case blocked by high-ranking officials. In another case a former minister of transportation was indicted.

Last week Bowen issued a report finding the U.S. Embassy had not done enough to combat corruption.

Allawi argues that U.S. authorities can do little because of the Iraqi officials with whom they are dealing.

"The Americans who are supporting this political class, I believe really have no choice. This is a group they have been saddled with, or supported in power, and must grin and bear it," he said.

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