Stoffel’s Tale from the Tombs Begins to Expose U.S. Free Fraud Zone in Iraq

February 16, 2009

Iraqi children playing in the streets in Sadr City, September 2008. A cholera epidemicwas then raging. AP.

Iraqi children playing in the streets in Sadr City, September 2008. A cholera epidemicwas then raging. AP.

In these days of multi-trillion dollar bailouts, it might seem petty to quibble over the fate of a mere $125 billion. But quibble we must, for that is the sum that the U.S. government has been accused of frittering away through corruption in Iraq since the fall of Saddam.

Indeed, cynics might snipe that the unwinding of several investigations into corruption in Iraq is occuring just as the world economy has made the sums involved seem trivial. Three years ago, we would realise the magnitude of a $125 billion theft from a nation with nothing. Nowadays, that sum has been somewhat overshadowed by what really amounts to a larger theft – the malfeasance of financial markets, and the subsequent shovelling of tax monies into their guts to resurrect them.

But as the Independent’s indefatigable Patrick Cockburn reminds us, the scale of the looting surely matches, and betters that of Bernard Madoff. And, if we were tempted to blame the perfidious natives, he relates the opinion of an Iraqi businessman that “I believe the real looting of Iraq after the invasion was by US officials and contractors, and not by people from the slums of Baghdad.”

Quite so. As Cockburn continues, “In 2004-05, the entire Iraq military procurement budget of $1.3bn was siphoned off from the Iraqi Defence Ministry in return for 28-year-old Soviet helicopters too obsolete to fly and armoured cars easily penetrated by rifle bullets. Iraqi officials were blamed for the theft, but US military officials were largely in control of the Defence Ministry at the time and must have been either highly negligent or participants in the fraud.”

The New York Times has been reporting this week on developments in certain corruption cases, and it is these cases that have led to the exposure of the sums being discussed. The twist, at least for unfortunate U.S. patriots, is that the week’s revelations have seen two high ranking U.S. military officials accused of serious corruption. Step forwards Lieutenant Colonel Ronald Hirtle (USAF) and Colonel Anthony Bell, who Cockburn relates was “responsible for contracting for the reconstruction effort in 2003 and 2004.”

Responsible may not quite be the correct word. The Times also reported that, while Bell and Hirtle have been fingered (both deny any guilt, by the way), “The investigation is also meant to ascertain whether there were connections between mid-level officials who have already been prosecuted and higher-level officials.”

Whether the Special Inspector General for Iraqi Reconstruction (sic) will get to the bottom of these cases is crucial to the future of Iraq, and it will depend upon the willingness of the Obama administration in pushing for full disclosure. That, in turn, will require a total u-turn from the Bush era, in which corruption allegations were pushed firmly under the Oval Office carpet.

As the Nation’s David Corn reported back in 2006, Congressional attempts to investigate corruption in Iraq were deliberately scuppered by the White House. When Henry Waxman sought to procure “documents and witnesses” to testify about corruption within the Iraqi government headed by Nouri al-Maliki, he was met with a wall of refusal. The State Department under Condolleezza Rice instructed its officials not to make any “Broad statements/assessments which judge or characterize the quality of Iraqi governance or the ability/determination of the Iraqi government to deal with corruption, including allegations that investigations were thwarted/stifled for political reasons” or “Statements/allegations concerning actions by specific individuals, such as the Prime Minister or other GOI [Government of Iraq] officials, or regarding investigations of such officials.”

As Waxman blustered, “The scope of this prohibition is breathtaking. On its face, it means that unless the Committee agrees to keep the information secret from the public, the Committee cannot obtain information from officials in the Office of Accountability and Transparency, about whether there is corruption within the Iraqi ministries, how extensive the corruption is, or whether the corruption is funding the insurgency and undermining public confidence in the Iraqi government.”

That was 2006. In 2008, a couple of members of the State Department’s “Office of Accountability and Transparency” did manage to testify before members of Congress. One, Arthur Brennan, told the Senate Democratic Policy Committee that “the State Department prevented a congressional aide visiting Baghdad from talking with staffers by insisting they were too busy” while, “In reality…office members were watching movies at the embassy and on their computers.”

According to Brennan, the OAT was “little more than ‘window dressing,” In any case, by the time he came to tell his story, as the Associated Press reported, “[had been] dismantled…after it alleged in a draft report leaked to the media that al-Maliki’s office had derailed or prevented investigations into Shiite-controlled agencies.”

