July 30, 2011 Quarterly Report

Quarterly Report and Semiannual Report to the United States Congress

[ July 30, 2011] (Public Laws 108-106 and 95-452, as amended)

224-241 Cover CX.indd 1 7/25/2011 9:25:36 AM SIGIR Mission Statement

Regarding U.S. relief and reconstruction plans, programs, and operations in Iraq, the Special Inspector General for Iraq Reconstruction provides independent and objective: · oversight and review through comprehensive audits, inspections, and investigations · advice and recommendations on policies to promote economy, efﬁciency, and effectiveness · prevention, detection, and deterrence of fraud, waste, and abuse · information and analysis to the Congress, the Secretary of State, the Secretary of Defense, and the American people

______

The jurisdiction of the Ofﬁce extends to amounts appropriated or otherwise made available for any ﬁscal year to the Iraq Relief and Reconstruction Fund, the Iraq Security Forces Fund, the Commander’s Emergency Response Program; or for assistance for the reconstruction of Iraq under the Economic Support Fund, the International Narcotics Control and Law Enforcement account, or any other provision of law.

(Section 3001 of Public Law 108-106, as amended)

July 11, 2011: Secretary of Defense Leon E. Panetta and General Lloyd J. Austin III, commander of U.S. Forces-Iraq, ﬂy by helicopter over Baghdad on their way to meetings with Iraqi Prime Minister Nuri al-Maliki and President Jalal Talabani. (DoD photo)

224-241 Cover CX.indd 2 7/25/2011 9:25:38 AM Special Inspector General for Iraq Reconstruction

Quarterly Report and

Semiannual Report to the United States Congress

[July 30, 2011] (Public Laws 108-106 and 95-452, as amended)

July2011.indb 1 7/25/2011 10:37:18 AM This publication is available free of charge at www.sigir.mil.

July2011.indb 2 7/25/2011 10:37:20 AM MESSAGEFROMTHESPECIALINSPECTORGENERALFORIRAQRECONSTRUCTION

I am pleased to present this 30th Quarterly Report to the United States Congress and the Secretaries of State and Defense.

The theme of this report, “ASummer of Uncertainty,” alludes to the question of whether the United States will maintain a military presence in Iraq beyond year’s end. Negotiations continue on this issue, with the nearly 44,000 remaining U.S. troops still scheduled to leave by December 31. Whatever the decision, the outcome will significantly affect the ongoing U.S. reconstruction program, which is in the throes of a series of program transitions from the Department of Defense (DoD) to the Department of State (DoS).

Among those transitions, DoS reported progress this quarter toward assuming full responsibility for the continued U.S. support of Iraq’s police forces. The Bureau of International Narcotics and Law Enforcement Affairs (INL) will manage this effort through the new Police Development Program (PDP). Executing the PDP will be challenging, involving fewer than 200 advisors based at 3 sites and supporting Iraqi police in 10 provinces. SIGIR’s efforts to audit the PDP were stymied this quarter because DoS either did not respond to repeated requests for information or provided data that was late and of limited usefulness. (SIGIR encountered similar obstacles in a separate audit of private security contractors in Iraq.)

Iraqremainsanextraordinarilydangerousplacetowork.Itislesssafe,inmyjudgment,than12monthsago. Buttressing this conclusion is the fact that June was the deadliest month for U.S. troops in more than two years. Shia militias—possibly armed and trained by Iran—were responsible for some of the lethal attacks. They may have also been behind this quarter’s increase in indirect fire ontheInternationalZone.Diyalaprovince,lyingjust northeast of Baghdad, also continues to be very unstable. This Quarterly Report’s “Focus on Diyala” provides an in-depth review of the province, its people, and the effects of U.S. reconstruction efforts there.

On the corruption front, Iraq’s Council of Representatives repealed Article 136(b) of the Iraqi Criminal Procedure Code. This provision permitted Iraqi ministers to block investigations of their subordinates. Its repeal represents an important step toward implementing an effective rule-of-law system, but much remains to be done in this regard, including securing judges from attacks and stopping the assassinations of police officials.

SIGIR published six audits this quarter, including a review of the U.S. government’s oversight of Anham, LLC, and its subcontracting procedures. The audit found weak oversight in multiple areas that left the government vulnerable to improper overcharges. Notably, SIGIR’s limited cost review of Anham questioned almost 40% of the costs reviewed. Particularly egregious examples of overbilling included an Anham subcontractor that charged the U.S. government: • $900 for a control switch valued at $7.05 (a 12,666% difference) • $80 for a small segment of drain pipe valued at $1.41 (a 5,574% difference) • $75 for a different piece of plumbing equipment also valued at $1.41 (a 5,219% difference) • $3,000 for a circuit breaker valued at $94.47 (a 3,076% difference) • $4,500 for another kind of circuit breaker valued at $183.30 (a 2,355% difference)

2530 Crystal Drive • Arlington Virginia 22202

July2011.indb 3 7/25/2011 10:37:20 AM As a result, SIGIR has formally questioned all of the contract’s costs and recommended reviews of billing practices in all of Anham’s U.S. government contracts in Iraq and Afghanistan, which total about $3.9 billion.

SIGIR’s other audits this quarter found that: • USF-I’s management of the Iraq Commander’s Emergency Response Program, which spent Iraqi funds through CERP processes, led to U.S. funds unnecessarily being used for projects. • USF-I use of FY 2011 U.S. Commander’s Emergency Response Program funds for capacity-development programs does not appear linked to DoD’s counterinsurgency mission. • The future of the reporting system for serious incidents involving private security companies is uncertain. • Many of the U.S. government contracting officer’s representatives responsible for monitoring security contracts whom SIGIR interviewed often received inadequate training, and there was insufficient information in the files to determine whether their oversight was sufficient. • DoS had taken sufficient remedial measures to close 13 of 45 SIGIR outstanding recommendations.

SIGIR’s investigative work this quarter led to 8 indictments, bringing the total number of individuals indicted to date to 64—54 of whom have been convicted. Other investigative accomplishments included: • asettlementagreementbetweentheU.S.governmentandDynCorpInternationalandoneofitssubcon- tractors under which DynCorp and its subcontractor must pay more than $8 million to resolve allegations that they submitted false claims for reimbursement under DynCorp’s police-training contract • two guilty pleas by former U.S. Army majors in related bribery cases • the unsealing of an 11-count indictment against a U.S. Army sergeant first class and a former U.S. Army master sergeant for their alleged roles in a bribery and money-laundering scheme • aguiltypleabyaformerU.S.ArmysergeantfirstclassforconspiringtostealgeneratorsfromaU.S.basein Mosul and sell them on the Iraqi black market • the arrest of a former U.S. Army sergeant for receiving more than $12,000 in stolen cash that was intended for an Iraqi contractor

SIGIR continues to maintain a robust oversight presence in Iraq. Our 15 personnel stationed at the Embassy consistently generate a high volume of quality work under extremely onerous conditions.

Respectfully submitted,

Stuart W.Bowen, Jr.

July2011.indb 4 7/25/2011 10:37:20 AM SIGIRSUMMARYOFPERFORMANCETABLEOFCONTENTS

SIGIR Summary of Performance As of July 30, 2011 Audits Cumulative Last 12 Months

Reports Issued 194 23 Recommendations Issued 473 46 SavingsifAgenciesImplementSIGIRRecommendationsto: Put Funds to Better Use ($ Millions) $586.62 $12.00

Disallow Costs SIGIR Questioned ($ Millions) $624.48 $115.25

Inspectionsa

Project Assessments Issued 170 - Limited On-site Assessments Issued 96 - Aerial Assessments 902 40

Investigations

Investigations Initiated 563 50 Investigations Closed or Referred 448 55 Open Investigations 104 104 Arrests 35 6 Indictments 64 21 Convictions 54 20 Monetary Results ($ Millions) $153.9 $83.0

Hotline Contacts, as of June 30, 2011

Email 404 22 Fax 18 0 Mail 30 2 Referrals 26 0 SIGIR Website 184 25 Telephone 82 4 Walk-in 112 0 TotalHotlineContacts 856 53

Other Products

Congressional Testimony 33 3 LessonsLearnedReportsIssued 5 0 Quarterly Reports 30 4

a TheInspectionsDirectorateceasedconductingprojectassessmentsonApril30,2010.

July2011.indb 5 7/25/2011 10:37:20 AM July2011.indb 6 7/25/2011 10:37:20 AM TABLEOFCONTENTS

Section 1 SIGIR Observations 1 ASummerofUncertainty 2 Reconstruction Management and Funding 3 Security 6 Economy, Public Services, and the Rule of Law 8 SIGIR Oversight 11 Section 2 FundingforIraqReconstruction 15 Funding Overview 16 U.S. Funding 17 Iraqi Funding 33 International Support 36 Section 3 U.S. Presence and Reconstruction Management 37 TheU.S.Presencein2011 38 Contracting 43 Section 4 Developments in Iraq 59 Governance 60 Security 70 Rule of Law 77 Economy 85 Public Services 94 Section 5 SIGIR Oversight 103 SIGIR Audits 104 SIGIR Investigations 119 SIGIR Hotline 132 SIGIR Website 133 Legislative Update 134 Section 6 Other Agency Oversight 135 Introduction 136 Other Agency Oversight Reports 137 Other Agency Investigations 140

Special Feature FocusonDiyala 47

Endnotes 141 Quick Facts Sources 154 Sources and Notes for the Insert 155 Acronyms 157

*ThecompleteversionofthisSIGIRQuarterlyReportisavailableontheSIGIR website: www.SIGIR.mil.ItistheofﬁcialversionoftheReport,containingall appendices and corrections.

July2011.indb 7 7/25/2011 10:37:20 AM TABLEOFCONTENTS

Appendices

The appendices for this Quarterly Report are not included in the print version of the publication. TheyarepublishedontheSIGIRwebsiteatwww.sigir.mil.

Appendix A cross-references the pages of this Report with SIGIR’s statutory reporting requirements underSection3001ofP.L.108-106,asamended,andtheInspectorGeneralActof1978,asamended.

Appendix B cross-referencesbudgettermsassociatedwiththeCommander’sEmergencyResponse Program (CERP), Economic Support Fund (ESF), Iraq Relief and Reconstruction Fund (IRRF), Iraq SecurityForcesFund(ISFF),InternationalNarcoticsControlandLawEnforcement(INCLE)account, and international support for Iraq reconstruction.

Appendix C reportsoninternationalcontributionstotheIraqreconstructioneffort.

Appendix D containsalistofSIGIR’scompletedinspectionsofIraqreconstructionactivities.

Appendix E contains a comprehensive list of suspensions and debarments related to Iraq reconstructioncontractsorArmysupportcontractsinIraqandKuwait.

Appendix F providessummariesofcompletedandongoingauditsandreviewsofIraqreconstruction programs and activities released by other U.S. government agencies.

Appendix G containsalistofcompletedaudits,reports,andtestimoniesonIraqreconstruction activitiesreleasedbySIGIRandotherU.S.governmentauditagencies.

July2011.indb 8 7/25/2011 10:37:20 AM SIGIR OBSERVATIONS

A Summer of Uncertainty 2

Reconstruction Management and Funding 3

Security 6

Economy,PublicServices,andtheRuleofLaw 8

SIGIR Oversight 11 1section

July2011.indb 1 7/25/2011 10:37:20 AM SIGIR OBSERVATIONS

A SUMMER OF UNCERTAINTY Fivemonthsfromtheissuanceofthisreport,the U.S.-IraqSecurityAgreementwillexpire.Un- lessanewagreementisreached,theU.S.military presence in Iraq will conclude by year’s end. The DepartmentofState(DoS)andDepartmentof SecretaryofDefensePanettatalkstoU.S.troopsinBaghdadin Defense(DoD)arevigorouslypreparingforthe July. (USF-I photo) myriad effects of the impending troop withdrawal, recommendationsontheissueofextendingthe whileholdingopenthepossibilitythattheGov- U.S.militarypresence,statingthattheCoRwould ernmentofIraq(GOI)willrequestalimitedU.S. reachadecisiononthismatterinAugust.4 military presence beyond 2011. IfagreementisreachedtocontinueaU.S.troop On July 7,the Chairman of the Joint Chiefs of presence beyond 2011, potential duties for the Staff,AdmiralMikeMullen,confirmedongoing remaining forces could include:5 negotiations with the GOI to extend the military • supporting and protecting U.S. government mission.1 AndduringaJuly10pressbriefing,new civilians and contractor personnel U.S.SecretaryofDefenseLeonPanettanotedthat • maintainingapresencealongthe“GreenLine” itwasincumbentupontheGOItorequestsuchan separating the Kurdistan Region from the rest extensionsoon,ifitwantsU.S.forcestostay.2 of Iraq ForginganIraqipoliticalconsensusforacon- • providinganair-defenseumbrellaforIraqwhile Forging an Iraqi tinuingtrooppresencehasprovedchallengingfor thenascentIraqiAirForcedevelopsitscapacity political consensus for PrimeMinisterNurial-Maliki.Manymembersof to conduct independent operations a continuing troop theIraqiCouncilofRepresentatives(CoR)vocifer- • collecting, analyzing, and disseminating intelli- presence has proved ouslyopposeit.Muqtadaal-Sadrhasgonesofaras gencedataonterroristgroupsthatwouldenable challenging. to issue ominous diktats threatening violence that theIraqiSecurityForces(ISF)toconducttimely wouldensueiftheextensionoccurs.Thefollowing counterterrorism operations eventsexemplifythefissureswithintheGOIon • assisting the ISF to improve its logistics capacities this explosive matter:3 • About 100 members of the CoR—including Thisquarter,thesize,scope,andshapeofthe manyofthosealliedwithMuqtadaal-Sadr— U.S. reconstruction mission changed dramati- signedapetitioncallingforU.S.troopstodepart cally,andthepaceofthatchangewillacceleratefor on schedule. theremainderof2011.Bytheendofthisyear,the • ThespeakeroftheKurdistanRegionalGovern- four remaining Provincial Reconstruction Teams ment(KRG)parliamentstatedthatthefragile (PRTs) will close, DoS will assume responsibil- securitysituationwarrantedU.S.troopsremain- ityforIraqipolicetraining,andthenewOfficeof ing after December. Security Cooperation-Iraq (OSC-I) will take over • TheShia-dominatedBasrahProvincialCouncil mostaspectsofU.S.-Iraqimilitaryrelations.To passedaresolution“banning”allU.S.troops meetitsever-expandingobligations,U.S.Embassy- from the province. Baghdadisdoublingthenumberofpersonnel undertheChiefofMission(COM)—from7,980to On July 9, President Jalal Talabani requested the approximately16,000U.S.governmentemployees, politicalblocsintheCoRtosubmittheirrespective contractors, and locally employed staff.6

2 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 2 7/25/2011 10:37:20 AM SIGIR OBSERVATIONS

These manifold transitions and transfers occur ofJuly15,onlythePRTsinBaghdad,Diyala, againstthebackdropofasecuritysituationinIraq Anbar,andNajafcontinuedtooperate—and During June, 14 U.S. thatcontinuestodeteriorate.Duringthemonthof thesewillclosebymid-September.Thisquarter, servicemembers were June,14U.S.servicememberswerekilledbyhostile DoSopenedtwonewpermanentconsulates killed by hostile ﬁre, fire,thehighestmonthlytotalsinceApril2009.7 inErbilandBasrah,andalsointendstohavea the highest monthly Iranian-backedShiamilitias,whichhavegrown temporaryconsulateinKirkuk.TheinitialDoS total since April 2009. moreactivethisyear,werereportedlyresponsible planforreplacingthePRTsalsocalledforaRe- forsomeofthesedeaths.Al-Qaedaalsoremainsa gionalEmbassyOfficeinMosul,butbudgetary lethalthreat,withU.S.intelligenceofficialsestimat- constraintsforcedanindefinitepostponementof ingthatupto1,000al-Qaeda-affiliatedmilitants theplansforthatpost.10 are now in Iraq. • Implementing the Police Development Pro- Othersecurityproblemsthisquarterinclude:8 gram (PDP). The official 90-day handover pe- • frequentrocketattacksagainsttheInternational riodforthePDPbeganonJuly1.DoS’sBureau Zone(IZ)usingmoredestructiveandmoreac- of International Narcotics and Law Enforcement curate Iranian-produced munitions Affairs(INL)isreplacingtheU.S.militaryasthe • theassassinationofmanyseniorGOIofficials, lead agency responsible for mentoring the Iraqi includingjudges,generals,andcivilservants police. INL’s efforts will focus on building the • a series of suicide bombings targeting ISF per- managerialandinvestigativecapacitiesofIraqi sonnel and inflicting mass casualties police units. About 190 U.S. advisors based in • renewedeffortsonthepartofanti-government threemainsites(Erbil,Baghdad,andBasrah) forces to target Iraq’s oil infrastructure will implement the PDP, working from more than 20 sites in 10 provinces to advise, mentor, NotwithstandingtheveryrealfragilityofIraq’s andteachIraqipolice.AspectsofINL’splans devolvingsecurityenvironment,whichisfur- remain in flux, including finalizing security and therdetailedbelow,theU.S.Forces-Iraq(USF-I) travelarrangementsfortheadvisorsandreach- continuestocontrastthecurrentsecuritystatusin ing land-use agreements with the GOI. INL will Iraqtothatofmid-2007—whenthecountrywas assume complete responsibility for this mission embroiledinastateofnear-civilwar—notingin fromtheU.S.militaryonOctober1,2011.11 lateMay,forexample,thatthesecuritytrends“are • Establishing OSC-I. ADoDorganizationfall- very,verypositive.”9 ingunderCOMauthority,OSC-Iwillbethe conduitforallmilitary-to-militarytiesbetween theUnitedStatesandIraq.Currentplanscall forsixOSC-Isites(Baghdad,Besmaya,Kirkuk, RECONSTRUCTION Taji,Tikrit,andUmmQasr).Describingplans forOSC-Ias“significantlybehindschedule,”the MANAGEMENT DepartmentofStateOfficeofInspectorGeneral AND FUNDING (DoSOIG)reportedinMaythatitisunlikely to reach full operational status by October, as Reshaping the U.S. Reconstruction originally planned.12 Footprint Severaldevelopmentsthisquarterpresagedthemajor U.S. Reconstruction Funding transitionsthatwillcharacterizetherestof2011: Since2003,theUnitedStateshasappropriatedor • ClosingPRTsandOpeningNewConsulates. otherwise made available $61.64 billion for Iraq SinceApril,DoShasclosed10PRTsand,as reconstruction efforts, primarily through five

JULY 30, 2011 I REPORT TO CONGRESS I 3

July2011.indb 3 7/25/2011 10:37:20 AM SIGIR OBSERVATIONS

majorfunds:theIraqReliefandReconstruction governmentcivilianemployeesand57contractors Fund(IRRF),IraqSecurityForcesFund(ISFF), underCOMauthorityoverseeingorimplementing EconomicSupportFund(ESF),Commander’s reconstructionprogramsinIraq—orjust0.08%of Emergency Response Program (CERP), and all personnel.16 InternationalNarcoticsControlandLawEnforce- ment(INCLE).AsofJune30,2011,$4.27billionin 2011 Iraqi Budget available budget authority remained unexpended InFebruary,Iraq’sCoRapprovedan$82.62billion forthefivemajorfunds.13 budgetfor2011,a14%increaseovertheprevious FortheESF,$549millionisavailableforobliga- year’s $72.36 billion budget. The 2011 budget ap- tiontonewprojects,andanadditional$348million propriates $25.70 billion for capital expenditures remainsinunexpendedobligations.14 For the ISFF, and$56.92billionforoperatingexpenses.This $1.69billionisavailableforobligationtonewproj- constitutes a 27% annual increase in the GOI capital ects,includingmorethan99%ofFY2011funds. budgetanda9%increaseinitsoperatingbudget.17 An additional $863 million remains in unexpend- • Ministriesreceivinglargerbudgets.Of the 26 ed ISFF obligations.15 Table1.1detailsthestatusof GOIministries,15sawtheirbudgetsincrease FY2010–FY2011ISFFappropriations.Formore from2010levels.Thefiveministriesreceiving on U.S. reconstruction funding, see Section 2 of thelargestincreases,asmeasuredbypercentage this Quarterly Report. change from 2010 to 2011, are Labor and Social Affairs (285%), Oil (97%), Foreign Affairs (90%), ObstructionofSIGIROversight Culture(61%),andAgriculture(49%).18 In response to this report’s request for informa- • Ministries receiving smaller budgets. The five tion,U.S.Embassy-Baghdaddeclinedtorespond ministries receiving the largest decreases in the U.S. Embassy- to questions concerning the use of support con- CoR-approved budget, as measured by percent- Baghdad declined to tracts—including the Logistics Civil Augmentation agechangefrom2010to2011,areEnvironment respond to questions Program(LOGCAP)—toprovideservicestoDoS (-28%),Electricity(-28%),PlanningandDevelop- concerning the use postsinIraqinvolvedinmanagingreconstruction mentCooperation(-18%),HumanRights(-17%), of support contracts to provide services programs,insteadreferringSIGIRtoDoSOIGfor and Communications (-17%).19 to DoS posts in Iraq this information. • PrimeMinister’sOffice(PMO)andSecretariat. involved in managing U.S. Embassy-Baghdad again took an extremely Thebudgetallocatesacombined$484million reconstruction circumscribed view of how many persons under forthePMO($363million)anditsSecretariat programs. COMauthorityareinvolvedinthe“reconstruction ($121 million), a 13% decrease from last year.20 effort.” According to its implausibly narrow ap- • Security ministries. The 2011 Ministry of proach,asofJune30,2011,therewereonly10U.S. Defense(MOD)budgetof$5.85billionis19%

Table 1.1 Status of FY 2010–FY 2011 ISFF, as of 6/30/2011 $ Millions Appropriated Obligated Expended Unobligated Unexpended Expires

FY 2010 $1,000 $810 $627 $190 $373 9/30/2011 FY 2011 $1,500 $1 $0 $1,499 $1,500 9/30/2012 Total $2,500 $812 $627 $1,688 $1,873

Note: Data not audited. Numbers affected by rounding.

Sources: USF-I,responsetoSIGIRdatacall,7/15/2011;OSD,“JustiﬁcationforFY2011OverseasContingencyOperationsRequest,IraqSecurityForces Fund,” 2/2010,p.4.

4 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 4 7/25/2011 10:37:20 AM SIGIR OBSERVATIONS

morethanits2010budget,whiletheMinistryof toopenanewaccountattheFederalReserve Interior(MOI)budgetof$6.31billionrepre- BankofNewYork(FRBNY)toreplacetheUN- sentsa3%annualincrease.Ofthecombined mandated Development Fund for Iraq (DFI) $12.16billionthe2011budgetallocatestothese accountintowhichallIraqioilrevenuehasbeen twoministries,97%isforoperatingexpenses, deposited since 2003. The GOI Committee of including salaries and maintenance.21 FinancialExperts,underthedirectionoftheBSA • Rule-of-law institutions. The budget for the president, will oversee this account and another Higher Judicial Council, which oversees Iraqi FRBNYaccountholdingIraqioilrevenue. courts, increased by about 4% to $278 million. TheendoftheUN-mandatedarrangements Thecombined2011budgetsofIraq’stwopri- thatrequiredIraqtodepositallproceedsfrom mary anticorruption agencies, the Commission petroleum export sales into DFI-linked accounts ofIntegrity(COI)andtheBoardofSupreme broughtwithittheendoftheimmunityfrom Audit(BSA),total$86million—a3%decrease creditorclaimsaffordedtothesefundsunderUN fromtheircombined2010budgets.22 Security Council Resolution 1483.26 SIGIR announced FordetailsontheGOI’s2011budget,seeSection2 SIGIRannouncedathirdauditoftheDFIthis a third audit of the of this Quarterly Report. quarter,whichwillcloseoutitsreviewofU.S.man- DFI this quarter, TheGOIfinancesitsexpendituresprimarilywith agementofIraqirevenues.Morethan$20billion which will close out fundsobtainedfromtheexportofoil.For2011,oil in Iraqi funds were under Coalition Provisional its review of U.S. revenue will account for about 90% of government Authority(CPA)supervisionin2003–2004.The management of revenue.23 Crudeoilproductionreachedanaverage CPAusedthemchieflytorunIraqigovernment Iraqi revenues. of2.55millionbarrelsperday(MBPD)thisquarter, operations and execute reconstruction programs. andexportsroseto2.21MBPD.Bothincreases WhentheCPAconcludedoperationsinJune2004, were just enough to surpass the previous quarterly areported$6.6billionremained.A2005SIGIR records. However, average oil production this audit found that the CPAprovided less-than-ade- quarterremainedbelowtheMinistryofOil’s2011 quatecontrolsforapproximately$8.8billioninDFI target of 2.75 MBPD.24 Amongthefactorscontrib- fundsprovidedtoIraqiministries.AndaSIGIR utingtoIraq’sinabilitytomeetwhatmayhavebeen 2010auditconcludedthatanother$8.7billionof unrealisticproductiongoalsarecontinuedsecurity theDFIwasnotproperlyaccountedfor.SIGIR’s concerns,antiquatedpipelineandstorageinfra- thirdauditaimstoprovidethebestaccounting structure, byzantine bureaucratic structures, and possiblefortheportionoftheDFIunderU.S. laborunrest.Inlightofthesecontinuingdifficulties, controlafterJune2004. Minister of Oil Abdul Kareem al-Luaibi announced This quarter, media accounts mischaracterized inJunethattheministryisstudyingwhetherto SIGIR’spositionbyclaimingthat$17billionwas reduceIraq’sstatedgoalofincreasingcrudeoilpro- stolenorsimplylost.Duringarecentmeetingof ductiontomorethan12MBPDby2017,suggesting theInternationalAdvisoryandMonitoringBoard thatatargetof7–8MBPDmightbemorerealistic.25 forIraq,inJordan,BSAPresidentDr.AbdulBassit statedthatIraq’sreviewofthe“$17billionissue”is SIGIR Oversight of the anefforttoaddress“alackofdocumentationand Development Fund for Iraq enabletheauditorstopassclearjudgment”onhow TheGOItookin$20.11billioninoil-export theDFIwasspent.TheGOIcreatedaspecialhigh- receipts this quarter—setting a post-2003 record. levelcommitteechairedbyDeputyPrimeMinister BeginningonJuly1,theGOIassumedcontrol (DPM) for Economic Affairs Rowsch Shaways to overitsoilrevenue.InApril,itinformedthe review and report on this matter. Other members of United Nations Security Council that it planned thecommitteeincludetheMinistersofJustice,Oil,

JULY 30, 2011 I REPORT TO CONGRESS I 5

July2011.indb 5 7/25/2011 10:37:21 AM SIGIR OBSERVATIONS

Foreign Affairs, and Finance, as well as the Presi- Continuing a trend that has worsened since dent of the Central Bank of Iraq, the BSA President, last quarter, more than 70 senior GOI military andtheLegalAdvisortothePrimeMinister. andcivilianofficialsweretargetedforassassina- More than 70 senior SIGIR continues to work with DoD to identify tionthisquarter.Atleast44oftheseattempts GOI military and remainingbalancesfromDFIaccountsthatcould succeeded, including the assassination of the civilian ofﬁcials be returned to the GOI. This quarter, the Under ChairmanoftheAccountabilityandJustice were targeted for Secretary of Defense (Comptroller) notified the (De-Ba’athification)CommissioninlateMay. assassination this quarter. GOI of the impending return of $8.5 million. In Althoughprecisestatisticsonthesetargetedat- addition,SIGIRhasidentified$106millionin tacks are difficult to obtain, this quarter marked unspentDFIfundsinanaccountusedbyDoDfor the highest number of assassination attempts Iraq reconstruction efforts. Those remaining funds that SIGIR has recorded since it began tracking arenowunderGOIcontrol. this information.28 SIGIR’spreviousfindingsofinadequateDFIre- InagrimreminderofwhatChiefJusticeMedhat cord-keeping indicate that the fund was vulnerable al-Mahmoud told SIGIR was the most crucial to waste and fraud. To date, our investigations have ledtonineconvictionsonchargesstemmingfrom Figure 1.1 illegaluseofDFIfunds.SIGIRcontinuestowork Selected Significant Security Incidents, 4/15/2011−7/16/2011

with the GOI on accountability for these funds and 5/19/2011 4/30/2011 2 bombs targeting police Suicide attack in Mosul willreleasethethirdandfinalauditnextquarter. kill more than 25 in Kirkuk kills 8 and wounds 19 6/3/2011 6/10/2011 Bombing of Tikrit DAHUK 2 bombs kill at least 5 hospital kills several and injure more than 50 in Mosul 5/10/2011 4/28/2011 SECURITY Car bomb targeting a ERBIL Bomb attack on police police patrol in Tikrit NINEWA convoy kills 6 in Kirkuk kills at least 11 SULAYMANIYAH Recent Violence Kirkuk 6/14/2011 5/22/2011 TAMEEM Attack on government DoD reported that at least 248 Iraqi civilians and buildings kills 9 in Ba’quba Multiple bombs kill at Tikrit 193ISFpersonnelwerekilledinactsofterrorist least 16 in Baghdad SALAH AL-DIN 27 violence during April 1–June 19, 2011. More Samarra 6/23/2011 4 bombs kill at least than100diedinmass-casualtysuicideattacks, 40 in Baghdad Ramadi DIYALA which struck nearly every major Iraqi city, ANBAR BAGHDAD 5/3/2011 Baghdad Bomb attack on Baghdad includingMosul(April30andJune10),Tikrit cafe kills at least 16 Kerbala 5/5/2011 (May10andJune3),Baghdad(May22andJune BABYLON WASSIT KERBALA Suicide car 23)Ramadi(June2),andBasrah(June13). bomb attack on police 6/2/2011 MISSAN Attacks this quarter continue to target GOI 3 bombs targeting QADISSIYA building in politicalleadersandsecuritypersonnel.OnMay5, GOI buildings kill at Hilla kills 16 least 10 in Ramadi NAJAF THI-QAR asuicidebombercrashedhisvehicleintoanIraqi 7/15–16/2011 police barracks in Hilla, killing at least 16 officers. 3 bombs kill 13 and injure more than 100 in Kerbala BASRAH Twoweekslater,bombsweredetonatedinapark- 6/21/2011 MUTHANNA 2 suicide bombers kill more than 20 ingfacilityfrequentedbylocalpoliceinKirkuk, and injure more than 30 near GOI compound in Qadissiya killingatleast20police.InJune,insurgentscarried 6/13/2011 Car bomb kills 5 and injures outbrazensuicideattacksagainstprovincialgov- more than 25 in Basrah ernmentfacilitiesinDiyalaandQadissiya,causing multiple fatalities. Figure 1.1 shows this quarter’s Note: All casualty figures are based on best available information.

major security incidents. Source: SIGIR analysis of GOI and U.S. government documents and open-source information in Arabic and English.

6 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 6 7/25/2011 10:37:21 AM SIGIR OBSERVATIONS

problemfacingthejudiciary,assassinsalsotargeted • OnJune23,Dr.StevenEverhart,aU.S.Agency severaljudgesthisquarter:29 for International Development contractor, was • OnApril20,anappellatejudgeinSalahAl-Din killedwhenabombdetonatednearhisve- province survived an improvised explosive hicleinBaghdad.Hewasleavingameetingat device (IED) attack. Baghdad’s al-Mustansiriya University when the • Tendayslater,aBaghdadjudgewaskilledwhen attack occurred. gunmen stormed his residence. • OnJune26,twoU.S.servicememberswere • Inmid-May,policedisarmedabombattachedto killedbygrenadesandsmall-armsfireinDiyala Ninewa’s criminal court chief’s car. province. • OnJune6,policedisarmedabombplantednext totheresidenceofanotherNinewajudge. FormoreonthestateofIraqisecurityandU.S. • Threedayslater,aciviccourtjudgewasshotand assistancetotheISF,seetheSecuritysubsectionof killed while driving in Baghdad. this Quarterly Report. Since2003,atleast47judgeshavebeenkilledinIraq.30 Attacks on Oil Infrastructure TargetingofU.S.Installations Iraq’soilsectorcontinuestoconfrontmyriad and Personnel challenges,includinginsurgentattacks.InJuly, Thisquarter,Shiamilitantgroups,includingthe theheadofIraq’sOilPolicestatedthatal-Qaeda HezbollahBrigades,thePromisedDayBrigades, in Iraq’s main objective for 2011 is to disrupt andtheAsaibAhlal-Haq(LeagueoftheRigh- Iraq’s economic development by damaging its teous), stepped up their attacks on U.S. person- pipelines, storage tanks, and refineries. Echoing DPM al-Shahristani nel.31 TwofatalattacksinJunepossiblyinvolved thoseconcerns,DPMforEnergyAffairsHussein described the improvised rocket-assisted munitions (IRAMs).32 al-ShahristanidescribedtheFebruaryattackon February attack on OnJune6,sixU.S.servicememberswerekilledat thelargerefinerycomplexatBaijias“themost the large reﬁnery CampLoyaltyinBaghdad,33 and three more were dangerousmomentsincethefalloftheBa’athist complex at Baiji as killedlaterinJuneinanattackonaU.S.basein regime.”Whileittookthreeweekstorestorefull “the most dangerous thesouthernprovinceofWassit.34 Larger and more production,DPMal-ShahristanitoldtheInspec- moment since the lethalthanmortarrounds,IRAMswerefirstseen torGeneralinMaythatitcouldhavehadfar fall of the Ba’athist regime.” inIraqaboutfouryearsagoandareknowntobe graverconsequences,aslessthanone-thirdofthe suppliedbyIrantoShiamilitias. explosivedevicesplantedbytheattackersactually OnJuly7,twoU.S.servicememberswerekilled detonated. Underscoring the continued threat to whenaprobableexplosivelyformedpenetrator theoilsector,inearlyJune,insurgentsattemptedto (EFP) detonated near an entrance to USF-I’s Victory bomb the Doura refinery in Baghdad and succeed- Base Camp headquarters facility.35 EFPs are a signa- edindamaginganal-Zubairoil-storagefacilityin tureweaponofIranian-backedShiamilitias. southern Iraq.37 OtherattacksonU.S.personnelthisquarter included:36 • OnMay15,elevenrocketslandedinsidethe IZ,damagingU.S.facilities.Thiswasjustone of several similar indirect-fire attacks on the IZ thisquarter,includingaJuly12incidentthat followed Defense Secretary Panetta’s visit to Baghdad.

JULY 30, 2011 I REPORT TO CONGRESS I 7

July2011.indb 7 7/25/2011 10:37:21 AM SIGIR OBSERVATIONS

Electricity ECONOMY, PUBLIC PowershortagesremainafactoflifeinIraq.As temperatures rose with the onset of summer, demand SERVICES, AND THE averagedalmost11,500megawatts(MW),22%above RULE OF LAW whatitwasduringthesamequarterin2010.Julyis on course to set a monthly record for demand. The Although reverberations of the Arab Spring supplyofelectricityonthenationalgridcannotkeep movement echoed throughout the region, Iraqis pacewiththisgrowingdemand,havingremained tooktothestreetsinsmallernumbersthisquar- relativelyflatsincelate2009.Thisquarter,thetotal terthanlast,withprotestsdiminishinginsize supplyofelectricityonthegridaveraged6,574MW, andfrequency.However,theunderlyingissues enoughtoachieveanewrecordhigh(albeitbyjust thatdrovecitizensintothestreetsthispastwin- 0.5%), but not enough to provide noticeable im- ter—suchaspowershortagesandpubliccorrup- provementinthedailylivesofIraqicitizens.40 tion—remain unresolved. Inanefforttoavertarepriseoflastsummer’s electricity riots, which led to several deaths and Economic Development theresignationoftheMinisterofElectricity, TheInternationalMonetaryFundprojectedIraq’s DPMal-ShahristanitoldSIGIRinMaythatthe realgrossdomesticproduct(GDP)growthratefor ministryistakingaseriesofemergencymeasures 2011atmorethan12%,upfromanestimatedreal to improve the near-term supply of electricity, in- GDPgrowthrateoflessthan1%in2010,making cludingfast-trackingtheconstructionofsmalldie- itoneoftheworld’sfastestgrowingeconomies.38 selpowerplants,increasingthesupplyofgenerator Sustainableeconomicgrowthandtangibleim- fuel made available to the public, and importing provementtoqualityoflifedepends,inpart,on morepowerfromneighboringcountries.However, theGOI’sabilitytoconstructamultitudeoflong- DPMal-Shahristanicautionedthatsignificant delayed infrastructure projects, including:39 improvements will not occur before mid-2012, at • theMansuriyanaturalgasfieldinDiyala which point he hopes the Ministry of Electricity province (MOE)willhavedoubledthesupplyofelectricity • multiple pipeline projects available on the national grid.41 • a series of telecommunications projects intended to quadruple the number of fixed landlines in Corruption Iraqby2016 Corruptionremainsasignificantchallengefor • morethanadozenelectricity-productionplants Iraq. While the country’s three main anticorrup- The country’s three usingcombustionturbinespurchasedfrom tion agencies—the COI, BSA, and ministry inspec- main anticorruption General Electric tors general (IGs)—have increased their capacities agencies remain toinvestigatecriminalactivitysince2004,they stymied by political Inaddition,theGOImustclose,reform,priva- remainstymiedbypoliticalresistanceandlackof resistance and lack of capacity. tize,orfindfundingformorethan170state-owned capacityandhavedifficultypursuingcasesinvolv- enterprises. Although these initiatives—and many ing complex crimes and high-level officials. others—havebeenwidelypublicizedbytheGOI, AsCOICommissionerJudgeRahimal-Ugaili it will be several years before any are fully imple- explainedtoSIGIRofficialsinMay,corruptgovern- mented. For more information on these projects mentcontractingpracticeslieattheheartofmost andtheoverallstateoftheIraqieconomy,seethe majorcorruptioncasesunderinvestigationbyhis PublicServicesandEconomysubsectionsofthis office.Describingthisproblemas“thefatherof Quarterly Report. allcorruptionissuesinIraq,”theCommissioner

8 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 8 7/25/2011 10:37:21 AM SIGIR OBSERVATIONS

Figure 1.2 The Ties that Bind: Relationships that Foster Corruption in Some GOI Contracts

Prominent political figure (P).

GOI Agency Contracting company staffed with P’s surrogates. controlled by P or his surrogates.

TheInspectorGeneralmeetswithCoRSpeakeral-Nujaiﬁ.(GOI,CoRphoto) Source: GOI, COI Commissioner, meeting with SIGIR, 5/5/2011. detailedhowasignificantportionofmajorGOI adversely affects all aspects of Iraqi life. Recent contractsaregiventocompaniescontrolledby developments illustrate how corruption cuts across powerfulIraqipoliticalfiguresortheirsurrogates. boundaries,limitingtheGOI’scapacitytoimprove He stated that “many” of the major firms in Iraq are security, deliver services, and educate its citizens. alliedwithapoliticalfaction,enablingthemtowin Keysectorsaffectedbycorruption,orallegations contractsatvastlyinflatedprices.Becauseoftheir thereof, include: closetieswiththeGOI,thesefirmsreceivesignifi- • Security. Earlier this year, the MOD Legal Con- cantdownpaymentspriortobeginningworkand sultantwassentencedtothreeyearsinjailfor usually are not at risk of suffering financial penalties embezzling funds from the ministry. Moreover, in the event of nonperformance or poor perfor- inaMaymeetingwiththeInspectorGeneral, mance. The Commissioner also noted that the Iraqi formerPrimeMinisterAyadAllawiclaimed PenalCode,muchofwhichwaswrittenin1969, thatmanydefensecontractsareawardedtorela- makesitdifficulttoprosecutethesecases,aflaw tively obscure Eastern European firms because thattheCOIiscurrentlytryingtoremedybydraft- thosecompaniesaremorewillingtopaybribes ing new legislative proposals.42 Figure 1.2 illustrates thanWesterncounterpartsandarenotpre- theincestuoustiesamongpoliticians,GOIofficials, ventedfromdoingsobyanticorruptionstatutes, andcontractingcompaniesinIraq. suchastheU.S.ForeignCorruptPracticesAct. One of the main Thisquarter,however,oneofthemainlegal Although Allawi’s contentions must be viewed legal obstacles to the obstacles to the effective enforcement of anticor- inlightofhiscurrentestrangementfromPrime effective enforcement ruptionstatuteswasremovedwiththerepealof Minister al-Maliki, the CoR Integrity Commit- of anticorruption Article 136(b) of the Iraqi Criminal Procedure teeisalsopursuinginvestigationsintocorrupt statutes was removed Code. This provision—twice previously repealed contracting practices at the MOD, allegations with the repeal of only to be subsequently reinstated—allowed ofwhichhaveplaguedtheministrysinceits Article 136(b). ministerstoblocklegalactionfrombeingtaken reconstitutionafterthe2003overthrowofthe against their subordinates. Ba’athist regime.43 The continued economic dominance of the • Electricity. InJune,theMOEIGissueda publicsectormeansthatgovernmentalcorruption detailed public statement on the MOE website

JULY 30, 2011 I REPORT TO CONGRESS I 9

July2011.indb 9 7/25/2011 10:37:21 AM SIGIR OBSERVATIONS

describinghowcorruptnetworkswithinthe Figure 1.3 ministrystealdieselfuelintendedforelectricity COI, Key Indicators, 1/1/2011−5/31/2011 plants.Thestolenfuelisthensoldontheblack COI Cases Referred to Number of Suspects Referred to market,reducingtheamountavailabletothe Investigative Judges, Investigative Judge, by Office plantsthatsupplypowertothenationalgrid.44 by Alleged Crime DG & Total above • Education. Mostmid-andsenior-levelGOI Other 483 Municipalities and postsrequireapplicantstopresentproofof Forgery 136 1 28% 597 Public Works theireducationalandprofessionalaccredita- 34% Finance 119 0 tions. Under Iraqi law, submitting fraudulent Bribery 82 Defense 113 20 certificatesisacrimepunishablebyjailtime.In 5% 11% Labor 113 2 24% thefirstfivemonthsof2011,theCOIreferred Embezzlement Health 105 0 597forgerycasestoinvestigativejudges(IJs)for 186 Misuse of Public Funds 427 Education 101 2 adjudication,thevastmajorityofwhichinvolved Justice 92 0 allegedly fraudulent educational or professional Number of Suspects Referred Interior 82 3 to Investigative Judges, certificates. Last year, COI investigators un- by Province Industry and Minerals 78 0 coveredanddismantledacriminalconspiracy Higher Education 69 1 500+ attheMinistryofEducationinvolvingseveral 250-500 Transportation 68 5 employeeswhoweresellingfakecredentialsto 150-250 Diwan of Provinces 56 1 75-150 45 Agriculture 52 4 job applicants. 1-75 Oil 49 1 OnJune20,theCOIissueditsmid-yearreport, Trade 42 2 detailing its anticorruption activities through Electricity 39 0 theendofMay2011.SinceJanuary1,theCOI Baghdad Amanat 39 0 referred1,777subjectstoIJs,including66officials Communications 37 2 holding the rank of director general or higher. Water Resources 29 0 Figure1.3summarizestheCOI’sperformance Provincial Councils 28 10 duringJanuary1–May31,2011.Formoredetails Other 330 3 on corruption in Iraq, see the Rule of Law subsec- Source: GOI, COI, “The Most Important Indicators for 2011,” 6/1/2011, www.nazaha.iq/pdf_up/300/The%20most%20important%20indicators%20for%202011.pdf, accessed 7/10/2011. tion of this Quarterly Report. effectontheirqualityoflife—someday.However, Public Perceptions otherdatasuggeststhatthiseffecthasyettobefelt. aboutConditionsinIraq Iraqisaresplitonwhethertheircountryiscurrent- Recent public opinion data collected on behalf lya“realdemocracy”—42%believingthatitisand oftheU.S.NationalDemocraticInstitute(NDI) 39%statingthatitisnot.Moreover,49%believe showsthemixednatureofpopularsentiment thattheoverallsituationinIraqisdeteriorating(a among Iraqis. Overall, respondents viewed the 5% increase from the previous survey conducted in Overall, respondents securitysituationasimproving(62%),butfeltthat November2010),while42%believethecountryis viewed the security corruption(58%)andtheelectricitysupply(51%) on the right track. The main demographic groups situation as were getting worse. Further, despite positive mac- that feel conditions are getting worse are Sunni improving, but felt roeconomic trends, 56% described Iraq’s economy Arabs(71%)andyoungmalesundertheageof35 that corruption and the electricity supply asweak,citinglackofjobs(63%)andpoorpublic (54%)—twogroupsthatplayedsignificantrolesin were getting worse. services(47%)astheirtwotopconcerns.46 the worst days of the insurgency.47 Almostthree-quarters(71%)ofrespondents believethatdemocracy“willlikely”haveapositive

10 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 10 7/25/2011 10:37:21 AM SIGIR OBSERVATIONS

