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KEY OVERSIGHT BODY IN IRAQ NEEDS MORE TIME
TO REVIEW COALITION SPENDING, NEW REPORT FINDS
April 2004
 Read
the full report 
NEW YORK, April 21, 2004-The monitoring group in charge of
overseeing Iraq's oil revenues has less than three months
to account for billions of Iraqi funds spent by the Coalition
Provisional Authority, said a report by the Open Society Institute's
Iraq Revenue Watch project. The report, Racing the Deadline:
The Rush to Account for Iraq's Public Funds, warns that
the International Advisory and Monitoring Board (IAMB) cannot
provide accurate accounting for this money unless it is able
to work beyond June 30th, when the Coalition Provisional Authority
is scheduled to hand over power to an Iraqi interim government.
"There is not enough time left to cram in an audit of
more than a year's worth of expenditures, many of which have
not been accounted for," said Svetlana Tsalik, director
of OSI's Revenue Watch.
It took months of wrangling to determine the terms of reference
for the IAMB, which was created by a United Nations Security
Council resolution in May 2003 to oversee the management of
the Development Fund for Iraq (DFI), the main repository for
Iraq's oil revenues. The Coalition had been reluctant to hand
over broad auditing authority to the IAMB-whose members consist
of the UN, the World Bank, the International Monetary Fund,
and the Arab Development Fund-but finally agreed to such a
provision in October.
Substantial amounts of money have passed through the DFI.
Under the Coalition Provisional Authority, $6.9 billion in
crude oil export revenues, $3.8 billion in frozen and seized
assets from Saddam Hussein's regime, and $4 billion in leftover
UN Oil for Food Program funds have all been transferred into
the DFI. To date, the Coalition has spent over $7 billion
in DFI funds on infrastructure, administration, security and
other projects, without any independent monitoring or supervision.
Since the IAMB began work in December, it has expressed concern
over the use of DFI funds to pay for a contract awarded to
Halliburton with no competitive bidding. The IAMB has also
urged the Coalition Provisional Authority to begin metering
extracted Iraqi crude oil immediately. Currently, they are
unable to determine what amounts are smuggled prior to reaching
refineries, shipping terminals, and pipelines.
Racing the Deadline calls on the UN Security Council
to extend the Board's mandate as long as necessary to complete
a full audit of the Development Fund for Iraq under Coalition
management. The report also urges the IAMB to provide opportunities
for Iraqis to participate in the Board's work on an equal
footing with the current members. "Iraqi partnership
in the IAMB is crucial to the legitimacy of the Board's conclusions
and the continuity of its work," said Tsalik.
Read
the full report
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