Brennan’s colleague, James Mattil, also related how those who sought to combat corruption in Iraq did not just meet a wall of silence in their own country. When they sought to flee, following intimidation (and numerous murders), the U.S. government completely turned its back on them.

That was in May 2008. By November 2008, the press was reporting that what Brennan and Mattil had said was true – the Maliki government, aided by the Bush administration has almost completely disbanded mechanisms intended to police corruption. As the New York Times reported, of 30 “inspector generals” in each Iraqi ministry, perhaps 17 had been sacked and not replaced. According to Stuart Bowen, who is the aforementioned Special Inspector General for Iraqi Reconstruction, this has been abetted by the Bush administration, telling the Times that “the inspectors general were vulnerable because once their offices were created, the United States provided little support and training for what was a startling concept for the bureaucracy, which was shaped by the secrecy and corruption of the Saddam Hussein era.”

But the problem seems not to be lack of competence. The problem is precisely the converse – too much competence. After all, why would Maliki bother too much about an incompetent corruption investigator? And no amount of training will help corruption trackers deal with a thuggish regime installed and guaranteed by the most powerful nation on earth.

It’s all quite deliberate. And it’s also been approved by the British, at least tacitly. The case of Judge Rathi al-Rathi – certainly the highest profile of Iraq’s corruption investigators – illustrates this. Al-Rathi had seen 30 of his colleagues killed and his house attacked by rockets (having had the temerity to take his job seriously as head of Iraq’s “Commission on Public Integrity”). Yet the Maliki government then charged al-Rathi with corruption, forcing him to flee to the U.S. in 2007.

Before fleeing, al-Rathi’s son had applied for asylum in the UK, but was turned down. That’s after rocket attacks on his home. It was, perhaps more tellingly, soon after al-Rathi had testified on Capitol Hill before the House Oversight Committee, prompting Henry Waxman to ask Americans “is the Maliki government too corrupt to succeed? We need to ask whether we can in good conscience continue to sacrifice our blood and tax dollars to prop up this regime?”

As the Times’ Sarah Baxter drolly put it, “Soon after he gave evidence, Radhi received word that an application for asylum in Britain filed by his 21-year-old son had been turned down…Liam Byrne, a Home Office minister, wrote to Chris Mullin MP that Radhi’s son would have access to “the highest level of protection available in Iraq” and would thus have no reason to stay in Britain.”

Both Washington and London have sought to protect the Iraqi government from any investigations of its immensely corrupt record. They have been doing so partly out of realpolitik – to protect a (reasonably) compliant leader. But, as this week’s revelations about senior U.S. military personnel suggest, the real motivation may well be more self-preservation, given the sums of money involved.

But how do we know anything about these cases of official corruption? Well, it’s not because the U.S. political system has an impeccable means of investigating corruption and bringing the perpetrators to justice. The evidence that has been reported comes from a lucky coincidence. As Cockburn reports, “In the expanded inquiry by federal agencies, the evidence of a small-time US businessman called Dale C Stoffel who was murdered after leaving the US base at Taiji north of Baghdad in 2004 is being re-examined.”

Stoffel, “an arms dealer and contractor” was “granted limited immunity from prosecution after he had provided information that a network of bribery – linking companies and US officials awarding contracts – existed within the US-run Green Zone in Baghdad.” It is Stoffel’s evidence which links the U.S. military hierarchy to “bribes of tens of thousands of dollars [that] were regularly delivered in pizza boxes sent to US contracting officers.”

This evidence is not new in any sense. As Cockburn and the NYT report, law enforcement knew about Stoffel before his death. The contractor/arms dealer/CIA agent had only just returned from Washington at the time of his death, having alerted Senator Rick Santorum to his allegations. Indeed, just moments before his murder, he had been consulting with high ranking U.S. military and Iraqi officials at camp Taiji.

More details about Stoffel’s (extremely shady) life can be found in an excellent extended article by Aram Roston, published by the Washington Monthly back in 2005.

Right now, whether he was murdered by the U.S., or the Iraqi state (if the two could be extricated back in 2004) is by the by. It is his voice from beyond the grave that we must concern ourselves with, and the $125 billion question that he can’t help asking: Where is the damn money and how can Iraqis get it back?


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