SIGIR OVERSIGHT Audits Thisquarter,SIGIRpublishedsixauditreports: • DoDManagementofIraqCommander’s EmergencyResponseProgram(I-CERP).The I-CERPwasajointU.S.-Iraqiprogramwhereby theU.S.militaryimplementedreconstruction projectsusing$270millioninGOI-provided DFIfunds.SIGIR’sreview,however,foundthat USF-I’smanagementoftheI-CERPledtoU.S. Anham,throughasubcontractor,billed$20,000forinstallation ofa“plugandplay”voicesystem. fundsbeingusedinsteadofI-CERPinsome cases.Atpresent,$24.4millioninI-CERPfunds ISFF($91.7million)andArmyOperationsand remainthatcouldbeusedtopayforplannedor MaintenanceFund($28.5million).Atitsconclu- ongoing reconstruction projects. SIGIR recom- sion, the contract had obligations of approxi- mendedthatUSF-IidentifyplannedCERP mately $119.2 million, with Anham subcontrac- projectsthatcouldbefundedwithI-CERPand, torsprovidingatleast$55millionofsupplies whereappropriateandfeasible,useI-CERP andservices.SIGIR’sreviewfoundsignificant fundstopayfortheseprojects—allowingU.S. weaknesses in the government’s oversight of fundstobeputtobetteruseelsewhere. Anham’s business systems and other contract • PlansforMonitoringSeriousIncidentsInvolv- administration functions that left the govern- ingPSCsonceU.S.MilitaryForcesLeave ment at significant risk of paying unreason- SIGIR’s review Iraq. SIGIRfoundthatthesystemforreporting able costs. For example, the Defense Contract found signiﬁcant and investigating serious incidents involving AuditAgency(DCAA)didnotreviewAnham’s weaknesses in U.S.governmentPSCshaschangedlittlesince estimating system and found weaknesses in its the government’s SIGIR’s 2009 report on this issue. Moreover, billingsystem.Further,theDefenseContract oversight of Anham’s DoD’ssystemisprojectedtoremainunchanged Management Agency (DCMA) recommended business systems throughtheendof2011.Thesystem’sfutureis approval of Anham’s purchasing system despite and other contract lesscertainasresponsibilitiesformonitoringthe identifyingsignificantgapsindocumentationon administration functions. activities of DoD PSCs have not been fully deter- thedegreeofpricecompetitionobtained. minedandmaybedisestablishedeventhough SIGIRalsodeterminedthatcontractover- U.S.-fundedPSCswillcontinuetosupportDoD sightbythecontractingofficer’srepresenta- andDoSorganizationsandtheU.S.Agencyfor tives(CORs)wasweak.SIGIRalsoconducted InternationalDevelopment.SIGIRcouldnot alimitedincurred-costreviewofAnhamand determineDoS’plansforitsPSCsthatcurrently questionedalmost39%ofthecosts($4.4mil- reportserioussecurityincidentsusingDoD’s lion)reviewed.SIGIRquestionedwhether system because DoS would not provide SIGIR these costs were fair or reasonable because of with that information. questionable competition practices, inappropri- • U.S.GovernmentOversightofAnham,LLC, atebundlingofsubcontractoritems,andclose andItsSubcontractingProcedures.This working relationships—or possible ownership report examined subcontracts associated with affiliations—between Anham and certain sub- a reconstruction and logistics contract awarded contractors.Asaresultofthemultipleproblems toAnham.Thecontractwasfundedbyboththe identified in this report, SIGIR is questioning

JULY 30, 2011 I REPORT TO CONGRESS I 11

July2011.indb 11 7/25/2011 10:37:21 AM SIGIR OBSERVATIONS

allofthecostsonthiscontract,$113.4million, • StatusofSIGIRRecommendationstoDoS.The andrecommendsthattheU.S.militaryinitiate secondinaseriesreviewingagencyactionson asystematicreviewofbillingpracticesonall SIGIR recommendations, this report reviewed AnhamcontractsinIraqandAfghanistan.Cur- thestatusofrecommendationsmadetoDoS.In rently, Anham holds about $3.9 billion in U.S. earlyJuly2011,DoSprovidedSIGIRwithareport government contracts. statingthatithasclosed38ofthe45recom- • DoD Use of FY 2011 CERP Funds. The CERP’s mendations. SIGIR closed 13 recommendations purposeistoenableU.S.militarycommanders basedonthisinformationinthereport,butDoS torespondtourgenthumanitarianreliefandre- provided insufficient information for SIGIR to constructionrequirementsbyfundingprograms closetheother25.SIGIRalsofoundthatDoShas andprojectsthatwillimmediatelyassisttheIraqi afollow-upprocessandtrackingsystemforaudit people. However, SIGIR’s review determined reportsandrecommendationsandhasagreedto that many of the capacity-development projects usethatprocessforSIGIRreports. undertaken with FY 2011 CERP funds do not appearrelatedtoDoD’scounterinsurgencymis- Since2004,SIGIRhasissued194audits.For sion.SIGIRalsofoundthatDoSpersonnelare moreonthisquarter’saudits,seeSection5ofthis often involved in planning and implementing Quarterly Report. CERP projects, raising questions about whether theCERPhasevolvedintoanotherU.S.develop- Investigations mentprogramsimilartothoserunbytheU.S. AsofJuly15,SIGIR’sinvestigativeworkhasre- Agency for International Development (USAID) sulted in 35 arrests, 64 indictments, 54 convictions, andDoS.Additionally,SIGIRrecommendedthat andmorethan$153.9millionincourt-ordered DoDtakestepstoimproveCERPperformance monetary penalties. metrics. Recognizing the need for improved OnApril22,2011,theUnitedStatessettleda metrics,DoDstatedthatitisworkingondevel- whistleblowerlawsuitagainstDynCorpInterna- opingbettermetricstoassessmoreaccuratelythe tionalLLCanditssubcontractor,TheSandiGroup impactofCERPprojectsonacommunity. (TSG).ThesuitallegedthatDynCorpandTSG • DoDOversightofTheater-wideInternalSecu- submitted or caused to be submitted false claims DynCorp agreed rity Services (TWISS) Contracts. This audit re- forpaymentunderDynCorp’spolice-training to pay the United viewed DoD oversight of five contracts to PSCs, contractwithDoS.Underthetermsofthesettle- States $7.7 million finding that the CORs charged with monitoring ment,DynCorpagreedtopaytheUnitedStates to resolve allegations the TWISS contracts often received insufficient $7.7milliontoresolveallegationsthatitsubmitted that it submitted trainingtocarryouttheirmission.OftheCORs inflatedclaimsfortheconstructionofbasecamps inﬂated claims for the construction of surveyed by SIGIR, 40% said the training they atvariouslocationsinIraq.TSGagreedtopayjust base camps at various receiveddidnotpreparethemfortheirduties, morethan$1milliontoresolveallegationsthatit locations in Iraq. and 25% said they lack sufficient time to conduct sought reimbursement from the U.S. government effectiveoversight.Inaddition,DCMA,which fordangerpaythatitfalselyclaimedtohavepaid appointsandtrainsCORs,doesnotprovide its employees working in Iraq. CORsortheirratingofficerswithregularwrit- Other notable investigative accomplishments tenfeedbackontheirperformance.SIGIRalso this quarter included: determinedthatCORsarenotcompleting,nor • OnMay11,2011,CharlesBowie,aretiredU.S. is DCMA maintaining, all monthly checklists Army major, pled guilty to one felony count that should be used to monitor contractor com- forhisroleinawide-rangingcontract-fraud pliancewiththetermsofthetaskorder. schemeinvolvingformerU.S.ArmyMajorJohn

12 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 12 7/25/2011 10:37:21 AM SIGIR OBSERVATIONS

Cockerhamandseveralothermilitaryandcivil- thesefirmsreceivednearly$25millionworthof ianofficials.Bowieadmittedtoreceivingabout business. In exchange, the sergeant and the two $100,000fromacontractorinexchangeforthe majors allegedly received cash, airplane tickets, awardofabottled-watercontract.Bowiefacesa andnumerousotheritemsofvalue. maximumof10yearsinprisonandhasagreed • OnJune28,RobertNelson,aformerU.S.Army to pay $400,000 in restitution. sergeantfirstclass,pledguiltytoconspiring • Inarelatedcase,DerrickShoemake,aformer tostealU.S.Armyequipmentfromabasein U.S.Armymajor,pledguiltytotwocountsof Mosul.Whileservingtherein2008,Nelson briberyonJune13.WhileservingasaCOR agreedwithaU.S.Armytranslatortosteal in Kuwait, Shoemake accepted approximately eightgeneratorsthatthetranslatorlatersoldon $250,000fromtwocontractorsforimproperly theblackmarket.Nelsonadmittedreceiving assistingthemwithcontractsforthedeliveryof $44,830fromthisscheme.Atsentencing,Nelson bottledwatertoU.S.troopsservinginIraqand facesuptofiveyearsinprison,amaximumfine Afghanistan.Hefacesupto15yearsinprison of $250,000, and up to three years of supervised and has agreed to repay $250,000. releasefollowingaprisonterm. • OnJune21,an11-countindictmentwasunsealed • OnJuly7,2011,aformerU.S.Armysergeantwas inaWestVirginiafederalcourtchargingaU.S. arrestedandchargedwithreceivingmorethan Army sergeant first class and his associate, a $12,000instolencashthatwasallegedlymailed The cash was then former U.S. Army master sergeant, for their tohimfromIraqbyanotherformerU.S.Army allegedly stolen, allegedrolesinabriberyandmoney-laundering sergeant.Thefundsweresupposedtohavebeen concealed inside a scheme.Theindictmentallegesthatthesergeant, usedtopayalocalcontractorwhonevershowed stuffed toy animal, aseniorprocurementspecialistwhoservedin up to collect his fee. The cash was then allegedly and mailed back to Kuwait during 2005–2006, and two former U.S. stolen,concealedinsideastuffedtoyanimal,and the United States. Armymajorsawardedcontractsandimproperly mailedbacktotheUnitedStates. disclosed information to two contracting firms. Accordingtotheindictment,asaresultofthe For additional information on SIGIR investiga- actionstakenbythesergeantandthetwomajors, tions,seeSection5ofthisQuarterlyReport.◆

JULY 30, 2011 I REPORT TO CONGRESS I 13

July2011.indb 13 7/25/2011 10:37:21 AM SIGIR OBSERVATIONS

Quick Facts

Reconstruction Funding Cumulative Funding Major U.S. Funds $ Billions $ Billions $61.64 $107.41 U.S. Funding Iraqi Funding $60

$50

$40 $13.03 $30 International Funding $20 $10 Recent Funding $0 FY 2011 2011 2011 Appropriated Obligated Expended $3.70 B $25.70 B $471 M U.S. Funding Iraqi Capital Budget International Commitments IRRF ISFF ESF CERP INCLE

Average Price per Barrel, by Week Oil (1/2010–6/2011) $120.95 MBPD, by Month (1/2010–6/2011) 2.63 2.56 $106.38 2.46 Production 2.28 2.25 Exports 1.92 $75.66 $69.35 1.79

Electricity Security Supply vs. Demand, by Quarter (1/1/2010–6/30/2011) Average Daily Security Incidents, by week MW (1/2010–6/2011) 44 14,000

12,000 Estimated Demand 10,000 21 20 8,000 13

6,000 Total Supply Persons Killed (4/1/2011–6/30/2011)

4,000 U.S. Military 21

2,000 ISF 193 0 Q1 Q2Q3 Q4 Q1 Q2 Iraqi Civilians 248 2010 2011

Contractors 4

Note: ISF and Iraqi civilian data is through June 19, 2011, and U.S. military and contractor data is through June 30, 2011. Contractor number represents personnel working under contract for the U.S. government who died as a result of both combat and non-combat incidents.

14 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 14 7/25/2011 10:37:21 AM FUNDING FOR IRAQ RECONSTRUCTION

Funding Overview 16

U.S. Funding 17

Iraqi Funding 33

International Support 36 2section

July2011.indb 15 7/25/2011 10:37:22 AM FUNDINGFORIRAQRECONSTRUCTION

FUNDING OVERVIEW

AsofJune30,2011,$182.08billionhadbeenmade Figure 2.1 availableforthereliefandreconstructionofIraq Funding Sources, 2003–2011 through three main sources:48 $ Billions Total: $182.08 • U.S. appropriations—$61.64 billion Total Non-U.S. International • IraqifundsoverseenbytheCoalitionProvi- CPA Spending Funding $12.07 Bilateral sional Authority (CPA) and the Iraqi capital Total Iraqi $8.60 $13.03 Funding Multilateral budget—$107.41 billion $107.41 $4.44 • Internationalcommitmentsofassistanceand IRRF loans from non-U.S. sources—$13.03 billion $20.86 SeeFigure2.1foranoverviewofthesefunding ISFF $20.54 Total U.S. sources.SeeFigure2.2foranoverviewofbudget Funding Iraqi $61.64 execution by source.◆ Capital ESF $4.83 Budgets CERP $3.85 $95.34 INCLE $1.18 Other $10.37

Note: Data not audited. Numbers affected by rounding.

Figure 2.2 Sources: See Figure 2.2. Execution of Funding Provided for Iraq Reconstruction, by Funding Source

U.S. Funding Iraqi Funding Non-U.S. International Funding

Unexpended Obligations Expired 3% 3% Not Uncommitted Executed Pledges 14% 28%

95% 86% 72% Expended Executed Committed

Note: Data not audited. Numbers affected by rounding. U.S. execution rate based on major appropriations (IRRF, ISFF, ESF, CERP, INCLE) that expired on or before 9/30/2010. GOI capital budget execution rate based on 2006–2010 capital budgets. International contributions based on net commitments and pledges (loans and grants) reported by NEA-I through 12/31/2010; some countries committed more than they pledged.

Sources: P.L. 108-7; P.L. 108-11; P.L. 108-106; P.L. 108-287; P.L. 109-13; P.L. 109-102; P.L. 109-148; P.L. 109-34; P.L. 109-289; P.L. 110-28; P.L. 110-92; P.L. 110-116; P.L. 110-137; P.L. 110-149; P.L. 110-161; P.L. 110-252; P.L. 111-32; P.L. 111-117; P.L. 111-118; P.L. 111-212; P.L. 112-10; ABO, responses to SIGIR data call, 7/14/2011 and 7/15/2011; DoS, response to SIGIR data call, 4/5/2007; INL, response to SIGIR data call, 7/15/2011; DoS, NEA-I, response to SIGIR data calls, 4/12/2011, 4/15/2011, 6/20/2011, 6/24/2011, and 6/27/2011; OUSD(C), responses to SIGIR data calls, 4/10/2009 and 7/15/2011; SIGIR Audit 11-007, “Iraq Relief and Reconstruction Fund 1: Report on Apportionments, Expenditures, and Cancelled Funds,” 12/28/2010; U.S. Treasury, response to SIGIR data call, 4/2/2009; USACE, response to SIGIR data call, 7/5/2011; USAID, responses to SIGIR data calls, 7/8/2010 and 7/7/2011; USTDA, response to SIGIR data call, 4/2/2009; USACE, response to SIGIR data call, 10/6/2008; DoS, DRL, response to SIGIR data call, 4/12/2011; TFBSO, response to SIGIR data call, 1/4/2011; USAID, “U.S. Overseas Loans and Grants [Greenbook],” 2008, gbk.eads.usaidallnet.gov/query/do?_program=/eads/gbk/countryReport&unit=N, accessed 4/15/2010; DoJ, Justice Management Division, responses to SIGIR data call, 4/5/2011 and 4/11/2011; DoS, NEA-I, responses to SIGIR data calls, 10/4/2010, 10/6/2010, 4/5/2011, 4/15/2011 and 7/7/2011; DoS, ECA, response to SIGIR data call, 4/14/2010; OUSD(C), response to SIGIR data call, 10/14/2010; U.S. Treasury, OTA, “Office of Technical Assistance Overview,” 12/30/2005, ustreas.gov/offices/internationalaffairs/assistance/, accessed 10/16/2009; DoS, PM, response to SIGIR data call, 7/6/2011; BBG, response to SIGIR data call, 3/7/2011; Congressional Budget Justification, Foreign Assistance Summary Tables, FY 2009–2011; USAID, responses to SIGIR data calls, 1/12/2009 and 4/8/2009; OMB, response to SIGIR data call, 6/21/2010; U.S. Embassy-Baghdad, response to SIGIR data call, 10/3/2009; GOI, CoR, “Federal Public Budget Law for the Fiscal Year 2011,” 2/23/2011, Article 2; GOI, MOF, information provided to SIGIR, 6/27/2011; U.S. Treasury, responses to SIGIR data calls, 1/4/2008 and 4/9/2009; “GOI Budget” (as approved by TNA and written into law December 2005); GOI, Presidency of the Iraqi Interim National Assembly, “The State General Budget for 2005,” 2005; GOI, “Budget Revenues and Expenses 2003, July–December,” 2003; DoS, NEA-I, responses to SIGIR data calls, 4/5/2011, 4/7/2011, and 7/12/2011.

16 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 16 7/25/2011 10:37:22 AM U.S. FUNDING

U.S. FUNDING

Since2003,theUnitedStateshasappropriatedor • Commander’s Emergency Response Program otherwise made available $61.64 billion for recon- (CERP)—$3.85 billion structioneffortsinIraq,includingthebuildingof • International Narcotics Control and Law physical infrastructure, establishment of political Enforcement (INCLE)—$1.18 billion and societal institutions, reconstitution of security AsofJune30,2011,$4.27billioninavailable forces,andthepurchaseofproductsandservices budgetauthorityremainedunexpendedforthefive forthebenefitofthepeopleofIraq.49 majorfunds($3.86billioninunobligatedfunds Since 2003, $51.27 billion has been made avail- plus$1.67billioninunexpendedobligationsminus ablethroughfivemajorfunds:50 $1.27billioninexpiredfunds).51 • IraqReliefandReconstructionFund(IRRF)— TheIRRFhasexpiredfornewobligations,and $20.86 billion quarterlyexpendituresfromthefundnowconsti- • IraqSecurityForcesFund(ISFF)—$20.54billion tute only a small fraction of overall quarterly expen- • Economic Support Fund (ESF)—$4.83 billion ditures. Consequently, SIGIR will no longer discuss the IRRF in detail in the Quarterly Report.52 Figure 2.3 The Congress also made $10.37 billion available Status of Major U.S. Funds, as of 6/30/2011 through several smaller funding streams.53 $ Billions ForanoverviewofU.S.appropriations,obliga- INCLE Unexpended Obligations tions,andexpendituresfromthefivemajorfunds, $50 Total: $1.67 see Figure 2.3. For details on appropriations and CERP INCLE INCLE $45 CERP ESF thestatusofallfunds,seeTable2.1. $0.35 ESF CERP ESF ISFF $40 21% ISFF ESF $0.86 ISFF 52% $35 ISFF FY 2011–FY 2012 Appropriations

$30 19% Full-yearFY2011appropriationswereenactedon $25 IRRF April15,2011,followingaseriesofsevencontinu- $0.32 8% ingappropriationsactsthatprovidedtemporary $20 IRRF IRRF IRRF INCLE extensions of FY 2010 budget authority.54 As of CERP $0.13 $15 1% June 30, 2011, $3.70 billion had been allocated to $0.01 IraqactivitiesforFY2011:$2.34billioninforeign $10 assistance and $1.36 billion for reconstruction- $5 related operating expenses.55 In the first three quar-

$0 tersofthefiscalyear,just$2.3millioncombined Appropriated Obligated Expended wasobligatedfromtheISFF,ESF,andINCLE—

Note: Data not audited. Numbers affected by rounding. approximately one-tenth of 1% of the amount appropriatedforFY2011.Incontrast,morethan Sources: P.L. 108-7; P.L. 108-11; P.L. 108-106; P.L. 108-287; P.L. 109-13; P.L. 109-102; P.L. 109-148; P.L. 109-34; P.L. 109-289; P.L. 110-28; P.L. 110-92; P.L. 110-116; P.L. 110-137; P.L. 110-149; P.L. 110-161; P.L. 110-252; P.L. $42millionwasobligatedfromtheCERP—64%of 111-32; P.L. 111-117; P.L. 111-118; P.L. 111-212; P.L. 112-10; ABO, responses to SIGIR data call, 7/14/2011 and 7/15/2011; DoS, response to SIGIR data call, 4/5/2007; INL, response to SIGIR data call, 7/15/2011; NEA-I, the amount appropriated for FY 2011.56 response to SIGIR data calls, 4/12/2011, 4/15/2011, 6/20/2011, 6/24/2011, and 6/27/2011; OUSD(C), responses to SIGIR data calls, 4/10/2009 and 7/15/2011; SIGIR Audit 11-007, “Iraq Relief and Reconstruction Fund 1: InitsbudgetrequestforFY2012,theAdminis- Report on Apportionments, Expenditures, and Cancelled Funds,” 12/28/2010; U.S. Treasury, response to SIGIR data call, 4/2/2009; USACE, response to SIGIR data call, 7/5/2011; USAID, responses to SIGIR data calls, trationrequested nearly $6.83 billion for foreign 7/8/2010 and 7/7/2011; USTDA, response to SIGIR data call, 4/2/2009.

JULY 30, 2011 I REPORT TO CONGRESS I 17

July2011.indb 17 7/25/2011 10:37:22 AM FUNDINGFORIRAQRECONSTRUCTION

Appropriations by Fiscal Year, FY 2003–FY 2009 Table 2.1 P.L. 110-92, U.S. Appropriated Funds P.L. 110-116, P.L. 110-137, $ Millions P.L. 109-102, P.L. 109-289, P.L. 110-149, P.L. 108-7, P.L. 108-106, P.L. 109-148, P.L. 110-5, P.L. 110-161, P.L. 110-252, P.L. 108-11 P.L. 108-287 P.L. 109-13 P.L. 109-234 P.L. 110-28 P.L. 110-252 P.L. 111-32

FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009

Major Funds

IraqReliefandReconstructionFund(IRRF1andIRRF2)a 2,475 18,389

Iraq Security Forces Fund (ISFF) 5,490 3,007 5,542 3,000 1,000

Economic Support Fund (ESF)b 1,469 1,554 562 542

Commander's Emergency Response Program (CERP)c 140 718 605 743 956 355

International Narcotics Control and Law Enforcement (INCLE) 91 170 85 20

Subtotal 2,475 18,529 6,208 5,172 8,010 4,603 1,917 Other Assistance Programs

Migration and Refugee Assistance (MRA) and Emergency Refugee & Migration 40 78 278 260 Assistance (ERMA)

Natural Resources Risk Remediation Fund (NRRRF)d 801

Iraq Freedom Fund (Other Reconstruction Activities)e 700

P.L. 480 Food Aid (Title II and Non-Title II) 368 3 24

International Disaster Assistance (IDA) and International Disaster and Famine 24 7 45 85 51 Assistance (IDFA)

Democracy Fund (Democracy) 190 75

Iraq Freedom Fund (TFBSO) 50 50 74

Nonproliferation, Anti-terrorism, Demining, and Related Programs (NADR)f 19 16 36

DepartmentofJustice(DoJ) 37 2 11 23 25 7

Child Survival and Health Programs Fund (CSH) 90

EducationandCulturalExchangePrograms(ECA) 75 7 7

Overseas Humanitarian, Disaster and Civic Aid (OHDACA) 9 15 3

International Affairs Technical Assistance 13 3

U.S. Marshals Service 23221

International Military Education and Training (IMET) 122

Alhurra-Iraq Broadcasting 5

Subtotal 2,069 22 15 33 416 563 438 Reconstruction-Related Operating Expenses

Diplomatic and Consular Programsg

Coalition Provisional Authority (CPA)h 908

Project and Contracting Ofﬁce (PCO)i 200 630

USAID Operating Expenses (USAID OE) 21 24 79 37 41 48

U.S. Contributions to International Organizations (CIO) 38 30

DoD OSC-I Support

Iraq Freedom Fund (PRT Administrative Costs) 100

Subtotal 21 908 24 279 767 79 78 Reconstruction Oversight

Special Inspector General for Iraq Reconstruction (SIGIR) 75 24 35 3 44

Defense Contract Audit Agency (DCAA) 16 14 13

USAID Ofﬁce of the Inspector General (USAID OIG) 4 2 3 3 7 4

DoSOfﬁceoftheInspectorGeneral(DoSOIG) 13 4 6

DoDOfﬁceoftheInspectorGeneral(DoDOIG) 521

Subtotal 477330574766

Total 4,569 19,536 6,250 5,515 9,251 5,293 2,499

a The Congress initially appropriated $18,649 million to IRRF 2, but earmarked $210 million to be transferred to other accounts for programs in Jordan, Liberia, and Sudan. In FY 2006, the Congress transferred roughly $10 million into the IRRF from the ESF. In FY 2008, P.L. 110-252 rescinded $50 million. b P.L. 108-11 provided $10 million for war crimes investigations and $40 million to reimburse the ESF account for resources advanced to fund supplies, commodities, and services prior to the conflict in Iraq. c Generally, the Congress does not appropriate the CERP to a specific country, but rather to a fund for both Iraq and Afghanistan. SIGIR reports DoD’s allocation to the CERP for Iraq as an appropriation. d Includes funds transferred from the Iraq Freedom Fund (IFF). e Includes funds appropriated to the IFF by P.L. 108-11, Title I, and transferred to reconstruction activities, with the exception of funds transferred to NRRRF, which are recorded under that fund. f The $20 million reported for FY 2009 was appropriated by P.L. 111-8. g Diplomatic and Consular Programs includes FY 2010 supplemental funding to support U.S. Embassy-Baghdad in establishing an enduring provincial presence. h Excludes $75 million for the Special Inspector General for Iraq Reconstruction under P.L. 108-106. i Reconstruction support funding is provided for Project and Contracting Office (PCO) activities per the P.L. 109-234 and P.L. 110-28 conference reports.

18 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 18 7/25/2011 10:37:22 AM U.S. FUNDING

FY 2010 FY 2011

P.L. 111-117 P.L. 111-118 P.L. 111-212 P.L. 112-10 Status of Funds

12/16/09 12/19/09 7/29/10 4/15/11 Total Appropriated Obligated Expended Expired

Major Funds

IraqReliefandReconstructionFund(IRRF1andIRRF2) 20,864 20,369 20,048 495

Iraq Security Forces Fund (ISFF) 1,000 1,500 20,539 18,342 17,479 509

Economic Support Fund (ESF) 383 326 4,835 4,120 3,771 166

Commander's Emergency Response Program (CERP) 263 67 3,846 3,726 3,718 96

International Narcotics Control and Law Enforcement (INCLE) 52 650 115 1,183 850 718 0

Subtotal 435 263 1,650 2,007 51,267 47,407 45,734 1,265 Other Assistance Programs

Migration and Refugee Assistance (MRA) and Emergency Refugee & 300 16 280 1,252 955 915 Migration Assistance (ERMA)

Natural Resources Risk Remediation Fund (NRRRF) 801 801 801

Iraq Freedom Fund (Other Reconstruction Activities) 700 680 654

P.L. 480 Food Aid (Title II and Non-Title II) 395 395 395

International Disaster Assistance (IDA) and International Disaster and Famine 33 9 17 272 255 232 Assistance (IDFA)

Democracy Fund (Democracy) 265 265 245

Iraq Freedom Fund (TFBSO) 174 86 65

Nonproliferation, Anti-terrorism, Demining, and Related Programs (NADR) 30 30 131 62 62

DepartmentofJustice(DoJ) 13 118 111 107

Child Survival and Health Programs Fund (CSH) 90 90 90

EducationandCulturalExchangePrograms(ECA) 7 7 40

Overseas Humanitarian, Disaster and Civic Aid (OHDACA) 27 27 10

International Affairs Technical Assistance 16 16 14

U.S. Marshals Service 999

International Military Education and Training (IMET) 2 2 9 9 6

Alhurra-Iraq Broadcasting 555

Subtotal 386 25 336 4,304 3,766 3,610 Reconstruction-Related Operating Expenses

Diplomatic and Consular Programs 1,122 1,030 1,119 3,271

Coalition Provisional Authority (CPA) 908 832 799

Project and Contracting Ofﬁce (PCO) 830

USAID Operating Expenses (USAID OE) 52 46 349

U.S. Contributions to International Organizations (CIO) 33 31 132

DoD OSC-I Support 129 129

Iraq Freedom Fund (PRT Administrative Costs) 100

Subtotal 1,207 1,030 1,326 5,720 832 799 Reconstruction Oversight

Special Inspector General for Iraq Reconstruction (SIGIR) 23 22 225 207 198

Defense Contract Audit Agency (DCAA) 43

USAID Ofﬁce of the Inspector General (USAID OIG) 7 29

DoSOfﬁceoftheInspectorGeneral(DoSOIG) 7 5 26

DoDOfﬁceoftheInspectorGeneral(DoDOIG) 26

Subtotal 37 27 348 207 198

Total 2,064 263 2,705 3,695 61,639 52,212 50,341 1,265

Sources: ABO,responsestoSIGIRdatacall,7/14/2011and7/15/2011;BBG,responsetoSIGIRdatacall,3/7/2011;CongressionalBudgetJustification,ForeignAssistance Summary Tables, FY2009–2011;DCAA,responsetoSIGIRdatacall,7/15/2011;DoSDRL,responsetoSIGIRdatacall,4/12/2011;DoSECA,responsetoSIGIRdatacall,4/14/2010;DoSPM,responsetoSIGIR data call, 7/6/2011; INL, response to SIGIR data call, 7/15/2011; Justice Management Division, responses to SIGIR data call, 4/5/2011 and 4/11/2011;NEA-I,responsestoSIGIRdatacalls, 10/4/2010, 10/6/2010, 4/5/2011, 4/12/2011, 4/15/2011, 6/20/2011, 6/24/2011, 6/27/2011, and 7/7/2011; OUSD(C), responses to SIGIR data calls, 10/14/2010 and 7/5/2011; SIGIR Audit 11-007, “Iraq Relief and Reconstruction Fund 1: Report on Apportionments, Expenditures, and Cancelled Funds,” 12/28/2010;TFBSO,responsetoSIGIRdatacall,1/4/2011;OMB,responseto SIGIRdatacall,6/21/2010;U.S.Treasury,OTA,“OfficeofTechnicalAssistanceOverview,” 12/30/2005, ustreas.gov/offices/international-affairs/assistance/,accessed10/16/2009;U.S. Embassy-Baghdad,responsetoSIGIRdatacall,10/3/2009;USACE,responsestoSIGIRdatacalls,10/6/2008and7/5/2011;USAID,responsestoSIGIRdata calls, 1/12/2009, 4/8/2009, and 7/7/2011; USAID, “U.S. Overseas Loans and Grants [Greenbook],” 2008, gbk.eads.usaidallnet.gov/query/do?_program=/eads/gbk/countryReport&unit=N, accessed 4/15/2010.

JULY 30, 2011 I REPORT TO CONGRESS I 19

July2011.indb 19 7/25/2011 10:37:22 AM FUNDINGFORIRAQRECONSTRUCTION

Table 2.2 U.S. Appropriations, FY 2011–FY 2012 $ Millions FY 2012 Request FY 2011 Request and Appropriations Overseas Contingency Fund Request Appropriation Base Operations Total

Foreign Defense ISFF 2,000.0 1,500.0 0.0 Assistance CERP 200.0 66.5 25.0 25.0 Subtotal 2,200.0 1,566.5 25.0 25.0 Foreign Operations INCLE 315.0 114.6 1,000.0 1,000.0 FMF 1,000.0 1,000.0 ESF 383.0 325.7 325.7 325.7 MRA/ERMA n/a 280.0 n/a NADR 29.8 29.8 32.4 32.4 IDA n/a 17.3 n/a IMET 2.0 2.0 2.0 2.0 Subtotal 729.8 769.4 360.1 2,000.0 2,360.1 Subtotal 2,929.8 2,335.9 360.1 2,025.0 2,385.1 Operating DoD OSC-ISupport 245.0 129.1 524.0 524.0 Expenses Subtotal 245.0 129.1 524.0 524.0 DoS D&CP 1,787.1 1,119.4 495.9 3,229.5 3,725.4 CIO 31.0 44.3 44.3 ECSM 37.0 37.0 ECA 6.9 7.0 7.0 Subtotal 1,787.1 1,157.3 584.2 3,229.5 3,813.7 Other Civilian USAID 62.8 46.3 75.4 75.4 SIGIR 22.0 22.0 18.5 18.5 DoS OIG 4.9 9.2 9.2 Subtotal 84.8 73.2 84.6 18.5 103.1 Subtotal 2,116.9 1,359.6 668.8 3,772.0 4,440.8 Total 5,046.7 3,695.5 1,028.9 5,797.0 6,825.9

Note: Data not audited. Numbers affected by rounding. DoD Operating Expenses include only those funds requested to support the Ofﬁce of Security Cooperation-Iraq; in FY 2010– FY 2012, an additional $119 billion was appropriated or requested for Operations Iraqi Freedom and New Dawn ($62 billion in FY 2010, $46 billion in FY 2011, and $11 billion in FY 2012). DoS and USAID Operating Expenses include funds for operations (including diplomacy for DoS), security, construction, and all other purposes other than foreign assistance.

Sources: P.L. 111-212; DoS, “CongressionalBudgetJustification,Volume1:DepartmentofStateOperations,FY2012,” 2/14/2011, p. 779; DoS, “Executive Budget Summary: Function 150 & Other International Programs, FY 2012,” 2/14/2011,pp.155,162,167,171,776,“Congressional Budget Justification: Foreign Assistance Summary Tables, FY 2011,” p. 88, and “Congressional Budget Justification: Foreign Assistance Summary Tables, FY 2012,” p. 101; DoD, “FiscalYear2012BudgetRequest:Overview,” 2/2011, Chapter 6, p. 6; DoS, NEA-I, responsetoSIGIRdatacall,7/7/2011;USAID,responsetoSIGIRdatacall,7/7/2011.

assistance and operating expenses for Iraq—nearly and its predecessor, the Multi-National Force-Iraq, twice as much as was appropriated for FY 2011. The tosupportIraq’sMinistryofDefense(MOD)and anticipatedgrowthisdrivenprimarilybya$3.73billion MinistryofInterior(MOI)indevelopingtheIraqi requestfortheU.S.Embassy-BaghdadintheDiplo- SecurityForces(ISF)andincreasingministerial The Administration matic and Consular Programs account.57 capacity.Thisincludes$1.50billionprovidedby requested $1.00 FordetailsonFY2011appropriationsandthe P.L. 112-10, which will remain available for obliga- billion in FMF and Administration’s FY 2012 appropriations request, tion until September 30, 2012.58 The Administration $1.00 billion in INCLE see Table 2.2. didnotrequestanyISFFfundingforFY2012.In- to support the ISF as stead,theAdministrationrequested$1.00billionin part of its “Overseas Contingency ForeignMilitaryFinancing(FMF)and$1.00billion Operations” request. Iraq Security Forces Fund inINCLEtosupporttheISFaspartofits“Overseas Contingency Operations” request.59 Since2005,theCongresshasappropriated$20.54bil- AsofJune30,2011,$863millionofobligated liontotheISFFtoenabletheU.S.Forces-Iraq(USF-I) ISFF funds had not been expended. An additional

20 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 20 7/25/2011 10:37:23 AM U.S. FUNDING

Table 2.3 Figure 2.4 ISFF:StatusofFunds,byMinistryandSub-activityGroup, ISFF: Status of Funds, as of 6/30/2011 as of 6/30/2011 $ Millions $ Millions Appropriated $20,539.3 Obligated $18,342.2 Status of Funds Quarterly Change Sub-Activity Expended $17,478.7 MinistryGroup Obligated Expended Obligated Expended

Defense Equipment 4,866.9 4,753.3 8.0 4.7 Unexpended Obligations Total: $863.5 Infrastructure 3,074.7 2,971.9 Sustainment 2,347.2 2,177.2 82.3 15.5 Related Activities Sustainment $35.1 $169.9 Training 610.0 527.2 10.0 0.9 Interior Defense Subtotal 10,898.8 10,429.7 100.3 21.2 $359.2 Other $469.1 $147.9 20% Interior Training 2,659.0 2,564.5 -1.3 -3.7 17% Equipment 1,951.8 1,835.0 30.3 28.9 Equipment Infrastructure 1,346.9 1,259.9 Training 13% $113.6 $94.5 11% Sustainment 629.0 568.2 0.6 2.0 Subtotal 6,586.7 6,227.5 29.6 27.2 14% 12% 10% Varies Related Activities 856.6 821.5 0.5 Equipment Infrastructure $116.8 $102.8 Total 18,342.2 17,478.7 129.9 48.9 Training $82.8 Note: Data not audited. Numbers affected by rounding.

Sources: OUSD(C),responsestoSIGIRdatacalls,4/18/2011and7/15/2011. Note: Data not audited. Numbers affected by rounding. Sources: P.L. 109-13; P.L. 109-102; P.L. 109-234; P.L. 110-28; P.L. 110-92; P.L. 110-116; P.L. 110-137; P.L. 110-149; P.L. 110-161; P.L. 110-252; P.L. 111-32; Table 2.4 P.L. 111-212; P.L. 112-10; OUSD(C), response to SIGIR data call, 7/15/2011. FY2011ISFFSpendPlanthrough9/30/2011 $ Millions Ministry Sub-Activity Group Project Details Allocation $2.20billionhadnotbeenobligated,but$509million ofthisamounthasexpired.Thisleaves$1.69billion Defense Sustainment Warﬁghter Sustainment 80.7 availableforobligationtonewprojects:$190million JBW Supplemental (parts) 60.0 fromP.L.111-212,whichexpiresonSeptember30, Scan Eagle 5.0 2011,andnearlythefull$1.50billionfromP.L.112-10, Subtotal 145.7 whichexpiresonSeptember30,2012.Intotal, Equipment Corps Headquarters 95.3 $2.55billioninavailablebudgetauthorityremained ISOF Academy 30.0 unexpended for the ISFF.60 Subtotal 125.3 ForthestatusoftheISFF,includingabreak- Subtotal 271.0 down of unexpended obligations, see Figure 2.4. Interior Sustainment Logistics Professional Military 18.0 Education & Resource Mgt Training ForthestatusandquarterlychangeofISFFobliga- Subtotal 18.0 tionsandexpenditures,byministryandsub-activity Equipment Federal Police Equipment 95.0 group, see Table 2.3. Subtotal 95.0 Subtotal 113.0 FY 2011ISFF SpendPlan Varies RelatedActivities QuickResponseFund 5.0 TheprojectsoutlinedinUSF-I’sFY2011ISFF spendplanareintendedto“enableUSF-Itocontinue Subtotal 5.0 itsmissiontosustain,equip,[and]traintheISF Total Allocated 389.0 DefenseandInteriorForces[to]reachMinimum Unallocated Funds 1,111.0 EssentialCapabilities(MEC)bytheendofmission Total Appropriated 1,500.0 on 31 December 2011.” The spend plan was most Note: Data not audited. Numbers affected by rounding. The FY 2011 ISFF expires on 9/30/2012. Allocations currentasof3/31/2011. recentlyupdatedinFebruary2011andreflects

Source: OUSD(C),responsetoSIGIRdatacall,7/5/2011.

JULY 30, 2011 I REPORT TO CONGRESS I 21

July2011.indb 21 7/25/2011 10:37:23 AM FUNDINGFORIRAQRECONSTRUCTION

funding available at that time through the fourth Figure 2.5 FY 2011 continuing appropriation (P.L. 111-322).61 ESF: Status of Funds, as of 6/30/2011 $ Millions Sincethen,theCongresspassedthreeadditional Appropriated $4,834.9 continuing appropriations, as well as a full-year appro- Obligated $4,119.9 priation.62 The full-year appropriation (P.L. 112-10), Expended $3,771.4 enactedonApril15,2011,provides$1.5billionto Unexpended Obligations 63 beobligatedbySeptember30,2012. According to Total: $348.5 theDoDOfficeoftheUnderSecretaryofDefense Community Action (Comptroller)(OUSD(C)),thefull-yearspendplanis Political Other Political Program Security $77.6 $16.4 $55.2 $146.7 beingpreparedandwillbeprovidedtoSIGIRwhen 5% 16% approved.64 For available details, see Table 2.4. Democracy PRT/PRDC and Civil Society 10% Projects $61.3 18% $35.8

8% PRT Quick Other Economic 8% Response Fund Economic Support Fund $27.9 8% $26.2 7% 11% Other Security Financial Sector 9% Since2003,theCongresshasappropriatedmorethan Development $29.5 $25.4 $4.83 billion to the ESF to improve infrastructure and Economic Provincial Primary Health $124.2 Economic Growth Care Program communitysecurity,promotedemocracyandcivil $32.2 $38.6 society,andsupportcapacitybuildingandeconomic Note: Data not audited. Numbers affected by rounding. 65 development. Thisincludesnearly$326million Sources: P.L. 109-102; P.L. 109-234; P.L. 110-28; P.L. 110-92; P.L. 110-137; provided by P.L. 112-10, which will remain available P.L. 110-149; P.L. 110-161; P.L. 110-252; P.L. 111-32; P.L. 111-117; P.L. 112-10; USAID, response to SIGIR data call, 7/7/2011; USACE, forobligationuntilSeptember30,2012.66 The Con- response to SIGIR data call, 7/5/2011; NEA-I, responses to SIGIR data calls, 4/12/2011, 4/15/2011, 6/24/2011, 6/27/2011, and 7/7/2011. gressiscurrentlyconsideringtheAdministration’s FY 2012 ESF request of $326 million.67 by the IRRF. Appropriations averaged $1.51 billion AsofJune30,2011,$348millionofobligated peryearinFY2006–FY2007,$552millionper ESFfundshadnotbeenexpended.Anadditional yearinFY2008–FY2009,and$354millionin $715 million had not been obligated, but $166 mil- FY 2010–FY 2011. The majority of the ESF in Iraq lionofthisamounthasexpired.Thisleaves$549mil- hasbeenrequestedandappropriatedassupple- lionavailableforobligationtonewprojects.Intotal, mentalfunding,andtheCongresshasprovideda $897 million in available budget authority remained much greater share of supplemental requests than unexpended for the ESF.68 regular requests.69 ForthestatusoftheESF,includingabreakdown Fordetailsonrequestsandappropriations,see of unexpended obligations, see Figure 2.5. For the Figure2.6andTable2.6. statusandquarterlychangeoftheESF,by“track” andprogram,seeTable2.5. ESF Programming, Obligations, and Expenditures ESF Requests and Appropriations The larger supplemental appropriations in In the fourth quarter Since2006,theAdministrationhasrequested FY2006–FY2007wereobligatedmorequickly of FY 2007, U.S. $6.89billionfortheESFinIraq,andtheCongress thanappropriationsinlateryears.Atthepeak,in agencies in Iraq were has appropriated $4.83 billion. The size of requests thefourthquarterofFY2007(beforetheFY2006 obligating nearly and appropriations have declined significantly appropriations expired), U.S. agencies in Iraq were $15.7 million each sinceFY2006–FY2007,whentheESFservedas obligatingnearly$15.7millioneachdayonaver- day on average. follow-on funding for the Community Stabilization age. Overall, obligations in the fourth quarter of Programandotherprogramsoriginallyfunded anygivenfiscalyearweresignificantlyhigherthan

22 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 22 7/25/2011 10:37:23 AM U.S. FUNDING

Table 2.5 in the three preceding quarters, suggesting a “rush ESF: Status of Funds, by Track and Program, as of 6/30/2011 to obligate” before funds expired at the end of the $ Millions fiscal year.70 Expenditures peaked at an average Status of Funds Quarterly Change $6.7millionperdayduringthefourthquarterof Track Program Obligated Expended Obligated Expended FY2008,asobligationsoftheFY2006–FY2007 Security Community 619.3 608.6 appropriations were liquidated. However, there Stabilization Program wasnoapparentannualpatterntoexpenditures PRT/PRDC Projects 594.7 558.9 8.4 24.4 similartothatobservedforobligations.71 Local Governance 440.5 422.2 5.0 12.7 Program The ESF has supported projects implemented Community Action bytheU.S.AgencyforInternationalDevelopment 394.3 339.1 10.0 14.6 Program (USAID);theGulfRegionDivision(GRD)and PRT Quick Response 276.2 250.0 2.4 16.9 successor offices of the U.S. Army Corps of Engi- Fund neers(USACE);theDoSBureausofDemocracy, Infrastructure Security 194.2 193.7 -0.5 4.2 Protection HumanRights,andLabor(DRL)andPopulation, Subtotal 2,519.2 2,372.6 25.2 72.7 Refugees,andMigration(PRM);and—attheU.S. Political Tatweer National Embassy-Baghdad—theOfficeoftheChiefofMis- 309.4 304.1 4.7 Capacity Development sion(COM),theOfficeofProvincialAffairs(OPA), Democracy and Civil 260.6 199.3 15.8 Society theIraqStrategicPartnershipOffice(ISPO)and its predecessors, and the Regime Crimes Liaison Iraqi Refugees 95.0 94.5 1.2 Office (RCLO).72 Economic Gov. II, Policy 85.0 83.9 andReg.Reforms Fordetailsonobligationsandexpenditures,see Ministerial Capacity 37.6 35.5 Figure2.6.Fordetailsonprogramobligations,see Development Table 2.7. Regime Crimes Liaison 28.5 28.4 Elections Support 13.9 13.8 U.S. Agency for International Development Monitoring and Eval. 13.4 6.4 5.0 1.0 AsofJune30,2011,USAIDhadobligated$2.50billion Subtotal 843.6 765.9 5.0 22.8 (61%)oftheESFinIraq.USAID’slargestESF-funded Economic O&M Sustainment 275.2 274.0 0.3 programs were the Community Stabilization Program Inma Agribusiness 149.8 133.9 5.0 5.0 (CSP), the Local Governance Program, the Com- Development munity Action Program, and the Tatweer National Tijara Provincial 117.8 85.5 8.6 Economic Growth CapacityDevelopmentprogram—allofwhichhad Targeted Development 73 60.4 50.3 4.4 obligated in excess of $300 million. The latter three Program arecapacity-developmentprogramsandaredetailed Plant-Level Capacity 50.4 50.3 0.2 Dev. & Tech. Training intheGovernancesectionofthisQuarterlyReport. PrimaryHealthCare CSP was a three-year “non-lethal counterinsur- 39.1 0.5 0.5 Program gencyprogram.”LaunchedinMay2006,itwasde- Izdihar Private Sector 32.8 32.2 signedtocomplementtheU.S.militarysurgebyre- Development ducingincentivesforviolencebyat-riskyouth,ages Financial Sector 31.6 6.2 2.9 74 Development 17–35. The program focused on generating em- Subtotal 757.1 633.0 5.0 21.9 ployment, rehabilitating infrastructure, sponsoring Total 4,119.9 3,771.4 35.2 117.4 youthprograms,assistingmunicipalgovernments,

Note: Data not audited. Numbers affected by rounding. andmitigatingconflictin“strategic”citiesaffected byinsurgentaction.Initialactivitieswerelimited Sources: NEA-I, responses to SIGIR data calls, 3/25/2011, 3/28/2011, 4/5/2011, 4/12/2011, 4/15/2011, 6/24/2011, and6/27/2011;USAID,responsetoSIGIRdatacall,7/7/2011;USACE,responsestoSIGIRdatacalls,4/5/2011 toBaghdad,buttheprogramsubsequentlyspread and 7/5/2011.

