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May 6, 2004
Why Did Bremer Block the IGC's UNSCAM Audit?

Friends of Saddam notes that CPA head Paul Bremer has blocked the Iraqi Governing Council's effort to audit the UN Oil-For-Food program using the accounting firm KPMG. Accountacy Age filed a brief report on Bremer's action but does not note any reason for blocking the audit:

KPMG was commissioned by the Iraqi Governing Council to investigate the scandal-hit fund, but the work was halted after Paul Bremmer, the head of the US-led Coalition Provisional Authority, said it could not be paid for out of CAP funds without a proper tender process.

A twin-track process emerged as a result. The governing council has confirmed KPMG as the investigator, but the provisional authority still has its tender procedure underway.

In any forensic accounting investigation, elapsed time can permanently cripple any ability to track missing funds or records. To stop KPMG's work because of a bureaucratic detail about payment mechanics suggests that Bremer has other motivations than a complete accounting of OFF funds. Given that the CPA has captured hundreds of millions of dollars in cash left behind by fleeing Ba'athists -- which were used, in some instances, for quick funding for rebuilding that also bypassed normal "tender processes" -- obstinacy takes on the appearance that the money is more important than the investigation. Also, since the US has decided to work more closely with the UN on Iraqi sovereignty, suspicions about cutting deals on OFF investigations for political support in Iraq may arise.

Bremer should be instructed to cooperate with the IGC immediately on their efforts to find the money that was supposed to assist Iraqi citizens and to quit giving the impression that the US wants to stonewall this investigation. A simple guarantee of payment would allow KPMG to begin while the CPA untangles the appropriation procedures. Bremer is scheduled to be replaced by John Negroponte in July, after the transfer of sovereignty, and the Iraqis will likely take this function over themselves -- but two months is plenty of time for the thieves to bury their trail.

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Posted by Ed Morrissey at May 6, 2004 12:38 PM

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