JULY 30, 2011 I REPORT TO CONGRESS I 23

July2011.indb 23 7/25/2011 10:37:23 AM FUNDINGFORIRAQRECONSTRUCTION

Figure 2.6 ESF: Appropriations, Obligations, and Expenditures, 2006–2012 $ Millions Regular and Supplemental Appropriations

$2,500 P.L.110-28 Total, FY 2006–FY 2011 Regular Supplemental Total $2,000 P.L.109-234 Requested $1,756.7 $4,807.0 $6,563.7 $1,500 Appropriated $1,008.9 (57%) $3,826.0 (80%) $4,834.9 (74%)

$1,000 P.L.110-92, P.L.110-252 P.L.110-137, P.L.110-149, P.L.111-32 P.L.111-117 P.L.112-10 P.L.109-102 P.L.110-161 $500 P.L.110-252

$0 Reg Supp Supp Reg Supp Reg Supp Reg Reg Reg FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Unobligated Appropriations P.L.110-28 $2,500 Unobligated Appropriations

$166.1 Not Available for $2,000 New Obligations FY 2010 FY 2006–FY 2009 P.L.109-234 P.L.110-92, $1,500 P.L.110-137, P.L.110-149, P.L.110-252 P.L.110-161 P.L.112-10 FY 2008 $1,000 P.L.111-32 P.L.111-117 P.L.110-252 FY 2011 FY 2011 FY 2006 FY 2007 $548.9 $500 FY 2010 Available for P.L.109-102 FY 2009 New Obligations Expired Funds $0 2006 2007 2008 2009 2010 2011 2012

Cumulative Obligations and Expenditures Unexpended Obligations USAID $2,500 Total: $348.5 Cumulative Obligations Cumulative Expenditures D&CS $2,000 Other Unexpended Obligations Other USAID PRT/PRDC $1,500 USACE FSD Other DoS/Embassy USACE PEG CAP $1,000 DCS PHCP DoS/Embassy $500

$0 2006 2007 2008 2009 2010 2011 2012

Note: Data not audited. Numbers affected by rounding.

Sources: P.L. 109-102; House Report 109-265, to accompany H.R. 3057, 11/2/2005, p. 86; P.L. 109-234; House Report 109-494, to accompany H.R. 4939, 6/8/2006, pp. 95–96; P.L. 110-28; House Report 110-107, to accompany H.R. 1591, 4/24/2007, pp. 202–204; P.L. 110-92; P.L. 110-137; P.L. 110-149; P.L. 110-161; House Appropriations Committee, “Consolidated Appropriations Act, 2008, Committee Print: Division J—Department of State, Foreign Operations, and Related Programs Act, 2008,” 1/30/2008, pp. 2177–2178, 2208; P.L. 110-252; Senate Explanatory Statement, to accompany H.R. 2642, 6/26/2008; P.L. 111-32; Conference Report 111-151, to accompany H.R. 2346, 6/12/2009, pp. 127–129; P.L. 111-117; Conference Report 111-366, to accompany H.R. 3288, 12/8/2009, pp. 1466, 1470; DoS, “Foreign Operations Congressional Budget Justification, FY 2006,” p. 448; House Document 109-90, “Request for FY 2006 Budget Amendments,” 2/28/2006, p. 26; DoS, “Foreign Operations Congressional Budget Justification, FY 2008,” pp. 48, 128–129, 138, 490; DoS and USAID, “Supplemental Appropriations Justification, FY 2008,” p. 38; DoS, “Foreign Operations Congressional Budget Justification, FY 2009,” pp. 542–544; DoS and USAID, “Supplemental Justification, FY 2009,” pp. 40–43; DoS, “Foreign Operations Congressional Budget Justification, Annex: Regional Perspectives, FY 2010,” pp. 421–426; DoS, “Foreign Operations Congressional Budget Justification, Annex: Regional Perspectives, FY 2011,” pp. 471–477; DoS, “Foreign Operations Congressional Budget Justification, Annex: Regional Perspectives, FY 2012,” pp. 522–528; USAID, response to SIGIR data call, 7/7/2011; USACE, response to SIGIR data call, 7/5/2011; DoS, NEA-I, responses to SIGIR data calls, 4/12/2011, 4/15/2011, 6/24/2011, 6/27/2011, 7/7/2011, and 7/8/2011; SIGIR Audit 07-005, “Fact Sheet on Sources and Uses of U.S. Funding Provided in Fiscal Year 2006 for Iraq Relief and Reconstruction,” 7/27/2007, p. 13.

24 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 24 7/25/2011 10:37:23 AM U.S. FUNDING

Table 2.6 ESF: Requests, Justifications, Appropriations, and Earmarks, FY 2006–FY 2012 $ Millions Request Administration’s Budget Justification Appropriation Congressional Earmarks and Restrictions FY 2006 Develop economic governance programs and new training; P.L. 109-102 Notlessthan$56shallbemadeavailablefordemocracy, Regular enhanceemploymentcenters;continueworkinlegal,fiscal, $60 governanceandrule-of-lawprogramsinIraq;Conference $360 institutional,andregulatoryframeworksforprivatesector; Exp. 9/30/2007 Reportprovided$28forIRIand$28forNDI;$5tobe continueagricultureandwaterresourcesprograms. transferredtotheIRRFtosupporttheMarlaRuzickaIraqi War Victims Fund. FY 2006 $675forPRTstoimprovelocalgovernmentcapacity, P.L. 109-234 $50forCAP(ofwhich$5tobetransferredtotheMarla Supplemental enhance security, and promote development; $287 to $1,409 Fund);$50topromotedemocracy,ruleoflaw,and $1,489 secureinfrastructure;$355tosustainU.S.-fundedprojects; Exp. 9/30/2007 reconciliation(including$10forIRI,$10forNDI,and$10 $125 to increase MOF and CBI capacity, transparency, and fortheInternationalFoundationforElectoralSystems). accountability;$37forRCLO;$10fordemocracypromotion. $1,485wasappropriated;P.L.110-161laterrescinded$76. FY 2007 Reformkeysectorsoftheeconomy,includingagriculture; P.L. 110 -28 FundsconditionaloncertificationthatIraqwasmeeting Supplemental increase commercial lending and microfinance; provide $1,554 benchmarks, including legislation related to de- $2,072 businessdevelopmentservices;helpministriesexecute Exp. 9/30/2008 Ba'athification, hydrocarbons, and semi-autonomous budgets; support GOI in improving economic governance; regions,aswellasaconstitutionalreview,reduced engagepoliticalparties,civilsocietyorganizations,and sectarian violence, improved ISF, and implementation of national political institutions; support independent media, the Baghdad Security Plan; Conference Report allocations national reconciliation, and women’s and human rights. include:PRTs($620),CSP($354),CAP($95,ofwhich$5was fortheMarlaFund),LGP($90),andtheCOMfund($57). FY 2008 Stabilize strategic Iraqi cities through rehabilitation of P.L. 110 -92, Series of Continuing Appropriations extended FY 2007 Regular community infrastructure, job training and vocational P.L. 110 -137, budget authority through 11/16/2007 (P.L. 110-92), $298 education, youth programs, and microloans; improve local P.L. 110 -149 12/14/2007(P.L.110-137),andultimately12/31/2007 and provincial governance through PRT projects directed, $123 (P.L. 110-149). whilecontinuinggovernancereformsatthenationallevel. Exp. 12/31/2007 P.L. 110 -161 Provided$10throughtheMiddleEastPartnershipInitiative $15 torescuescholarsinIraqand$5totheMarlaFund. Exp. 9/30/2008 FY 2008 Support PRTs; secure infrastructure; generate employment P.L. 110-252 MadefundsformostprogramsconditionalonGOI Supplemental and finance business; improve Iraqi ability to sustain $424 dollar-for-dollar matching; prohibited funds for prison $797 projects and execute budgets; fund democracy and Exp. 9/30/2009 construction;madePRTfundingconditionalonsubmission governanceprogramsaheadofelectionsandKirkuk ofaDoSreportdetailingplanstowinddownandcloseout referendum;reformGOIeconomicpolicies;establish PRTs, anticipated costs for PRT programming and security, business capital fund. andanticipatedplacementandcostsforfutureconsulates. FY 2009 Train local leaders in good governance, project P.L. 110-252 FY2009regularappropriations—referredtoasbridge Regular implementation, and conflict resolution; build ministry $103 funding—became available on 10/1/2008. $300 capacity in financial management, budgeting, and Exp. 9/30/2009 procurement; support political parties and CoR functions; fostercivilsocietyandindependentmedia;promote macroeconomic reforms, agriculture, and microfinance. FY 2009 Supportelections,civilsociety,independentmedia,and P.L. 111-32 Funds conditional on GOI matching; Conference Report Supplemental politicalinstitutions($112);fundLGP($55)andCAP($35)to $439 allocationsincludedallocationstoCAP($50),Democracy $449 strengthen local governments; support ministerial capacity Exp. 9/30/2010 andCivilSociety($118),IraqCulturalAntiquities($2), development ($60), Marla Fund ($3.5), and Iraqi widows MarlaFund($10),theCOM’sdiscretionaryfund($15), ($5);promotepolicy,legal,andregulatoryreforms($50); and Widows’ Assistance ($5); conferees directed greater fundPEG($27.5)tosupportbusinessdevelopment;support clarification of democracy and governance programs and agriculture ($43). expressed concern for women and minorities. FY 2010 Support ministerial capacity (Tatweer)andlocal P.L. 111-117 Conference Report allocations included: Democracy and Regular governmentcapacity(PRTsandCAP);fostercivilsociety $383 CivilSociety($126),CSP($50),MCD($50),IraqiMinorities $416 andindependentmedia;reintegrateIraqirefugeesand Exp. 9/30/2011 ($10), and Marla Fund ($5); conferees expressed belief IDPs; provide anticorruption and election support; promote thattheGOIshouldfundfutureministerialcapacity sustainable,diversifiedeconomicgrowth;pursueeconomic, developmentanddirectedDoSandUSAIDtoconsultwith legal, and regulatory reforms; build the capacity of theCongressontheprocessforassessingthebenefits economic institutions. versus security costs of work in Iraq. FY 2011 Promoteconflictmitigation(QRF);assistinlegislative P.L. 112-10 Thefull-yearcontinuingappropriationforForeign Regular drafting,budgetanalysisandexecution,andconstituent $326 Operationswasmadelateinthefiscalyearandwasnot $383 relations;supportcommunitygroupsinpromotingstability, Exp. 9/30/2012 accompaniedbyacommitteereport;accordingtoDoS, providingassistance,andgeneratingemployment;provide theFY2011allocationwasthesameasitsFY2012request: technicalassistancetothehealthcare,education,andsocial $326;DoSsubmittedaspendplantotheCongresson services sectors; support agriculture, microcredit, and public 7/5/2011. financial management; promote sound macroeconomic and monetary policies. FY 2012 Institutionalizeelectoralsystemsthatmeetinternational The Congress is currently considering the Administration's Regular standards; improve professionalism, outreach, and FY 2012 request. $326 responsivenessofpoliticalparties,CoR,andprovincial councils; clarify role of federal government; increase capacityandeffectivenessofcivilsociety,media,and anticorruption institutions; pursue community conflict prevention and reconciliation; improve rule of law and promote human rights; provide technical assistance to health and education sectors; support the Marla Fund; promote economic growth and job creation. $6,889 $4,835

Note/Source: See Figure 2.6.

JULY 30, 2011 I REPORT TO CONGRESS I 25

July2011.indb 25 7/25/2011 10:37:24 AM FUNDINGFORIRAQRECONSTRUCTION

Table 2.7 ESF Obligations, by Implementing Agency, Program, and Fiscal-year Appropriation, as of 6/30/2011 $ Millions Obligations Implementing Unexpended Agency Program FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 Total Obligations

USAID Community Stabilization Program 135.0 379.0 100.0 5.3 0.0 619.3 10.7 Local Governance Program 160.0 99.5 101.0 55.0 25.0 440.5 18.3 Community Action Program 59.3 100.0 85.0 95.0 55.0 394.3 55.2 Tatweer National Capacity Development 60.0 144.5 64.8 40.1 0.0 309.4 5.4 PRT Quick Response Fund 0.0 130.0 8.0 35.0 0.0 173.0 12.3 Inma Agribusiness Development 0.0 97.5 0.0 52.3 0.0 149.8 15.9 Tijara Provincial Economic Growth 0.0 35.8 25.0 37.0 20.0 117.8 32.2 Economic Gov. II, Policy and Reg. Reforms 20.0 65.0 0.0 0.0 0.0 85.0 1.1 Democracy and Civil Society 0.0 29.6 0.0 36.5 18.0 84.1 37.3 Primary Health Care Program 3.7 6.0 0.0 29.5 0.0 39.1 38.6 Izdihar Private Sector Development 9.0 23.8 0.0 0.0 0.0 32.8 0.6 Financial Sector Development 0.0 0.0 0.0 21.6 10.0 31.6 25.4 Elections Support 11.4 2.6 0.0 0.0 0.0 13.9 0.1 Monitoring and Evaluation 0.0 0.0 0.2 8.0 5.3 13.4 7.1 Subtotal 458.4 1,113.2 384.0 415.3 133.3 2,504.1 260.2 USACE/GRD PRT/PRDC Projects 261.5 333.2 0.0 0.0 0.0 594.7 35.8 O&M Sustainment 275.2 0.0 0.0 0.0 0.0 275.2 1.2 Infrastructure Security Protection 194.2 0.0 0.0 0.0 0.0 194.2 0.6 Plant-Level Capacity Dev. & Tech. Training 50.4 0.0 0.0 0.0 0.0 50.4 0.1 Subtotal 781.4 333.2 0.0 0.0 0.0 1,114.5 37.7 DoS/ DRL Democracy and Civil Society 85.0 15.0 0.0 76.5 0.0 176.5 23.9 Embassy OPA PRT Quick Response Fund 0.0 36.0 25.0 16.2 26.0 103.2 13.9 PRM Iraqi Refugees 50.0 0.0 45.0 0.0 0.0 95.0 0.5 COM Targeted Development Program 0.0 57.4 0.0 3.0 0.0 60.4 10.1 ISPO Ministerial Capacity Development 32.6 0.0 5.0 0.0 0.0 37.6 2.1 RCLO Regime Crimes Liaison Ofﬁce 28.5 0.0 0.0 0.0 0.0 28.5 0.1 Subtotal 196.1 108.4 75.0 95.7 26.0 501.2 50.6 Total 1,435.9 1,554.7 459.0 511.0 159.3 4,119.9 348.5

>150+ >75–150 >30–75 >0–30 0 >75+ >30–75 >15–30 >0–15 0

Note: Data not audited. Numbers affected by rounding. Iraq Strategic Partnership Ofﬁce (ISPO) includes obligations made by predecessor agencies.

Sources: USAID,responsetoSIGIRdatacall,7/7/2011;USACE,responsetoSIGIRdatacall,7/5/2011;DoS,NEA-I,responsestoSIGIRdatacalls,4/12/2011,4/15/2011, 6/24/2011, and 6/27/2011; SIGIR, QuarterlyandSemiannualReportstotheUnitedStatesCongress, 4/2007–4/2011.

to18locationsacrossIraq.75 AccordingtoaUSAID ofprogramparticipantsthannon-participantsfelt evaluation released in 2009, CSP was successful their community was safer in 2009 than in 2006. The evaluation said when program elements were coordinated internally However,theevaluationsaidthatconfounding that confounding (for example, by matching competent vocational variables,includingtheeffectofsimilarprograms variables made training with business grants) and integrated with like the CERP, made it impossible to conclude a it impossible to otherU.S.programs(suchastheCERP).However, causativerelationshipbetweenCSPandareduc- conclude a causative both coordination and integration depended more tion in violence.77 relationship between CSP and a reduction onpersonalitiesthanoninstitutionalizedproce- Ina2008auditofCSP,theUSAIDOfficeof in violence. dures.76 Accordingtotheevaluation,theprogram Inspector General (USAID OIG) acknowledged was generally considered successful by participants apositivetrendincitizens’perceptionoflo- andobservers.Forexample,agreaterpercentage cal government effectiveness. However, USAID

26 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 26 7/25/2011 10:37:24 AM U.S. FUNDING

OIG could not determine whether CSP achieved assistance to refugees and internally displaced itsintendedresultswithregardtocommunity persons.83 Inaddition,morethan$103millionwas infrastructure or essential services and could obligatedthroughthePRTQuickResponseFund, USAID OIG was notsubstantiateclaimsmadeaboutemployment whichlikePRT/PRDCProjectssupportssmall-scale presented with generation.Inaddition,USAIDOIG’saudit local initiatives.84 AsofJune30,2011,thelargest evidence suggesting foundevidenceoffraudwithincertainCSP ongoing program was DRL’s portion of Democracy that potentially projects.InBaghdad,forexample,USAIDOIG and Civil Society.85 millions of dollars was presented with evidence suggesting that in CSP funds had potentiallymillionsofdollarsinCSPfundshad been diverted to ESF Expired Funds been diverted to insurgents.78 The budget authority for FY 2006–FY 2009 ESF ap- insurgents. AsofJune30,2011,fiveUSAID-administered propriationshasexpired.Agenciescannotobligate ESFprogramshadgreaterthan$25million fundsfromtheseappropriationstonewprojects,but remaininginunexpendedobligations:theCom- canadjustexistingobligationsandexpendfundsfor munity Action Program, Primary Health Care aperiodoffiveyearsaftertheirrespectiveexpiration Program,DemocracyandCivilSociety,Provincial dates.86 If funds were obligated before they expired EconomicGrowth,andFinancialSectorDevelop- andwerethensubsequentlydeobligated,theycan ment.79 Formoredetailsonmostofthesepro- beobligatedtonewprojectsforaperiodoffouryears grams, see the Governance and Economy sections pasttheiroriginalexpirationdate—effectivelyex- of this Quarterly Report. tending the period of obligation for new projects.87 BothmeansofrepurposingESFfundshavebeen U.S.ArmyCorpsofEngineers used extensively in Iraq. For example, the Primary AsofJune30,2011,USACEhadobligated$1.11billion Health Care Program, which was first reported to (27%)oftheESFinIraq.ThemajorityofUSACE’sESF SIGIRlastquarter,isfundedbyESFappropriations fundingwenttoProvincialReconstructionTeam/ fromFY2006,FY2007,andFY2009—allofwhich Provincial Reconstruction Development Council wouldhavepreviouslyexpiredundernormal (PRT/PRDC) Projects.80 The program enabled local circumstances and would have been unavailable developmentteamstoidentify,prioritize,andmanage tosupportthenewprogram.AsofJune30,2011, “small, immediate-impact projects” targeted at Iraqi $39.1millionhadbeenobligatedtotheprogram priorities.81 USACEalsoimplementedinfrastruc- andapproximately$500,000hadbeenexpended.88 turesecurity,sustainment,andcapacity-building Since FY 2006, additional obligations (positive projects.AllESFfundingforUSACEworkcame adjustments) to ongoing ESF-funded projects in from the FY 2006–FY 2007 appropriations, with Iraqhavebeenmorecommon(orhadlargerdollar theagencyreceivingmostoftheFY2006appro- amounts) than deobligations (negative adjust- priation.AsofJune30,2011,nearly$38millionin ments).Consequently,foranygivenfiscal-year unexpendedobligationsremainedforUSACEpro- appropriation,thenetamountofexpiredfunds grams,thegreatmajorityforPRT/PRDCProjects.82 decreasedbetweenitsrespectiveexpirationdate andJune30,2011.89 DoS and U.S. Embassy-Baghdad As of June 30, 2011, nearly 3.4% of appropriated ESF AsofJune30,2011,thesixentitiesunderthe hadexpired,morethanINCLE(0.0%),IRRF(2.4%), umbrellaofDoSandU.S.Embassy-Baghdadhad ISFF (2.5%), and CERP (2.5%).90 The $325.7 million obligated$501million(12%)oftheESFinIraq. FY2011ESFappropriation,whichwasonlyrecently Together,DRLandPRM—standingbureausin apportioned for use in Iraq because of delayed ap- DoS—obligatedmorethanhalftopromotedemoc- propriation, will expire on September 30, 2012. racy and civil society and provide humanitarian As of June 30, 2011, none of the funds from the

JULY 30, 2011 I REPORT TO CONGRESS I 27

July2011.indb 27 7/25/2011 10:37:24 AM FUNDINGFORIRAQRECONSTRUCTION

FY 2011 appropriation had been obligated.91 Ac- Figure 2.7 cordingtotheBureauofNearEasternAffairs-Iraq, CERP: Status of Funds, as of 6/30/2011 $ Millions DoSsubmitteditsFY2011ESFspendplantothe Appropriated $3,846.1 92 Congress on July 5, 2011. Obligated $3,726.3 Fordetailsonexpiredfunds,seeFigure2.6. Expended $3,717.8

Unexpended Funds Total: $128.4 Commander’s Emergency Response Program

Since2004,theCongresshasprovided$3.85billion totheCERPinIraqforthepurposeofenabling 7% Unexpended Obligations militarycommanderstorespondtourgenthumani- $8.5

tarianreliefandurgentreconstructionrequirements 93% 93 Unobligated within their areas of responsibility. UnderP.L.112-10, $119.9 theCongressappropriatedupto$100millionfor

CERPinIraqinFY2011.U.S.ArmyCentralpro- Note: Data not audited. Numbers affected by rounding.

videdapartialallocationof$75milliontoUSF-I. Sources: ABO, responses to SIGIR data call, 7/14/2011 and 7/15/2011. USF-Isubsequentlydetermineditwouldnotneed all $75 million and returned $8.5 million. Thus, updatedonlythroughtheendofthefiscalyear USF-I’sCERPbudgetforFY2011became$66.5mil- inwhichthefundsareappropriated.Thislackof lion, $33.5 million less than originally authorized by reporting creates a data gap on which SIGIR has USF-I’s CERP budget the Congress.94 These funds will remain available for reportedextensivelyinpastQuarterlyReportsand for FY 2011 became obligation until September 30, 2011.95 The Congress is which is evidenced in the difference between ABO $66.5 million, currently considering the Administration’s request financial data and USF-I CERP Project Tracker $33.5 million less for$25millionforFY2012.96 data shown in Table 2.8.98 than originally AsofJune30,2011,$8millionofobligated USF-I J8 officials previously informed SIGIR that authorized. CERP funds had not been expended. An additional thisproblemhadbeencorrectedandthatUSF-I $120 million had not been obligated, but $96 mil- wouldtrackandreportonFY2010CERPprojects lionofthisamounthasexpired.Thisleaves$24mil- thatcontinuedintoFY2011.99 For this Quarterly lionavailableforobligationtonewprojects.Intotal, Report,USF-Ididprovideupdateddataonasubset $33millioninavailablebudgetauthorityremained of FY 2010 CERP projects, and this data answers at unexpended for the CERP.97 leastsomeofSIGIR’squestionsaboutthestatusof ForthestatusoftheCERP,includingabreak- those projects.100 down of unexpended funds, see Figure 2.7. For the Accordingtotheinformationprovidedforthis status and quarterly change of the CERP, by project Report,USF-Ihad12openFY2010CERPprojects category, as of June 30, 2011, see Table 2.8. as of June 30, 2011, with combined obligations of $7.6million.Ofthese12projects,6wereinitially CERP Data Gap valued at more than $500,000.101 USF-I does not report on CERP projects during the SIGIRwillcontinuetryingtogetabetterunder- five-yearreportingandoutlayphasethatfollows standingofthestatusofFY2010CERPprojects. each appropriation’s period of obligation. USF-I’s SIGIRisunawareifUSF-Ihasidentifiedameans CERPProjectTracker—theonlysystemicsource of correcting records for FY 2004–FY 2009 CERP of CERP project descriptions and categories—is appropriations.

28 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 28 7/25/2011 10:37:24 AM U.S. FUNDING

Table 2.8 CERP:StatusofFunds,byProjectCategory,asof6/30/2011 $ Millions Status of Funds Quarterly Change Project Category/Fiscal Year Obligated Expended Obligated Expended

StatusofFunds, Water & Sanitation 673.9 224.5 0.1 5.1 by Project Category, Protective Measures 490.3 267.9 0.2 0.4 According to Electricity 444.6 132.8 0.1 1.1 the USF-I CERP Project Tracker Education 429.2 179.0 0.9 1.5 Transportation 386.2 149.3 0.3 1.2 Civic Cleanup Activities 240.9 116.9 0.4 0.4 Other Urgent Humanitarian or Reconstruction Projects 224.2 84.1 -0.1 0.5 Agriculture 208.4 74.9 0.6 Economic, Financial, and Management Improvements 184.3 77.6 1.4 1.3 Health Care 152.4 60.7 0.4 0.3 RuleofLaw&Governance 113.4 44.7 1.2 Civic Infrastructure Repair 67.5 23.9 Repair of Civic & Cultural Facilities 63.1 27.4 0.3 Civic Support Vehicles 58.5 32.3 1.5 Condolence Payments 50.7 35.4 Telecommunications 39.6 10.2 Temporary Contract Guards for Critical Infrastructure 35.6 35.3 Battle Damage Repair 23.8 18.0 0.1 0.1 Food Production & Distribution 21.2 8.2 0.1 0.1 Non-FMR 5.8 0.0 Detainee Payments 1.0 0.6 Iraqi Hero Payments 0.7 0.7 Subtotal 3,915.2 1,604.1 4.9 14.4 Difference FY 2004 -5.8 133.6 between ABO Financial Data FY 2005 -49.2 404.4 and USF-I CERP FY 2006 136.7 499.8 Project Tracker, by Fiscal Year FY 2007 -181.5 324.2 -1.0 0.2 FY 2008 -91.9 513.2 -0.5 -0.5 FY 2009 -9.3 116.4 0.4 FY 2010 14.4 115.3 -1.7 21.3 FY 2011 -2.4 6.8 -2.4 6.8 Subtotal -189.0 2,113.6 -5.7 28.1 Total, According to ABO Financial Data 3,726.3 3,717.8 -0.7 42.5

Note: Data not audited. Numbers affected by rounding. Table compares project category totals from the USF-I CERP Project Tracker with financial data from ABO, by fiscal year. Project CategoriesreportedintheUSF-ICERPProjectTrackerwereinconsistentacrossfiscalyears,butmostaberrationscouldbematchedwithaProjectCategoryprovidedforintheDoDFMR. ProjectCategoriesreportedbyUSF-IthatcouldnotbematchedtoaProjectCategoryprovidedforintheDoDFMRwereclassifiedas“Non-FMR” in this table.

Sources: ABO,responsestoSIGIRdatacalls,10/4/2010,10/8/2010,12/6/2010,12/22/2010,4/5/2011,4/18/2011,7/5/2011,and7/14/2011.

Strategic Oversight component—theCERPWorkingGroup(CWG)— In response to congressional concerns about the was subsequently added.103 AccordingtoDoD, CERP’s management, approval thresholds, and the “oversight structure continues the important interagencycoordination,DoDinMay2010estab- balance between headquarters-level visibility, ac- lished a two-tiered structure for strategic oversight, countability,oversight,andstrategicguidanceand comprising the CERP Steering Committee (CSC) field-level management, flexibility, responsiveness, and the CERP Management Cell (CMC).102 A third andtacticalcounterinsurgencyefforts.”104

JULY 30, 2011 I REPORT TO CONGRESS I 29

July2011.indb 29 7/25/2011 10:37:24 AM FUNDINGFORIRAQRECONSTRUCTION

CSC/CMCfocushasshiftedfromIraqtoAf- addingarequirementtoobtainapprovalfromthe CSC/CMC focus ghanistantoreflecttheshiftinfinancialresources SeniorContractingOfficial-Iraqonprojectswith has shifted from Iraq astheIraqcommitmentdrawsdown.However, a total cost of more than $500,000 that extended to Afghanistan to accordingtoDoD,CSCandCMCcontinueto beyondMay31,2011;changingtheprojectman- reﬂect the shift in evaluateandadjustbroadCERPstrategyand agementdatabasefromtheIraqReconstruction ﬁnancial resources as the Iraq commitment implementationmethodologyastheyrelatetoboth Management System (IRMS) to the Combined draws down. countries. On average, approximately 30% of the InformationDataNetworkExchange(CIDNE); CMCworkloadisdevotedtoIraq.105 andclarifyingthatabrigadecommandercouldbe delegatedapprovalauthorityforprojectsestimated CERP Steering Committee to cost between $200,000 and $500,000.111 CSCisco-chairedbytheUnderSecretaryof The DoD Financial Management Regulation Defense (Policy) (USD(P)), the Under Secretary of (FMR)chapterrelatedtotheCERP,whichisthe Defense (Comptroller) (USD(C)), and the Vice- other primary source of CERP guidance, has not ChairmanoftheJointChiefsofStaff.Itreports beenupdatedsinceJanuary2009—beforeCSC directlytotheDeputySecretaryofDefense.106 CSC and CMC were established.112 Accordingtothe provides senior-level oversight of the CERP and CMC,theFMRistheresponsibilityofOUSD(C) is responsible for the integration, coordination, and has been undergoing revision since the spring andresolutionofallCERPissueswithinDoDand of 2010 to incorporate recommended changes for engaging with the Congress, U.S. government fromthefieldandCMC,congressionalguidance, agencies,andotherrelevantorganizations.The and new legislative provisions. The revised chapter fullCSChasformallymetoncesinceitsinception, is “in coordination.”113 but according to DoD, CSC leadership engages In addition, according to DoD, CSC has reviewed regularly on CERP issues, including through andrecommendedtheapprovalofseveralhigh- smallgroupmeetingsand“frequentvirtual valueprojectsthatrequireapprovalbytheSecretary communications.”107 ofDefense(orDeputySecretaryifdelegated).114 AccordingtoDoD,CSChasissuednumerous AccordingtotheMAAWS,theSecretaryofDefense recommendations since its inception related to isrequiredtoapproveallCERPprojectswitha fundingallocations,projectoversight,andinter- totalcostofmorethan$1million.115 In FY 2010, no agency coordination, “all” of which “have been CERPprojectsinIraqfitthiscriterion.116 CSC does coordinatedandimplementedbytheproperCERP not approve or make recommendations for projects stakeholder.”108 Thisquarter,CSCrecommended with a total cost of less than $1 million “unless thetransferof$33.5millionofunobligatedFY2011 broughttotheCommittee’sattentionthroughother CERP-IraqfundstoAfghanistan,whichwassub- oversight mechanisms.”117 mittedforcongressionalapprovalinJune2011.109 InFY2010,therewerefiveprojectswithtotal CSCmadenorecommendationsrelatedtoIraqlast costsinexcessof$900,000—thatis,justunderthe quarter.110 SpecificexamplesofCSCrecommenda- thresholdrequiringapprovalbytheSecretaryof tions from prior quarters were not provided. Defense(ordelegate).ThelargestFY2010CERP SinceCSCwasestablished,changestothe projectinIraq,only$1,480shyofthereview MoneyasaWeaponSystem(MAAWS)standard threshold,wasintendedtotransferrawsewageto operatingproceduresmanual,whichregulates theHabbaniyaBioLagoon,operateandmaintain theuseoftheCERP,includeremoving“Sonsand theaerationsystem,andsupplyageneratorand Daughters of Iraq” as an eligible CERP project anaircompressor.AccordingtoDoD,theproject category; clarifying requirements for coordina- wouldmitigatepartofAnbarprovince’sinad- tionwithPRTsandUSAIDatallprojectsvalues; equate sanitation and water treatment problems.

30 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 30 7/25/2011 10:37:25 AM U.S. FUNDING

Thisprojectisoneofthe12fundedbytheFY2010 fornon-acquisitionpersonnel,reviewingand appropriation that had not been completed as of recommending approval of large-scale projects June 30, 2011. There have been no reported FY 2011 (Afghanistan-specific), responding to media and CERPprojectsinIraqwithtotalcostsinexcess congressionalinquiries,draftingquarterlyreports of $500,000.118 andcoordinatinghigh-valueprojectnotifications totheCongress,improvingCERPaccountability CERP Management Cell andtransparencythroughtimelyinputtointernal AccordingtoDoD,CMCprovidesafocalpointfor andexternalaudits,andrecommendingrevi- CERPmanagementand“promotesaholistic,inte- sionstotheCERPsectionofDoD’sFMR.127 Also, grated approach.”119 Theofficeisledbyafull-time accordingtoDoD,aninterimCERPdataman- Director of SES rank, appointed by the USD(P) agement system has been developed that will lead withtheconcurrenceoftheUSD(C)andstaffedby to an integrated interagency data management oneciviliandeputy(GS-15)andoneanalyst(con- system to improve data integration for project data tractor).120 CMCisresponsibleforensuringthat in Afghanistan.128 CSC recommendations are coordinated and imple- mentedbytheproperCERPstakeholders.121 The SIGIRAuditoftheCERP CMCDirectorreportstotheCSCco-chairsand Inanauditthisquarter,SIGIRquestionedDoD’s directs the activities of CWG, including convening useofFY2011CERPfundsforprimarilycivil meetings;vetting,assigning,andtrackingofCERP capacity-development projects given the pro- issuesandtasksacrossallofDoD;andpromulgat- gram’s goal of meeting counterinsurgency-based ingCERPdecisionsanddirection.122 objectives. Many of the civil capacity-development AccordingtoDoD,specificissuesconsidered projects undertaken do not appear related to byCMCinitsmanagementcapacityinclude DoD’s counterinsurgency mission, and SIGIR did CERP requirements, planning, program con- not find any guidance or directives that explain trols, program coordination, review of criteria for howcivilcapacitydevelopmentsupportsalarger SIGIR did not ﬁnd high-value project approval, and standards for counterinsurgency strategy. SIGIR noted that any guidance or pre-deployment and in-theater training.123 To track PRTsaredeeplyinvolvedinidentifying,plan- directives that progress,theCMCusesnumerousperformance ning, and implementing CERP projects. DoS explain how civil metrics, including: funding obligation rates, project representatives at the PRTs stated that USF-I capacity development approval-to-completion time, individual project reliesonthem,inpart,becauseoffrequent supports a larger merit, completeness of recorded data, the number military deployment rotations, reduced troop counterinsurgency ofcoordinatedCERPactions,andresponsetimeto presence, limited subject-matter expertise, and strategy. andfrominternalandexternalstakeholders.124 little experience in the management of capacity development-type projects. While SIGIR supports CERP Working Group theinvolvementofDoSincoordinatingprojects, CWGcomprisesmorethan30representatives thisheavyDoSinvolvementraisesquestionsabout fromDoDentitiesinvolvedwiththeCERP.125 whether the projects undertaken support DoD’s AccordingtoDoD,CWGmeetsweekly“toensure military objectives or whether the CERP has anintegratedapproachtoCERPmanagement,” evolvedintoanotherU.S.developmentprogram, althoughCERPisapart-timedutyformostofthe similartothoserunbyUSAIDandDoS.Finally, members.126 Among its significant outputs, DoD SIGIR found that some of the performance metrics counts drafting pre-deployment and in-theater used to evaluate CERP projects lack support and trainingstandards,preparingmobileCERP thereforecannotprovidemeaningfulinformation training teams and additional training modules to assess the program’s impact.129

JULY 30, 2011 I REPORT TO CONGRESS I 31

July2011.indb 31 7/25/2011 10:37:25 AM FUNDINGFORIRAQRECONSTRUCTION

International Narcotics Control Table 2.9 INCLE:StatusofFunds,bySectorandProgram,asof6/30/2011 and Law Enforcement $ Millions Since2006,theCongresshasappropriated$1.18billion Status of Funds Quarterly Change totheINCLEinIraqtosupportrule-of-lawactivi- Sector Program Obligated Expended Obligated Expended ties.130 Thisincludesroughly$115millionprovided Criminal Police Advisors 457.6 405.6 25.2 8.8 Justice byP.L.112-10,whichexpiresonSeptember30,2012, Courts 104.5 76.9 0.1 8.6 and$650millionthatwas“forward-funded”by Public Integrity 29.7 23.7 -4.0 -3.4 P.L. 111-212 (the FY 2010 supplemental appropria- Rule of Law Advisors 26.0 17.4 1.2 tion),whichalsoexpiresonSeptember30,2012.131 Major Crimes Task Force 13.1 10.4 1.3 AsofJune30,2011,$132millionofobligated Justice Integration 6.8 6.1 0.6 INCLEfundshadnotbeenexpended.Anaddi- Legal Framework 2.5 2.5 tional $333 million had not been obligated, nearly Subtotal 640.2 542.5 21.2 17.1 allofwhichisavailablefornewprojects.Intotal, Corrections Advisors 90.6 71.7 2.6 7.2 $465millioninavailablebudgetauthorityre- Construction 83.7 82.2 132 mained unexpended for the INCLE. Subtotal 174.3 154.0 2.6 7.2

ForthestatusoftheINCLE,includingabreak- ProgramDevelopmentandSupport 34.5 21.9 4.4 4.4 down of unexpended obligations, see Figure 2.8. Counternarcotics 1.0 0.0 ForthestatusandquarterlychangeoftheINCLE, Total 850.0 718.4 28.2 28.7 by sector and program, see Table 2.9. Note: Data not audited. Numbers affected by rounding.

Sources: INL,responsestoSIGIRdatacalls,4/6/2011and7/15/2011. Smaller Funds Figure 2.8 INCLE: Status of Funds, as of 6/30/2011 $ Millions The Congress has appropriated or otherwise made Appropriated $1,183.0 available nearly $10.37 billion in smaller funding Obligated $850.0 streamsforIraqreconstruction.SIGIRhasclassi- Expended $718.4 fiedthemintothreecategories:133 • Other Assistance Programs—$4.30 billion Unexpended Obligations Total: $131.6 Police • Reconstruction-related Operating Advisors Counternarcotics $52.0 Expenses—$5.72 billion 1% Criminal Justice $1.0 $97.6 • ReconstructionOversight—$348million Program 40% Development As of June 30, 2011, at least $4.80 billion (46%) & Support 10% ofthesefundshadbeenobligated,andatleast $12.7 134 Advisors $4.61billion(44%)hadbeenexpended. $18.8 14% However,agencyreportingisinconsistentforthe Corrections 21% Courts $20.3 smallerfunds,andthesevalueslikelyunderstate Other 7% 7% $27.6 1% actual obligations and expenditures through these $1.5 Other $9.4 Rule of Law Advisors fundingstreams.Fordetailsonthestatusoffunds, $8.6

see Table 2.1.◆ Note: Data not audited. Numbers affected by rounding.

Sources: P.L. 109-234; P.L. 110-5; P.L. 110-28; P.L. 110-161; P.L. 110-252; P.L. 111-32; P.L. 111-117; P.L. 111-212; P.L. 112-10; INL, response to SIGIR data call, 7/15/2011.

32 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 32 7/25/2011 10:37:25 AM IRAQI FUNDING

IRAQI FUNDING

AsofJune30,2011,Iraqhadprovided$107.41billion forIraq’sfiscalyear2011capitalbudget,whichruns forreliefandreconstructionthroughCPAspend- concurrently with the calendar year.136 ingofIraqifundsin2003–2004($12.07billion) and annual GOI capital budgets in 2003–2011 ($95.34 billion).135 This total includes $25.70 billion CoR-approved 2011 GOIBudgetAllocations Figure 2.9 Monthly Oil Price, Exports, and Revenue vs. GOI Budget Projections TheGOI’s2011budgetprojects$69.18billionin Monthly Oil Price and Exports vs. Projections revenueand$82.62billioninexpenditures,leaving 137 $118.5 2.5 a projected deficit of $13.44 billion. The budget broadly categorizes expenditures as those related to $104.5 2.4 operations ($56.92 billion) and capital investment $90.5 Price 2.3 2011 Budget Projection ($25.70 billion).138 Thisquarter,theGOImadeavail- $76.5 2.2 (MBPD) Exports 2010 Budget Projection 2.2 MBPD at $76.50/barrel ablethebudgetallocationsapprovedbytheCouncil $62.5 2.1 2.1 MBPD at $62.50/barrel ofRepresentatives(CoR)forgovernmentministries $48.5 2.0 and agencies.139 For details, see Table 2.10. $34.5 1.9 Price per Barrel ($US) Exports $20.5 1.8 $6.5 1.7 GOI Budget and Revenue

JFMAMJJASOND J FMAMJ 2010 2011 Duringthefirsthalfof2011,theGOIreceived Monthly Oil Revenues and Receipts vs. Projections $36.42billioninoilreceipts,50%morethanthe $ Billions $24.35billionreceivedduringthefirsthalfof2010, $8.0 and19%morethanthe$30.71billionprojectedfor $7.5 thefirstsixmonthsof2011intheGOIbudget.140 $7.0 Iraq is on pace for record-high annual oil receipts, $6.5 exceedingeventhepeakof$58.79billionin2008.141 $6.0 Overall,the2011GOIbudgetestimatedthat89% $5.5 142 Revenue of annual revenue would come from oil exports. $5.0 Performanceonbothpriceandexportvolumes 2011 Budget Projection $4.5 comparesfavorablyto2010.Duringthefirsthalf $4.0 of2011,Iraqhasreceivedanaverageof$101.08 $3.5 Receipts 2010 Budget Projection perbarrelofoilexported,wellabovethepriceof $3.0 JFMAMJJASOND JFMAMJ $76.50usedtoprojectIraqioilrevenuesfor2011. 2010 2011 Thecountry’soilexportvolumewas5%lessthan projected, but still improved over last year.143 For Note: Data not audited. Numbers affected by rounding. Not all oil export revenue accrues to the GOI; 5% is paid in war reparations to Kuwait, which accounts for the difference between the Receipts and Revenue lines in this chart. details, see Figure 2.9. Monthly price per barrel is derived by dividing monthly revenue by monthly exports. Crude oil production and export figures calculated by NEA-I and U.S. Treasury frequently differ because of different methodologies.

Sources: U.S. Treasury, response to SIGIR data call, 7/5/2011; GOI, CoR, “Federal Public Budget Law for the Fiscal Year 2010,” 1/27/2010, and “Federal Public Budget Law for the Fiscal Year 2011,” 2/23/2011.

JULY 30, 2011 I REPORT TO CONGRESS I 33

July2011.indb 33 7/25/2011 10:37:25 AM FUNDINGFORIRAQRECONSTRUCTION Table 2.10 CoR-approved Allocations for the 2011 Iraqi Budget, with Changes from 2010 and 2009 $ Millions 2011 Budget Allocations Total Allocation, Change From: 2010 2009 Category Ofﬁce Operating Capital Total -60% -40% -20% 0% 20% 40% 60% 80% 100%

Republic Presidency Subtotal 78.2 10.1 88.3 Council of Council of Representatives 247.7 247.7 Representatives BSA/COI 86.0 3.5 89.5 Other 117.4 117.4 Subtotal 451.0 3.5 454.5 Council of Ministers Prime Minister and Secretariat 425.7 57.9 483.6

Martyrs Foundation 276.8 196.2 472.9 108% Endowments 857.8 76.1 933.8 Iraqi National Intelligence Service 140.8 34.3 175.1

Joint Staff/National Security Council 66.7 1.3 68.0 447% Militia Disarm. and Integration 195.5 195.5 Other 47.5 1.8 49.4 Subtotal 2,010.7 367.6 2,378.3 Ministries Finance 12,224.4 1,018.1 13,242.5 Oil 2,047.4 5,940.2 7,987.6 148% Education 6,096.6 384.6 6,481.2 Interior 6,146.0 167.4 6,313.4 Defense 5,674.4 170.9 5,845.3 Health 3,993.5 897.4 4,891.0 Electricity 1,034.9 3,197.9 4,232.8 Commerce 3,928.3 34.2 3,962.5 Higher Education and Scientiﬁc Research 1,858.5 342.0 2,200.5 Municipalities and Public Works 727.3 1,058.8 1,786.1 Water Resources 199.9 1,163.5 1,363.5 103% Agriculture 694.1 275.0 969.1

Housing and Construction 233.8 658.1 891.9 285% Labor and Social Affairs 867.9 15.4 883.2 418% Youth and Sports 96.6 652.5 749.1 Foreign Affairs 309.0 408.5 717.5 143% Industry and Minerals 33.0 551.0 584.0 Transportation 189.2 285.2 474.4 Justice 382.5 11.5 394.0 Culture 157.9 119.7 277.6 123% Communications 11.0 213.7 224.7 Planning and Development Cooperation 188.6 17.5 206.1

Other 350.3 46.6 396.9

Subtotal 47,445.2 17,629.7 65,074.9 Independent Ofﬁces Local Councils in the Provinces 200.1 200.1 General Management in the Provinces 424.4 3,944.1 4,368.5 Independent Higher Electoral Commission 159.1 5.8 164.9 Other 55.4 55.4 7,007% Subtotal 839.0 3,949.9 4,788.9 Higher Judicial Council Subtotal 263.1 14.7 277.8 Kurdistan Region Subtotal 5,832.9 3,722.2 9,555.1 Total 56,920.1 25,697.7 82,617.7

Note: Data not audited. Numbers affected by rounding. Line-item data from the 2009 budget is not available for the Council of Representantives, Council of Ministers, or Independent Ofﬁces budget categories.

Sources: GOI, Ministry of Finance, “2011 Iraq Budget Schedules,” 5/16/2011; GOI, Presidential Council, “Federal Public Budget Law for the Fiscal Year 2010,” 2/10/2010; U.S. Treasury, responsetoSIGIRdatacall,4/9/2009.

34 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 34 7/25/2011 10:37:25 AM IRAQI FUNDING

GOI Revenue Account In addition to the new account, the GOI said it wouldcontinuetooperateasecondaccount,known Pursuant to United Nations Security Council as the Oil Proceeds Receipts Account, held in the Resolution (UNSCR) 1956, Iraq took control over nameoftheCentralBankofIraq(CBI),alsoatthe itsoilwealthonJuly1,2011.InApril,2011,the FederalReserveBankofNewYork.Theendofare- GOIinformedtheSecurityCouncilitplannedto quirementforIraqtodepositallproceedsfrompe- openanewaccountattheFederalReserveBank troleumexportsalesintoaccountslinkedtotheDFI The package of ofNewYorktoreplacetheDevelopmentFundfor constitutedasignificantsteptowardclosingmost arrangements Iraq (DFI) account. The UN established the DFI remaining UN sanctions imposed on Iraq after governing the use in 2003 as a repository for Iraq’s petroleum export SaddamHussein’sAugust1990invasionofKuwait. and international revenues as well as balances from the UN Oil for However,UNSCR1956extendsIraq’sobligationto oversight of the Food Programme and other frozen Iraqi funds. pay5%ofitsoilrevenuesintoacompensationfund DFI ended on UnderthetermsofUNSCR1956,thepackageof to pay victims of Saddam’s aggression.145 June 30. arrangements governing the use and international The GOI’s Committee of Financial Experts, oversightoftheDFIendedonJune30.144 For a headedbythePresidentofIraq’sBoardofSupreme comparisonofinternationalreservestoDFIassets, Audit, assumed audit oversight responsibilities see Figure 2.10. fortheoilrevenueaccountsfromtheUN-created Figure 2.10 InternationalAdvisoryandMonitoringBoard Iraq’s International Reserves and Total DFI Assets, 1/2008–4/2011 (IAMB).TheIAMB’smandatewillendoncean $ Billions external auditor submits a preliminary report of $60 theDFIthroughJune30,2011.146 UNSCR 1956 also

$50 endstheimmunityprotectionofIraq’soilrevenues againstcreditorclaimsfirstaffordedunderan $40 earlier UN resolution.147 Along-standingPresiden- Gross International Reserves tialExecutiveOrderwillprovideamorelimited $30 protectiontoGOIaccountsattheFederalReserve Total DFI Assets $20 BankofNewYork.OnMay17,2011,President Obama extended that order for one year.148 ◆ $10

$0 2008 2009 2010 2011

Note: Data not audited.

Source: IMF, Country Report No. 11/75, “Iraq: Second Review Under the Stand-By Arrangement, Requests for Waiver of Applicability, Extension of the Arrangement, and Rephasing of Access—Staff Report; Press Release on the Executive Board Discussion; and Statement by the Executive Director for Iraq,” 3/2011, p. 4.

JULY 30, 2011 I REPORT TO CONGRESS I 35

July2011.indb 35 7/25/2011 10:37:25 AM FUNDINGFORIRAQRECONSTRUCTION

INTERNATIONAL SUPPORT

AccordingtotheDoSBureauofNearEastern and$6.52billioninloans.Internationaldonors Affairs-Iraq, there was no change this quarter in hadpledged$18.02billion:$5.26billioningrant thestatusofinternationalsupport.AsofJune30, assistanceand$12.77billioninloans.149 2011, international (non-U.S.) donors had com- For a breakdown of pledges and commit- mitted $13.03 billion for the relief and recon- ments, by type of assistance and donor, see structionofIraq:$6.51billioningrantassistance Figure 2.11. ◆

Figure 2.11 International Grants and Loans, by Type of Assistance, Status, and Donor, as of 6/30/2011 $ Billions Loans Grants $4 $3 $2 $1 $0 $0 $1 $2 3.28 1.21 3.50 Japan 1.41 0.84 EU 0.24 0.68 UK 0.83 0.15 Italy 0.46 0.53 0.24 Status, by Donor Korea 0.20 Bilateral Multilateral Total 0.10 0.30 Canada 0.14 Committed 8.60 4.44 13.03 0.23 0.13 Pledged 10.88 7.14 18.02 Kuwait 0.50 0.11 Spain Status, by Type 0.24 0.09 Saudi Arabia Loans Grants Total 0.50 0.50 UAE 0.08 Committed 6.52 6.51 13.03 0.22 0.50 Pledged 12.77 5.26 18.02 1.00 Iran All Other 0.72 Bilateral 0.55 IRFFI 1.85

1.69 3.64 IMF 0.90 3.00 World Bank Islamic 0.50 Development Bank

Note: Data not audited. Numbers affected by rounding. Bilateral commitments exclude IRFFI deposits. Amounts may differ from prior quarters due to changes in foreign exchange rates.

Sources: NEA-I, responses to SIGIR data calls, 4/5/2011, 4/7/2011, and 7/12/2011.

36 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 36 7/25/2011 10:37:26 AM U.S. PRESENCE AND RECONSTRUCTION MANAGEMENT

The U.S. Presence in 2011 38

Contracting 43

Special Feature: Focus on Diyala 47 3section

July2011.indb 37 7/25/2011 10:37:26 AM U.S. PRESENCE AND RECONSTRUCTION MANAGEMENT

THE U.S. PRESENCE IN 2011

Consistent with the terms of the U.S.-Iraq Security managethecontractsfortheseservicesaregreater Agreement(SA)of2008,150 theU.S.Forces-Iraq thananypreviouslyfacedbyDoSandarebeing (USF-I)isslatedtobeginarapiddrawdownthis addressed in coordination with DoD, which is pro- summer,leadingtoacompleteexitofU.S.troops viding bridging support through contract vehicles As of July 20, 2011, onDecember31,2011.WhiletheU.S.government suchastheLogisticsCivilAugmentationProgram the GOI had not hasexpressedawillingnesstokeepacontingent (LOGCAP)andstaffingassistancethroughthe asked the United ofmilitarypersonnelbeyondthecurrentend-of- Defense Contract Management Agency and De- States to extend the mission deadline,151 asofJuly20,2011,theGovern- fenseContractAuditAgency.154 presence of U.S. military personnel mentofIraq(GOI)hadnotaskedtheUnitedStates beyond the end of toextendthepresenceofU.S.militarypersonnel the year. beyondtheendoftheyear.Duringarecentvisit Reconstruction in Transition to Iraq, new Secretary of Defense Leon Panetta commentedthatanysuchextensionwouldrequire U.S.ArmyCorpsofEngineers aformalrequestfromtheGOI.152 OnJune2,theU.S.ArmyCorpsofEngineers Asthetroopsdepart,U.S.Embassy-Baghdadand (USACE)closedtheGulfRegionDistrict(GRD), theDepartmentofState(DoS)willtakeonaseries whichwaslocatedatUSF-Iheadquarters.USACE of ever-increasing challenges. While maintaining a significant diplomatic presence, DoS over the next sixmonthswillassumeprimaryresponsibilityfora planned$6.8billionoperationthatincludesadvis- ingandmentoringtheIraqiSecurityForces(ISF), leading the Police Development Program (PDP), supporting advice and training for purchased mili- taryequipment,andbuildingcapacityandproviding technicalassistancetovariousgovernmentminis- tries and provinces. It will do so from 11 locations around Iraq, including three consulates and the world’slargestembassy.DoSwillalsoberespon- sible for working with the Department of Defense (DoD)toexecutetwoofthelargestForeignMilitary Sales(FMS)andForeignMilitaryFinancing(FMF) programsintheworldandtospendthe$2.55billion inIraqSecurityForcesFund(ISFF)budgetary authority remaining as of June 30, 2011.153 Planscallforupto16,000governmentemploy- ees and contractors needed to do the work and to ensure adequate air and land transportation,

maintenanceofintelligenceandsecuritycapabili- AssistantSecretaryofStateforNearEasternAffairsJeffrey ties,personalprotection,lifesupport,logistics,and Feltman,ConsulGeneralPiperA.W.Campbell,U.S.Ambassador JamesJeffrey,andMaj.Gen.EddyM.SpurginattheJuly5 medical services. The challenges to negotiate and inaugurationoftheU.S.ConsulateinBasrah.(USF-Iphoto)

38 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 38 7/25/2011 10:37:26 AM THEU.S.PRESENCEIN2011

addition,ithasfiveprojectsfundedbytheEco- nomicSupportFund(ESF)andfourprojects funded by the FMS program—collectively valued at $533 million—in the pre-award stage, as well astwostudies,valuedat$1million,workingin supportoftheGOI.WiththeexceptionoftheFMS work, MED expects all remaining projects in Iraq With the exception of tobecompletedbySeptember2013.157 the FMS work, MED MED’sIraqAreaOffice(IAO),whichopened expects all remaining onApril2,isheadquarteredatForwardOperat- projects in Iraq to ingBase(FOB)UnionIII.IAO’sthreeproject be completed by officesarelocatedinTaji,Tikrit(CampSpeicher), September 2013. and Basrah.158

Iraq Strategic Partnership Ofﬁce Embassy-supported reconstruction projects will continue well beyond the scheduled summer 2011 closingoftheEmbassy’sIraqStrategicPartnership Office(ISPO),atwhichtimetheresponsibilities andfunctionsofISPO,alongwithitsstaff,will transfertotheEconomicSectionattheEmbassy. IAOwillsupporttheEconomicSectionbymanag- OnJune2,2011,GulfRegionDistrictCommanderCol.Jon ingthetechnicalaspectsoftheseprojects.The Christensen (right) and Transatlantic Division Commander Maj. Gen. Kendall Cox participated in a ceremony transferring GRD’s remainingISPOstaffmembersareexpectedto responsibilities for Iraq reconstruction to USACE’s Middle East 159 District. (USACE photo) depart the Embassy during summer 2012. AsmallISPOstaffcurrentlyoverseesUSACE beganitsIraqreconstructioneffortsin2003and effortsandprovidesliaisonwiththerelevant consolidated them under one command in January GOIagenciesfortheprojects.ISPO’sprocessof 2004 when it formed the Gulf Region Division. From windingdownreconstructionprojectshasina theoutset,thisDivisionwasaprovisionalentity,and fewinstancesrequiredtheawardofassessment whenUSACE’sworkloadandthetheater’srecon- andrepaireffortsforpreviouslycompletedwork. struction effort began to transition toward the Iraqis The ISPO oversight efforts involve communicating takingthelead,USACEbeganconsolidatingitsvari- withUSACEonprojectprogressandaddress- ousIraqengineerdistricts.InOctober2009,USACE ingthechallengesthataffectprojectcompletion, disestablishedtheDivision,andbytheendofMarch monitoring USACE regularly provided reports, 2010,whatremainedintheaterwasGRDandthree reviewingfinancialmanagement,andvisiting areaoffices.WiththeclosingofGRD,allremain- sitesonoccasion.Thisquarter,ISPOstaffvisited ingUSACEreconstructionactivityinIraqisbeing theWazeriyaNationalElectricTrainingCenter executed by an area office that reports to the Middle and the Supervisory Control and Data Acquisi- EastDistrict(MED)inWinchester,Virginia.155 tiontrainingprogramattheResearchTriangle Since2003,USACEhascompletedmorethan5,000 Institute and also made numerous ministerial reconstruction projects, valued at $8.4 billion.156 contactsandvisitstodiscussprojectsandresults. MEDhastakenoverresponsibilityfor48GRD AccordingtoU.S.Embassy-Baghdad,noprojects legacyprojectsand8GRDservicecontracts.In were canceled this quarter.160

JULY 30, 2011 I REPORT TO CONGRESS I 39

July2011.indb 39 7/25/2011 10:37:26 AM U.S. PRESENCE AND RECONSTRUCTION MANAGEMENT

Provincial Reconstruction $1billionintheFY2012budgettounderwritethe In line with the schedule for downsizing the Pro- firstyear’sprogramexpenseandothercriminal- vincialReconstructionTeam(PRT)program,the justice program costs. Despite these uncertainties, U.S.EmbassypresenceinIraq’sprovincesischang- thefirstwaveofadvisorswhowillguidethePDP ingrapidly,OnApril1,2011,therewasanEmbassy havealreadyarrivedinIraq.BytheendofJune, presenceat17sitesinIraq,including14PRTsand therewere18advisorsinIraq.164 The plan devel- 3 Forward Presence Locations. By July 31, 2011, opedbyINLcallsforatotalof190advisors.165 onlyfourPRTswillremain:Baghdad,Anbar, DoSannouncedinMaythatAmbassador Diyala, and Najaf. These last remaining PRTs will Michele Sison will become the Assistant Chief of be closed by mid-September.161 MissionforLawEnforcementandRuleofLawAs- TheEmbassy’spresenceintheprovincesisbeing sistanceatU.S.Embassy-Baghdad.Sheisexpected replaced by Iraqi Cultural Advisors, who will live and toarriveinIraqthissummer.AmbassadorSison’s workintheprovincesandadviseU.S.diplomatson primaryrolewillbetoleadtheEmbassy’sINL developments,concerns,andkeyissues.TheCultural officeandthePDP.Inaddition,AmbassadorSison AdvisorswillalsoprovidedirectsupporttotheCon- willreplacetheDeputyChiefofMissionasChairof sulatesinErbil,Basrah,andKirkuk.162 theLawEnforcementWorkingGroup,whichmeets Consulates are replacing PRTs in Basrah and biweekly, and she will coordinate with the Depart- KirkukandtheRegionalReconstructionTeamin mentofJusticeonprogramsfundedbyINL.166 Erbil.AninitialproposaltohaveEmbassyBranch The Supplemental Appropriations bill for FY 2010 Offices(EBOs)inMosulandKirkukhasbeen providedINLwith$450milliontoconstructtem- altered.Theplanningnowcallsforatemporary porarylocationsatFOBShield,whichisadjacentto consulateinKirkuk,whiletheEBOinMosulhas theBaghdadPoliceCollegeseveralmilesfromthe beenmothballed.TheEmbassyheldformalribbon- Embassy.TheothertwoPDPsitesareinErbiland cuttingceremoniesinJulytoopentheConsulates Basrah.ArecentDoSOfficeofInspectorGeneral inBasrahandErbil;onJuly5,AmbassadorJeffrey (DoS OIG) inspection report recommends that the hosted an American Independence Day celebra- U.S.ConsulateinErbilbecolocatedneartheErbil tion in Basrah to formally recognize the Consulate AirportwithINL’spolicetrainingandairwing in southern Iraq.163 Basrah is the epicenter for the operations.InAugust2009,DoSOIGreportedthat developmentofIraq’svastoilreservesinsouthern theErbilfacilitiesareinadequate.InMay2011,DoS Iraq,wheresignificantbusinessopportunitiesare OIGestimatedthat$12milliononsecurityand developing for U.S. companies. facilityupgradescouldbesavediftheConsulate were colocated with INL operations until a perma- nentfacilitycouldbeconstructed.INLexpressed Police Training Program itsoppositiontothiscost-savingrecommenda- tion, stating it would be cost-effective for the Erbil Handover from DoD to DoS ConsulatetoremainatitsAnkawalocationuntila U.S.Embassy-Baghdadofficiallytakesoverthe permanent Consulate is constructed.167 program for training the Iraqi police from the USF-ITrainingandAdvisoryMissiononOcto- Contract Oversight ber1,2011.The90-dayhandoverperiodbeganon Since2004,contractsforpolicetraininghavebeen July1.FinalizingthePDP,whichwillbeledbythe challengingtomanagebecauseoftheirsizeand Finalizing the INL-led DoSBureauofInternationalNarcoticsandLaw complexity.In2005,INLwastolditneededtobeef PDP has been delayed EnforcementAffairs(INL),hasbeendelayedbe- upitsstaffingtostrengthenitsoversightbothin because of funding cause of funding uncertainties. DoS has requested IraqandAfghanistan.InJanuary2007,SIGIRand uncertainties.

40 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 40 7/25/2011 10:37:52 AM THEU.S.PRESENCEIN2011

DoS OIG reported that poor contract administra- invoice oversight in contract execution—particu- tion by INL and the DoS Office of Acquisition larlyforthenewINL-ledpolicetrainingeffort. Managementputmillionsofdollarsatrisk.InOc- InOctober2010,SIGIRreportedthattherewere tober2007,SIGIRhadtosuspenditsauditbecause weaknessesinDoD’smanagementofthepolice INLcouldnotidentifywhatDynCorpInternation- training program. These weaknesses existed, al provided under the contract or how funds were specifically,intheareasofprogramplanningand spent. In January 2010, SIGIR reported that INL assessments, communications and coordination continuedtoexhibitweakoversightofDynCorp between organizations performing the training, andlackedresourcesandcontrolstomanagethe and oversight of contract police advisors. contract,thusmaking$2.5billioninU.S.funds vulnerable to waste and fraud. Becauseoversighthadbeenweak,INLhadto Ofﬁce of Security reconcile all historical invoices for work under- Cooperation-Iraq takenunderthecontract.InOctober2007,SIGIR wastolditwouldtakeINLthreetofiveyearsto EffectiveOctober1,2011,responsibilityforU.S.as- completethereconciliation;however,SIGIRfound sistancetoIraq’sMinistryofDefensewilltransition in January 2010 that the reconciliation effort would fromtheDeputyCommandingGeneralforAdvis- take longer because INL had not adequately staffed ingandTraining(DCG-A&T)toOSC-I.OSC-I,in the effort. conjunctionwithU.S.Embassy-Baghdad,theGOI, InJune2011,DoSUnderSecretaryforManage- andU.S.CentralCommand(CENTCOM),will ment Patrick Kennedy testified before the Commis- continue to conduct security cooperation activi- sion on Wartime Contracting (CWC) that INL had tiestosupportIraq’scontinueddevelopmentintoa conducteda100%reconciliationofallINL-funded, stableandlong-term,self-reliantstrategicpartnerof Iraq-relatedinvoicespriorto2006andhadcollected theUnitedStates.OSC-IwillbeaSecurityAssis- $40.8millionrelatedtoIraqandAfghanistan tanceOrganizationunderChiefofMission(COM) invoices.HeaddedthatINLhasrequestedanother authority and will engage directly with the Political- $37.9millionfromDynCorp.AmbassadorKen- MilitarySectionattheEmbassy.170 nedywentontotestifythatINL’sreviewhadledto AccordingtoOSC-I,onJanuary1,2012,the afurtherreductionofmorethan$109millionin Chief of OSC-I will likely become the Senior De- reduced bills for contractor support services.168 fenseOfficial(SDO)inIraq.Inthisrole,theSDOwill TheStateDepartment’sdecisiontoundertake serveastheprincipalDoDofficialintheEmbassy The State the reconciliation of invoices follows years of SIGIR andastheprincipalmilitaryadvisorondefenseand Department’s decision criticismofINL’sweakcontractadministration nationalsecurityissuesfortheCOM.TheSDOwill to undertake the andoversightdatingbackto2005.Mostrecently,in alsoserveasthefocalpointinIraqforU.S.de- reconciliation of January2010,SIGIRfoundthatINLexhibitedweak fensecoordinationwithCENTCOM.Thespecific invoices follows years oversight of the DynCorp task orders for support relationshipsandresponsibilitiesoftheSDOwillbe of SIGIR criticism of of the Iraqi police training program. SIGIR’s audit defined in the SDO appointment letter.171 INL’s weak contract revealedthatINLcouldnotensurethatthecosts OSC-IwillprovidemanagementwithinIraqof administration and oversight. submittedbyDynCorponinvoiceswereallowable, theGOIsecurityassistanceprograms.According norwasthereadequatesupportingdocumentation toDoDofficials,OSC-Ipersonnelwillinclude118 fortheamountsbeingpaidunderthecontract.169 militarypersonnel,9civilians,and30locallyem- The results of the reconciliation as reported by ployedstaff.USF-Iestimatesthatanadditional3,000 AmbassadorKennedyareacleardemonstration contractorsmaybeneededtoprovidelifesupport, ofthecriticalimportanceofcontemporaneous security,andtransportationassistanceforOSC-I.172

JULY 30, 2011 I REPORT TO CONGRESS I 41

July2011.indb 41 7/25/2011 10:37:52 AM U.S. PRESENCE AND RECONSTRUCTION MANAGEMENT

OSC-IDoDstaffwillsupporttheIraqiforces byadvising,training,assisting,andequippingthe force,providingprofessionalmilitaryeducation, andplanningforjointmilitaryexercises.Inaddi- tion, OSC-I staff will administer the FMS program inIraq.ToprovidethislevelofsupporttotheIraqi forces,OSC-Iplanstooperatefrom10locations throughoutIraq—6dedicatedsitesand4sites shared with the Embassy. The six dedicated sites are located near Iraqi military installations:173 • Baghdad,atthecurrentlocationofDCG-A&T SIGIRDeputyInspectorGeneralvisitsfutureOSC-IsiteinTajion at FOB Union III July 13, 2011. • Tikrit,atthehomeoftheIraqiAirAcademy Funding Issues • UmmQasr,attheprimarylocationofthe FundingforOSC-Ihasnotyetbeenapprovedby OSC-I plans to Iraqi Navy the Congress. The FMF budget request for FY 2012 operate from • Taji,attheIraqiArmyheadquartersandsiteof includes$1billiontoallowtheUnitedStatestocon- 10 locations the Iraqi National Logistics Center tinue to advise, train, and equip Iraqi military forces. throughout Iraq— • Kirkuk,homeoftheKirkukRegionalAirWing AlthoughthefullscopeoftheUSF-Iadvising 6 dedicated sites and 4 sites shared with • Besmaya,atthesiteoftheIraqiArmy and training mission will terminate with the USF-I the Embassy. Training Center withdrawal,significantbalancesoftheISFFwill The four shared sites are Joint Security Stations be available to continue support for the ISF after Shield and Sather, and the Consulate locations in that date. USF-I reported that OSC-I will likely be ErbilandBasrah.FMScaseimplementationmay responsibleforexecutinganyunobligatedorunex- require OSC-I personnel, particularly Security As- pended ISFF monies.175 TheISFFhadbeenintend- sistanceTeams,tooperateatadditionallocations.174 edtoprovidefortheISFtoattainaminimum essential capability (MEC) standard prior to the withdrawal of U.S. troops in December 2011.176 It now appears that the readiness of the ISF to managethesecurityenvironmentatthetimeof U.S.forces’endofmissionwilllikelyfallshortof the MEC that the ISFF funds were intended to realize.177 ForinformationontheISFFspendplan, seeSection2ofthisQuarterlyReport.◆

42 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 42 7/25/2011 10:37:52 AM CONTRACTING

CONTRACTING

Ofthe16,000personnelwhoareexpectedtoserve U.S.-funded Contractors under COM authority after the U.S. military draw- and Grantees in Iraq down, most will be contractors. They will provide lifesupport,security,andtransportation,aswellas AsofJune30,2011,69,457U.S.-fundedcontrac- help meet the medical requirements of personnel torsandgranteessupportedDoD,DoS,USAID, servingundertheCOM.178 andotherU.S.agenciesinIraq,accordingtodata Contract oversight and management will play availableintheSynchronizedPredeployment asignificantroleasnewcontractsareawarded and Operation Tracker (SPOT). The number of andcontractexecutioncommences.Testimony U.S.-funded contractors declined significantly this presentedinJune2011beforetheCWCreinforced quarter,droppingby14,797(18%)fromthe84,254 the important role of contract management. contractorsregisteredinIraqasofMarch31, IndescribingtheStateDepartment’sstrategy 2011.181 Forinformationoncontractorsandgrant- inIraq,AmbassadorKennedysaidthatDoS’s ees,byagencyandnationalorigin,seeTable3.1. primarycontractingteamislocatedinWash- DoD officials expect the number of PSC person- ington,D.C.Tosupportitsgrowingcontracting nelinIraqsupportingDoDactivitiestocontinueto demands, Ambassador Kennedy testified that declinealongwiththenumberofU.S.troops.This DoSstartedaskills-basedclassforcontracting declinewillbepartiallyoffsetbyanincreaseinthe officer’s representatives (CORs) and adopted the numberofPSCpersonnelsupportingDoSactivi- Federal Acquisition Certification Contracting ties.182 Forinformationoncontractorsandgrantees, Officer Representative Requirements for contract byagencyandtypeofservice,seeTable3.2. administration training.179 IndiscussingtheU.S.reconstructioneffort DoS reached an agreement with DoD to allow with SIGIR, Vice President Khudayer al-Khuza’ie Al-Khuza’ie also theuseofLOGCAPIVasacontractvehicleto acknowledgedtheworkdonebytheUnitedStates noted what he obtainlifesupportservicesattheprimaryEmbassy to help Iraq. However, al-Khuza’ie also noted what perceived as the U.S. locationinBaghdadanditsadditional11locations heperceivedastheU.S.overrelianceonlayersof overreliance on layers throughout Iraq. The LOGCAP IV contract for Iraq subcontractors,statingthat“bythetimeyougot of subcontractors. isexpectedtobeawardedbytheendofJuly.This tothecontractordoingtheactualwork,there isatemporarystepdesignedtoallowDoStimeto wasonlyenoughmoneyforonecoatofpaintthat solicititsownlifesupportcontract.DoD,whichhas meltedawayassoonasitrained.”183 considerable experience in oversight of LOGCAP IIIandnowLOGCAPIV,hasrecommendedthat DoSprovide20CORstomanagethecontractin Contracting Actions and Grants Iraq.However,DoSapparentlybelievesthatonlysix CORs will be needed to manage the contract.180 As of June 30, 2011, DoD, DoS, and USAID had reported 34,728 contracting actions or grants, totaling$35.94billionincumulativeobligations.184 Thisaccountsfor84%ofthe$42.83billionin reportedfinancialobligationsfromtheIraqRelief andReconstructionFund(IRRF),ESF,andISFF.185 Comprehensive contract data was not available for

JULY 30, 2011 I REPORT TO CONGRESS I 43

July2011.indb 43 7/25/2011 10:37:52 AM U.S. PRESENCE AND RECONSTRUCTION MANAGEMENT

Table 3.1 ContractorsandGranteesinIraq,byAgencyandNationalOrigin,asof7/1/2011 Third- Country U.S. Iraqi Agency National Citizen National Total Quarterly Change

Department Department of the Army (Army) 24,646 14,807 1,761 41,214 -3,578 (-8%) of Defense CENTCOMContractingCommand(C3) 10,722 2,110 2,681 15,513 -8,176 (-35%) DepartmentoftheAirForce(AirForce) 1,242 849 7 2,098 -310 (-13%) U.S. Transportation Command (USTRANSCOM) 256 10 580 846 148 (21%) ArmyandAirForceExchangeService(AAFES) 720 19 3 742 -325 (-30%) Department of the Navy (Navy) 563 563 -234 (-29%) Defense Contract Management Agency (DCMA) 4 528 16 548 -118 (-18%) U.S.SpecialOperationsCommand(USSOCOM) 250 250 45 (22%) DoDJointProgramOfficeMRAP 192 192 Department of Defense (DoD) 49 63 4 116 8(7%) Defense Intelligence Agency (DIA) 83 83 -35 (-30%) SpaceandMissileDefenseCommand(SMDC) 64 64 -7 (-10%) Defense Logistics Agency (DLA) 40 17 57 1(2%) Defense Information Systems Agency (DISA) 4 49 53 -10 (-16%) Washington Headquarters Service (WHS) 35 4 39 -17 (-30%) National Geospatial-Intelligence Agency (NGA) 32 32 -31 (-49%) Defense Contract Agency (DCA) 20 20 -2 (-9%) AirForceCenterforEngineeringandtheEnvironment(AFCEE) 14 14 13 (1300%) Defense Advanced Research Projects Agency (DARPA) 10 10 -7 (-41%) Missile Defense Agency (MDA) 10 10 -11 (-52%) OfficeoftheSecretaryofDefense(OSD) 8 8 -3 (-27%) Business Transformation Agency (BTA) 7 7 Army Materiel Command (AMC) 3 3 -2 (-40%) Defense Contract Audit Agency (DCAA) 1 1 -4 (-80%) Defense Finance and Accounting Service (DFAS) 1 1 -15 (-94%) Subtotal 37,718 19,709 5,057 62,484 -12,670 (-17%) Other Department of State (DoS) 1,734 3,034 35 4,803 -1,172 (-20%) U.S. Agency for International Development (USAID) 92 65 1,908 2,065 -98 (-5%) General Services Administration (GSA) 54 54 -35 (-39%) Department of Justice (DoJ) 29 29 -20 (-41%) Department of Energy (DoE) 21 21 SocietyofEnvironmentalToxicologyandChemistry(SETAC) 1 1 -25 (-96%) Department of Health and Human Services (DHHS) -3 (-100%) Department of Interior (DoI) -1 (-100%) Not Specified -773 (-100%) Subtotal 1,827 3,203 1,943 6,973 -2,127 (-23%) Total 39,545 22,912 7,000 69,457 -14,797 (-18%)

Note: Data not audited.

Sources: USD(AT&L),SPOTProgramSupport,responsestoSIGIRdatacalls,4/25/2011and7/5/2011.

44 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 44 7/25/2011 10:37:52 AM CONTRACTING

Table 3.2 ContractorsandGranteesinIraq,byTypeofServiceProvidedandAgency,asof7/1/2011 Agency Quarterly Category Service Provided Army C3 State USAID Other Total Change

Support Services Security Guards and Patrol Services 120 10,598 2,540 13,258 -4,708 (-26%) Facilities Support Services 738 203 403 761 2,105 103 (5%) Security Systems Services 325 60 5 390 - 444 (-53%) (except Locksmiths) Other 33,370 475 98 506 34,449 -1,666 (-5%) Subtotal 34,553 11,336 3,046 1,267 50,202 -6,715 (-12%) Professional, Translation and Interpretation Services 2,969 137 73 94 3,273 -1,123 (-26%) Scientiﬁc, and Administrative Management and General Technical Services 93 27 21 1,722 44 1,907 -70 (-4%) Management Consulting Services Engineering Services 702 28 968 1,698 -133 (-7%) Other 424 78 29 503 1,034 -109 (-10%) Subtotal 4,188 242 151 1,722 1,609 7,912 -1,435 (-15%) Miscellaneous Sewage Treatment Facilities; Finish Carpentry; Facilities Support; Appliance 1,000 1,000 -613 (-38%) Repair and Maintenance Support Activities for Air Transportation 176 30 473 221 900 100 (13%) Specialty Trade Contractors 17 761 1 779 -83 (-10%) Police Protection 716 716 -589 (-45%) Satellite Telecommunications 334 334 -80 (-19%) Other 1,933 1,684 412 343 2,250 6,622 -2,704 (-29%) Subtotal 2,460 3,475 1,602 343 2,471 10,351 -3,969 (-28%) Not Speciﬁed 13 460 4 515 992 -2,678 (-73%) Total 41,214 15,513 4,803 2,065 5,862 69,457 -14,797(-18%)

Note: Data not audited.

Sources: USD(AT&L),SPOTProgramSupport,responsestoSIGIRdatacalls,4/25/2011and7/5/2011.

Table 3.3 the Commander’s Emergency Response Program Contracting Actions and Grants andtheInternationalNarcoticsControlandLaw $ Millions Enforcement account. Current Status Change over Quarter Thisquarter,DoD,DoS,andUSAIDreported Fund Count Obligated Expended Count Obligated Expended 194 new contracting actions or grants from ISFF 18,598 $17,830.4 $17,202.1 245 (1%) $77.4 (0%) $213.0 (1%) theIRRF,ESF,andISFF,resultingin$147mil- IRRF 8,494 $14,417.4 $14,300.3 5 (0%) -$1.2 (0%) $10.2 (0%) lioninnewobligationsand$298millioninnew ESF 7,636 $3,694.3 $3,341.6 -56 (-1%) $71.3 (2%) $75.0 (2%) expenditures.186 Total 34,728 $35,942.0 $34,844.1 194 (1%) $147.4 (0%) $298.3 (1%) Foranoverviewofthestatusandquarterly

Note: Data not audited. Numbers affected by rounding. Tables represent only those contracting actions that change of contracting actions and grants, see werereportedbytheagencies;theydonotreﬂectallobligationsorexpendituresmadeinIraq. Table3.3.Foralistofthetopcontractorsand Sources:CEFMS,ESF, IRRF: Construction, IRRF: Non-construction, ISFF,4/1/2011and7/9/2011;USAID, responsestoSIGIRdatacalls,1/22/2010,4/16/2011,and7/7/2011. granteesinIraq,seeTable3.4.Foracompletelist of contracting actions and grants, as reported to SIGIR, visit: www.sigir.mil.◆

JULY 30, 2011 I REPORT TO CONGRESS I 45

July2011.indb 45 7/25/2011 10:37:52 AM U.S. PRESENCE AND RECONSTRUCTION MANAGEMENT

Table 3.4 TopContractorsinIraq,asof6/30/2011 $ Millions Obligated Expended Contractor IRRF ISFF ESF Total IRRF ISFF ESF Total

Bechtel National, Inc. 1,186.6 1,186.6 1,180.2 1,180.2 EnvironmentalChemicalCorporation 352.3 766.6 1,118.9 351.2 755.8 1,107.0 Fluor/AMEC, LLC 943.6 943.6 942.2 942.2 AECOMGovernmentServices,Inc. 11.5 953.8 965.3 11.5 905.1 916.6 Washington Group International 509.5 164.7 674.2 508.4 163.6 672.0 ParsonsGlobalServices,Inc. 687.7 3.6 691.3 665.8 3.6 669.4 International Relief and Development 686.7 686.7 656.0 656.0 Parsons Iraq Joint Venture 631.7 631.7 630.4 630.4 KelloggBrown&RootServices,Inc. 626.5 7.9 634.4 620.2 6.4 626.6 Navistar 68.7 560.7 629.4 68.7 543.8 612.4 American Equipment Company (AMERCO) 0.2 516.9 517.1 0.2 513.3 513.4 Research Triangle Institute 446.5 446.5 428.2 428.2 IraqiContractor-5300 16.6 347.8 10.5 374.9 16.6 330.1 10.5 357.2 TolTest,Inc. 86.1 266.8 352.9 82.4 263.8 346.2 TetraInternational,LLC 67.4 276.2 0.4 344.0 67.4 274.8 0.4 342.6 Laguna Construction Company, Inc. 156.7 180.3 337.0 155.8 165.7 321.5 AMEC Earth & Environmental, Inc. 134.6 183.3 317.8 134.4 182.8 317.3 Innovative Technical Solutions, Inc. 25.6 283.9 309.6 25.6 279.4 305.0 Management Systems International, Inc. 354.8 354.8 301.1 301.1 MAC International FZE 177.3 118.6 295.9 177.2 117.9 295.1 Research Triangle Institute (RTI) 287.7 287.7 287.4 287.4 Weston Solutions, Inc. 114.1 170.3 284.4 114.1 170.0 284.1 Anham Joint Venture 258.5 6.3 264.8 258.5 6.3 264.8 CHF International 51.4 210.9 262.3 51.3 201.2 252.5 Louis Berger International, Inc. 300.4 300.4 251.6 251.6 BearingPoint, Inc. 154.4 93.6 248.0 153.3 92.5 245.9 SymbionPower,LLC 240.0 240.0 239.6 239.6 Siemens 217.9 6.4 224.3 217.9 6.4 224.3 Raytheon Company 2.5 227.3 0.9 230.7 2.5 216.4 0.9 219.8 URSGroup,Inc. 225.8 225.8 219.7 219.7

Note: Data not audited. Numbers affected by rounding. Table represents only those contracting actions that were reported by the agencies; the values do not reﬂect all obligations or expenditures made in Iraq.

Sources: CEFMS, ESF, IRRF: Construction, IRRF: Non-construction,ISFF,4/1/2011and7/9/2011;USAID,responsestoSIGIRdatacalls,1/22/2010,4/16/2011,and7/7/2011.

46 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 46 7/25/2011 10:37:52 AM FOCUSONDIYALA

FOCUSONDIYALA

Figure D.1 Geography SULAYMANIYAH TAMEEM Provincial Capital: Ba’quba 6,828 square miles Kifri Area: (17,685 square kilometers), 4.1% of national territory SALAH AL-DIN Major Cities: Ba’quba, Baladrooz,al-Khalis,Kifri, and Khanaqin IRAN Demography Khanaqin Population: 1.65 million Lake Hamrin (2009 GOI est.) Sunni Rural vs. Urban: 59% vs. 41% Uzaim Shia Major ethnosectarian groups: Kurd Sunni (55%); Shia (25%); Kurds(10%);others,including er Shia/Sunni Mix iv R Turkmen, Christians, and la Shia/Kurdish Mix a y Yazidis (10%) Balad Di Al-Muqdadiya Political Economy Al-Khalis Governor: Abdul-Nasser al-Mahdawi Tigris River Mandali (Iraqi Accordance Front) Ba’quba Baladrooz Provincial Council Chairman: Tarmiya TalibMohamadHasan (Kurdistani Alliance) Main Industry: Agriculture Taji Al-Rashidiyah U.S. Presence Turki Diyala PRT Closure Date: September 2011 Total U.S. Reconstruction Funds BAGHDAD Committed: $1.06 billion Baghdad Ongoing U.S. Capital Note: The map above shows the diverse ethnic and religious composition of Diyala province. The shapes are rough Investment: $54.9 million indicators and should not be viewed as exact. Planned U.S. Capital Investment: Source: 3rd HBCT, 1st Cavalry Division, “Diyala Province,” 10/2006–12/2007, as sourced in Claire Russo, “Diyala Provincial $5.18 million Election: Maliki and the IIP,” The Institute for Understanding War, 1/30/2011, p. 12. Note: Population estimates based on data call responses from U.S. Embassy-Baghdad, With no national census since 1987 and 3/29/2009, 7/6/2009, and 7/16/2009, and Background information from the Diyala Investment Bordered by Iran, the Kurdistan Region, large-scale population displacements hav- Commission. Funding information from PRT Diyala. Baghdad, the mostly Sunni province ingoccurredbothbeforeandafter2003, ofSalahAl-Din,andtheoverwhelm- measuring the size and composition of inglyShiaprovinceofWassit,Diyalaisa Iraqi provincial populations with precision amidst this ethnic mosaic is an even more microcosmofIraq.Withitscontentious isimpossible.Thesituationisparticularly complexweboftribes.Accordingtothe intercommunal relationships, mixed difficult in Diyala because of the Ba’athist U.S. military, in 2007 there were at least economy,andvariedgeography,the regime’s mass resettlement of Arabs 25majortribesandalmost100sub-tribes majorissuesinDiyalareflect,albeitona thereandrelatedexpulsionsofKurdsin inDiyala,someofwhichencompassed smaller scale, the foremost challenges fac- theperiodaftertheIran-IraqWar.Most bothSunniandShiabranches.Asafor- ingIraq.AsoneU.S.brigadecommander estimates, however, show that a majority of merDiyalaProvincialCouncilmember saidaboutDiyalain2007,“basically,all Diyala’s residents are Sunni Arabs, but as told SIGIR in July, ethnic tensions were theissuesandconflictsthatexistthrough FigureD.1shows,theysharetheprovince minimized prior to 2003 because, “Sad- allIraq...existhere.”187 with several different groups. Intertwined dam ruled with an iron fist.”188

JULY 30, 2011 I REPORT TO CONGRESS I 47

July2011.indb 47 7/25/2011 10:37:53 AM FOCUSONDIYALA

Becauseitsoilandnaturalgasresources theunresolvednatureofthisdispute,in haveyettobeextensivelydeveloped, lateMay2011,theKhanaqinmunicipal Diyala’s economy remains heavily depen- governmentraisedtheKRGflagoveran dentonagriculture.Onceknownasthe officialbordercrossingwithIranforthe “CityofOranges”foritsbountifulcitrus first time.192 groves,theprovincialcapitalofBa’quba Since2010,theU.S.militaryhasbeen lies at the heart of the fertile Diyala River engaged in joint patrols with the Iraqi Se- valley,whichbisectstheprovincefrom curityForces(ISF)andKurdishPeshmerga thenortheasttothesouthwest.Butaplu- alongtheKurdistanRegion’ssouthern U.S. artillery round detonates during operations ralityoftheprovince’spopulation(40%) border.AsofJune30,nofirmplansexist against insurgents in Diyala in January 2007. residesintheprovince’slargest,and regardingwhatforce,ifany,willreplace (USF-I photo) mostlydesert,districtofBaladrooz.189 themiftheU.S.militarywithdrawsfrom Although Coalition forces killed al-Zarqawi Iraqasscheduledbytheendoftheyear. inaJuneairstrikeonhishideoutnear Arab-Kurdish Dispute This led former U.S. Forces-Iraq (USF-I) Ba’quba,thesecuritysituationintheprov- NorthofBaladroozliesthedistrictof Commanding General Raymond Odierno incecontinuedtodeteriorateastheyear Khanaqin—the central focus of Arab- to publicly raise last year the possibility woreon.SectariantensionsinDiyalawere KurdishtensionsinDiyalaprovince. of an international peacekeeping force alsoexacerbatedbytheSunniperception IntheaftermathoftheIran-IraqWar, eventually patrolling territories claimed that the Shia-dominated police force acted Saddam Hussein attempted to “Arabize” by both the KRG and GOI.193 inapartisanmanner.Inoneincident,a much of Khanaqin by expelling large police sweep netted about 900 detainees— numbersofFeyli(Shia)KurdsfromIraq, allbut2ofwhomwereSunnis.196 accusingthemofactivelysympathizing Security As the security situation grew worse, with their Shia co-religionists across the The Insurgency Intensiﬁes: 2003–2006 Diyala’s government ceased to func- border.Intheirplace,theBa’athistsrelo- Between 2003 and 2006, the insurgency tion.InSeptember2006,Diyalaofficials cated Sunni Arab families—thought to graduallyintensifiedinDiyala,asarmed stopped distributing regular food rations be more sympathetic to Saddam—to take groups streamed into the province from andfueltoresidents.InOctober,the ownershipofthevacatedhomes.After citieswheretherewasalargerCoalition provincial government recessed because 2003, many displaced Kurds resettled in militarypresence,suchasBaghdad.194 ofthedeterioratingsecuritysituation. thedistrict,andtheKurdistanRegional By June 2007, the number of monthly By December, the insurgency effectively Government (KRG) asserted claims incidentshadreached1,023:195 controlledBa’qubaandmuchofthe 197 topartsofKhanaqinandneighboring 1,023 Diyala valley. Kifridistricts—claimscontestedbythe 6/2007 GovernmentofIraq(GOI).190 Securing Diyala: 2007 Thesetensionsledtoastand-offbe- BeginninginJanuary2007,Coalition tween Kurdish Peshmerga forces and the forces,ledbytheU.S.1stCavalryDivi- Iraqi Army (IA) in August 2008, when sion,slowlyreassertedcontroloverDi- elements of the IA’s 1st Division entered 96 yala.AfterclearingAQIfightersfromthe 1/2004 46 Khanaqin—a movement that the IA’s 12/2010 villageofTurkisoutheastofBa’qubain ChiefofStaff,aKurd,claimsnottohave FigureD.2showsmajorsecurityevents OperationTurkiBowl,U.S.forcesgradu- knownofinadvance.191 Like the disputes in Diyala during peak violence in ally pushed toward the provincial capital. betweentheGOIandKRGoverKirkuk, 2006–2008. Inanattempttocountertheincreased theconflictingclaimsovernorthern ByApril2006,AbuMusabal-Zarqawi, tempoofU.S.operations,AQIlaunched Diyalaaremeanttobesettledaspart then-headofal-QaedainIraq(AQI),felt several attacks in March and April, using oftheprocesssetforthinArticle140of secureenoughtodeclareDiyalaasthecapi- suicide bombers against civilian targets the Iraqi Constitution. But, to date, the talofthecaliphateheintendedtoestablish intownsandvillagesandkidnapping GOI has made little progress in moving inIraq.Thatsamemonth,AQIlauncheda andkillingmanyGOIofficials.Shia forwardwiththeArticle140process, large-scale offensive in the province, strik- militias also constituted a serious secu- whichrequiresittoconductbotha ingtargetsacrossDiyalafromtheirrural rity threat. In late February, U.S. troops census and referendum. Underscoring bastions in the farmlands near Ba’quba. uncovered a cache of more than 150

48 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 48 7/25/2011 10:37:53 AM FOCUSONDIYALA

Figure D.2 Significant Security Events in Diyala, 2006−2008 2006 2007 2008

Mid-May Commander of 5th Iraqi Army Division relieved of January command for sectarian bias Coalition forces clear September AQI elements from September April AQI launches a series farming communities Diyala government U.S. forces establish 7 of attacks on Diyala northeast of Ba’quba stops PDS food and combat operating posts in Concerned Local April fuel deliveries and around Ba’quba Citizen groups October Abu Musab Series of major March–June al-Zarqawi June 7 January–February September 24 reconciliation ISF and SOI declares Diyala Al-Zarqawi U.S. army sweeps Suicide bomber kills meetings held increase presence August–September the capital of his killed in U.S. rural areas east and 28 at a reconciliation by pro-GOI northeast of ISF arrests several caliphate airstrike south of Ba’quba meeting in Ba’quba sheiks Ba’quba Diyala SOI leaders

October March June 19 August 19 November–December August 11 Diyala government recesses AQI launches Operation More than 100 Operation Raider Reaper targets Diyala Provincial large-scale Arrowhead Diyala tribal AQI elements operating in rural Council removes December attacks in Ripper targets leaders sign areas outside Ba’quba Provincial Police Insurgents take effective southern insurgents in pact pledging Commander Qureshi control of Ba’quba Diyala Ba’quba to oppose AQI July 15 on grounds of sectarian and other Suicide bombers attack IA bias Mid-March July insurgents recruiting station in Diyala, U.S. forces Operations Ithaca killing 35 Mid-August reinforce Diyala and Olympus drive August 27 Special GOI AQI from smaller U.S. and ISF counterterrorism unit Diyala town forces launch raids provincial Operation government buildings, July 23 Church north of arresting several Sunni First large reconciliation Ba’quba officials on charges of meeting held by anti-AQI supporting AQI tribal sheiks and Diyala officials Mid-August Iraqi Army enters Khanaqin district; standoff with Kurdish Peshmerga ensues

Note: This timeline highlights selected major events during 2006−2008.

Source: SIGIR analysis of GOI and U.S. government documents and open-source information in Arabic and English.

Munitions seized from insurgents in Diyala. IraqiArmysoldieronpatroloutsideBa’quba. SOI checkpoint in Diyala. (USF-I photo) (USF-I photo) (USF-I photo) Iranian-made weapons, suggesting that Sunnialliesabandoningthemandbegin- remnants from farming communities Iraq’seasternneighborwassupplying ningtoprovideintelligenceandotheras- andsmalltownsintheDiyalavalley.In Shia militia operating in Diyala.198 sistancetotheU.S.military.Thesecollec- contrast to previous operations, which OnJune19,2007,U.S.andISFunits tionsofconcernedlocalcitizensincluded sweptthroughtheseareaswithout began Operation Arrowhead Ripper the Ba’quba Guardians, a U.S.-backed leavingbehindapermanentsecurity toclearBa’qubacityanditsenvirons. groupformedinJuly2007toprovidese- presence, U.S. and ISF units began estab- Although fighting continued throughout curityintheprovincialcapital.Eventually, lishingoutpostsinseveraloutlyingcom- thesummer,Ba’qubawasmostlysecure manyofthesegroupswouldbefinancially munities.200 Figure D.3 compares AQI’s byAugust,asU.S.forcespushedAQIout supportedbytheU.S.militaryviathe presence in Diyala in December 2006 to ofthecityandintothehinterlands.By Sons of Iraq (SOI) initiative.199 itspresenceinMarch2008. mid-year,AQI’sreligiousextremismand In 2007 and 2008, tensions grew brutal tactics, along with an increasingly Precarious Stability: 2008–2011 betweenDiyala’sShiaprovincialpolice assertive Coalition military presence, In 2008, Coalition military operations chief,Ghanemal-Qurishi,andthe contributedtomanyofAQI’ssecular in Diyala emphasized clearing AQI mostlySunniSOI.Thisconflictcameto

JULY 30, 2011 I REPORT TO CONGRESS I 49

July2011.indb 49 7/25/2011 10:37:54 AM FOCUSONDIYALA

Figure D.3 Al-Qaeda in Diyala Province, 2006 vs. 2008

Kirkuk Kirkuk December 2006 March 2008

Tikrit Tikrit

Samarra Samarra

Ba’quba Ba’quba

Ramadi Ramadi Diyala Province Diyala Province Falluja Baghdad Falluja Baghdad

KEY KEY Isolated Heavy Isolated Heavy Pockets Concentration Pockets Concentration

Source: MNF-I, Charts to accompany the testimony of General David H. Petraeus, before the Senate Armed Services Committee hearing, “On the Situation in Iraq and Progress Made by the Government of Iraq in Meeting Benchmarks and Achieving Reconciliation,” 4/8/2008, slide 8.

Figure D.4 Diyala officials expressed grave con- Sons of Iraq in Diyala Province Breakdown of SOI Personnel cernstoSIGIRinJulymeetingsaboutthe Beginning in October 2008, the Government of Iraq (GOI) securitysituation.Theprovince’schief progressively assumed full management responsibility for the Sons prosecutor remarked that every time he of Iraq (SOI) program from Coalition military forces, taking control of more than 8,600 Diyala personnel on January 1, 2009. Under the stepsoutsidehishouse,it“isawalkinto terms of an agreement with the Multi-National Force-Iraq, the GOI the unknown:”203 promised to provide government employment for all 95,120 SOI members, either in the security ministries (Interior and Defense) or There isn’t anything that makes me elsewhere. A SIGIR audit released in January 2011, however, 9.1% hopeful.Ifanything,I’mcynical.As reported that meeting this goal has been challenging. As of long as sectarianism still exists it will killallhopeandoptimism,andfearwill December 2010, about 42% of all SOI personnel had been Total SOI force strength reign.Asacountry,weneedsecurity. transferred to GOI jobs—but only 463 (5.3% of all SOI transferred) Diyala personnel, as of 4/2009 were from Diyala province. We’vegoneback100years.Theother countriesoftheregion—oncehavingonly Source: SIGIR Audit 11-010, “Sons of Iraq Program: Results are Uncertain and Financial Controls Were Weak,” 1/28/2011. sand—arethrivingtoday...andlooklike Europeancities.AllwewantinIraqisto aheadinAugust,whenspecialsecurity aprovincialgovernmentbuilding.At be stable enough to start catching up.204 unitsfromBaghdadraidedtheBa’quba least9peoplediedintheattackand government center, arresting pro-SOI/ about17werewounded.Twoweeks Future of U.S. Presence anti-Qureshi officials after a firefight later,Ba’quba’smayorwasinjuredwhen Whiletheprovincialofficialswhospoke with the center’s guards. The ISF remains an improvised-explosive device deto- to SIGIR expressed mixed feelings about reluctanttointegrateDiyalaSOIintoits natednearhisconvoy.Inthewakeof theplanneddepartureoftheU.S.troops units (see Figure D.4 for information on these attacks, several Diyala officials an- currentlystationedinBa’quba,theywere theSOIprograminDiyala).201 nouncedtheirintentiontoavoidprovin- unanimousintheirwishfortheUnited Although the security situation in cialgovernmentfacilitiesandconduct States to maintain some presence in Diyalahasimprovedsince2008,the theirworkelsewhereuntilthesecurity theprovinceafterDecember2011.One province remains one of Iraq’s most situation had improved.202 Figure D.5 DiyalaofficialtoldSIGIRthat,“ifthe volatile.OnJune14,2011,multiple listssignificantrecentsecurityeventsin UnitedStatespullsoutallits[civilianand suicidebombersandgunmentargeted Diyala province. military] personnel from the province,

50 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 50 7/25/2011 10:37:54 AM FOCUSONDIYALA

Figure D.5 Selected Incidents of Violence in Diyala, 4/10/2011−7/10/2011 April Wednesday, April 13: Local government official wounded by IED in Ba’quba Thursday, April14: Police spokesman survived bomb attack on his residence in Ba’quba Thursday, April 28: Suicide bomber attacked Shia mosque in Baladrooz, killing 8 and wounding about 18 Friday, April 29: Imam of a mosque in Khanaqin killed with his family by gunmen; 4 Awakening members killed in armed attack on a house south of Ba’quba May Friday, May 6: Bodyguard of Awakening sheik stabbed to death south of Ba’quba Saturday, May 7: 10 police officers wounded in car bomb attack in Ba’quba; 5 killed and 3 wounded in attack on money exchange in Ba’quba Wednesday, May 25: Ministry of Oil official killed by gunmen in Khanaqin SIGIRDeputyInspectorGeneralmeetswithDiyala Saturday, May 28: 2 attacks (IED and grenade) killed 1 civilian and wounded 3 police officers in Ba’quba ofﬁcials. June Tuesday, June 7: Police chief of Hibhib, a small town west of Ba’quba, killed by sticky bomb detonation Governance Saturday, June 11: Retired IA officer and his son killed by sticky bomb detonation in Khanaqin Relationsbetweentheprovincialgovern- Tuesday, June 14: Suicide bombers and gunmen attacked Diyala provincial government complex in Ba’quba, killing 2 police officer and wounding more than 20 others ment and Baghdad remain somewhat Saturday, June 18: Bomb killed 3 in Ba’quba Sunday, June 19: Sticky bomb explosion in Ba’quba killed 1 and injured 3 contentious.Thisquarter,Diyala’sgover- Monday, June 20: Mayor of Judeidat al-Shat, a small town north of Ba’quba, killed by gunmen who attacked his residence northreatenedtoresigniftheGOIfailed Sunday, June 26: Suicide bomber kills police chief near Ba’quba Tuesday, June 28: Mayor of Ba’quba survived IED attack on his vehicle to release certain detainees and accede to July hisdemandsonothersecuritymatters.207 Monday, July 4: Official from the Patriotic Union of Kurdistan party shot and killed northeast ofBa’quba Wednesday, July 6: VBIED attack in Ba’quba killed 2 police officers and wounded 19 other people AsofJuly10,however,hehadnotfol- Thursday, July 7: IED exploded near a butcher shop west of Ba’quba, wounding 3 lowed through with his threat. Saturday, July 9: Booby-trapped motorcycle exploded in Ba’quba, wounding 15

Note: The security incidents cited above are intended to provide a sense of the types of violence occurring in Diyala province. This is not intended to be a comprehensive list of all security incidents. Provincial Elections,

Source: SIGIR analysis of open-source Arabic- and English-language documents, 4/2011–7/2011. 2005 and 2009 In2005,awidespreadboycottbymost SaddamHusseininhiswarsagainstIran SunniArabpoliticalpartiesofIraq’sfirst andtheU.S.-ledCoalitionandwereplaced post-2003 provincial elections resulted ontheU.S.DepartmentofState(DoS) inacoalitionofShiapartieswinning list of Foreign Terrorist Organizations. In almost50%ofthe41seatsonDiyala’s mid-2004, Coalition forces granted the Provincial Council, despite Shia number- camp’sresidentsprotectionunderinter- ingonlyaboutone-fourthoftheprov- national law, on the condition that they ince’spopulation.TheonlymajorSunni relinquish their arms. Arab party participating in the 2005 OnJanuary1,2009,theU.S.military provincialelectionsinDiyala,theIraqi

ISFandSOIofﬁcialsconferataU.S.baseinDiyala. transferred control of Camp Ashraf and IslamicParty,won14seats.AKurdish- (USF-I photo) itsapproximately3,400residentstothe ledblocwontheremaining7seats.Thus, itwillbeaverybigmistake.”Diyala GOIontheunderstandingthatthese SunniArabs,whocomprisemorethan officials cited the simmering religious protections would continue. However, one-half of the province’s population, andethnictensions—betweenSunni ISF units have entered the camp on at heldonlyaboutone-thirdoftheseatson and Shia, and Arabs and Kurds—and its least two occasions since January 2009, the Provincial Council. After the 2005 strategiclocationontheIranianborder andeachencounterresultedinmultiple elections, council members chose as astworeasonsweighinginfavorofacon- deaths.Mostrecently,anISFincursionin governorRa’adHameedal-MulaJowad tinued U.S. presence in the province.205 earlyAprilresultedinthedeathsofmore al-Tamimi,aShiaArabaffiliatedwiththe than30campresidents.AU.S.congres- partynowknownastheIslamicSupreme Camp Ashraf: A Lingering Issue sional delegation attempted to visit Camp CouncilofIraq.208 Locatednortheastofthetownofal-Kha- AshrafduringaJune2011triptoIraq,but Four years later, Sunni Arab turnout lis, Camp Ashraf has housed members of wasnotgrantedGOIpermissiontotravel increased dramatically, resulting in two the Iranian Mujaheddin e-Khalq (MeK) there.CurrentGOIplanscallforshutting Sunni Arab-led parties finishing first (alsoknownasthePeople’sMujahed- down Camp Ashraf by the end of the year andsecondinDiyala’s2009provin- dinOrganizationofIran)formorethan andrelocatingtheMeKelsewhere,either cial elections. The United Accord and twodecades.TheMeKfoughtasalliesof inIraqoranothercountry.206 ReformFrontinDiyalaandtheNational

JULY 30, 2011 I REPORT TO CONGRESS I 51

July2011.indb 51 7/25/2011 10:37:56 AM FOCUSONDIYALA

IraqiProjectcombinedtowin15ofthe Council of Representatives exports. However, the Chamber 29seatsonthenewlyreduced-in-size In the March 2010 national parliamentary reported that its operations have been Provincial Council. The council subse- elections,formerPrimeMinisterAyad somewhat impeded by the Ministry of quently elected as governor Abdul-Nasser Allawi’sal-Iraqiyablocwon8ofDiyala’s Interior’sseizureofhalfofitshead- al-Mahdawi,aSunni.209 Figure D.6 13 seats, with about 60% of eligible voters quarters building. compares the approximate Shia, Sunni, casting ballots. The Shia-dominated Iraqi • Provincial Investment Commission andKurdishpopulationsin2005and National Alliance finished second, win- (PIC). Beset by political infighting 2009 with the percentage of council seats ning3seats.TheKurdistaniAllianceand from its inception more than two wonbyeachcommunity. PrimeMinisterNurial-Maliki’sStateof yearsago,thePICisstrugglingtogain Lawcoalitioneachwononeseat.210 afootholdintheprovinceandhasnot Figure D.6 receivedanyfundsfromtheMinistry Council Seats Won in Diyala, of Finance. The nine commission- 2005 vs. 2009 Economic Development ers who lead the PIC have not been Diyala AccordingtoDiyalaofficialsandcommu- paid,andtheycurrentlyoperateout 80% nity leaders with whom SIGIR met in early ofarentedhouse.TheU.S.Provincial 70% July2011,theprovincialeconomyisone Reconstruction Team (PRT) in Diyala 60% of the worst-performing in Iraq. Diyala ishelpingthePICfindapermanent 50% officialsestimatedunemploymentatabout headquarters.

40% two-thirds of the working-age population.

30% Theprovincialeconomyrunsadeficit, Agriculture producinglittlethatcontributestothe Diyala contains about 10% of all arable 20% nationalcofferswhiledrawingabout land in Iraq, and its agricultural sector 10% 0% $120millionannuallyfromBaghdadfor isthemainsourceofemploymentinthe Shia Sunni Kurd Other payrollandstipends.Diyalaofficialshave province,providingroughly70%ofall 2005 Election Results 2009 Election Results chieflyascribedthepoorperformance nongovernmentjobs.Primarycropsin- % of Province Population oftheeconomytothenearanarchythat cludedates(ofwhichtherearemorethan characterizedtheprovincebefore2008. 72localvarieties),citrusfruits,seasonal Sources: UNAMI, Elections Results, Issue No. 30, 2/2009; GOI, IHEC, www.ihec.iq/arabic, SIGIR translation, Officials added that although some vegetables(suchaseggplantsandpep- accessed 2/22/2009; U.S. Embassy-Baghdad, response to 214 SIGIR data call, 4/2/2009. progresshasbeenmadeinthepastthree pers), wheat, barley, grapes, and figs. years,securityintheprovincehasdeterio- UndertheOttomanEmpire,most ratedinrecentmonths,placingeventhat farmland in Diyala was registered to fragile progress at substantial risk.211 The tribal collectives. Today, farms are held uncertain security environment in Diyala underavarietyofdifferenttypesofdeeds, hasdissuadedforeigncompaniesfrom including private, tribal, government- committing resources to the province. ownedand-operated,andgovernment- Onestudyconcludedthatlessthan1%of owned but provided to businesses or all foreign commercial activity in Iraq last citizensforcommercialexploitation.This yearoccurredinDiyala.212 complicatedsystemoflandownership isjustonefactoraffectingthedevelop- Provincial Investment Promotion ment of Diyala’s farming sector. Other Diyala has two main investment-promo- challenges include low rainfall, which tion organizations operating to improve averages about four inches per year; its economy:213 poorlymaintainedirrigationcanals;lack • Diyala Chamber of Commerce. With of fertilizer; limited refrigerated-storage amembershipofabout5,000,the facilities;andpoorroadnetworks.215 Chamberisthelargesteconomicdevel- Mostofthewaterusedforfarming opment organization in the province, comesfromtheDiyalaRiver,which assisting businesses in obtaining loans, flows from Iran, through the Kurdistan Residentsofal-KhalisconferwithISFofﬁcialsabout insurgent attacks. (USF-I photo) monitoring inflation, and promoting Region,intotheprovince.Accordingto

52 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 52 7/25/2011 10:37:56 AM FOCUSONDIYALA

Diyala ofﬁcials open the annual date festival in JointU.S.-ISFpatrolsneartheDiyalaRiver. U.S.patrolencounterscattleinruralDiyala. Ba’quba. (USF-I photo) (USF-I photo) (USF-I photo) theprovincialDirectorGeneral(DG) open in the province because they would Diyala lacks the large oil fields found ofWaterResources,“amountsreleased have better technical infrastructure and inprovincestoitsnorthandsouth,fur- fromIranaretotallyarbitrarybecause more experienced staff.218 thercontributingtoitsrelativeimpov- there are no agreements between the Banks do make loans available to erishment. Most of Diyala’s modest oil twogovernments.”TheKRGalsodams Diyala residents, albeit in limited fashion. depositsarelocatedinthenorthernarea thewater,furtherlimitingtheprovince’s The GOI Real Estate Bank offers 20-year oftheprovince.NaftKana,thelargest supply.“Asaresult,wecan’tplanany- loans for homes at 2%, while Rafidain field,producesabout16,000barrelsper thing,” the DG said. offers 15-year loans at 8%. For those who day,muchofwhichisshippedtoBagh- Studiesonundergroundwater followIslamiclaw,whichprohibitsthe dadbytruckforrefining.Accordingto sourceshavefoundthatwatertablesare paymentofinterest,theGOIisexploring PRTDiyala,theoilsectorprovidesabout between60and360feetdeep,buttheir theestablishmentofIslamicbanks.Prime 32,000 jobs in Diyala.222 high salinity and sulfur levels render Minister al-Maliki also recently set up a themunusable.Asaconsequence,many fund that provides five types of no-interest Industrial Activity people unable to sustain their farms are loanstofarmers.ButDiyalaofficialsnoted AccordingtoPRTDiyala,largebusi- migratingtothecitiesandjoiningthe thatthereisnooversightoftheseloans nesses operating in the province (those ranks of the unemployed. The DG said after the money is lent.219 with more than 100 employees) provide hisofficeistryingtoadoptnewirrigation jobsformorethan11,000individuals.223 technologies such as drip irrigation with Natural Gas and Oil Many of Diyala’s largest firms, however, assistancefromPRTDiyala,butstated On June 5, 2011, the Ministry of Oil final- are not operational. Cheap imports have that the challenges are still vast.216 izeda20-yearcontractwithaTurkish-led caused several food-processing plants OnJuly9,residentsofKhanaqincon- consortium to develop the Mansuriya to cease operations, as their products ductedaprotestmarchagainsttheIranian naturalgasfield,locatedabout50kilome- werepricedoutofthemarket.Politics government’sdecisiontointerruptthe ters northeast of Ba’quba, near the Iranian also plays a role. For example, al-Khalis downstreamflowofwaterinoneofthe border.Thefieldisestimatedtobecapable MedicinalAlcoholPlantliesidlebecause DiyalaRiver’stributaries.Accordingtothe ofproducingabout320millioncubicfeet theGOIhasdeniedtheownersfinanc- chairman of Diyala’s Provincial Council, of gas per day. As part of the deal, Turkey’s ing, citing their close association with the localofficialslodgedaformalcomplaint state-ownedoilandgascompany(TPAO) former Ba’athist government. Table D.1 with Baghdad about this matter in May, willcontribute50%oftheinvestment summarizesthecurrentstateofDiyala’s but did not receive a response.217 needed to exploit this field, the Kuwait large businesses.224 Energy Company will contribute 30%, Banking and the Korean Gas Corporation will pro- State-owned Enterprises: Thebankingsectorisamajorcomponent vide the remaining 20%. Production is not ACaseStudy oftheprovincialeconomy,butit,too,is estimatedtocomeonlineuntil2015.220 The largest state-owned enterprise (SOE) strugglingtoaddressmultiplechallenges. The Ministry of Oil announced plans to operatingintheprovinceistheDiyala Thereareonly11branchesofthegovern- conduct its fourth hydrocarbon licensing StateCompanyforElectricalIndustries ment-owned Rafidain and Rashid banks roundinearly2012,whichwouldincludea (DEI).Establishedin1977,thecompany foraprovinceofmorethan1.6million largenatural-gasexplorationsitethatruns began producing a variety of small people.TheDiyalaSupervisorofBank- from southern Diyala under the inter-pro- consumerandindustrialgoodsinthe ingstressedtheneedforprivatebanksto vincialborderintonorthernWassit.221 early1980s.Employingmorethan3,500

JULY 30, 2011 I REPORT TO CONGRESS I 53

July2011.indb 53 7/25/2011 10:37:57 AM FOCUSONDIYALA

Table D.1 Figure D.7 StatusofMajorCompaniesin Small and Medium-sized Businesses in Diyala and Nationwide, by Sector Diyala, 7/2011 Agribusiness Total Diyala Status Business Name Employees Construction Iraq

Currently Operating Manufacturing

Diyala State Company Professional Services forElectricalIndustries 3,500 (51% private, 49% Wholesale, Retail Trade public) Transport and Storage Baladrooz Brick Plant 2,000 (100% public) Hotels, Restaurants and Tourism Khan Bani Sa’ad Silo 270 Communications (100% private) New Baghdad Brick Electricity, Gas, Oil 240 Factory (100% private) 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% Not Operating Source: USAID, Tijara, “Market Assessment: Business Constraints and Opportunities at the Business Enabling Environment Dehliki Food and Firm Levels for the Province of Diyala, Iraq,” 3/2010, p. 33. Processing Plant 1,500 (100% private) workers,thecompanymakessparkplugs, Al-OuryFoodProcess Plant (Ba’quba) (100% 1,500 waterheaters,electricaltransformers, private) ovens,andceilingfans,whichitsellspri- Nassim al-Baradi marily to various GOI ministries.225 Date Processing Plant 1,000 (privately owned by Although the security situation caused Jordanian interest) ittoceaseoperationsforatimein2007,its Al-Muqdadiya Milk 300 Factory (100% private) majorproblemsarenowmoremundane andmorepersistent.Irregularpowersup- Al-Khalis Medicinal Alcohol (51% public, 210 pliesoftendisruptproductionlines,and 49% private) modern management methods remain Khan Bani Sa’ad Water 200 Bottling Plant (n/a) largelyunknown.Moreover,theglobal Ba’qubabusinessdistrict. Baladrooz Water economic downturn of 2008 stymied businesses, comparing them with the 200 Bottling Plant (n/a) efforts to attract foreign investors, causing rest of Iraq.228 Al-Muqdadiya Chicken 100 an Egyptian-Jordanian consortium to Although they pre-date American Factory (n/a) back out of its initial commitment to pur- mallsbymillennia,suqs serve much Source: PRT Diyala, “Diyala Provincial Business and 226 Investment Organizations” (draft), 7/2011. chase51%ownershipinthecompany. thesamefunction,bringingtogethera Notwithstanding these challenges, PRT widevarietyofcommercialenterprises DiyalareportsthattheGOIrecentlyor- andserviceprovidersinonelocation.In deredmorethan$20millionofelectrical Diyala,about50%ofallsmallbusinesses transformers from DEI.227 are housed in suqs,asaretheofficesof many doctors, lawyers, and other profes- Small and Medium-sized Businesses sionals.Cognizantoftheirimportance WhilelargeSOEsdominatedmuchof tothelocaleconomy,AQIconducted Iraq’spre-warcommandeconomy,the operationsoutofbaseslocatedinside pasteightyearshavewitnessedtherise the suqs, which consequently suffered of smaller, independent businesses. More significant damage when U.S. and Iraqi than70%ofsmallandmedium-sized forcesconductedclearingoperations businesses in Diyala have been estab- aimedateliminatingtheseterroristnests. lishedsince2003.Ofthese,45%operate TheArubaSuqinal-Muqdadiya,Diyala’s in the trade sector, selling consumer largest market, suffered extensive dam- goodsorotherproductsoutofsuqs (Ara- ageasaresultofsuchoperations.229 Table bic for markets) or small shops. Figure D.2summarizesU.S.-fundedeffortsto Worker moves sheet metal at the Diyala State Electrical Company. (USF-I photo) D.7showsasectorbreakoutofthese refurbish Diyala suqs.230

54 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 54 7/25/2011 10:37:57 AM FOCUSONDIYALA

Table D.2 U.S.-funded Support for Diyala Suqs %of Provincial Number of Name Business Shops Assistance 2,500 Former headquarters of AQI in Diyala and a Aruba (al-Muqdadiya) 16 (200 open) major Coalition rehabilitation project Several Coalition projects have focused on West Ba’quba 10 1,500 rehabilitating this market CSP is rehabilitating this market and Khan Bani Sa’ad 10 1,500 coalitionforceshaveprovidedroughly SIGIRofﬁcialsmeetwithDiyalaChiefJustice. $400,000 in microloans Baladrooz 7 75 Rehabilitated by Coalition forces theentireprovincialeconomy.Several Old Ba’quba 3 600 n/a officialsmentionedsectarianismasone I-CERP funds are currently being used to Al-Khalis 2 500 factor contributing to corruption, as un- rehabilitate this market qualifiedgovernmentofficialsusetheir Abu Sayda 2 500 CSP project submitted positionstoadvancethefinancialand Buhritz (Ba’quba) 1 250 Received some Coalition funding Al-Mulameen political interests of themselves and their 1250n/a (al-Muqdadiya) particular affiliations.234 Hibhib 0.5 150 CSPprojectsubmitted AccordingtoCommissionofInteg- Udain (1) 0.5 150 CSP project submitted rity(COI)officials,GOIanticorruption Udain (2) 0.3 75 Rehabilitated by Coalition forces agencies in Diyala focus their efforts on Khanaqin 0.3 75 n/a the capital, and they often lack the will Mandali 0.25 65 n/a andthemeanstocarrytheiroversight Source: PRT Diyala, “Overview of Major Suqs in Diyala,” 7/2011, pp. 35–36. to the provinces. They cited inadequate Rule of Law in May 2011, suggesting that the police resources—suchascars,personnel,office Citing recent increases in the overall arenowlesslikelytoroundupsuspects equipment, and funding—and pressure number of convictions, the province’s and detain them without conducting a from local officials and religious leaders chiefjudgeandchiefprosecutortold proper investigation.232 However, the chief as factors inhibiting their efforts.235 SIGIR that the Diyala judiciary, though prosecutor voiced concern over the quality FromJanuary1toMay31,2011,the facing profound challenges, is improving of some police. He said that these officers, COI reportedly referred 186 suspects itsperformance.Thechiefprosecutor drawnfromarmybackgrounds,haveless from Diyala to investigative judges noted that the magnitude and complexity respectforcourtorders.Thechiefprosecu- (IJs)forfurtheraction:139(75%)were ofcasesisthemainproblemfacingDiyala tor added that sometimes these problematic accused of violating Article 240, which judges. He stated that about 70% of recent officers will not release a prisoner despite a criminalizes the disobeying of direc- convictions involved terrorism matters. judge’sruling,whileothertimestheywill tionsgivenbyapublicofficial,and36 He said that, “before 2003, the worst case notarrestsomeoneeventhoughthecourt (19%)wereallegedtohaveusedforged wehadwasahomicidecase,”adding issuedavalidwarrantforthatperson’sde- educationalorprofessionalcertificatesto that,“backthen,wehandledabout175 tention. He also noted that there continue obtain employment or promotion. Thus, casesperyear.…Lastyearwehandled tobesomeilliteratepoliceofficerswho 94%oftheCOIcasessenttoIJsduring 880cases.”Inlookingaheadtotherest cannot perform basic job functions.233 that period involved relatively minor of2011,hesaidthatthecourtisontrack allegations,andnocasesinvolvingsenior to handle even more cases than in 2010, Corruption Diyalaofficialshadbeenforwardedfor having opened more than 500 new cases Diyala provincial government officials adjudication.236 betweenJanuaryandJuneofthisyear.231 described corruption in the province asrampant,notingthatpositionsthat Police should be occupied by skilled technocrats Living Conditions Accordingtothechiefjudgeandchief areinsteadfilledwithpatronageappoin- In meetings with SIGIR, Diyala officials prosecutor, the Iraqi police in Diyala tees whose loyalties lie with politicians expressedapervasivesenseofpessimism areimproving.Theycitedadecreasein inBaghdad.Sincegovernmentjobsare aboutthefutureoftheprovince.Asone thenumberofpre-trialdetaineesfrom oftentheonlyemploymenttobehad, governmentofficialsaid,“Ourfathers 2,500inNovember2010toaround1,200 corruptioninthepublicsectoraffects livedbetterthanwedid,andtheliveswe

JULY 30, 2011 I REPORT TO CONGRESS I 55

July2011.indb 55 7/25/2011 10:37:57 AM FOCUSONDIYALA

Figure D.8 powersituationimprovedsignificantly, Popular Dissatisfaction with Services Poverty in Diyala, by District, withtheloadservedbythenationalgrid Arecentsurveyof3,223Diyalaresi- 6/2011 increasing from 62% of estimated demand dentsconductedbyAl-NoorUniversal 0–15% 15–25% to 98%. But the situation began deteriorat- Foundation found widespread dissatis- 25–35% 35%+ ingin2010,andthisquarter,onlyabout factionwiththeprovisionofgovernment Kifri 65%ofestimateddemandwasserved:239 services. Only about 11% of respondents 98% characterized services as either good or 2009 Q4 Khanaqin verygood,while48%chosethelowest Al-Khalis possible descriptive category—bad—to Al-Muqdadiya describethestateofpublicservicesinthe

65% province.Respondentscitedfivemain 2011 Q2 244 Ba’quba 59% reasonsforpoorservices: Baladrooz 2007 Q2 • unstable security situation Whilesomeofthisdecreaseisattribut- • lack of government oversight able to increased demand during the •lowlevelsofcivicpride

Note: Data reflects the percentage of households reporting summer months and the proliferation • inadequate transparency and average expenditures in the lowest quintile, as measured nationally by the UN. of electronic devices, the percentage of accountability demandmetisthelowestithasbeenfor • sectarianism among government Source: IAU, “Diyala Governorate Profile,” 6/2011, www.iauiraq.org/gp/print/GP-Diyala.asp, accessed 6/27/2011. this period since 2007.240 officials have lived, as difficult as they have been, Diyala’s only indigenous power-gen- When asked whether services had theyarebetterthanthelivesourchildren erationcapacityisattheHimreenDam, improved over the past year, 14% said will lead.” These officials noted that with production this quarter averaging that they had, while 79% said they had DiyalaremainsdependentonBaghdad amodest12megawatts(MW).Thebulk remainedthesameordeteriorated.Dis- for jobs, subsidies, and other assistance, of the power consumed in Diyala is im- satisfactionovercleanliness,healthcare, andremarkedthateventheagricultural ported from Iran.241 The GOI’s Ministry education, public works, and availability sector—oncethedrivingforcebehind ofElectricitycurrentlyisintalkswith of fuel was voiced by 65%–80% of all theprovincialeconomy—isstagnantand theFrenchcompany,Alstom,about respondents;lackofpowerwascitedasa underperforming.237 building a 720 MW combustion-turbine problembymorethan82%.245 plantinMansuriya.242 Poverty Displaced Persons A 2009 GOI study listed Diyala as one Drinking Water AccordingtoPRTDiyala,morethan of Iraq’s five least-developed provinces, Diyala’s main water sources do not meet 60,000formerresidentsofDiyalaare alongwithMuthanna,Thi-Qar,Mis- theprovince’sneeds.Downstreamflows stilldisplaced,livingmostlyinBagh- san,andQadissiya.Anestimated33%of fromtheTigrisRiverandsmallerrivers dad, Najaf, Kerbala, and Sulymaniyah Diyalaresidentshaveincomesbelowthe originatinginIranandtheKurdistan provinces. In June 2011, the UN report- nationalpovertylineofabout$2.20per Region are insufficient supplements ed that 8% of Iraq’s internally displaced day, compared with a national average of totheprovince’smaindrinking-water persons(IDPs)resideinDiyala,making 23%.238 AsFigureD.8shows,thepoverty source, the reservoir formed by the itoneoftheprovincesmostaffected levelisgreatestinthewesternpartsof HimreenDam.TheUNreportsthat by the intercommunal violence that theprovinceandintheruralsouthern morethan40%ofallDiyalaresidents district of Baladrooz. suffer from the irregular availability of drinking water, a figure that rises to Electricity 74%inal-Muqdadiyadistrict.Moreover, Like most of Iraq, the estimated de- approximatelyhalfofallhouseholdsin mand for electricity in Diyala province al-Muqdadiya(47%),Kifri(53%),and outstrips the available supply, leading to Baladrooz(40%)districtsdrinkwater persistent power shortages, especially in directlyfromastream,river,orlake,al-

thehotsummermonths.Frommid-2008 though bottled water is readily available U.S.troopsconferwithlocalcitizensinDiyala. throughtheendof2009,theprovince’s in most cities and towns.243 (USF-I photo)

56 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 56 7/25/2011 10:37:58 AM FOCUSONDIYALA

Figure D.9 Figure D.10 Where IDPs Take Refuge, by District U.S.-funded Infrastructure Projects in Diyala Province, Kifri by Category and Fund, as of 9/2010 Al-Muqdadiya 204 % of $954.17 Million 9,456 0.2% Baladrooz Security & Justice ($280.54) 11,220 8.2% ISFF Defense Forces ($161.80) 9.7% Public Works & Water ($152.79) ISFF Interior Forces ($94.61) Khanaqin 12.1% 53.6% Ba’quba 14,035 62,128 Electrical ($94.57) Peacekeeping ($54.83) ESF $20.93 16.2% Health ($28.90) ISFF Al-Khalis Education ($28.59) $256.41 18,773 IRRF Transportation ($23.05) $409.92 Buildings ($12.66) Source: IAU, “Diyala Governorate Profile,” 6/2011, www.iauiraq.org/gp/print/GP-Diyala.asp, accessed 6/28/2011. Private-sector Development ($10.55) Communication ($4.28) CERP $266.91 followed the bombing of the Samarra Oil ($3.75) mosqueinFebruary2006.OfallDiyala International Development ($3.24) IDPs,83%originallyresidedwithinthe 0% 5% 10% 15% 20% 25% 30%

province.AsFigureD.9shows,more Note: Numbers affected by rounding.

than half of Diyala IDPs have taken Source: IRMS, Global Benchmark, 9/3/2010. refuge in Ba’quba district.246 During August–September 2008, U.S. Reconstruction Program • providing an $80,000 procurement more than 40,000 IDPs and refugees AccordingtoPRTDiyala,since2003,the grant to fund start-up costs associated returned to Diyala province. The rate of U.S.governmenthasspentmorethan with the establishment of the Diyala return dropped sharply after that, and $1.05 billion on infrastructure projects Economic Development Center in inApril2011,theUNreportedonly in Diyala province, or about $642 per December 2009.252 1,810 returns:247 resident.249 FigureD.10showsU.S.expen- USAIDisalsoworkingwithPRTDiyala 20,740 ditures in Diyala by project category and to establish the Diyala Small Business 8/2008 fund,basedoninformationprovidedin Development Center (SBDC). Plans for

13,840 September2010,bytheIraqReconstruc- this new organization are in the early 7/2008 tion Management System (IRMS). stages,andwhileUSAIDhasobtaineda building for the SBDC, it has not received USAID Operations in Diyala any funding to support it.253 1,810 4/2011 USAIDreportsthatitsInma agribusi- nessprogramhassupportedanumberof OtherU.S.ReconstructionEfforts In2009,theGOIcreatedaHigher initiativesinDiyalaprovince,including:250 InOctober2010,theU.S.ArmyCorpsof CommitteetoassistDiyalainestablishing •importingcommerciallytestedfruit Engineers(USACE)completedworkon theconditionstoenticedisplacedpersons treesandgrapevinestoenhancethe a$10.7millionregionalcommandobase to return to their homes. The Diyala qualityoflocalorchardsandvineyards inBa’qubafortheIraqiSpecialOpera- Initiative focuses on improving public ac- • supporting a microfinance lending tionsForces.ThisIraqSecurityForces cess to water, electricity, food, shelter, and institution that, to date, has disbursed Fund (ISFF) project was USACE’s largest infrastructure. The initiative is supported more than 300 loans valued at $976,200 reconstructioninitiativeinDiyala.Other bytheUNandtheU.S.government,with in the province significant USACE reconstruction proj- theU.S.AgencyforInternationalDevel- • providing training in a variety of ectscompletedinDiyalainclude:254 opment(USAID)andPRTDiyalaassist- specialized areas, including irrigation, • a $6.8 million, ISFF-funded location- ing in the implementation of governance livestockhusbandry,financialmanage- commandfacilitytosupportarein- andagriculturalprograms.AsofJanuary ment,andstrategicplanning forced Iraqi Army battalion stationed 2011,theGOIhadpaidalmost$30million • supportingtwomicrofinanceinstitu- in Baladrooz to compensate Diyala residents for dam- tionsinDiyalaprovince—al-Thiqaand •a$1.7million,IRRF-fundedprimary age caused by violence.248 al-Amman.251 healthcare center in al-Atheem

JULY 30, 2011 I REPORT TO CONGRESS I 57

July2011.indb 57 7/25/2011 10:37:58 AM FOCUSONDIYALA

TheDoSIraqStrategicPartnershipOffice reportedthecompletionoftwoprojects inDiyalasinceJuly2010:255 • Ba’quba General Hospital Surgi- calHealthCenter.Financed by the IraqReliefandReconstructionFund (IRRF)andexecutedbyUSACE,this $8.7 million project expanded the Ba’quba General Hospital’s surgical War-damaged Diyala suq. Diyala suq refurbished with U.S. assistance. health center. This three-story facility center includes a 50-bed intensive-care unit,20emergency-roombeds,and surgicalandtraumaoperatingrooms. • Baghdad-Kirkuk Carriageway South. This roadway-improvement projectrunningthroughDiyalawas executedbytheMinistryofConstruc- tionandHousingusingan$11.3mil- lion IRRF grant. ISPO reported that the only remaining projectitoverseesinDiyalaisanassess- KhanBaniSa’adisstilllyingunusedandincomplete.ThereissomediscussionamonglocalIraqiofﬁcials 256 mentoftheKhanBaniSa’adprisonsite. thattheMOJmayturnitintoaworkingfacilitysomeday.However,asofJuly2011,theMOJhasonlyposteda fewsecurityguardsatthesite,mostofwhomrarelyreporttowork.(USACEphoto) SIGIR Oversight remainingworkontheprojectafter as“abandoned”whenthecontractwas In2004,theCoalitionProvisional investing approximately $40 million of terminatedweremissingfromthesite. AuthorityissuedataskordertoParsons theIRRF.Twomonthslater,USACE InJuly2011,GOIofficialsinDiyala Delaware,Inc.(Parsons),todesignand unilaterallytransferredtheprisontothe province informed SIGIR that the cor- construct the 3,600-bed Khan Bani Sa’ad GOI,althoughtheMinistryofJusticehad rectionalfacility,whichlocalsrefertoas Correctional Facility in Diyala prov- informed USACE representatives that it “thewhale,”remainedidle.258 ince. In June 2006, the U.S. government would not “complete, occupy, or provide Thisquarter,ISPOreportedthatit terminated the contract for default on security” for the facility.257 isstudyingthecurrentstatusofthe thepartofParsons,leavingthefacility InJune2008,SIGIRinspectedthe prisonsitetoconfirmpreviousassess- partially completed. Subsequently, the prison, finding construction deficiencies, ment results and assist in preparing an U.S. government awarded three suc- generally poor workmanship, and poten- estimateofhowmuchitwouldcostto cessor contracts to complete the work. tially dangerous conditions. SIGIR also renderthefacilityuseable.Thestudywill In June 2007, the U.S. government, determinedthatmostofthe$1.2million alsoexploreGOIinterest,ifany,inusing citingsecurityreasons,terminatedall inmaterialsthatthecontractorreported the site.259 ◆

58 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 58 7/25/2011 10:37:58 AM DEVELOPMENTS IN IRAQ

Governance 60

Security 70

Rule of Law 77

Economy 85

Public Services 94 4section

July2011.indb 59 7/25/2011 10:37:59 AM DEVELOPMENTS IN IRAQ

GOVERNANCE

The100-daydeadlineforimprovedministerialper- formance set by Prime Minister Nuri al-Maliki in February passed on June 7 without any ministers beingreplacedforpoorperformance.Statingthatit wasunrealisticforofficialstoeffectdrasticchanges inperformancewithinsuchashortperiod,Prime Ministeral-Malikiprovidedhisministersanother 100daystooutlinetheirperformance-improve- mentplans.Meanwhile,hecontinuedtoholdthe portfolios of Minister of Defense and Minister of Interior,asthemajorpoliticalblocshaveyetto The Inspector General has met with COI Commissioner Judge agree on mutually acceptable candidates.260 Raheem al-Ugaili twice in 2011. nowpostontheirArabic-languagewebsitesinfor- mation about contracts and development plans.262 Ministerial Accountability Inaddition,theMinistryofElectricity(MOE) The Ministry of announcedinearlyJulythatitwasforminganew Electricity announced Lastwinter’sprotests—whichpromptedthe100- officethatwouldbeopensevendaysperweekto in early July that it dayreview—werefueledlargelybypublicanger answer citizen inquiries.263 Moreover, many GOI was forming a new overpoorservicesandthewidespreadperception agenciesrequiredbylawtoissueannualreportsare ofﬁce that would be open seven days thatcorruptionisrampantinmostministries.In publishing more detailed accounts of their activi- per week to answer anefforttodefusepublicdiscontentoverthese ties. The Commission of Integrity (COI), Iraq’s citizen inquiries. problems, Prime Minister al-Maliki ordered his chiefanticorruptionagency,releaseditsannual ministerstoappearonnationaltelevisionthis reportthissummer.Itprovidesacomprehensive quartertodetailtheirplansforreformingtheir look at anticorruption activities in Iraq. For a sum- ministries. Beginning with Deputy Prime Minister mary of the report’s findings, see the Rule of Law (DPM)forEnergyAffairsHusseinal-Shahristani, subsection in this Quarterly Report.264 severalseniorGovernmentofIraq(GOI)officials delivered nationally televised addresses in early June,promisingimproveddeliveryofpublicser- Structuring the vicesandstricteradherencetotheruleoflaw.261 Government of Iraq Thisgesture—thefirstofitskindinpost-2003 Iraq—concludedsoonerthanoriginallyplanned Security Portfolios butwasinkeepingwithaseriesofotherrecent InearlyJune,PrimeMinisteral-Malikiappointed measuresapparentlydesignedtoincreasegov- his close advisor, Falih al-Fayiad, as Acting Minis- ernmentaltransparencyandaccountability.For terofNationalSecurity.ButasofJuly20,al-Maliki example, many GOI agencies are updating their continuedtoserveasactingheadofboththe websites more frequently with information about Ministry of Defense (MOD) and Ministry of Inte- ministerialplansandissuingmoredetailedreports rior (MOI). The U.S. Forces-Iraq (USF-I) Deputy on government activities. For instance, some pro- Commanding General for Operations stated to vincialinvestmentcommissions(includingAnbar) SIGIRinMaythatthecontinuedlackofpermanent

60 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 60 7/25/2011 10:37:59 AM GOVERNANCE

ministersatMODandMOIwashavinganadverse aremoreadvisorythanexecutoryinnature.As effectontheabilityoftheseministriestocreateand ofJuly17,theCoRwasconsideringtheprime implement long-term strategic plans.265 minister’s initiative.269

Vice Presidents National Council for Higher Policies Thisquarter,oneofIraq’sthreevicepresidents InaMay5meetingwithSIGIR,formerPrime (VPs),AdelAbdulal-Mahdi,oftheShiaIslamic Minister Allawi, whose bloc won the most seats in SupremeCouncilofIraq(ISCI)party,resigned. theCoRintheMarch2010elections,indicatedthat AccordingtoastatementreleasedbyISCI,his formationofthenewNationalCouncilforHigher resignation was an expression of the will of the Policies (NCHP) might still be possible. Proposed Shiacommunityandastatementagainstexcessive byU.S.diplomatsasanAllawi-ledforumforstrategic statespendingonpoliticianswithpurelysymbolic decisionmaking,theprospectoftheNCHPwasan or superficial duties.266 As part of the compromise integral part of the government-formation com- agreement reached late last year among the main promise that was brokered by Kurdistan Regional Iraqipoliticalblocs,theGOIaddedonemoreVP Government (KRG) President Massoud Barzani in and one more DPM, bringing to three the total late2010.Allawistatedthatheiscurrentlyengaged numberofeach.ThetworemainingVPs—Tariqal- indiscussionswithBarzaniandotherprominent Hashimi, of the Iraqi National Movement (a Sunni politicalfiguresabouttheNCHP’sfate.Asofmid- partyalliedwithal-Iraqiyabloc)andKhudayer July,however,theNCHPremainedunformed,and al-Khuza’ie,oftheDawaTanzimparty(apartof questions about its constitutionality remain.270 PrimeMinisteral-Maliki’sStateofLawcoalition) continue to serve.267 OnJuly10,SIGIRofficialsmetwithVPal-Khuza’ie Issues of Regionalism in Baghdad. He stated that the current corrup- tionandsecurityproblemsfacingIraqresultfrom Someofthispastwinter’smostviolentprotests myriad factors, including post-2003 violence, the tookplaceintheKurdistanRegion.Indiscussions lastinglegacyoftheBa’athistdictatorship,and withSIGIRthisquarter,GOIofficialsidentified the Iraqi people slowly coming to grips with their therisingKurdishmiddleclass’sgrowingdissatis- Many Kurds have become dissatisﬁed rightsandobligationsascitizensofademocratic factionwiththepoliticalduopolythatcontrolsthe with the dominance republic. He added that he believes Iraq is head- regionasoneoftheprimefactorsdrivinginstabil- of the Patriotic Union ingintherightdirection—remarkingthatthe ity there. Although the region’s standard of living of Kurdistan and “windsofchangethatblewintotheregionthisyear hasimprovedoverthepastdecade,manyKurds the Kurdistan emanated from Iraq”—but noted that supporters have become dissatisfied with the dominance of Democratic Party. of the former dictatorship, as well as some regional the Patriotic Union of Kurdistan (PUK) and the powers,continuetothreatenthesustainabilityof Kurdistan Democratic Party (KDP)—both led by Iraqi democracy.268 groupswhoseformativeexperiencescameduring thearmedstruggleagainsttheSaddamregime.271 Downsizing the GOI InJuly,PrimeMinisteral-Malikiapprovedaplan toreducethenumberofcabinet-levelofficialsfrom Legislative Update 42to30(29ministersandtheprimeminister). Describedasanefforttoreducepublicexpen- Status of Legislation ditures,thisplanwouldeliminatesomeofthe TopasstheCoR,abillmustundergothreeread- at-largeministersofstatewhoseresponsibilities ings,atwhichtimemembersmayproposechanges

JULY 30, 2011 I REPORT TO CONGRESS I 61

July2011.indb 61 7/25/2011 10:37:59 AM DEVELOPMENTS IN IRAQ

to the text. Legislation passed by the CoR becomes Table 4.1 lawonlyafteritissenttothepresidentandpub- CoRLegislativeActivity,1/1/2011–6/30/2011 lished in the Official Gazette (similar to the U.S. Passed Legislation Federal Register). As of the end of June, 176 bills Vice Presidents law hadbeenproposed,44hadundergoneonereading, Budgetlawfor2011 22hadbeenthroughasecondreading,and16 Cancellation of the ratification of al-Ahdab oil field development and production contract had become law. Table 4.1 lists legislation that has Modification of the crude-oil pipeline agreement signed in August 1973 passedtheCoRandbeenpublishedintheGazette CancellationofRevolutionaryCommandCouncil(RCC)decree349of1991 272 as of June 30, 2011. CancellationofRCCdecree100of1995 Forseveralyears,theCoRhasbeenunableto RepealofArticle136(b)oftheIraqiCriminalProcedureCode passapackageofhydrocarbonlawsthatwould First amendment to the Private Investment Law regarding the refinement of crude oil regulateIraq’soilandgassectors.Oneofthemain Claims Settlement Agreement with the United States obstaclestopassageoftheselawsisthelongstand- Ratification of memoranda concerning Japanese loan of 2010 ing difference of opinion between the national Association of administrative organizations governmentandtheKRGoverhowtoallocateoil Consultative committees revenues. In May, DPM for Energy Affairs al-Shah- CancellationofRCCdecree133of1985 ristanitoldSIGIRthathewasskepticalaboutthe Law of the Mukhtars prospects of passage, stating that he doubted the LawoftheServiceandRetirementfortheInternalSecurityForces hydrocarbonlawswouldpassinthenearfuture.273 Ratificationofnominationoftwojudgestothespecialcassationcommitteeexamining appeals filed against decisions of the Accountability and Justice (De-Ba’athification) CoR Committees Commission CoRcommitteescontinuedtoexercisetheirover- Source: CoR, information provided to SIGIR, 7/1/2011. sightfunctionthisquarter.Significantcommittee thedisputedinternalboundaryinthenorth.Ac- activities included:274 cordingtotheDeputyMinisterofPlanning,the • TheIntegrityCommitteepressedforwardwith main obstacle to conducting the census is Kurdish DPM for Energy its investigation into corruption at the MOD, leaders’oppositiontoaquestionontheproposed Affairs al-Shahristani focusingonallegationsofimproperlypurchased census form which would ask respondents to told SIGIR that he aircraft from Eastern European countries. classify themselves by ethnic group. When held, was skeptical the • TheSecurityandDefenseCommitteeresponded thecensuswouldbeIraq’sfirstcompletenational hydrocarbon laws would pass in the to the wave of assassinations of senior GOI census since 1987.275 near future. militaryandcivilianofficialsbydemanding changesinpersonnelattheBaghdadOperations Center, the GOI interagency entity responsible Government Capacity- forsecurityinthecapital. development Programs • TheOilandEnergyCommitteeattemptedto forge a compromise between the Ministry of AsofJune30,2011,theUnitedStateshadobli- OilandKRGovertheissueofoilcontractswith gated $5.59 billion and expended $5.24 billion for foreign companies. governance programs in Iraq, mainly through the Economic Support Fund (ESF).276 Census Delayed Twoprogramswerereportednearcomple- The GOI has repeatedly postponed holding a tion this quarter: the Local Governance Program national census because of concerns that it would (LGP), an initiative designed to strengthen Iraq’s upsetthefragilestabilitythathasprevailed provincialgovernments;andthelong-running betweentheArabandKurdishpopulationsalong NationalCapacityDevelopmentProgram(called

62 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 62 7/25/2011 10:37:59 AM GOVERNANCE

Tatweer,or“development,”inArabic),whichhas Society programs.278 The latter two are scheduled trained government employees at the national forcompletionin2013.279 level. Tatweer isslatedtoendonJuly31,2011,while ForthestatusoffundingforthesefiveESF- LGP,originallyscheduledtoendthisquarter,was funded capacity-development programs, see Tatweer is slated extendeduntilSeptember2011.Bothprogramsare Figure 4.1. to end on July 31, administeredbytheU.S.AgencyforInternational 2011, while LGP, Development (USAID).277 National Capacity Development originally scheduled Three additional capacity-building programs Fromitsinceptionin2006throughJune30, to end this quarter, administered either by USAID or the U.S. De- 2011, the Tatweer programexpendedatotalof was extended until partment of State (DoS) remained ongoing this $304.1millionoftheESF,including$4.7million September 2011. quarter:theCommunityActionProgram(CAP), this quarter, to train Iraqi government civil ser- whichisscheduledforcompletionbySeptem- vantsincorepublicadministrationfunctionsand ber2012;theMinisterialCapacityDevelopment to improve internal functions of key ministries.280 (MCD)program;andtheDemocracyandCivil This quarter, Tatweer graduated its first group of Figure 4.1 70 master trainers equipped to develop curricula, Ongoing U.S.-funded Capacity-development Programs assess training needs, and prepare annual train- $ Millions ingplans.Aspartofitssustainabilityplan,the

National Capacity Development Total Allocation: $309.43 program turned over essential training materials to (Tatweer) some GOI universities.281 Assisted Iraq's national government by training government employees in budget execution, Unexpended Although Tatweer is scheduled to end on July personnel management, and other areas; created $5.36 national employee database and a digitized social Expended 31,2011,afinalevaluationoftheprogram,which $304.07 security system, among other initiatives. wascommissionedbyUSAIDandcarriedabout bytheQEDGroup,wasreleasedinApril2011. Local Governance Program Total Allocation: $440.50 The report praised Tatweer’s program for training Strengthens Iraq's provincial governments through legislative support, developing government plans about76,000ofroughlyonemilliongovernment and budgets, and monitoring efforts to provide Unexpended essential services to constituents. $18.28 employees. Originally, Tatweer setouttocreatea Expended $422.22 national training center that would develop the IraqiCivilService,butthisgoalwasabandoned afterU.S.officialsdeterminedthattheGOIlacked Community Action Program Total Allocation: $394.30 Strengthens Iraq's government at the district and thecapacitytocreateanationalservice.Tatweer sub-district levels through community action Unexpended groups that support small economic initiatives, $55.21 re-focuseditseffortsontrainingGOIemployees small business ventures, and agriculture, among and,in2008,shifteditsemphasisfromindividual other areas. Expended $339.09 employeetrainingtoa“trainthetrainers”program.ItalsoformedtheTatweer Energy Group Democracy and Civil Society Total Allocation: $263.26 toprovidetechnicalassistancetotheMinistryof Focuses on grassroots empowerment by Unexpended Oil,its16operatingcompanies,andtheMinistry supporting widows, rule-of-law projects, $63.91 democracy-building projects, media, and other of Electricity. Tatweer createdanationalemployee areas to support the institutionalizing of democracy and strengthening of civil society. Expended database, a Geographic Information System (GIS), $199.35 andadigitizedsocialsecuritysystem,amongother

Ministerial Capacity Development Total Allocation: $50.03 initiatives. It also helped Iraqi officials create the 282 Aids development of projects in Iraq's executive Unexpended NationalDevelopmentPlan(2010–2014). branch, including ministries and the Prime $14.50 Minister's Office. However, the report noted that “soft impacts” Expended $35.53 suchasorganizationalculturechangesandtheem- braceofmoderntechniqueswerenotachieved.The Sources: NEA-I, responses to SIGIR data calls, 4/12/2011 and 6/27/2011; USAID, response to SIGIR data call, 7/7/2011.

JULY 30, 2011 I REPORT TO CONGRESS I 63

July2011.indb 63 7/25/2011 10:37:59 AM DEVELOPMENTS IN IRAQ

reportalsonotedthatsystemsimprovementswere notedanabsenceofpoliticalwilltodecentralize notfullyrealizedbecausetop-levelmanagersin government,notingthatPrimeMinisteral-Maliki some ministries failed to implement reforms. For hadopposedtheProvincialPowersAct.Moreover, instance, several ministries simply renamed their the report noted that the CoR had plans to pass personneldepartmentsinsteadofadoptingthe newlegislation,calledLaw25,thatwouldend substantivechangestotheirhumanresourcesap- traditional, informal levels of local government that proach that had been recommended by Tatweer.283 have been active in Iraq since the 1970s.288 When the LGP ends in September, USAID LocalGovernanceProgram planstobeginanewESF-fundedGovernance AsofJune30,2011,theLGPhadexpendedatotal Strengthening Project that will continue to support of$422.2millionoftheESF,including$12.7mil- decentralizationinIraqthrough2016.289 lion this quarter.284 The program was set to end on June30,2011,butwasextendedfor90daysatno CommunityActionProgram additional cost to continue support for Iraq’s pro- AsofJune30,2011,USAIDhadexpendedatotal vincialgovernmentsastheU.S.militaryprepares of$339.1millionoftheESFonCAPprojectssince todrawdownandasProvincialReconstruction its inception in 2003, including $14.6 million this Teams(PRTs)phaseout.285 quarterforthethirdphaseoftheprogram,which Accordingtoprogramofficials,theLGPhas seeks to strengthen government at the district and soughttohelpIraqisimplementtheProvincial sub-district levels.290 USAIDreportedthatfourim- PowersActbyprovidinglegislativesupport,devel- plementingpartnerscontinuedtoadministerCAP opingprovincialgovernmentplansandbudgets, programs,suchassupplyingnetstofishermen, organizing staff and information, and monitoring supporting women’s embroidery cooperatives, efforts to provide essential services to constituents. pavingruralroads,andbuildingplaygrounds. TheLGPalsoworkswithBaghdad’slocalgovern- CAPalsooverseestheMarlaRuzickaWarVictims ment to improve financial management of capital Fund,setupin2003toaidIraqisandthefamilies projects, as well as oversight and physical inspec- ofIraqiskilledorinjuredbyU.S.orCoalitionmili- tionofmunicipalprojectsinanefforttoimprove tary operations.291 public services.286 USAID reported that during the program’s ex- Democracy and Civil Society tension, special emphasis will be placed on ministe- Since2003,DoShasexpendedatotalof$199.3mil- rial development critical to the long-term stability lion,including$15.8millionthisquarter,tofund The independence of provincial governments.287 The independence Iraqi programs through its Bureau of Democracy, and viability of andviabilityofIraq’sprovincialgovernmentshas HumanRights,andLabor(DRL).292 DRL reported Iraq’s provincial beenanissueofconcern.A2010midtermreport that 51 democracy and civil society projects, valued governments has commissionedbyUSAIDtoevaluatetheLGP at $202 million, were ongoing or started this been an issue of concern. foundthatthefutureoflocalgovernmentinIraq quarter.Thirteenofthesearehumanrightsgrants, was“uncertain,”andstatedinparticularthatef- totaling$36.3million,and26aredemocracyand forts to strengthen provincial governments often governanceprograms,totaling$154million.DRL clashed with national-level institutions, such as alsomanages12grantstotaling$11.2million theCouncilofMinisters(CoM),whichthereport that address women’s issues. These activities are found often worked against local governments. designedtoassisttheCoRandtheKRGtoperform While the report noted that efforts to aid members core functions and increase transparency, provide oftheProvincialCouncils(PCs)hadbeenwell advanced training for political parties and candi- received by the members themselves, the report dates, support political campaign management,

64 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 64 7/25/2011 10:37:59 AM GOVERNANCE

strengthen the media, and increase the participa- Provincial Development tion of women, youth, and minorities in govern- By July 31, 2011, only ment.293 Thisquarter,thehighest-valueongoing ByJuly31,2011,onlyfourPRTswillremainac- four PRTs will remain projectwasa$27.5millionefforttoincrease tive in Iraq. They will continue to draw on the active in Iraq. accountability and representation in Iraqi elec- ESFQuickResponseFund(QRF)andProvincial tions.294 All ongoing projects are scheduled to end Reconstruction Development Council (PRDC) by December 2013.295 programs to support a variety of ongoing DoS- administered projects in Iraq’s provinces.297 DoS Ministerial Capacity Development reported that 200 QRF projects were completed TheDoS-administeredMCDprogramisthesmall- thisquarteratacostof$6.4million,and38new estoftheU.S.governancecapacity-development QRFprojectswereapprovedatacollectivecostof programs,with$50millioninESFfundssetto $2.3 million.298 The highest-value ongoing projects expirebyDecember30,2013.Thisquarter,the weretheMyArabicLibraryproject,valuedat IraqStrategicPartnershipOffice(ISPO)expended $1.8million,anda$1.5millionprojecttodevelop approximately$2.8milliontoadministerfive primaryschoolsfortheChaldeanArchdioceseof projectsthatwerecompletedthisquarter,includ- ErbilintheKurdistanRegion.299 ing$181,000toprovidetechnicalassistancetothe AsofJune30,2011,DoShadcompleted382 Deputy Prime Minister, $20,000 to develop plans PRDC projects, valued at $457.7 million, including forwatersharing,$1.6milliontosupportinvest- severalthataddressedwaterandsanitationneeds, ment programs, $406,000 to assist with the MOE’s school rehabilitation, and electricity needs. The masterplan,and$592,000forprogramstoimprove highest-valuecompletedPRDCprojectthisquarter theruleoflaw.Anadditional$2millionhasbeen wasthe$11.5millional-Kiblasewerandstorm grantedtoextendsupportforinvestmentpro- networkinBasrahprovince.300 Thisquarter,46 gramsthrough2012.A$2millionefforttoprovide projects, valued at $122 million, remained ongoing. asubjectmatterexpertfortheGOIMinistryof ForanoverviewoffundingfortheQRFandPRDC Transportation is ongoing, with $61,000 expended funds, see Figure 4.2. this quarter.296 Figure 4.2 Internally Displaced Persons U.S.-funded QRF and PRDC Programs $ Millions and Refugees TheUnitedNationsHighCommissionerfor PRT Quick Response Fund Total Allocation: $276.00 Used by Provincial Reconstruction Teams to bolster Refugees (UNHCR) reported that more than local government by funding smaller projects in Unexpended the provinces. $25.97 838,000 internally displaced persons (IDPs) and Expended more than 460,000 refugees displaced since 2003 $250.03 hadreturnedtotheirplacesoforigininIraqby theendof2010.FromJanuarythroughMay2011, PRT/PRDC Projects Total Allocation: $632.14 anadditional37,210IDPsand19,170refugeeshad DoS committee of PRT members, Iraqi engineers, and ministry personnel; designed to undertake returned to their homes.301 For a breakdown of small-scale projects, such as schools and roads. Unexpended $73.22 IDP and refugee returns by year since 2003, see Figure 4.3. Expended $558.92 Despite those returns, UNHCR noted that there were still more than 1.3 million Iraqis displaced Sources: NEA-I, response to SIGIR data call, 6/24/2011; USACE, response to SIGIR data call, 7/5/2011; USAID, insideIraqasofJanuary2011.UNHCRalso response to SIGIR data call, 7/7/2011.

JULY 30, 2011 I REPORT TO CONGRESS I 65

July2011.indb 65 7/25/2011 10:37:59 AM DEVELOPMENTS IN IRAQ

emphasized that occasional reports of new internal Figure 4.3 displacementscontinuedtooccur,particularly Return of Iraqi IDPs and Refugees, 2003–2011 302 among Iraq’s minority communities. Similarly, 200,000 UNHCRreportedthattherewerestill188,599Iraqi

refugees,asylumseekers,andothersregistered 150,000 with UNHCR in neighboring countries—includ- ingEgypt,Iran,Jordan,Lebanon,Syria,Turkey, 100,000 and Persian Gulf countries—as of May 31, 2011.303 The actual number of Iraqi refugees is thought 50,000 to be much higher, but determining that number remainschallengingpartlybecausenotallrefugees 0 registerwiththeUNHCRandmanylivedispersed 2003 2004 2005 2006 2007 2008 2009 2010 2011 Jan–May in urban areas.304 IDP Returns Refugee Returns Regionally,SyriaandJordanremaintopdes- Source: UNHCR, “Monthly Statistical Update on Return–May 2011,” 6/2011, p. 1. tinations for Iraqi refugees. As of May 31, 2011, theUNHCRreportedithadregisteredatotalof U.S. Support for Refugees and IDPs 126,183 Iraqi refugees in Syria and 31,676 refugees DoSandUSAIDcontinuedthisquartertoad- in Jordan.305 Syriawasthelargestrecipientinthe ministersupportprogramsforIDPsandrefugees region for refugees, not counting Palestinians, de- through several U.S. and international programs. spiteongoingviolenceinpartsofthatcountry.The country’s borders remain open to Iraqi refugees, DoS Programs andschoolscontinuetoreceiverefugeechildren.306 Asofmid-July,DoShasprovided$201.8millionin Iraqirefugeesmayaccountforasmuchas9%of humanitarian assistance for Iraqi refugees, IDPs, Iraqi refugees may Jordan’s population, according to a UNESCO and conflict victims.311 Thisquarter,DoSreported account for as much report. Jordan, however, does not recognize Iraqis workingwithUNHCR,theGOI,andtheUN’s as 9% of Jordan’s as refugees; instead, it refers to them as “guests.” In International Organization for Migration (IOM) population. 2007,JordanbegintoallowIraqirefugeechildren and World Food Programme (WFP) to support access to education.307 thereintegrationofIDPsandrefugeeswhowished While Iraqi refugees residing in certain Arab to return to their places of origin. The DoS Bureau countries faced additional obstacles because of civil of Population, Refugees, and Migration (PRM) unrest in those countries, UNHCR reported that reported that programs included in-kind grants, protection for refugees has not been “substantially assistance in developing business plans, and small- degraded” by political violence.308 Many refugees scale infrastructure projects designed to have quick who returned to Iraq because of regional unrest impact on the economy. Projects were concentrated saidthattheyplannedtoleaveIraqagainassoon in eight provinces, including Baghdad, Diyala, astheregionalunrestsubsided.309 Nevertheless, Ninewa,Anbar,Babylon,Basrah,Erbil,andSulay- Iraq’sMinistryofDisplacementandMigration maniyah. Outside Iraq, PRM reported supporting announcedlastquarteritwouldprovidefreeair- UNHCR and other organizations in Syria, Jordan, plane tickets home for Iraqis who sought to flee the Lebanon,Turkey,andEgypttoassistIraqirefugees unrest;DoSreportedthisquarterthattheministry withpsychosocialsupport,education,vocational hadprovided420Iraqifamilieswithfreeflights training,andcash,amongotheraid.312 In addition, homefromEgypt.Allrefugeeswhoreturnedto PRMsupportstheconstructionofsheltersandthe Iraqwiththeintentiontostaypermanentlywere provisionofrehabilitationandprotectionservices eligibletoreceiveagrantofabout$1,285.310 for returnees and those who integrate locally.313

66 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 66 7/25/2011 10:37:59 AM GOVERNANCE

Figure 4.4 USAID/OFDA Programs Resettlement of Iraqi Refugees and Special Immigrant Visa AsofJune30,2011,USAID’sOfficeofForeign Holders, by State 10/2007–6/2011 Disaster Assistance (OFDA) has provided more than$22millioninhumanitarianassistanceto vulnerablepopulationsinIraq,includingIDPs. WA 1,508 Thisquarter,OFDAreportedprovidinglife-saving MT ME VT - 106 7 ND 171 support through programs to distribute essential OR 386 MN NH - 286 434 520 ID MA - 1,888 SD NY emergencyreliefsupplies,provideemergencyshel- 765 WI 1,724 WY 205 362 MI RI - 106 0 8,558 ters,expandaccesstowaterandsanitation,gener- IA PA CT - 512 NV NE 382 1,392 239 NJ - 430 ateincomeopportunities,andsupportagriculture 372 UT IL IN OH 3,923 231 1,187 315 CA 774 CO WV DE - 8 and food security. In addition to supporting pro- 14,436 930 KS MO 28 VA KY 2,238 MD - 798 183 1,005 1,201 gramsforIDPs,OFDAhasprovidedapproximately NC TN DC - 107 AZ OK 1,510 990 $1.25milliontosupportactivitiesspecificallyin 4,257 NM 166 AR SC 254 43 139 MS AL GA DiyalaandBaghdadprovinces,fromwhichlarge 26 323 1,417 TX LA numbersofpeoplefledsectarianviolence.Accord- 5,570 247 ingtoPRM,thesupportbenefitedalmost170,000 FL 1,075 vulnerable people, including IDPs.316 HI 0 AK 15 GOISupportforRefugeesandIDPs TheGOIcontinuestoaidIDPsthroughoutIraq with particular emphasis on the provinces of Di- Combined Refugees and SIV Holders yalaandBaghdad,whichwerehardhitbysectar- 0-99 100-999 ianviolenceandrankhighestinthenumberof 1,000-4,999 familiesdisplacedsince2007.Throughaprogram 5,000-15,000 calledtheDiyalaInitiative(discussedfurtherinthe Source: DoS, PRM, response to SIGIR data call, 7/1/2011. special section on Diyala in this Quarterly Re- PRMalsocontinueditsprogramtoresettle port),theGOIbeganinJuly2009toaidIDPsand Iraqi refugees and Special Immigrant Visa (SIV) refugees who wished to return to that province.317 holders who qualified to relocate to the United Recently, discussions began to expand the initia- PRM reported States. As of June 10, 2011, more than 63,400 Iraqi tive to Baghdad.318 TheGOIalsohasformulateda supporting refugeesandSIVholdershadresettledinthe National Policy on Displacement that emphasizes, UNHCR and other United States since October 2007 through two amongotherthings,therightofIDPchildrento organizations in separate programs, including 58,925 resettled education.319 SinceMay2010,BaghdadandDiyala Syria, Jordan, asrefugeesandatleast4,509resettledwith provinces have absorbed the largest number of re- Lebanon, Turkey, SIVs (DoS only tracks SIV holders who elect to turning IDPs (see Figure 4.5). Baghdad also topped and Egypt to resettle and seek benefits through PRM). This the list for returns of refugees (see Figure 4.6). assist Iraqi refugees. quarter,662Iraqisresettledasrefugees,and28 resettledwithSIVs.Themajorityofrefugees International Support have resettled in California, Michigan, Texas, forRefugeesandIDPs Arizona,andIllinois,whilemostSIVholders WithDoSsupport,UNHCRcontinuedthis have resettled in Texas, California, Virginia, quartertoregisterIraqirefugeesinneighboring Arizona, and Michigan.314 For an overview of countries and to provide basic assistance such refugeeresettlementintheUnitedStates,see asfood,water,health,andeducationservicesto Figure 4.4. refugees.Additionally,itworkedwithrefugeesto

JULY 30, 2011 I REPORT TO CONGRESS I 67

July2011.indb 67 7/25/2011 10:37:59 AM DEVELOPMENTS IN IRAQ

Figure 4.5 Figure 4.6 IDP Returns, by Province, 5/2010–4/2011 Refugee Returns, by Province, 5/2010–4/2011

50,000 10,000 31%

40,000 8,000 54% 23% 30,000 42% 6,000

16% 20,000 4,000 13%

10,000 2,000 8% 5% 4% 2% 1% 2% 0 0 Baghdad Diyala Basrah Salah Al-Din All Others Baghdad Najaf Kerbala Missan Qadissiya Diyala All Others

Source: UNHCR, “Monthly Statistical Update on Return—April 2011,” Source: UNHCR, “Monthly Statistical Update on Return—April 2011,” 4/2011, p. 4. 4/2011, p. 3.

provide essential documentation and legal services. than one-third.321 Figure 4.7 shows concentrations Inside Iraq, UNHCR coordinated emergency of minority populations in Iraq. shelter,water,andsanitationservicestoIDPs,with Although Iraq’s Constitution establishes particular focus on some 500,000 IDPs living in freedom of religion, the U.S. Commission on squatter settlements in Baghdad. UNHCR also International Religious Freedom (USCIRF) continuedtohelpIDPswithlegalcounselingand reportedthisquarterthatcontinuedviolence services through its Return, Reintegration, and inthecountryhasposedathreattoreligious Community Centers.320 andethnicminorities.Sectarianattacksagainst religiousleadersandplacesofworshipreportedly continuedthisquarter,andsignificantnum- Iraqi Minority Communities bers of minority populations continued to seek refugeoutsideIraq,evenastheGOIhasmadean Whiledemographicstatisticsarelackingdueto efforttosafeguardminorities.TheUSCIRFreport theabsenceofacurrentcensus,variousnongov- paintsagrimpictureoflifeinIraqforminority ernmental organizations estimate that Iraq’s ethnic communities, including reports of kidnappings, and religious minorities make up no more than rape,torture,beheadings,bombingsofreligious 10%ofthepopulation.TheseincludeChristians, sites, and forced displacements and conversions. Turkmen, Yazidis, Sabaean-Mandaeans, Baha’is, Theviolencehasprovokeda“massexodus”of Shabaks,FeyliKurds,Kaka’is,andaverysmall minoritiesandpromptedUSCIRFtorecommend number of Jews. Violence, both general and target- thatIraqbeplacedontheStateDepartment’slist Violence reportedly edagainstminorities,reportedlyhascausedlarge of “countries of particular concern,” a designa- has caused large numbersofIraqisinmostminoritycommunities tion reserved for states that have engaged in numbers of Iraqis to flee the country. Estimates vary, but the Chris- “systematic, ongoing, and egregious” violations in most minority tian population is thought to have been reduced by ofreligiousfreedom.Thereportalsonotedthat communities to ﬂee the country. morethanhalfsince2003,whiletheMandaean- Iraq’sgovernmenthadfailedtoprovideprotection Sabaean population has dwindled by more than or justice for those persecuted because of their 80%andtheYazidishavebeenreducedbymore religious affiliations.322

68 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 68 7/25/2011 10:38:00 AM GOVERNANCE

Figure 4.7 Iraqi Minority Population Concentrations

Sunni Kurd Sunni Arab/Sunni Kurd Sunni Arab Shia Arab/Sunni Arab Shia Arab Christians: Assyrian/Chaldean, Armenian, Others Turkmen Mandaeans/Sabaeans Yazidis Shabaks Feyli Kurds Kaka’is

Sources: SIGIR analysis of open-source Arabic and English documents, 2010–2011; SIGIR interviews with Mandaean community members, 6/29/2011.

Thisquarter,U.S.Embassy-Baghdadre- QRF-funded minority-centered projects val- ported approving two new QRF-funded uedat$1,204,895werecompleted.Morethan projects, with a combined cost of $196,535, $500,000ofthatamountwasexpendedthisquar- toaidIraq’sminoritycommunities;asof teronthoseprojects.323 Citing security reasons, June 30, 2011, $42,077 had been expended U.S.Embassy-Baghdaddeclinedtodescribethe onthesetwoprojects.Anadditional19 natureorlocationoftheseprojects.324 ◆

JULY 30, 2011 I REPORT TO CONGRESS I 69

July2011.indb 69 7/25/2011 10:38:00 AM DEVELOPMENTS IN IRAQ

SECURITY

AsofJune30,2011,theUnitedStateshadallo- cated$27.07billion,obligated$25.66billion,and expended $24.49 billion for programs and projects to develop the Iraqi Security Forces (ISF),325 and approximately43,800U.S.troopswereoperating in Iraq with the primary mission to advise, train, assist,andequipthoseforces.326

Current Security Situation Ofﬁcials collect evidence at the Diyala Provincial Council headquarters, where a June 14, 2011, bombing killed 7 people ThecurrentsecuritysituationinIraqisachallenge and injured 30. (GOI photo) to gauge. Overall, violent attacks have dropped violentactivitiesarenotalwaysrelatedtoterror- off significantly—from 145 per day in 2007 to just ism.329 Figure4.8providesahistoricalsummaryof about13perdayinthefirstfourmonthsof2011, securityincidentsandciviliandeathssince2004. accordingtoDoD.327 However, DoD reported that Notwithstanding these long-term trends, a series DoD reported that atleast248Iraqiciviliansand193ISFperson- of mass-casualty attacks this quarter underscored violent crimes are nelwerekilledinattacksduringApril1–June19, thetenuousnatureoftheoverallsecuritysituation. exacerbated by easy 2011.328 Although much of the remaining violence OnMay5,2011,asuicidebomberdrovehiscar access to arms and continuestobetheworkofterroristgroupsat- intoapolicestationinHilla,killing24policeof- ammunition. tempting to disrupt the GOI, DoD reported that ficers and wounding 72 others.330 During the same violentcrimes—suchasarmedrobberies,assassi- month,acarbombkilled9andinjured27near nations,andkidnappings—areexacerbatedbyeasy apopularmarketinBaghdad.331 Twodayslater, accesstoarmsandammunition,notingthatthese againinthecityofHilla,abombkilled15people

Figure 4.8 Monthly Security Incidents and Civilian Fatalities, 1/2004−6/2011

U.S. Surge

8,000

7,000 Constitutional Security Incidents Referendum 6,000 Uprisings in Baghdad, Falluja, and Najaf Parliamentary Elections 5,000 Iraqi Civilian Fatalities 4,000 Iraqi Elections

3,000 Provincial National Elections Elections 2,000 Samarra Mosque 1,000 Bombing 0 2004 2005 2006 2007 2008 2009 2010 2011

Note: Data not audited. Totals for June 2011 civilian fatalities include data through June 19, and totals for June 2011 security incidents include data through June 17. “U.S. Surge” denotes period when at least 150,000 U.S. troops were in Iraq.

Sources: USF-I, responses to SIGIR data calls, 1/4/2011, 4/12/2011, and 7/1/2011; Brookings Institution, Iraq Index, 6/30/2010, pp. 3, 4.

70 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 70 7/25/2011 10:38:03 AM SECURITY

Figure 4.9 U.S. Military Fatalities per 20,000 Servicemembers, by Month, 1/2009–6/2011 7 6 5 4 3 2 1 0 2009 2010 2011 Sources: USF-I, response to SIGIR data call, 4/12/2011; CENTCOM, response to SIGIR data call, 7/1/2011; Brookings Institution, Iraq Index, 6/30/2011, pp. 8, 13; DoD, news transcript, “Media Availability with Secretary Panetta at Forward Operating Base Dwyer, Afghanistan,” 7/10/2011. IranianrocketshitavillagesouthofErbil,onJuly15,2011. (GOI photo) and injured dozens.332 OnJuly5,2011,justnorthof conditions in Mosul, where well-established ter- Baghdad,twinsuicideattacksatProvincialCoun- rorist organizations’ activities have been curbed in cilofficesandthesitewherenationalidentification aslowwarofattritionwiththeISF.Kirkuk,onthe cardsareissuedinTajikilledatleast35peopleand otherhand,hasseenslightlyworseningconditions, injured 60, making it the deadliest incident in more driven by tensions among different ethnic groups than six months.333 as they compete for influence in the historically The UN reported increased levels of indirect- contested, oil-rich city.340 fireattacksagainstUSF-IbasesandtheBaghdad WhilethejointeffortsbetweentheUnitedStates International Airport this quarter.334 In April, five and Iraq have succeeded in diminishing the threats soldiersdiedinthelineoffire,includingtwokilled posedbyal-Qaedaandotherterroristgroups,inter- whileconductingoperationsinsouthernIraq.335 nalmilitias,andevenbasiccrime,USF-Ireported InJune2011,14soldierswerekilledasaresultof that threats from smaller, foreign militias have hostileattacks—thedeadliestmonthforU.S.forces become cause for concern—the most prevalent sinceApril2009,priortotheirwithdrawalfrom beingthePromisedDayBrigades,AsaibAhlal- In all, 21 U.S. soldiers Iraq’s cities.336 In all, 21 U.S. soldiers were killed in Haq, and Hezbollah Brigades.341 were killed in action action this quarter.337 The U.S. military reported Thisquarteralsosawanincreaseinthenumber this quarter. thattwomoresoldierswerekilledonJuly7bya ofrocketshittingtheInternationalZoneandthe roadside bomb with armor-piercing projectiles out- U.S.Embassycompoundaswell.342 On May 15, sidethemainU.S.baseinBaghdad.338 These power- accordingtotheUN,11rocketsstrucktheInterna- fulbombsarethetrademarkofIranian-backedShia tionalZone—thehighestone-daytotalintwoyears. militias.339 Figure4.9showsmonthlyU.S.military FourmorerocketsstruckonJune9.343 Whether fatalities per 20,000 servicemembers stationed in they are trends or aberrations, these events remain IraqfromJanuary2009throughJune2011. causeforconcernastheUnitedStatespreparesto Militant attacks against Iraqi targets this quarter withdrawallmilitaryforcesbyDecember31,2011. were concentrated in Baghdad, where more than 40%ofallincidentstookplace.Thecityhasbeen Attacks on GOI Ofﬁcials the scene of more than three times the violence InMay,USF-I’sDeputyCommandingGeneralfor occurringinMosulandKirkuk,whereacombined Operations noted that the targeted killing of senior 23%ofallIraqiattackstookplace.However,recent GOIofficialshasemergedasoneofIraq’smain months have seen a slight improvement in security securityconcerns,sayingthatthesituationhas

JULY 30, 2011 I REPORT TO CONGRESS I 71

July2011.indb 71 7/25/2011 10:38:03 AM DEVELOPMENTS IN IRAQ

Figure 4.10 Selected Acts of Apparent Targeted Violence against Senior Officials, 4/15/2011–7/10/2011 Security Officials Targets/Victims Location Date Circumstances Result Location

MOI lieutenant colonel 4/16 Wounded

MOI colonel 4/22 Wounded; bodyguard killed

Intelligence ofﬁcial 4/23 Killed Ninewa IA ofﬁcer 4/24 Killed

MOD brigadier general 4/24 Wounded Tameem

MOD lieutenant colonel 4/24 Unharmed Salah Al-Din Unharmed; several others Deputy police chief 4/27 wounded Diyala IAFbrigadiergeneral 4/28 Killed Anbar Babylon MOI general 4/28 Killed with 5 others

MOD colonel 4/30 Killed

MOI colonel 5/3 Killed Missan

MOI ofﬁcial 5/7 Killed

MOI lieutenant colonel 5/14 Wounded Baghdad Intelligence ofﬁcial 5/14 Wounded

MOI major 5/17 Killed

District police chief 5/17 Unharmed

MOI ofﬁcial 5/20 Wounded

MOI colonel (forensics 5/20 Killed department) IED/VBIED MOI emergency 5/23 Unharmed battalion commander Gunfire MOI ofﬁcials 5/26 Atleast3killed Gunmen ambushed convoy MOD major general 5/29 Unharmed

ISF colonel 6/4 Killed Gunmen attacked residence MOI general 6/7 Wounded Gunmen attacked with silenced weapons MOD senior ofﬁcial 6/8 Wounded; son killed

Police commissioner 6/9 Killed Gunmen attacked vehicle Former IA general 6/11 Killed with son Residence bombed MOD general 6/14 Killed IA colonel 6/18 Killed Sticky bomb attached to vehicle MOI ofﬁcer 6/20 Killed Suicide bombers and gunmen storm compound Former IA colonel 6/22 Killed

Police chief 6/26 Ofﬁcial killed VBIED attack on convoy

ISF lieutenant colonel 6/29 Ofﬁcial wounded

Ofﬁcial wounded, at least 2 MOI lieutenant colonel 7/6 police killed

Note: This table provides examples of assassinations, attempted assassinations, and other small-scale acts of violence that appear to have been aimed at specific persons or groups this quarter. It does not purport to be all-inclusive, nor presume to imply the attackers’ respective motives.

Source: SIGIR analysis of open-source documents in Arabic and English, 4/2011–7/2011.

grownmoresevereoverthelastsixmonths.344 In personnelthisquarter.Thoseattackedincluded anefforttocounterthisgrowingproblem,USF-Iis prominentpoliticalfigures,ISFgeneralofficers, Those attacked working with the GOI to assist in instructing Iraqi andaprovincialgovernor.OnMay26,Alial- included prominent personnelonbasiccountermeasures,including Lami—the director of the Justice and Account- political ﬁgures, ISF surveillance-detection methods and procedures for abilityCommission(formerlyknownasthe general ofﬁcers, and inspecting vehicles for “sticky bombs.”345 De-Ba’athification Commission)—was shot and a provincial governor. Figure4.10showsselectedattacksonmore killedineasternBaghdad.InlateMay,Atheel than70seniorGOImilitaryandcivilian al-Nujaifi, the governor of Ninewa province,

72 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 72 7/25/2011 10:38:04 AM SECURITY

Non-Security Officials Targets/Victims Location Date Circumstances Result Targets/Victims Location Date Circumstances Result

Ministry of Higher Unharmed; two civilians MOH ofﬁcial/CoR 4/16 5/12 Killed Education ofﬁcial wounded candidate (al-Iraqiya)

Ministry of Education DG 4/19 Killed Tax ofﬁcial 5/15 Killed

National Democratic Party 4/18 Wounded with several others Judge 5/16 Bomb dismantled ofﬁcial

Unharmed; several CoR advisor 4/18 Ministry of Oil ofﬁcials 5/17 Wounded bodyguards wounded

Antiterrorism ofﬁcer 5/17 Killed MOF DG and CBI advisor 4/18 Unharmed

Al-Ahrar party ofﬁcial 5/22 Wounded Al-Ahrar party ofﬁcial 4/19 Unharmed

Ministry of Oil official 5/25 Killed Ministry of Oil official 4/20 Wounded De-Ba'athification 5/26 Killed Committee Chairman Electoral official 4/20 Wounded Ninewa Provincial 5/30 Unharmed Deputy Minister Governor of Housing and 4/20 Unharmed Reconstruction Minister of Human Rights Unharmed; two 6/1 (acting) civilians wounded Unharmed; Appellate judge 4/20 bodyguards wounded AdvisortoCoRSpeaker 6/5 Killed Chair of CoR Integrity 4/21 Unharmed Ministry of Planning Committee 6/5 Wounded official Ministry of Foreign Affairs 4/22 Killed official Ministry of Education IG 6/6 Wounded official Ministry of Housing and 4/22 Killed Reconstruction official Judge 6/6 Bomb dismantled Customs DG 4/23 Killed Judge 6/9 Killed Tax official 4/23 Killed

Baghdad provincial 4/26 Killed DG of al-Nasr SOE 6/9 Killed government official Diyala provincial 2policeofficerskilled, 6/14 Ministry of Culture official 4/27 Unharmed government officials several wounded

Baghdad Provincial Council 6/14 Killed Judge 4/30 Killed with several relatives legal director

Mosul judicial ofﬁcial 6/16 Wounded PUK ofﬁcial 5/1 Killed

Baghdad municipal ofﬁcial 5/1 Killed Mayor 6/20 Killed

Unharmed; several Passport ofﬁcial 5/2 Abu Ghraib local ofﬁcial 6/25 Killed with son others wounded

Grain Board Chief 5/3 Unharmed Ba'quba mayor 6/28 Wounded

Nationality certiﬁcates Former Minister of 5/7 Killed 6/28 Wounded ofﬁcial Housing and Construction

MoPDC director general 6/29 Killed DG, SOE cement company 5/10 Killed

Religious affairs (hajj) 6/30 Killed ofﬁcial Al-Iraqiya party ofﬁcial 5/12 Unharmed Local council deputy 7/6 Wounded Continuedinnextcolumn chairman

escapedunharmedafteranIEDwassetoffnear AccordingtoinformationprovidedbytheGOI- The governor hismotorcade.Al-Nujaifi,thebrotherofCoR ledSonsofIraq(SOI)programasofJune15,atleast of Ninewa has SpeakerOsamaal-Nujaifi,hassurvivedmultiple 38membershadbeenkilledinthelineofdutythis survived multiple assassinationattemptssincetakingofficein2009. year (see Figure 4.11). Total attacks on personnel assassination Ali al-Lami’s brother, an employee of construc- havedroppedsignificantlyinthelasttwoyears,347 attempts since tion and housing ministry, was reportedly killed butSOImembersandtheirfamiliescontinuetobe taking ofﬁce. on June 30 in an attack in Sadr City by assailants reportedbytheGOIandinIraqimediaasvictims using weapons with silencers.346 of attack. According to USF-I, transition of SOI

JULY 30, 2011 I REPORT TO CONGRESS I 73

July2011.indb 73 7/25/2011 10:38:04 AM DEVELOPMENTS IN IRAQ

Figure 4.11 normally within 24 hours.354 An armed attack on Attacks on SOI vs. KIA, 2008–2011 thesamerefineryinFebruarycausedextensive Attacks damageandtookrepaircrewsthreeweeksto 119 restoreproductiontopre-attacklevels.355 Plans to 78 attackthesamerefineryinMarchwerediscovered bytheISF,whichdefusedthethreat.356

KIA 24 InearlyJune,theISFreportedlydefusedfour 15 bombsthathadbeenplantedattheDourarefinery Note: Period for data shown ends 6/15/2011. USF-I does not track attacks 357 on SOI members or their families; it receives information from the GOI, in Baghdad. On June 5, insurgents attacked and which is responsible for running the program. destroyedanoilstoragetankinal-Zubair,south- On June 5, insurgents Source: USF-I, response to SIGIR data call, 7/5/2011. west of Basrah. Bombs were reportedly placed at attacked and memberstotheISForothergovernmentjobsre- foursuchtanksintheattack;however,justone destroyed an oil mainsatastandstill.Onlyabout9,000ofthe94,000 caused significant damage.358 storage tank in membershavebeentransitionedtotheISF,and USF-Ireportedthattherewereeightattempts al-Zubair. 30,000 have transitioned into other jobs.348 (fourinBaghdad)todisrupttheelectricityinfra- structure through the use of explosive devices this U.S. Civilian and Contractor quarter.Althoughsixexplosionsresultedindam- Deaths and Injuries agetotowersandlines,noneoftheattacksresulted USF-I reported that there have been no DoD/DoS in service interruption.359 civiliandeathsinIraqsinceSeptember1,2010,the OnJuly12,2011,Asiacell,thelargestprivate startofOperationNewDawn.349 Thisquarter,the Iraqi telecommunications company—and first mo- U.S. Department of Labor (DoL) received reports biletelecomcompanytoprovidecoverageforallof of4deathsofcontractorsworkingfortheU.S. Iraq—calledforgreatergovernmentprotectionof governmentinIraqand416injuriesthatresulted thecompany’sstaffandcommunicationtowersaf- inthecontractormissingatleastfourdaysofwork. terrecentlycomingunderattackbyarmedterrorist DoLhasreceivedreportsof1,533contractordeaths groupsinMosulandotherareas.Theseattacks since March 2003.350 correspondedwithinformationprovidedbythe ISFontheterroristgroups’intentionstodestroyall Attacks on Infrastructure Asiacell towers in Mosul.360 Infrastructure security remains a challenge, partic- ularlyasitrelatestocriticalhydrocarbonfacilities. TheMOIiscurrentlycoordinatingthedevelop- Iraqi Security Forces ment of a protection plan for such infrastructure,351 whileseniorGOIofficialspointtoplannedfacility As of June 30, 2011, more than 800,000 security securityimprovements,includingbetterlighting, forcepersonnelwereservingintheMOD,MOI, walls,fences,cameras,andmotion-detectionsys- andtheIraqiNationalCounter-TerrorismForce tems.352 FollowingaFebruary2011attackonIraq’s (see Table 4.2).361 More than 82,000 Facilities Pro- largestrefiningfacility,inBaiji,theIraqiArmy(IA) tectionService(FPS)personnelweretransitioned assumedsecurityfromthepolice.353 totheranksoftheIraqiPoliceonJanuary1,2011. Anaturalgaspipelineexplosionnearthemain AsofJune5,2011,23,159hadgraduatedfromthe operatingunitsoftheBaijiRefinerybrieflyshut MOI’sBasicRecruitTrainingCourse—arequire- downthefacilityJune24,butitremainedunclear mentforalltransferringpersonnel.FPShasre- iftheexplosionwascausedbyequipmentfailureor porteditisworkingonaplantotrain5,000–6,000 byanactofsabotage.Therefinerywasoperating recruits every month.362

74 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 74 7/25/2011 10:38:05 AM SECURITY

Table 4.2 IraqiSecurityForces,asof6/30/2011 Assigned Service Personnel

Ministry of Iraqi Army 193,421 Defense Training and Support 66,938 Air Force 5,053 Navy 3,622 Army Air Corps 2,366

IraqiSpecialForcescommandosinBasrahprepareanassault Total MOD 271,400 afterbeingdroppedoffbyIraqiArmyAviationhelicopters Ministry of Iraqi Police 302,000 duringOperationLion’sLeaponApril28—thelargestIraqijoint- Interior militaryexercisesince2003.(USF-Iphoto) Facilities Protection Service 95,000 Department of Border 60,000 The U.S. Iraq Training and Advisory Mission Enforcement (ITAM)hasbeenfundingawiderangeoftraining Iraqi Federal Police 44,000 activities for the ISF—from mechanics training Oil Police 30,000 363 coursesforwheeledequipment to an eight-week Total MOI 531,000 coursetotrainandequippolygraphexaminers Counter-Terrorism Force 4,200 withintheMODandMOI.Begunin2008,ISFF- Total 806,600 fundedpolygraphtrainingproducedexaminers Note: Numbersaffectedbyrounding.Assignednumbersillustrate whocouldsupportthevettingprocessfornew payroll data; they do not reﬂect present-for-duty totals. ministryhires.Anewcoursebegunthisyearis Sources: GOI, MOI IG, information provided to SIGIR, 7/11/2011; USF-I, teaching four examiners to be certified instructors responsetoSIGIRdatacall,7/15/2011. inpolygraphtechniquesthatcanbeusedforboth insomelocalareas—theIAremainsintheleadin source vetting and as an investigative tool.364 14 provinces, with operational control for security residinginsevenregionaloperationcommands. TransformingtheIraqiArmy TheGOIhasformedahigh-levelcommitteethat into an Externally Focused Force willassessthestateofsecurityandthecapability Withtheadventoftheinsurgencyin2003–2004, of Iraqi police forces in these provinces to deter- theUnitedStatesabandoneditsinitialsecurity minethetimingfortransferofinternalsecurityto plans,whichcalledforarelativelysmallIAoriented police. Such transfer will free up IA units to focus toward border-defense missions. Instead, U.S. and on the development of traditional combined-arms GOIofficialsembarkedonamulti-yearprogramto capabilitiesandexternaldefense.367 recruit,train,equip,anddeployarobustIAcapable CurrentplanscallforelementsoffourIAdivi- Although the police of conducting aggressive counterinsurgency opera- sionstobewithdrawnfromdomesticsecurity have increased their tionsinsideIraq.365 AsofJune30,2011,theIAhad operations in January 2012 for additional training size and capabilities, a nominal strength of almost 200,000 soldiers—a bytheOfficeofSecurityCooperation-Iraq(OSC-I) the IA remains in the forceUSF-Icharacterizedascapableofmaintain- in combined-arms operations. As an initial step lead in 14 provinces. ingdomesticsecuritywithlimitedsupportfrom in this process, USF-I is helping the IA integrate theU.S.military.366 mortarmen and combat engineers into the infantry AsTable4.2illustrates,theIraqiPolicecon- units. U.S. military advisors planned to start stitutethelargestISFforce.Although,asUSF-I trainingIAmechanizedinfantryunitsonmore reports, the police have increased their size and advanced combined-arms tactics in July, includ- capabilities—andhavereplacedIAunitsasthelead ingtheproperuseof1,100newarmoredpersonnel

JULY 30, 2011 I REPORT TO CONGRESS I 75

July2011.indb 75 7/25/2011 10:38:05 AM DEVELOPMENTS IN IRAQ

Table 4.3 FMS Purchases, GOI-funded vs. U.S.-funded Value of Value of Total Cases Cases Cases Obligated Delivered

GOI-funded 184 $6.2 billion $1.4 billion U.S.-funded 203 $2.5 billion $781.6 million

Note: Numbers affected by rounding.

Source: OSD,responsetoSIGIRdatacall,7/5/2011.

near Nassiriya. According to USACE, which began construction of the $539,000 facility in Iraqi Police arrest alleged insurgents in central Baghdad on December 2009, the new maintenance building June12,2011.(GOIphoto) provides a large workshop, spare parts storage, carriers,140M1Abramsmainbattletanks,andan and air-conditioned offices that accommodate arrayofmodernindirect-firesystems.368 state-of-the-art equipment.372

Foreign Military Sales USF-I Security-assistance Mission ThemodernizationoftheISFisbeingfacilitated throughtheFMSprogram.AsofJune30,2011, ReflectingboththeprogressoftheIraqiforcesand theGOIhadcommittedto387FMS“cases”—29 thethreatsthatpersist,USF-Iexecutesthreemain fortheMOIandtheremainderfortheMOD. tasks under Operation New Dawn:369 The GOI has funded approximately 70% (nearly • Advise, train, assist, and equip the Iraqi $7.6billion)ofthetotalvalueoftheprogramand security forces. 64%ofthenearly$2.2billioninequipmentand • Partner in counterterrorism operations. projects already delivered.373 See Table 4.3 for more • Supportandprotectthecivilianworkersfrom detailsonFMSfunding. theU.S.Mission-Iraqasitworkstobuildcivil ThetotalnumberofcommittedFMScases capacity throughout the country. increasedby13thisquarter.Asignificantnumber WhiletheISFhasmadeprogressonallfrontsof ofcasesinvolveFMSprocurementofforeign- To date, FMS cases themission,USF-IhasreportedthatasU.S.forces sourcedequipment.Todate,FMScasesnot not sourced in preparetoleaveIraqattheendoftheyear,gapsin sourcedintheUnitedStatesarevaluedatap- the United States ISFcapabilitiesexist.370 proximately$514million.Helicopterandrelated are valued at casesaccountformorethanhalf(56%)ofthe approximately TurningOverU.S.Projects value, with vehicles (32%)and ammunition (12%) $514 million. OnJune6,2011,theU.S.ArmyCorpsofEngineers accounting for the balance.374 Deliveries from U.S. (USACE)completedconstructionofairdefense andforeignsourcesthisquarterinclude:375 systemsatAliAirBaseinsouthernIraq.According • 8 Mi-171E Helicopters toUSACE,thiscapabilitywillplayacriticalpartin • 36M1A1Tanks theabilityofIraq’sAirForcetosecuretheborders •1M109A5Howitzer againstairattack.The$5.38millionairbasewas • 40M198Howitzers fundedthroughtheForeignMilitarySales(FMS) • 31HeavyEquipmenttruck/trailers program and was begun in November 2009.371 •16ArmoredSecurityVehicles◆ OnApril27,anewSignalsPlatoonMainte- nanceBuildingofficiallyopenedatCampUr,

76 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 76 7/25/2011 10:38:05 AM RULE OF LAW

RULE OF LAW

AsofJune30,2011,theUnitedStateshadobligated $2.38billionandexpended$2.12billiontoimprove theruleoflawinIraq.376 U.S. advisors work with theirGOIcounterpartstoformulatesolutions toadiversearrayofproblems,includingjudicial security, financial corruption, and prison adminis- Key ongoing tration. Key ongoing programs focus on support- programs focus on ingtheGOI’sjudiciary,police,andanticorruption supporting the GOI’s agencies. As the United States further normalizes judiciary, police, its bilateral relations with Iraq, U.S. programs and anticorruption areincreasinglyprioritizingeffortstoenhance Missan tribal leaders attend U.S.-sponsored quarterly rule of agencies. indigenousIraqitrainingcapabilitiesandassistthe law conference. (DoS photo) GOIinimprovingitsrelationswithinternational Additionally,duetotheclosureofthePRTsandthe agencies capable of providing advanced law-en- need to establish and maintain relationships within forcement and judicial mentoring. theprovinces,theDepartmentofJustice’s(DoJ)Of- ficeofOverseasProsecutorialDevelopmentandAs- sistance Training program will maintain a presence U.S. Capacity-development intheEmbassy’sconsulatesandalsoinBaghdad. Programs Moreover, DoJ’s Embassy presence will be reduced to reflect the increased emphasis on working with U.S.Embassy-Baghdad’sOfficeoftheRuleofLaw GOI rule-of-law institutions on combating interna- Coordinator(RoLC)administersongoingU.S.- tional crime, money laundering, and terrorism.379 funded efforts to improve Iraq’s judicial institutions. Activities this quarter included:377 • continued progress on the Basrah Pilot Court, U.S. Anticorruption Efforts a$286,449projectfundedbytheCommander’s EmergencyResponseProgram(CERP)to U.S. support for the GOI’s anticorruption efforts colocate newly trained judicial investigators focusesmainlyontheCommissionofIntegrity withinvestigativejudgesina10,000-square-foot (COI). The Embassy’s Anti-Corruption Coor- spaceatBasrah’smaincourthouse dination Office operates under DoS’s Bureau of • the first mixed-gender police training class at the International Narcotics and Law Enforcement BaghdadPoliceCollege Affairs(INL/ACCO)andleadstheU.S.effortto • completionofathree-weekjudicialsecurity assist Iraq’s three main anticorruption entities—the course conducted by the U.S. Marshals Service COI,theinspectorsgeneral(IGs),andtheBoardof for10personnelfromtheMinistryofJustice Supreme Audit (BSA). As of June 30, INL/ACCO (MOJ)and5fromtheMOI wasstaffedbyfourDoSpersonnelandtwolocal TheRoLCalsoworkedwithUSF-IandtheMOJto employees.Currentplanscallforittohavetwo coordinatethetransfertotheGOIoftheremaining DoSemployeesandfourlocalemployeesbyearly detaineesunderU.S.control.Thissummer,theU.S. 2012,asittransferssomeofitsfunctionstoother transferredabout200detaineestoGOIcustody.378 Embassy sections.380

JULY 30, 2011 I REPORT TO CONGRESS I 77

July2011.indb 77 7/25/2011 10:38:05 AM DEVELOPMENTS IN IRAQ

Training Iraq’s Anticorruption Agencies modern anti-money-laundering techniques. This Both INL/ACCO Since2008,INL/ACCOhasforgedaclosepart- quarter, DoS reported that U.S. advisors attached and COI ofﬁcials nershipwiththeUnitedNations(UN)toprovide totheDepartmentofTreasuryhadtrained20 strongly emphasized training and technical assistance to the GOI’s employeesfromtheCentralBankofIraq(CBI)on the need to train anticorruptioninstitutions.ItfundsseveralUN- compilingsuspiciousactivityreportsanddetect- GOI anticorruption administered anticorruption programs for the COI ingcounterfeitcurrency.Incollaborationwiththe personnel in modern anti- andforIGofficesviatheEconomicSupportFund BSA,theCOIisalsolookingtoenhanceitsability money-laundering (ESF), including:381 to investigate cases of alleged money laundering.384 techniques. • $8millionfortheUNDevelopmentProgramme (UNDP) to help implement Iraq’s National Anti- ICITAP Investigative Corruption Strategy for 2010–2014 (NACS) Capacity-development Program • $6milliontotheUNDPfortrainingtheIraqi Since2004,DoJ’sInternationalCriminalInvestiga- IGs(throughaprogramscheduledtobeginlater tive Training Assistance Program (ICITAP) has op- this year) eratedanINL-fundedprogramtotrainandmentor • $2millionfortheUNOfficeonDrugsand COIinvestigators.AsofMarch2011,INLhad Crime (UNODC) to assist the COI in conduct- providedmorethan$15millioninfundingforthis ingfinancialinvestigations effort,includingpurchasingmorethan$670,000 • $2milliontoUNODCforimprovingGOIca- insurveillanceequipmentfortheCOI.AsofJune pacity to recover stolen funds hidden in overseas 2011,oneINL-fundedICITAPadvisorandonelin- bank accounts guistwereassistingtheCOIinBaghdadaspartof INL/ACCOisalsorequestingabout$1million this program, down from approximately 16 advisors totrainCOIpersonnelonforensicinvestigative andasmanyas6linguistsduring2006–2008.The techniquesusingmoderncomputersoftware. programisscheduledtoconcludeinmid-2012. INL/ACCOmaintainsaliaisonrelationshipwith Recently completed programmatic activities theBSAaswell,butdoesnotfundanyprogramsto include:385 support it.382 • submittingtotheCOIDeputyCommissioner TheCOIDeputyCommissioneriscurrently a management assessment identifying flaws working with INL/ACCO personnel to build train- withCOIinternalpolicies,includingthelackof ing relationships with the international commu- adequatelyarticulatedgoalsfordepartmentsand nity.Todate,COIofficialshaveheldpreliminary individual employees discussions with representatives from the EU, • completing an investigative-prioritization model United Kingdom, Australia, Denmark, Spain, that,ifimplemented,wouldaidtheCOIindedi- Germany, Sweden, and Italy regarding training cating the appropriate amount of resources to programsthatcouldbeofferedtotheCOIinthe casesinvolvingseniorGOIofficials,largedollar following areas:383 amounts, or systemic instances of corruption • anti-money-laundering protocols • monitoring the COI’s in-house training pro- • trackingofthecross-bordermovementoffunds grams(theCOIassumedfullresponsibilityfor • advancedfinancialinvestigativetechniques all basic training from ICITAP in August 2010) •internationallaw • collaborating with the Defense Criminal Inves- • asset recovery tigativeServicetodeliveraprocurement-fraud investigations seminar for 23 COI investigators InmeetingswithSIGIRthisquarter,both • obtainingapprovalfromINL/ACCOforthe INL/ACCOandCOIofficialsstronglyemphasized Tumooh (Arabicfor“ambition”)English- theneedtotrainGOIanticorruptionpersonnelin languagetrainingprogram,thegoalofwhich

78 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 78 7/25/2011 10:38:05 AM RULE OF LAW

Polygraph Training As part of an INL-funded initiative, ICITAP trainedthe11-memberCOIpolygraphunit,con- cludingitseffortinMay2010.Sincethen,theCOI polygraph unit has been operating independently. Thegraduatesofthiscoursebecamethefirstpoly- graphexaminersinIraqtopossessinternation- ally recognized certifications.387 In 2010, the COI conducted256polygraphexaminationsofCOIand IGjobapplicantsandactive-dutypersonnel.388 For informationonU.S.-fundedpolygraphprograms forMODandMOI,seetheSecuritysubsectionof this Quarterly Report.389

Repealing Article 136(b) InJune,afteramulti-yeareffortledbytheCOI anditsalliesintheCoR,Article136(b)ofthe Iraqi Criminal Procedure Code—which allowed ministerstoimmunizetheirsubordinates—was finally repealed. The CoR voted to repeal Article 136(b) in mid-April, and the legislation became lawwhenitwaspublishedintheOfficial Gazette on June 13, 2011.390 Iraqi investigative judge examining evidence at a forensics lab in Kirkuk that was built with U.S. assistance. (USF-I photo) OtherAnticorruptionLegislativeActivity istotrain500COIpersonnelinconversational Iraq’s National Anti-Corruption Strategy for Englishoverthenextfiveyearsinsessions 2010–2014 charges GOI agencies with formulat- conductedinbothIraqandtheUnitedStates ingplanstoaddress201distinctproblemsinvolv- (thefirst18monthsoftheprogramarebudgeted ingthewaste,fraud,orabuseofpublicfunds.As at $580,000) partofitsongoingefforttoimplementtheNACS, ICITAP advisors continue to confer with COI, theCOIhasdraftedanewanticorruptionlawthat The legislation INL/ACCO, and UNODC representatives regard- criminalizestypesofconductthatarenotconsid- repealing Article ing the goCASE computer-based case manage- eredillegalundertheIraqiPenalCode,including 136(b) became mentsystemfortheCOIInvestigationsDirector- severaltypesofconflictsofinterest.TheCOIisalso law when it was ate.Thissystemisdesignedtoenhancetheability developing legislation to protect witnesses who co- published in the of supervisors to manage ongoing investigations operatewiththegovernmentincriminalcasesanda Ofﬁcial Gazette. and intelligence, generate automated management lawtoreplaceCoalitionProvisionalAuthority(CPA) andpersonnelperformancereports,andestablish Order93,whichcriminalizesmoneylaundering.391 paperless investigative files. Although as of May, InearlyMay,theSecretaryGeneraloftheCoM thesystemisnotyetindailyuse,thehardwareand statedthatnewdraftlawscoveringtheanticor- softwareareinplace,andfiveCOIpersonnelhave ruption institutions include the establishment beentrainedonitsuse.Currently,thesefiveare of specialized anticorruption courts. The CoM acting as instructors and training approximately Secretary General noted that this step came as a 125oftheircolleagues.386 resultofjointeffortsledbytheCOItobringIraq’s

JULY 30, 2011 I REPORT TO CONGRESS I 79

July2011.indb 79 7/25/2011 10:38:05 AM DEVELOPMENTS IN IRAQ

GOIAnticorruptionActivities currentlyworkingwiththeLebaneseandJordaniangovern- mentstorecovermorethan$5millioninstolenfunds. Major Corruption Developments • InlateMay,theIGfortheMinistryofLaborandSocialAf- Recentdevelopmentsinkeycorruptionmattersincluded:392 fairs stated he was investigating allegations that more than • OnApril24,theNinewacriminalcourtsentencedthe $15millionstolenfromNinewaprovince’ssocial-services formerchairmanoftheNinewaProvincialCounciltoeight network has been used to finance terrorism. yearsinprisonforaschemeinvolvingthepaymentofsala- • InJune,thePrimeMinisterorderedajudicialinvestigation ries to “ghost employees.” intotheactivitiesoftheTradeBankofIraqanditsChair- • TheDiyalaCriminalCourtsentenced,inabsentia,theprov- man,Husseinal-Uzri,whoimmediatelyfledthecountry. ince’s former deputy governor to eight years in prison for TheGOIsaiditplannedtobeginextraditionproceedings. passinghimselfoffasalaw-schoolgraduate—andthereby ABritishadvisortothebank,ClaudeHankes,chargedthe receivingacommensuratelyhighersalary—when,infact, move was politically motivated and came only after the thehighesteducationalcredentialhehadattainedwasa bankrefusedtogoalongwithGOIdemandstocarryout diplomafromanagriculturalhighschool. whathedescribedas“improperbankingtransactions.”Al- • Thedirectorgeneralwhohandledlandregistrationatthe Uzrideclaredhewaspreparedtocooperatewithaninvesti- BaghdadAmanat(mayoralty)waskilledafterreturning gation into the bank’s operations as long as an international toBaghdad.Shehadfledthecapitalafterbeingrepeatedly auditor was involved. pressured by high-ranking officials to transfer deeds to • InlateJune,MinistryofElectricity(MOE)IGofficialsstated politically connected individuals. that an ongoing year-long investigation has uncovered • InearlyMay,theRusafaCriminalCourtsentencedaformer aschemebyMOEpersonneltostealdieselfueldestined BaghdadAmanatofficialtolifeinprisonforembezzling for power stations. For more on the challenges facing the millionsofdollarsinemployeesalaries.TheCOIhas electricity sector, see the Public Services subsection of this tracedsomeofthestolenfundstooverseasaccountsandis Quarterly Report.

anticorruption laws in accordance with the UN to most IG personnel is delivered by the BSA or Convention Against Corruption, to which Iraq Iraqi universities on an ad hoc basis. However, the accededin2010.393 MOIIGwasskepticalthatanIGacademycouldbe established in the near future.395 Iraqi Training Initiatives Lastfall,theGOIopenedtheNationalAnticor- Commission of Integrity ruptionAcademyintheInternationalZone.The Academywasoriginallyintendedtotrainrepresen- Long-term Strategy tativesfromallthreeGOIanticorruptionagencies, U.S.-supportedtraininghashelpedmaketheCOI butalmostallstudentsenrolledarefromtheCOI. afunctionallaw-enforcementagencycapableof AccordingtoIraqiofficials,BSAandIGpersonnel investigatingsimplecrimescommittedbylow- rarelyattendclasses.COIpersonneladministerthe rankinggovernmentofficialswholackpowerful Academyandteachmostoftheclasses,andmostof patronswillingtoprotectthem.Goingforward, thecurriculumfocusesonEnglishlanguageinstruc- theCOI’sstrategicgoalistoincreaseitscapacity The COI’s strategic tion, Iraqi law, and basic management methods.394 to investigate more complex crimes perpetrated by goal is to increase its In his meeting with SIGIR this quarter, the high-rankingofficials.Figure4.12illustrateshow, capacity to investigate Ministry of Interior Inspector General (MOI IG) byenhancingitsinvestigativeskills,theCOIisat- more complex crimes expressedhisdesireforanindependentIGtraining temptingtotransformitselfintoalaw-enforcement perpetrated by high- ranking ofﬁcials. facility that would instruct both IG personnel and agencycapableofsuccessfullyworkingmorecases GOIprocurementofficialsfromtheministries. involving high-level officials and sophisticated TheMOIIGnotedthattheonlytrainingprovided formsofcriminalactivity.396

80 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 80 7/25/2011 10:38:06 AM RULE OF LAW

Annual Report for 2010 Figure 4.12 Thissummer,theCOIreleasedits“AnnualReport COI Investigative Capacity vs. Desired Effect on Future Crime Trends for2010.”Overall,thereportshowsthattheCOI appears to be increasing the tempo of its inves- Today tigative activities, but remains constrained by its Simple crimes Sophisticated crimes inabilitytopursueallegationsofcorruptionlodged perpetrated by committed by againstseniorGOIofficials.Figure4.13summa- high-ranking officials or high-ranking officials their allies or their allies rizessomeofthekeyfindingsfromthereport.

Decline in Arrests Resulting from COI Investigations TheCOIdoesnothavetheauthoritytoarrest COI’s Investigative Capacity suspects.UnderCPAOrder55,whichcontinuesto Simple crimes Strength of Suspect’s Political Cover committed by governCOIactivitiesmorethansevenyearsafter low-ranking officials theconclusionoftheCPA’smission,allarrests must be made by an Iraqi police officer pursuant to Complexity of Crime ajudicialwarrant.Inthefirstthreemonthsof2011, 143individualswerearrestedasaresultofinvesti- In 5 Years gativeworkperformedbytheCOI—a52%decline Simple crimes Sophisticated fromthe293arrestedduringthefirstthreemonths perpetrated by crimes committed high-ranking officials by high-ranking of 2010: or their allies officials or their allies

293 143 2010 2011 44 Q1 Q1 2008 Q3 COI’s Investigative Capacity

COI officials COIofficialsattributedthistrendtothedif- Strength of Suspect’s Political Cover Simple crimes committed by attributed this trend ficulty in tracking down fugitives who have either low-ranking to the difficulty fledabroadorarebeingshelteredbyfriendsand officials in tracking down relativesinIraq.397 Complexity of Crime fugitives who have Sources: ACCO and COI officials, meetings with SIGIR, 5/2011. either fled abroad or Investigative Judges are being sheltered by During2005–2010,oneofthemainproblems COI referred 569 cases to IJs—an increase of 129% friends and relatives. faced by the GOI’s anticorruption agencies was the fromthefirstthreemonthsof2009.399 lackofasufficientnumberofinvestigativejudges (IJs) dedicated to hearing corruption cases. As the COI Budgetary Constraints officialsempoweredtoorderarrestsandforward To increase its investigative reach, the COI requested casestotrial,theIJsoccupyapivotalroleinthe about$10.3millioninthe2011budgettofund criminal justice system. In recent meetings with non-payroll expenses, such as support for active SIGIR,INL/ACCOandCOIofficialsagreedthat investigations and equipment and land purchases. therearenowanadequatenumberofIJstohandle Instead,theCoRcutthistrancheoftheCOIbudget corruptioncases,notingthattheincreasedcapacity for2011by41%—fromapproximately$10.4million oftheRusafaCriminalCourthasreducedmuchof in2010toabout$6.1millionthisyear.TheGOI the backlog.398 Inthefirstthreemonthsof2011,the alsoreducedtheamountoffundsavailableforCOI

JULY 30, 2011 I REPORT TO CONGRESS I 81

July2011.indb 81 7/25/2011 10:38:06 AM DEVELOPMENTS IN IRAQ

Figure 4.13 COI Summary of Performance, 2010

According to its “Annual Report for 2010,” the COI received 8,958 corruption allegations last year, 696 of which (8%) led to the filing of criminal charges. Other key indicators included: Arrest warrants. 4,225 arrest warrants were issued as a result of COI investigative work, including 57 for officials holding the rank of Director General (DG) or higher. Of these, 1,473 (35%) were served. Of the warrants issued, 57% were for alleged forgery. Summons. 4,082 individuals were summoned for questioning, including 190 officials holding the rank of DG or higher. Of these, 2,557 (63%) responded to the summons. Professional negligence was the subject of 44% of matters called to question (under Iraqi law, corruption encompasses actions that would be treated as workplace misconduct in the United States). The three ministries with highest percentage of cases. Of the 696 cases filed, 13% involved MOD employees, 7% MOI employees, and 6% employees from the Ministry of Municipalities and Public Works.

Number of Cases Opened by COI, 2004–2010 Length of Sentences for Individuals Convicted 8,450 of Corruption-related Crimes, 2010 2010 Life 6

Fines 786 173 2004–2005

Persons Convicted of Corruption-related Crimes, 2004–2010 0–3 years 33 412 5+ years 1,016 2010 92 3–5 years 103 2004–2006

Suspects Arrested as a Result of COI Suspects Referred to Investigative Judges, Investigative Work, 2010 2010

COI Investigative Offices X Total Suspects Ninewa Tameem X Rank of Director General or Above 137 – 52 – 139 14 141 – Salah Al-Din

58 3 Diyala 393 11 28 1 Baghdad 155 – 1,306 169 35 1 Wassit 71 3 Anbar Babylon Kerbala 79 – 190 1 212 3 Missan 132 6 53 – 109 1 Qadissiya 107 2 58 1 89 1 118 3 Najaf Thi-Qar

105 1 54 – Basrah 64 1 179 1 153 – 102 1 Muthanna

Note: COI is not active in the Kurdistan Region. 48 – 46 3 Source: GOI, COI, “Annual Report for 2010,” 7/2011.

Percentage of Responding GOI Officials Reporting Average Monthly Percentage of GOI Agency Respondents an Incident of Bribery by Province, 2010 vs. 2009 Reporting an Incident of Bribery, 12/2009–1/2011 2010 2009 2010 2009 Transportation 21.0 Labor 6.6 Najaf 13.3 23.2 Ninewa 5.8 12.2 Justice 8.4 Interior 6.0 Thi-Qar 12.1 18.5 Anbar 5.2 34.0 Municipalities 8.0 Electricity 4.8 Qadissiya 11.8 12.2 Baghdad 4.3 14.7 Communications 7.6 Baghdad Amanat 4.8 Babylon 10.0 24.2 Wassit 3.5 3.2 Education 7.4 Health 4.8 Basrah 9.7 42.2 Missan 2.6 14.3 Immigration 7.4 Commerce 4.3 Tameem 6.8 25.7 Salah Al-Din 2.4 12.6 Finance 7.3 Agriculture 2.6 Diyala 6.5 23.4 Muthanna 2.3 1.2 Oil 7.0 Kerbala 6.1 26.5

82 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 82 7/25/2011 10:38:06 AM RULE OF LAW

employee bonuses, making it more difficult for theagencytorecruitandretainqualifiedstaff.In a mid-May meeting, the COI’s budget director re- portedtoSIGIRthathedoesnotbelievethesecuts werepunitiveinnaturebutnotedthat,asanew organization,theCOIneedsmoresupportthan well-establishedentitiesliketheBSA.400 The COI is pursuing several different alternatives to offset this fundingshortfall,suchasrequestingpermission fromtheMinistryofPlanningtouseleftoverfunds from2010andshiftingsomefundsfromitspayroll account. If these solutions prove unsuccessful, the effects could be widespread. New COI headquarters complex. Thissummer,theCOIplanstoinaugurateits This summer, the COI newheadquartersfacilityintheInternational ministers,butpreservingthisautonomyhas plans to inaugurate Zone,butitdoesnothavethefundstofullyfurnish beenaconstantchallenge.404 its new headquarters and operate it.401 Moreover, the COI’s provincial • Clarifyingtheirresponsibilitiesunderthelaw. facility in the officeslacksufficientfundstopurchaselandfor For the past several years, elements within the International Zone, newoffices,acquirearmoredvehiclesforinvestiga- IGcommunity,ledbytheMinistryofHealth but it does not have tors,andbuycopymachinesforreproducingcase IG,havelobbiedtheCoRtoreplaceCPAOrder the funds to fully files. Currently, most investigators stationed in COI 57withanewIGlaw.AccordingtotheMOIIG, furnish and operate it. field offices rely on unarmored personal vehicles their efforts have been unsuccessful because they forworkandresorttocopyingsensitivefileson aimedtoreplaceCPAOrder57withanentirely machineslocatedinpublicmarketplaces.402 newlaw,asopposedtosimplyamendingit.405 • Conductingprovincialoversight.Most IG Financial Disclosure Laws offices,liketheCOI,areBaghdad-centric TheCOIisresponsibleforpromulgatinggov- organizations with limited provincial presences. ernment-wide financial disclosure regulations. Thisquarter,theMinisterofJusticeclosedfive However,becausethereisnopenaltyforproviding provincial IG offices (Anbar, Ninewa, Baby- incorrect information—other than being required lon, Tameem, and Basrah). The reason behind toamendthefinancialdisclosureforms—thedata hisdecisionremainsunclear,butU.S.officials provided to the COI has not resulted in the open- speculatethatitwaseitheracost-savingmeasure ing of any significant criminal cases. Figure 4.14 oranefforttoassertcontrolovertheIGs.406 summarizesthe2010financial-disclosureresponse rates for senior GOI officials.403 Judicial Security

Inspectors General OnJune9,BasimTaher,acivilcourtjudge,was shotandkilledwhiledrivingtohishomeinwestern Iraq’ssystemofministerialIGsisthefirstofits Baghdad. According to the Higher Judicial Council kindintheregion.Assuch,IraqiIGsfaceaunique (HJC),atleast47judgeshavebeenassassinated set of challenges, including: since 2003.407 Cognizantoftheongoingthreattohis • Maintaining their independence. CPA Order judgesandtheirfamilies,ChiefJusticeMedhatem- 57 states that IGs are independent of their phasizedinhisMaymeetingwithSIGIRtheneed

JULY 30, 2011 I REPORT TO CONGRESS I 83

July2011.indb 83 7/25/2011 10:38:11 AM DEVELOPMENTS IN IRAQ

Figure 4.14 GOI Financial Disclosure Reports, 2010

Percentage Filed CoR Members Prime Minister and Deputies Ministers Provincial Council Members

34.2% 100% 100% 67.6%

Total Filings Received Provincial Council Provincial Governors by COI Chairmen Not Filed Not Filed 10,000 9,510 8,046

5,000

0 2009 2010

Note: Does not include Kurdistan Region. Statistics for CoR members reflect data received by the COI for CoR members elected on March 7, 2010.

Source: GOI, COI, “Annual Report for 2010,” 7/2011.

forimprovedjudicialsecurity.TheChiefJustice for judges.408 He also stated that one of his priori- The Chief Justice stated that HJC personnel are performing almost all tiesremainstheconstructionofadditionalsecure stated that HJC judicialsecurityoperationsontheirownandcom- judicial residences outside of Baghdad, highlighting personnel are mentedthattheMOIremainsanobstacletoobtain- thelackofsupportavailabletojudgeswhoarebased performing almost ingweaponpermitsandadditionalsecurityguards in the provinces.409◆ all judicial security operations on their own.

84 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 84 7/25/2011 10:38:11 AM ECONOMY

ECONOMY

Iraq’seconomicgrowthacceleratedthisquarter, Figure 4.15 liftedbystrongoilexportrevenues.410 The impact Current Accounts Balance under Alternative Price Scenarios, Selected Countries of multibillion-dollar renewal projects now under- $ Billions wayinsectorssuchashousing,transportation,and electricityalsocontributedtoalevelofeconomic $160 $140 growththatisprojectedtobeashighas12.2%in $120 2011—wellabovethe2010growthof0.8%estimated $100 by the International Monetary Fund (IMF).411 $80 However,thesheerpaceofthisgrowth—especially $60 intheoilsector—hasstrainedthecapacityofthe $40 $20 country’s physical infrastructure and added pres- $0 sure to address bottlenecks caused by slow-moving $-20 Iran Iraq Kuwait Saudi United Arab governmentbureaucracyanddecisionmaking.412 Arabia Emirates Against this backdrop, the GOI is reevaluating its $114.36/barrel $107.16/barrel $88.42/barrel ambitiousmedium-termoilproductiontargets.413 Source: IMF, Regional Economic Outlook: Middle East and Central Asia, 4/2011, p. 20. ForanoverviewofIraq’seconomy,seetheInsert to this Quarterly Report. Coreinflationroseslightlythisquarter,crossing 6%forthefirsttimesince2009toreach6.3%in May.419 The increase reflects pressure from rising KeyEconomicTrends global commodity prices.420 Although now more and Developments thantwicethe3%rateofayearago,inflationis below the regional average of 10.9% and is expected Thesaleofcrudeoilisexpectedtogeneratemore toremaininthe6%rangethrough2012.421 Two The sale of crude oil than98%oftheGOI’stotalexportearningsand otherkeyindicators,theIraqidinar-U.S.dollar is expected to provide89%oftotalgovernmentincomein2011.414 exchangerateandtheCentralBankofIraq(CBI) generate more than TheGOIreceivedapost-2003recordof$20.11billion policyrate,wereunchangedduringthequarter.422 98% of the GOI’s inoilexportreceiptsthisquarter—$3.81billion An IMF report on Iraq last quarter welcomed the total export earnings more than last quarter and 31% ahead of quarterly GOI’scontinuedcommitmenttobothsoundfiscal and provide 89% of receiptsanticipatedin2011budgetprojections.415 and monetary policies and the independence of the total government Non-oil-sectoreconomicactivityalsohasshown CBI,butcautionedthatthepotentialforpolitical income in 2011. signsofgrowth,withseveralmultibillion-dollar instability,uncertainsecurityconditions,andde- infrastructure projects either launched or ready laysinoil-fielddevelopmentallposedriskstoIraq’s to launch.416 Onemid-yearanalysisconcluded economic revival.423 foreigncommercialactivitywasupsharplyduring UndertermsofUnitedNationsSecurityCouncil the first half of 2011.417 Withmajorspendingnow Resolution1956,arrangementsgoverningtheuse underway to rebuild the country, Iraq’s current and oversight of the Development Fund for Iraq accountbalanceislikelytobeindeficitfor2011.418 (DFI)endedonJune30.FordetailsoftheGOI’s HowIraq’scurrentaccountbalancecompareswith successorarrangementsseeSection2ofthisQuar- otherMiddleEastoil-producingnationsisshown terlyReport.Fordetailsofunaccounted-forDFI in Figure 4.15. funds, see Section 1.

JULY 30, 2011 I REPORT TO CONGRESS I 85

July2011.indb 85 7/25/2011 10:38:11 AM DEVELOPMENTS IN IRAQ

TheGOIhaspledgedtocontinueeffortsto Figure 4.16 settle Saddam-era foreign debts according to the Exploratory Sites Offered in the Fourth Oil and Gas Licensing Round, by Location, Size, and Type termsoftheNovember2004ParisClubagree- 424 Hydrocarbon ment. TheCoMthisquarterapprovedthepay- Dahuk Area Expectations mentof$408millioninEgyptianprivate-sector Site (Square Miles) & Possibilities 1 2,800 Gas debt under terms prescribed by the Paris Club.425 1 Erbil Ninewa 2 3,100 Gas About$45billionofIraq’sexistingexternaldebt Tameem Sulaymaniyah 3 2,700 Gas heldbynon-ParisClubmemberstatesiseligible 2 4 2,700 Gas fornegotiatedreductionundertermscomparable Salah Al-Din Diyala 5 3,100 Gas to the Paris Club accord.426 3 8 6 3,500 Gas Mostofthe$20.1billioninoutstandingwar-re- 4 Baghdad Anbar 7 2,300 Oil lated claims are owed to Kuwait.427 One claimant 5 Wassit 8 2,300 Gas declaredthelapseofUNimmunityagainstsei- Kerbala Babylon 7 9 350 Oil Qadissiya zureofIraqiassetsthatendedalongwiththeDFI Missan 10 2,100 Oil Najaf arrangements on June 30 would bring an “open Thi-Qar 11 3,100 Oil 11 10 6 9 season”onIraqiholdings.AlawyerforKuwait 12 12 3,100 Oil Basrah Airwaysannouncedthattheairlinewouldseek Oil Fields Gas Fields enforcementofaBritishcourtrulingthatIraqi Muthanna Airwaysillegallybenefittedthroughitsseizureof $1.2billioninKuwaitAirwayspropertyatthetime Source: GOI, Ministry of Oil, “Exploration Blocks of the 4th Bidding Round,” www.oil.gov.iq/EXPLORATION%20 BLOCKS-BR4.pdf, accessed 7/14/2011. ofthe1990invasion.TheattorneysaidtheKuwait aircarrierwouldgoafteranyavailableIraqiassets, NationalOilCompanyiscurrentlyunderdiscus- includingoiltankersandoilcargoes.428 sionintheCoR.Draftlegislationsettingoutabasic frameworkforthehydrocarbonsectorwasfirst approvedfouryearsagobytheCoM,butneveren- Oil and Gas acted because of serious political differences—including those between the central government and Oil Minister al-Luaibi Thisquarter,OilMinisterAbdulKareemal-Luaibi the Kurdistan Region over the division of power announced a new announcedanewroundoflicensing,scheduledfor between national and regional governments.430 round of licensing to January2012,todevelopmoreofIraq’suntapped develop more of Iraq’s oil and gas reserves. As planned, it will be the Crude Oil Production untapped oil and gas reserves. GOI’sfourthlicensingroundsincemid-2009and and Field Development offers 12 new blocks, the majority comprising vast Increasedoutputfromthelargesouthernfields areasofpreviouslyunexploredpartsofnorthern, offsetproductiondropsintheKirkukarea,keeping western, and southwestern Iraq. Seven of the blocks Iraq’saveragedailyoilproductionthisquarterat areexpectedtoyieldgasonly.Detailsofthefourth 2.55millionbarrelsperday(MBPD),essentially licensingroundaresetoutinFigure4.16.429 unchangedfromthepreviousquarterbut7%above TheGOIthisquarterworkedonimportantdraft thesameperiodlastyear.431 Byamarginof0.12%, legislationaffectingIraq’soilandgasindustry.The it marked the highest quarterly production volume CoM’sEnergyCommitteesentthefullcabinet recordedduringthepost-2003period,yetwasstill thedraftversionofahydrocarbonsframework belowtheGOI’sprojectedaveragecrudeoilpro- law, aimed at creating greater legal clarity for ductionlevelfor2011of2.75MBPD.432 Crude oil thoseinvolvedinextractingthecountry’soiland production in the Kurdistan Region, estimated to gasriches.AseconddraftlawtocreateanIraq have been about 200,000–250,000 barrels per day

86 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 86 7/25/2011 10:38:11 AM ECONOMY

Figure 4.17 Crude Oil Production and Exports, by Month, 10/2003–6/2011 Million Barrels per Day

3.0 Production 2.5

2.0

1.5

1.0 Exports

0.5

0.0 2003 2004 2005 2006 2007 2008 2009 2010 2011

Note: Exports include crude oil from the Kurdistan Region; production figures do not.

Sources: NEA-I, responses to SIGIR data calls, 6/4/2010, 7/6/2010, 1/11/2011, 4/5/2011, and 7/7/2011.

(BPD)thisquarter,isnotincludedinthenational • AttheHalfayafieldinsoutheasternIraq,aChina production figures.433 For crude oil production National Petroleum Corporation (CNPC)-led levelsandexportlevelssince2003,seeFigure4.17. consortium increased initial output to 10,000 Thisquarter’spositiveproduction-relateddevel- BPDonitswaytoatargetof70,000BPDin opmentsincludedthefollowing: thefirstquarterof2012.Halfayaisconsidered • AtthelargeWestQurna-1field,ExxonMobilre- amajorfield,projectedtoproduceasmuchas ported that average production was now around 525,000BPD.CNPCalsobroughtonstream 330,000 BPD—up from 285,000 reported last 60,000BPDatthesmalleral-AhdabFieldin quarter.AseniorExxonMobilexecutivesaid Wassit province.438 operatorswere“runningaboutthreeorfour Damaged pipes monthsaheadofplan”onthewaytoanultimate Severalotherdevelopmentsthisquarterun- connected to target of 2.825 MBPD.434 derscored the challenges of achieving the GOI’s production wells • AtWestQurna-2,theRussiangovernment production targets, including further evidence of in al-Rumaila announced that Lukoil is prepared to spend crude oil infrastructure decay. In the large south- ﬁeld caused losses $3.5billionoveratwo-yearperiodforthefield’s ernfields,accordingtooneanalysismadepublic that reached more development.435 thisquarter,damagedpipesconnectedtoproduc- than 2,000 BPD • Inmid-May,al-RumailafieldoperatorBP tionwellsinal-Rumailafieldcausedlossesthat in February. becamethefirstinternationaloilcompanyto reachedmorethan2,000BPDinFebruary.439 At receivepaymentforworkinthesouthernfields, theMajnoonfield,SouthOilCompany—together takingonacargoofcrudeoilatal-BasrahOil withoperatingpartnersRoyalDutchShelland Terminal(ABOT)ascompensation.436 Also this Petronas—awardedtheDodsalGroupofDubaia quarter,theGOIMinistryofFinancereleased contracttoreplaceanexisting28-inch-diameter $243milliontotheKurdistanRegionalGovern- pipeline with a 32-inch pipeline to transport crude ment—anamountequaltoabouthalfthevalue oil50milestostoragefacilitiesnearal-Zubair.440 ofthecrudeoilexportedfromtheregionduring Operatorsinthesouthhavecontended February and March 2011.437 with other issues, including decision-making

JULY 30, 2011 I REPORT TO CONGRESS I 87

July2011.indb 87 7/25/2011 10:38:13 AM DEVELOPMENTS IN IRAQ

bottlenecksthathaveslowedtheiroperations.Labor Table 4.4 andsecurityissuesthisquarteralsopresented Implementation of the Installation Plan for Oil Meters challenges. Only intervention by Basrah’s provin- Meters Meters Installed as Percentage cial governor averted work stoppages by South Company Planned of 12/31/2010 Completed OilCompanyworkersangryaboutdifferences Exporting South Oil Company 137 44 32% betweentheirpayandthatofthoseemployed Companies Missan Oil Company 65 32 49% by international oil companies.441 A bombing of North Oil Company 188 86 46% crude-oil storage tanks at al-Zubair also briefly interruptedproductionatthefield,whichisoper- Distributors Middle Refineries Company 592 352 59% ated by an ENI-led consortium.442 North Gas Company 69 41 59% Againstthisbackdrop,theMinisterofOilindi- Gas Filling Company 49 40 82% catedinearlyJunethattheGOIwasconsidering Pipelines Company 410 379 92% reappraising its previously stated goal of increasing North Refineries Company 239 200 84% OilProductsDistribution crude oil production to more than 12 MBPD by 2,992 695 23% 2017.Instead,hesuggestedthataplateauproduc- Company tiontargetof7–8MBPDovera13-yearor14-year South Refineries Company 137 27 20% period—nearlytwicethetimeenvisionedforthe South Gas Company 20 3 15% farhigherpeaklevels—wouldbemorefeasibleand Total 4,898 1,899 39% economically more beneficial for Iraq.443 Lower Source: PwC, “DevelopmentFundforIraq:ResultsofYearEndAudit,” presentation to the IAMB and COFE, Paris, France, 4/27/2011, p. 16. peakvolumeswouldrequirelessambitiousinfra- structure improvements and reduce the danger Oil Monitoring offloodingthemarketanddepressingprices.The Meteringtheflowofcrudeoilthroughpipelines ChairmanofBPsuggestedatargetof5–6MBPD from source to endpoint enables authorities to bytheendofthedecadewasamorerealisticpro- trackvolumeaccuratelyandalsoalertsthemto jection, considering the condition of the physical possible illegal siphoning. So far, however, fewer infrastructure.444 than1,900oftheplanned4,898metershave beeninstalledinIraqsincethestepwasfirst Crude Oil Exports and recommended by the International Advisory and Capacity Expansion MonitoringBoard(IAMB)in2004.Anauditby Exportsofcrudeoilaveraged2.21MBPDforthe PricewaterhouseCoopersLLC(PwC)showedthat, Exports of crude oil quarter,apost-2003recordthatamountstoan asofDecember31,2010,only52%ofthemeters averaged 2.21 MBPD increase of 2% over the previous quarter and 20% planned for installation by that date were actually for the quarter, more than the same quarter in 2010.445 Exports inplace.Duringthefinalquarterof2010,just208 a post-2003 record. fromtheKurdistanRegion,whichrananesti- meters were installed. Table 4.4 shows the status mated130,000–180,000BPDduringthequarter, of oil meter installation as of the end of 2010. On helped fuel the increase.446 However, further sub- May9,2011,theIAMBexpressed“concernthatthe stantial export growth is tied to expanding infra- implementation of the plan continues to fall fur- structure. A single-point mooring station at ABOT therbehindschedule”andurgedtheGOItomake isexpectedtoadd900,000BPDcapacitywhenitis every effort implement the plan. The PwC audit completed,currentlyestimatedbytheMinistryof welcomedtheOilMinistry’sdecisiontohirean Oiltobearoundtheendof2011.Additionalmoor- outsideflowmeasurementspecialist,theScottish ingstationsarescheduledtofollowunderaplan companyKeltonEngineering,toprovidetechnical to raise southern export capacity from its current assistance on the oil metering.448 1.7–1.8MBPDto5MBPDbylate2013.447

88 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 88 7/25/2011 10:38:13 AM ECONOMY

Table 4.5 Domestic Production and Imports of Reﬁned Fuels, 2010 vs. 2011 Comparison of April–June Quarters LPG Diesel Fuel Kerosene Gasoline Metric Tons per Day Million Liters per Day Million Liters per Day Million Liters per Day Production Imports Production Imports Production Imports Production Imports 2010 2,892.61 591.79 14.62 0.35 6.56 0.02 11.07 4.69

2011 3,706.00 28% 458.67 -22% 14.90 2% 1.96 464% 6.13 -7% 0.00 -100% 11.79 7% 6.51 39%

Sources: NEA-I,responsestoSIGIRdatacalls,6/4/2010,7/6/2010,and7/7/2011. ReﬁneriesandPetroleumProducts announcementwasseenasanimportantreaffir- AsshowninTable4.5,Iraq’srefineriesproduced mationofcommitmentonthepartofbothsides moredieselfuel,gasoline,andliquefiedpetro- to conclude long-stalled negotiations on a contract leum gas (LPG) this quarter, compared with the said to be worth $12 billion.453 On June 5, 2011, samequarterin2010,whilekeroseneproduction theGOIsignedfinalcontractsforthedevelop- dropped.449 AnexplosionattheBaijioilrefineryin mentoftwonaturalgasfields—onewithagroup late June halted production of petroleum prod- headedbyKuwaitEnergyCompanytodevelopthe ucts briefly.450 Despite the production increases, SibagasfieldinsouthernIraqwithanexpected importsincreasedforbothdieselfuelandgaso- capacityof100millioncubicfeetperday(MCFD), line. A 900-metric-ton-per-day increase in LPG andanotherwithaTurkishNationalOilandGas productionmorethancoveredadropinimports Company (TPAO)-led consortium to develop the ofjustover130metrictonsperday.Therewereno MansuriyagasfieldineasternIraq,whichhasan reported kerosene imports during the quarter, even estimatedcapacityof320MCFD.Afewdaysear- though domestic production dropped.451 lier, the GOI initialed an agreement with Kogas, of AsIraqheadedintothehottestmonthsofthe South Korea, for development of the 400 MCFD year,theMinistryofElectricityannouncedthatit AkkasfieldinwesternAnbarprovinceafterKo- plannedtoimport1.5millionlitersoffuelperday gas’spartner,theKazakhcompanyKazMuniaGaz, from Iran over the coming 12 months to burn in pulled out of the project.454 power plants.452 In May, Iraq entered into an enhanced strategic energy partnership with the European Union, in Natural Gas whichtheGOIagreedtoexplorepossibleexports The GOI entered TheGOIenteredintoimportantnaturalgasdeals of natural gas to the EU in return for a guaranteed into important with international operators this quarter, includ- marketforIraq’santicipatedsurplusofnaturalgas natural gas deals ingareporteddraftagreementwithRoyalDutch inthecomingdecades.Thetwosidesareexpected with international Shellthatcouldendtheflaringofassociatedgasin to begin negotiations later this year.455 The Iraq-EU operators this threelargesouthernoilfields.TheMinistryofOil agreementfollowedanannouncementbytheNa- quarter. issuedastatementbyGOIandRoyalDutchShell bucco Gas Pipeline International Company that it representativesstatingtheirintenttoestablish plannedtobeginconstructionin2013ofapipeline ajointlyheldcompanycalledtheBasrahGas thatwouldlinkEuropewiththeMiddleEastand Company,thatwouldcaptureandprocessthe Caspian regions.456 naturalgas.Collectively,upto700millioncubic feetperdayofgasiscurrentlyflaredatthefields Pipelines involvedinthedeal—al-Rumaila,WestQurna, TheGOIisalsoactivelyexploringseveraloptions andal-Zubair.Althoughthetwosidesfirstagreed to strengthen northern export routes, including toestablishthecompanyin2008,theJuly2011 twocrudeoilpipelineswithacombinedcapacity

JULY 30, 2011 I REPORT TO CONGRESS I 89

July2011.indb 89 7/25/2011 10:38:13 AM DEVELOPMENTS IN IRAQ

of2.75MBPDtoSyria’sMediterraneancoastthat Table 4.6 wouldbeabletocarryoilfromIraq’ssouthern Council of Ministers’ Spending Priorities in Proposed Infrastructure Program fields.IraqiandSyrianofficialssignedasecond $ Billions memorandum of understanding this quarter cov- Estimated eringconstructionofthepipelines.457 Sector Cost

InMay,theMinistryofOilawardeda$13.5million Transportation 10.0 management consultancy and engineering services Education 5.0 contracttoCanada’sSNCLavalintooverseethe Agriculture and Irrigation 5.0 initialphaseofaplannedoverhaulofIraq’spipeline Health 3.0 network. The project would connect the northern HigherEducationandScientiﬁcResearch 2.0 andsouthernoilproductionareaswithexport HousingforthePoor 2.0 routes.Theinitialphaseincludesa1.75MBPD Secondary Roads 1.5 pipelineconnectingBasrahwithapumpingstation Other 8.5 about140milesnorthwestofBaghdad.There,the Total 37.0 pipeline would split, with one route carrying oil Source: GOI, NMC, press release, “Approve the Bill Payment about900milesnorthwesttotheSyrianMediter- Infrastructure Reconstruction Resolution with $37 Billion,” 4/27/2011, www.nmc.gov.iq/ArticleShow.aspx?ID=882, accessed 4/29/2011. raneanportofBanias.Asecondpipelinewould tieintotheexistingnorthernexportroutetothe transportation an important sector for potential TurkishportofCeyhan.Engineeringworkwas future investment.461 scheduled to begin in June.458 As discussed in the Public Services section, the The CoM approved a TheCoMthisquarterapproveda$365million Communications Ministry has embarked on a $365 million contract contractforapipelinetocarrynaturalgasfromIran majorupgradeofthecountry’stelephonesystem, for a pipeline to carry tomeetfuelneedsforIraq’sgas-firedpowerplants.459 includinga$3.5billionprogramtoquadruplethe natural gas from Iran number of fixed lines in the country from two to meet fuel needs for Iraq’s gas-ﬁred milliontoeightmillionoverthenextfiveyears.462 power plants. Developments in SinceApril1,theMinistryofElectricityhas Non-Hydrocarbon Areas signed at least six contracts, collectively valued atnearly$5.8billion,forconstructionofnew Non-oil Investment generating capacity. InlateApril,theCoMagreedtoa$37billion Also this quarter, South Korea’s Hanwah program to upgrade the nation’s infrastructure, Engineering&Constructionsignedanagreement muchofwhichisobsolete,decaying,orboth.The program,whichrequiresCoRapprovalbeforeit canbeimplemented,wouldprovide$10billion fortransportationand$5billioneachforeduca- tionandagriculture(includingirrigation).460 For amoredetailedbreakdownoftheproposedinfra- structure renewal program, see Table 4.6. Ledbymajorprojectsintransportation,housing,andelectricity,non-oilinvestmentisexpected to grow substantially in 2011. Planned projects suchasal-Fawportandanewregionalairport toservethecentralIraqpilgrimagedestinations PrimeMinisterNurial-MalikijoinsSouthKoreanandIraqi participants in ceremonial signing of contract to build 100,000 ofKerbala,Najaf,andHillahavehelpedmake housing units south of Baghdad. (GOI photo)

90 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 90 7/25/2011 10:38:14 AM ECONOMY

ofcerealimportsfortheyearendingJune30,2011, droppedto4.7milliontons,about10%belowthe 5.2milliontonsimportedduringtheyearending June 30, 2010.467 Agricultural yields, invariably uneven,areexpectedtoremainespeciallyerratic in the years ahead without a large-scale investment programtorevitalizebothcropresearchandir- rigation infrastructure.468

Inma AnauditofUSAID’sagribusinessprogram, Inma,releasedbyUSAID’sOfficeofInspector General(USAIDOIG)thisquartercitedaseries The renovated al-Rasheed Hotel reopened in July. (GOI photo) ofmajorcontractorshortcomings.Includedin tobuildadefactosatellitecityof100,000housing thesefindingswasafailuretomeasureorreport unitsintheBesmayaareasoutheastofBaghdad.463 performanceresultsontwooftheprogram’sfour Baghdad’s al-Rasheed Hotel reopened in July fol- principal goals—to increase agricultural sector lowingamajorrenovation.The450-roomproperty productivity and boost the value of available finan- willprovideluxuryaccommodationinsidetheIn- cialresources,suchasagribusinessloans.USAID ternational Zone. The hotel was closed in 2010 for OIGfoundthatthecontractoralsofailedtoad- renovation as part of Baghdad’s preparation for an equately substantiate the results provided to meet Arab League summit, initially scheduled for March theprogram’stwoothermaingoals,generating Auditors found 2011, but then postponed.464 Also in July, Marriott newjobsandincreasingsalesofUSAID-assisted inadequate oversight InternationalsignedagreementswithEmpireIraq enterprises. In addition, auditors found inadequate had left $16.7 million tomanagetwohotelpropertiesinErbil.Onewill oversight had left $16.7 million susceptible to fraud. susceptible to fraud. bea200-roomhotelcarryingtheMarriottHotels Thereportcited“severalfactors,foremostamong andResortsbrand,theothera75-unitcomplex them mismanagement.”469 USAIDinformedSIGIR operated as Marriott Executive Apartments. Both that Inma hasmade“substantialprogress”in are scheduled to open in 2014.465 addressingmanagementshortcomingsandthat reporting deficiencies are being rectified.470 Agriculture Harvestingofthe2011winterwheatandbarley Financial Sector Developments cropsbeganinirrigatedareasofsouthernIraqthis Restructuring Iraq’s banking sector remains an quarter; however, forecasts about the size of Iraq’s importantprerequisiteforgreaterprivate-sector totalcerealharvestremainedunclearbecauseof growth.USAID’sIraqFinancialDevelopmentPro- lateanderraticrainsinnorthernIraqatthestart gramcompletedadraftofthefirstsurveyevercon- ofthegrowingseason.Thekeyrain-fedgrowing ductedofIraq’sprivatebankingsectorthisquarter. area of Ninewa province was especially affected The 153-question survey was distributed to 29 pri- by the later-than-normal rains. Low water levels vatebanks,anditsresultsareexpectedtoprovide ontheEuphratesandTigrisRiversandhighsoil insights into the ability of these lending institutions salinitybothareexpectedtodiminishcropyields tohelpfinancethegrowthofprivateenterprise. in the south.466 Strong banks are needed to expand private-sector Primarilybecauseofthebumperharvestof business and broaden the economy beyond oil. home-grownwintergrainsin2010,Iraq’sforecast Thebankingsectoriscurrentlydominatedby

JULY 30, 2011 I REPORT TO CONGRESS I 91

July2011.indb 91 7/25/2011 10:38:14 AM DEVELOPMENTS IN IRAQ

twostate-ownedbankswhosebalancesheetsare Figure 4.18 saddled with Saddam-era debt. Among the survey’s Influence of Banking and Capital Market Environment on Investment in Selected preliminaryfindings:only1.4%ofallIraqisholda Middle East Countries depositaccountatprivatelyownedbanks,andeven 471 fewerborrowfromthesebanks. Saudi Arabia

Qatar Trade Bank of Iraq The head of the Trade Bank of Iraq (TBI) was UAE removedsuddenlyinearlyJune,followingan Bahrain apparentclashwithPrimeMinisteral-Maliki. Kuwait ThePrimeMinisteraccusedthebank’schairman, Husseinal-Uzri,of“financialviolations”thatcould Egypt includecorruptionandalsoannouncedajudicial Syria investigation into possible wrongdoing.472 Al-Maliki Iraq appointedHamidaal-Jaf,anexecutivefromthe state-ownedRafidainBank,asthenewTBIhead. Yemen Following the change in leadership, the bank was 012345678910 operating normally.473 Inabankingsectorthathas « Unfavorable Favorable »

struggledtocomplywithinternationalstandards, Source: Arab Petroleum Investment Corporation, Economic Commentary, Vol. 6 No. 4, 4/2011, p. 2, http://apicorp-arabia.com/html/cms/media/ the TBI connected quickly with the outside world pdf/research/Commentary_V_6_N_4_2011.pdf, accessed 7/21/2011. afteritsfoundingin2003.Ithasestablishedanet- workofcorrespondingbanksin39countries,was or make payments—all by mobile telephones or thefirstIraqibanktoissueVisacreditcards,and remote computers. In a nation where two-thirds of began working with MasterCard in 2011. By mid- alladultsowncellphones,butonlyone-fifthhave 2011,ithadestablished15domesticbranches—all bank accounts, authorities hope the initiative will of them with automatic teller machines.474 For a expanduseofbanksandweanIraqisfromtheir comparisonofhowthebankingandcapitalmarket penchant for cash-only transactions.475 environment influences the investment climate in The Iraq Financial Sector Development Program selected Middle East countries, see Figure 4.18. reported progress in three other areas, as well:476 The Prime Minister • concludingtheinitialphaseofanefforttoestab- accused the bank’s U.S.AssistancetotheBankingSector lishanationalbankingassociationtoadvocate chairman of TheCBIandUSAIDthisquarteragreedona for the industry “ﬁnancial violations” memorandumofunderstandingtocreatetheIraq • buildingsupportamongthelargerprivatebanks that could include corruption. PaymentSystem—acentralpaymentsystemfor toestablishaBankTrainingInstitutetoimprove Iraq’sbanksthatwillincludemobiletelephone the level of employee technical skills and Internet technologies. USAID’s Iraq Financial • selecting United Arab Emirates University to Sector Development Program will be assisting conductananalysisoftechnicalknowledge developmentofthesystem,whichisexpectedto gapsthatcouldbefilledbyanadvanced-degree add flexibility—and potential customers—to a university program bankingnetworkthathasstruggledtodoeither Thisquarter,USAID’sProvincialEconomic since 2003. USAID will develop legal, regulatory, Growth Program, Tijara,conductedaseriesof andtechnicalrecommendationsfortheCBI.The small- and medium-enterprise lending workshops systemwouldenableIraqistoopenanaccount, forbankloanofficers,whichcoveredsuchissues transferfundsbetweenbanks,withdrawfunds, asmarketing,profitability,andthehandlingof

92 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 92 7/25/2011 10:38:14 AM ECONOMY

overdue loans. Microfinance institutions supported Figure 4.19 by the Tijara program financed more than 8,000 U.S. Exports to Iraq, 2008–2011 new loans this quarter, valued at $20.4 million.477 $ Billions $2.07 $1.77 SOE Reform $1.64 Individual ministries are looking at restructuring state-ownedenterprises(SOEs)undertheircontrol $1.17 $0.92 followingtheCoM’sapprovallastquarterofaroad $0.79 $0.74 map to restructure the country’s 170-plus SOEs to makethemmorecompetitive.About75ofthem 2008 2009 2010 2011 arecontrolledbyoneministry—theMinistryof First 5 months

IndustryandMinerals(MIM)—whichhasfocused Source: U.S. Census Bureau, “2011: U.S. Trade in Goods with Iraq,” oneffortstoattractprivatecapitalandbuildjoint- www.census.gov/foreign-trade/balance/c5050.html, accessed 7/18/2011. ventures to strengthen those enterprises already firstfivemonthsoftheyear,thevalueofAmeri- viewed as profitable. Steps taken over the past half cangoodsshippedtoIraqtotaled$1.17billion,an year have lifted the number of MIM-controlled increase of nearly 60% over the same period of 2010 SOEs considered commercially viable from 6 to andthestrongestfive-monthperformancegoing 14,accordingtotheminister,Ahmedal-Karbouli. backatleastthroughthemid-1970sforAmerican Intheprocess,theMIMhasbecometheleadGOI exportstoIraq.Despitethisgrowth,theoverall agency in testing the public-private partnerships trade relationship between the two countries is that form a key dimension of the government’s dominatedbyIraqioilexportstotheUnitedStates. restructuring road map. Enterprises the minister Thisimportsregisteredover$5billionforthefirst believesholdthegreatestpotentialincludethose fivemonthsof2011andtotaledmorethan$12billion producing phosphate, fertilizers, pharmaceuticals, in 2010.480 Figure4.19showsU.S.exportstoIraq cement,andpetrochemicals.Ifthesejoint-ventures since 2008. succeedincreatingnewjobsandnewwealth, Atrademissionwithrepresentativesofsix al-Karboulisuggestspoliticalsupportcanbuild U.S.companiesspentaweekinIraqthisquarter, fornewlawsneededforabroaderprivatizationof makingstopsinBaghdadandBasrahtolearn Iraq’s economy to succeed.478 more about possible commercial opportunities. The challenges are But the challenges in industry are formidable, ThemissionwassponsoredbytheU.S.Chamber formidable, including includingobsoletefactories,over-employment, of Commerce as part of its Iraq Business Initiative. obsolete factories, insufficient raw materials, outdated technologies, Duringthetrip,thechamberannouncedformation over-employment, andsporadicelectricitysupplies.OnJuly1,2011, of an American Business Council of Iraq, based in insufﬁcient raw McKinsey&Companysigneda$3millioncontract Baghdad, with goals to enhance American-Iraqi materials, outdated to assist the MIM in developing the type of public- economiccooperationandsupportU.S.businesses technologies, and privatebusinesspartnershipenvisionedinthe operatinginthecountry.Thetripwasinitially sporadic electricity GOI’splantomakeitsSOEscompetitive.479 scheduledforthefallof2010,butwastwicedelayed. supplies. ItoccurredasagrowingnumberofEuropeanand Trade Developments Asian-based companies have established them- Afteratwo-yeardecline,U.S.exportstoIraqhave selvesinIraqoverthepastyearbytakingstakesin shownnewsignsofgrowthin2011.Duringthe multibillion-dollar infrastructure projects.481◆

JULY 30, 2011 I REPORT TO CONGRESS I 93

July2011.indb 93 7/25/2011 10:38:14 AM DEVELOPMENTS IN IRAQ

PUBLIC SERVICES

Dissatisfactionwithpublicservicesremainshigh Figure 4.20 throughout Iraq. In its most recent assessment of Dissatisfaction with Basic Services as a Potential Cause of Civil Unrest, by Province how susceptible each province is to civil unrest, U.S.Embassy-Baghdadfoundthat2ofIraq’s18 provinceswereconsidered“moderatelyunstable” inthecategoryofpublicservices,andtheother16 wererated“veryunstable”(seeFigure4.20).Nearly all metrics used to determine this rating—such as accesstopotablewater,sewerage,electricity,and Very Stable qualityofroads—weredeemed“veryunstable”in Stable 482 almost all provinces. A recent survey of resi- Moderately Stable dentsinDiyalawasconsistentwiththesefindings: Moderately Unstable at least two-thirds of the respondents expressed Very Unstable dissatisfactionwithcleanliness,healthcare,educa- Note: Rankings are from U.S. Embassy-Baghdad’s Stability Development tion,publicworks,andavailabilityoffueland Roadmap, an assessment model that analyzes public opinion about 483 several areas of concern, including basic services, to estimate the potential electric power. for civil unrest resulting from these perceptions.

Source: U.S. Embassy-Baghdad, response to SIGIR data call, 7/5/2011.

Electricity requiredoverthenext20yearstoclosethecurrent supply-demandgapandkeepitclosed.487 AsofJune30,2011,theUnitedStateshadobli- gated $5.07 billion and expended $4.98 billion Supply and Demand to improve Iraq’s generation, transmission, and Iraq’sestimateddemandforelectricitythisquarter distribution of electricity.484 averagedabout275,600megawatt-hours(MWh) TheCoR-approvedGOIbudgetfor2011allocates perday,or11,484MW—a1%increasefromlast morethan$4.23billiontotheMinistryofElectric- quarter,but22%abovedemandduringthesame ity(MOE).Ofthattotal,almost$1billionisforthe quarterin2010.Followingthepatternofprevious purchase of imported energy—$486 million for April–June reporting periods, estimated demand imported electricity and $513 million for imported climbedalongwithrisingtemperatureseach June 2011 set a new fueltoburnatpowerplants—andalmost$3.20bil- month.Averaging13,294MW,June2011setanew record for monthly lion is for capital projects.485 On June 12, the CoM record for monthly electricity demand, and, as of electricity demand. approvedanadditional$927millionforthecapital themiddleofthemonth,Julywasontracktobreak budget to finance construction of new generat- that record.488 ing capacity and other electricity infrastructure ThetotalsupplyofelectricityonIraq’sgridthis projects. This brings the MOE’s 2011 capital budget quarteraveraged6,574MW,justenoughtoachieve tomorethan$4.12billion,18%morethanits2010 anewrecordhigh.AlthoughtheMOEhasbeen capitalbudgetof$3.49billion.486 The U.S.-funded actively announcing and implementing plans to Iraq Electricity Masterplan,whichisnowserving increase generating capacity, the country’s total as an internal MOE planning document, estimates supplyonthegridhaschangedlittleoverthepast thatalmost$77billionincapitalinvestmentswillbe twoyears,andGOIofficialshavebeencautioning

94 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 94 7/25/2011 10:38:14 AM PUBLIC SERVICES

Iraqisthatthesituationisunlikelytoimprove ExpansionofGeneratingCapacity before2012.Thisquarter’ssupplyrepresentedaless than3%(171MW)increasefromlastquarter,a6% GEMegaDealPlants (372MW)increasefromthesamequarterlastyear, Almost two-and-a-half years after the MOE entered anda0.5%(34MW)increasefromtheprevious intothe“MegaDeal”withGeneralElectric(GE) recordsetintheJuly–Septemberquarterof2010.489 to purchase 56 combustion turbines—each with Expandedgeneratingcapacityinprivatelyowned anameplatecapacityof125MW—groundwas andoperatedpowerplants—namely,thethree brokenthisquarterforthefirstprojectsthatwill combustion turbine plants in the Kurdistan Region use these turbines: andthetwodieselpowershipsinBasrah—wasthe • OnMay8,DeputyPrimeMinisterforEnergy Expanded generating primaryfactorbehindthesupplyincreaseoverthe al-Shahristani laid the foundation stone for the capacity in privately pastyear.Together,theseplantsproducedanaver- 1,250MWal-QaryatpowerplantinKerbala. owned and operated ageofmorethan1,400MWthisquarter,twicewhat ÇalıkEnerjiofTurkeywascontractedtobuild power plants was the they produced during the same quarter in 2010. theplantforatotalcostof$445.5million.The primary factor behind Thisadditionalgenerationfromprivateplantswas plant will have 10 generating units, and the the supply increase partiallyoffsetbydecreasedoutputatgovernment- MOE expects some of these units to be opera- over the past year. operated plants and reduced imports.490 tional in 2012 and all of them to be in service by AsurgeinpowergenerationatMosulDam mid-2013.492 contributed the most to this quarter’s production • OnMay15,SouthKorea’sHyundaiEngineering increase relative to last quarter. Because of low wa- &Constructionstartedworkona$219million terlevels,thedam’sturbineswereidleformuchof projecttoaddfourturbinestotheQudaspower theJanuary–Marchperiod,andtheirtotaloutput plantinBaghdad.Completionoftheproject, averaged15MW.Thisquarter,accordingtoMOE which the MOE expects to take 18 months, will data, the dam produced an average of 361 MW— expandtheplant’snameplategeneratingcapac- an increase of more than 2,200%.491 ityfromabout900MWto1,400MW.493 Forquarterlyaveragesofsupplyandestimated • OnMay22,ÇalıkEnerjiandtheMOEheld demandsinceJanuary2004,seeFigure4.21. thegroundbreakingceremonyforthe750MW

Figure 4.21 Average Iraqi Electricity Supply and Estimated Demand, by Quarter, 1/2004–6/2011 MW

14,000

12,000 Estimated Demand 10,000

8,000 Total Supply Imports 6,000

4,000 Power-plant Production 2,000

0 20042005 2006 2007 2008 2009 2010 2011

Sources: ITAO/ESD, Electric Daily Performance Reports, 6/1/2006−6/30/2011; DoS, Iraq Status Reports, 10/25/2006, slide 11, and 5/9/2007, slide 11.

JULY 30, 2011 I REPORT TO CONGRESS I 95

July2011.indb 95 7/25/2011 10:38:15 AM DEVELOPMENTS IN IRAQ

Division of Power Figure 4.22 The aggregated data for electricity supply Electricity Supply and Demand, Kurdistan Region vs. the Rest of Iraq, 2008–2011 anddemandinIraqmasksthediffer- Comparison of April–June Quarters encesintrendsinsideandoutsideofthe KurdistanRegion.TheKRG’sMinistryof Electricity Supply Load Served as Percentage of Demand MW Electricity(KRG-MOE)operatesapower transmission and distribution network 6,000 100% that serves Erbil, Dahuk, and Sulaymani- 5,000 80% 4,000 yah,whiletheGOI’sMOEcontrolsthe 60% 3,000 grid that serves Iraq’s 15 other provinces. 40% 2,000 Thetwogridsarenotconnected.494 1,000 20% ElectricityintheKurdistanRegion 0 0% is supplied by five power plants: three 2008 20092010 2011 2008 20092010 2011 combustion turbine plants owned and Kurdistan Region Iraq, excluding the Kurdistan Region operated by independent power producer Source: SIGIR analysis based on ITAO/ESD, Electric Daily Performance Reports, 4/1/2008–6/30/2011. Mass Global and two hydroelectric plantsrunbytheKRG.Thesefiveplants The picture became more complicated • Within the Kurdistan Region, lower have a combined feasible generating late this quarter when the province of Ta- output from the two hydroelectric capacityof2,094MWandproduced, meem (Kirkuk) began purchasing power plants, the cessation of imports from on average, 1,302 MW this quarter (62% fromoneofMassGlobal’splants.Inan- Turkey,andthestartofexportsto ofcapacity).Thethreeprivatelyowned nouncing these exports from the Kurd- Tameem were more than offset by plantsstartedcomingonlinein2008 istanRegion,KRGPresidentMassoud adoublingofproductionatthepri- andaccountedforalmost96%ofthere- Barzanisaidtheywereintendedtohelp vately owned plants. gion’stotalsupplythisquarter.Electric- Tameem during the summer and would • On the MOE-controlled grid, in- ityimportsfromaKartetpowerplantin continue until the GOI “returns all these creased production from the power- TurkeyendedinJanuary2011.495 areastotheKurdistanRegion.”497 During shipsandahigherlevelofimports IntherestofIraq,about85%ofthe the last eight days of the month, these werepartiallyoffsetbydecreasedpro- electricityisgeneratedatmostlyolder, importsaveraged85MW.498 Although ductionattheMOE’spowerplants. MOE-operatedpowerplants,and3%is thiselectricityisbeingusedoutsideof MOEdataalsoshowsdemandinthe produced by the privately owned power- theareacontrolledbytheKRG,itdoes KurdistanRegionincreasingatafaster shipsinBasrah.Together,thefeasibleca- not actually enter the MOE grid.”499 pacethanintherestofIraq.Compared pacityoftheseplantsis9,980MW,and AsshowninTable4.7,whilethegrid with the same quarter in 2010, the their average output this quarter was supplyforthecountryasawholein- region’s demand rose about 40%, while 4,624 MW (46% of capacity). Imports creasedby6%fromtheApril–June2010 intheother15provincesitincreased fromIranprovidedtheremaining12% quartertothesamequarterthisyear, an average of 18%.501 Figure 4.22 shows of supply on the MOE-controlled grid.496 it increased by 30% in the Kurdistan changesinthesupplyanddemandsitua- Regionandby1%intherestofIraq:500 tioninthesetwoareasofIraqsince2008. Table 4.7 Growth in Electricity Supply, by Area of Iraq, 2010–2011 Average Supply, in MW, during April–June Quarters Non-KRG Provinces KRG Provinces All Iraq 2010 2011 Change 2010 2011 Change 2010 2011 Change

Government Power Plants 4,589 4,466 -123 (-3%) 158 57 -102 (-64%) 4,748 4,523 -225 (-5%) Private Power Plants 21 158 137 (669%) 687 1,245 558 (81%) 708 1,402 695 (98%) Net Importsa 596 656 60(10%) 150 -7 -158(-105%) 747 649 -98(-13%) TotalSupply 5,206 5,280 74 (1%) 996 1,294 298 (30%) 6,202 6,574 372 (6%)

a Net imports include the electricity (averaging 7.5 MW over the entire quarter) that was exported from the Kurdistan Region to Tameem; this electricitydidnotbecomepartof the MOE-controlled grid.

Source: SIGIRanalysisbasedonITAO/ESD,Electric Daily Performance Reports, 4/1/2010–6/30/2011.

96 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 96 7/25/2011 10:38:15 AM PUBLIC SERVICES

al-Qayarah power plant in Ninewa province. U.S.Embassy-BaghdadreportsthattheMOE The MOE expects this $388 million project to be hascanceledal-Qaryatthermalplant,whichithad completedbyearly2013.502 plannedtobuildinKerbala. Once completed, these three engineering, procurement, and construction (EPC) projects will Fuel Availability Issues add2,500MWofnameplatecapacitytoIraq’s Becausenaturalgasisunavailabletothenewal- national grid. Sadr plant, it is set up to use diesel fuel. But truck- TwootherGEMegaDealEPCprojectsmoved ingtheneededquantityoffuel—about2million closertotheconstructionphasethisquarter.On liters (more than 500,000 gallons) each day—to the June20,theMOEsignedan$81.3millioncon- siteinnortheastBaghdadapparentlyhasprovento tractwithLancoInfratechofIndiaforconstruc- beachallenge.Althoughtheplant’scurrentcapac- tionofthe250MWAkkasplantinAnbar,503 and ityis320MW,itsaverageproductioninJunewas onJuly7,itawardeda$130millioncontractto 42MW;forthequarter,itwas20MW.508 BaghdadCompanytobuildthe500MWHaydariya Toovercomethisfuel-availabilityproblem,the plantinNajaf.504 MOEsigneda$365millioncontractonJune30 The MOE received bids in February for four underwhichECGIranwouldbuilda140-mile- otherGEMegaDealprojectsthatitplannedto longpipelinetotransportnaturalgasfromIran, award to independent power producers, but the throughDiyalaprovince,toBaghdad.According CoMcanceledtheseprojectsonMay24.TheMOE totheMOE,theproposedpipelinewouldserve thenconvertedthemtoEPCprojects,andbidsare theQudasandal-Sadrpowerplants,anditwould due during the first 10 days of August.505 provide25millioncubicmeters(almost900mil- lioncubicfeet)perdayforfiveyears—enoughgas Other Major Power-plant Projects to generate 2,500 MW.509 OnApril25,theMOEsigneda$1billioncontract Inanapparentmovetoprovideaninterim with China’s Shanghai Electric Group to almost solution for al-Sadr plant, the MOE announced on doubletheplannedcapacityofal-Zubaidiya June23thatithadsignedaone-yearcontractto thermalplantinWassit.InMay2010,Shanghai purchase1.5millionliters(almost400,000gallons) Electricbeganconstructionofthefirstphaseofthe perdayofdieselfuelfromIran’sOilMinistry.The project,a$924millionefforttoinstall1,320MWof MOE said that Iranian tanker trucks would deliver nameplate capacity. The second phase, scheduled thefuelandthatthevolumewouldbesufficientto forcompletionin2014,willaddtwo610MWgen- generateupto250MWofpower.510 eratingunitsandbringtheplant’stotalnameplate The MOE Inspector General has voiced concern capacityto2,540MW.506 thatlargequantitiesofdieselfuelenroutetopow- Alsothisquarter,IranPower&WaterEquip- erplantsarebeingstoleneachmonthasaresultof mentandServicesExportCompany(Sunir) collusion between trucking contractors and MOE The MOE IG completedconstructionofthefirstphaseofal-Sadr employees.AccordingtotheMOEIG,hisoffice estimates that the powerplantinBaghdad’sSadrCity.Theproject, has uncovered the theft of fuel from hundreds of illegal diversion of whichbeganinMarch2009,wascompletedon fullyloadedtankertrucksinBaghdad,Basrah, fuel has reduced daily schedule at a cost of about $225 million. The plant Baiji, Samarra, and other areas. He estimates that electricity production hastwo160MWSiemenscombustionturbines,the theillegaldiversionoffuelhasreduceddailyelec- in Iraq by as much as firstofwhichwasconnectedtothegridforatest tricityproductioninIraqbyasmuchas400MW, 400 MW. runinApril.TheMOEanticipatesaddingtwomore orabout6%oftotalsupply.511 160MWgeneratingunitstotheplant,whichwould bringthetotalnameplatecapacityto640MW.507

JULY 30, 2011 I REPORT TO CONGRESS I 97

July2011.indb 97 7/25/2011 10:38:15 AM DEVELOPMENTS IN IRAQ

Emergency Measures To Increase ofelectricityperdayatreasonableprices.Indoing Electricity Supplies so,theGOIacknowledgedthedifficultyitwashav- Mostofthelarge-scalenewgeneratingcapacity ingsupplyingconsumersviathenationalgrid.516 now being developed is not scheduled to come on Implementation of the plan began on June 1, and lineuntil2013–2015andwillnothelpIraqclose theMOEestimatesthatitcouldenableconsumers thesupply-demandgapthisyearornext.TheGOI togetupto20hoursofpowerperday—12hours thereforeisimplementingseveralemergencymea- from neighborhood generators and 8 hours from surestoincreasetheavailabilityofelectricpower. the national grid.517 As described in SIGIR’s April 2011 Quarterly Report, the MOE announced in March an expe- KRG Expansion Plans dited program to complete 50 new 100 MW diesel On July 7, the KRG’s Ministry of Electricity plantsbythemiddleofnextyear.Sincethen,the announceditsintentiontoadd6,000MWof MOEscaledthisprogramdownto40plants,and generating capacity, as well as a new 400 kilovolt ithasenteredintocontractsforall4,000MWof (kV) network, to the Kurdistan Region’s power new capacity: system.Thenewplantswouldoperateonnatural • OnMay18,theMOEsigneda$2.77billion gas,heavyfueloil,andhydropower.TheKRG- contract with STX Heavy Industries of South MOE said it was seeking qualified investors to Koreatobuild25plants.512 But according to U.S. design, supply, construct, commission, operate, Embassy-Baghdad,thecontractisnowonhold andmaintainthenewpowerplantsatvarious because STX has objected to some of its terms.513 locationswithintheregion.518 • OnJuly2,theMOEenteredintoa$1.17billion contractwithCanadianAllianceforPowerGen- Recently Completed and Ongoing erationEquipment(Capgent)forconstructionof U.S.-funded Projects 10 plants.514 TheU.S.ArmyCorpsofEngineers(USACE)re- • OnJuly6,itsigneda$625millioncontractwith ported that it completed six electricity projects, with USACE completed aGermancompanytobuildfivemoreplants.515 atotalvalueof$42.6million,thisquarter.Thesein- the last remaining To make more off-grid electric power available to cluded the last remaining electricity project funded electricity project consumersthissummer,theCoMonMay24ap- bytheIRRF:constructionofthe$29.1million funded by the IRRF. provedaplantoprovidealimitedquantityoffree substationinRamadi.Threeoftheothercompleted fuel to owners of government and private generators contractsused$11.6millionfromtheESFforequip- as long as those providers supplied at least 12 hours mentpurchases.AccordingtoUSACE,italsohad

The last IRRF-funded electricity project, the $29.1 million substation in Ramadi, was completed this quarter. (Symbion Power photos)

98 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 98 7/25/2011 10:38:15 AM PUBLIC SERVICES

Iraq’s Minister of fiveongoingESF-fundedelectricityprojectsatthe port along al-Faw peninsula in Basrah province.520 Transportation endofthequarter,withatotalvalueof$17million. InApril2010,theministerheldacornerstone-laying announced plans Thelargestwasa$6.8millionprojecttoprocure ceremonytoinaugurateplanstobuildtheport, to solicit bids gas-insulated circuit breakers and associated equip- whichIraqisenvisionasacriticalseaporthubfora to construct a mentforsubstationsinDiyala.Threeoftheprojects, “drycanal”—anetworkofrailwaysandroadsthat multibillion-dollar together valued at $7.2 million, were for additional theyhopewillcompetewiththeSuezCanalinthe deep-water port workatal-Musayabcombustion-turbineplant. transportation of goods to Europe.521 The Italian firm along al-Faw peninsula. Theotherwasfortheprocurementof$3millionin Technitalwonthecontracttocreatetheportdesigns, equipmentforasubstationinNinewa.519 whichwillprovideformultipledocksandjetties,a wheat silo, helicopter landing strips, water-treatment units, and security surveillance systems.522 Transportation However,acornerstone-layingceremonyheld thisquarterforaKuwaitiportprojectonBubiyan Ports Island rankled Iraqi leaders, who claimed the Thisquarter,Iraq’sMinisterofTransportation portwouldaffecttheeconomicandnavigational announcedplanstosolicitbidsbytheendofthe interestsofIraqduetoitspotentialtoimpedesea year to construct a multibillion-dollar deep-water traveltotheUmmQasrandal-ZubairPortsand toreducecommercialtrafficatal-FawPort.Iraqi Figure 4.23 officialstraveledtoKuwaittodiscussplansfor Location of Iraqi Ports, al-Faw Peninsula, and Bubiyan Island the competing port.523 Figure4.23displaysthe geographical proximity of al-Faw and Umm Qasr PortstoBubiyanIsland. Meanwhile, efforts continued this quarter IRAQ toestablishIraq’spresenceintheinternational Al-Zubair Port IRAN maritime community, with Iraqi and U.S. Coast UN-established boundary GuardofficialsattendingaconferenceinLondon demarcation line Umm Qasr Port toadvanceIraq’simplementationofandcompli- Al-Faw Peninsula ance with international maritime conventions and Al-Faw Port regulations.Thedelegationalsosoughttoconduct aportsurveytoestablishsecurityproceduresat Iraqiportsandtotraintrainers.524

KAAOT Aviation Bubiyan Island (site of new Kuwaiti port) ABOT USF-IreportedthisquarterthattheIraqiCivilAvia- tion Authority (ICAA) has more than 100 Iraqi air- trafficcontrollersatvariousstagesofhire,training, KUWAIT orcertification.InJune2011,Iraqassumedcontrol PERSIAN overallairspaceinthesouthernthirdofthecountry. GULF Elsewhere,theICAAcontrolsairspaceat15,000feet andabove,andisexpectedtoassumefullcontrol ofairspaceinthenorthernthirdofthecountryin AugustandinthecentralthirdbyOctoberofthis year.525 USF-Ireportedthatitmaintainedapres- Source: UNSC, S/1994/1111, “Report of the Secretary-General on the United Nations Iraq-Kuwait Observation encethisquarteratBaghdad,Basrah,andMosul Mission,” 9/29/1994.

JULY 30, 2011 I REPORT TO CONGRESS I 99

July2011.indb 99 7/25/2011 10:38:15 AM DEVELOPMENTS IN IRAQ

InternationalAirports.Itexpectedtoenditsmission Water and Sanitation attheBaghdadandMosulairportsinOctoberandat theBasrahairportinDecember.AccordingtoUSF-I, AsofJune30,2011,theUnitedStateshadobligated theBasrahandBaghdadairporttransitionswere $2.65billionandexpended$2.57billiontorehabil- progressingwell,butthetransitionatMosulairport itate Iraq’s water and sanitation sectors.534 The U.S. wasimpededbecausetheICAAhadalimited ArmyCorpsofEngineers(USACE)reportedthat presenceattheairportanddidnothavequalified it had completed 11 water and sanitation projects techniciansorair-trafficcontrollersthere.526 thisquarteratacombinedcostof$27million.535 Iraqcontinuedthisquartertoexpandthenum- Oftheseprojects,10werefundedbytheESF,and berofairlinesflyingcommercialflightstoBaghdad onewasfundedbytheIRRF.Al-KiblaSewerand andotherIraqicities.AustrianAirarrivedinBagh- StormNetworkwasthelargest—an$11.1million dadonJune8,andtheairlineannouncedplansto ESF-fundedprojectinBasrahprovincetodesign operatethreeflightsperweekbetweenViennaand andconstructasanitarysewerandstorm-water Baghdad.527 InJune,IraqiandTurkishcivilaviation collectionsystem.Thenetworkincludespumpsta- authoritiessignedanagreementtoincreaseflights tions,forcemains,manholes,inlets,andindividual andlaunchnewflightdestinationsbetweenthetwo house connections.536 countries; in July, Turkish Airlines flew its first di- USACEreportedthisquarterthatithadcom- rectflightbetweenIstanbulandNajaf.528 Asimilar pletedthe“backbone”ofthelong-awaitedFalluja USACE reported bilateralagreementwassignedthisquartertopave WasteWaterTreatmentPlantandCollection this quarter that thewayfordirectflightsbetweenIraqandItaly.529 System,a$100millioneffortcomprisingmultiple it had completed smallerprojectstodevelopawastewatertreatment the “backbone” of Railroads plantandcollectionsystemforthecityofFallujain the long-awaited Falluja Waste Water Thisquarter,theU.S.DepartmentofTransporta- Anbarprovince.Thetreatmentplant,alongwith Treatment Plant and tion (DOT) and its Volpe National Transporta- primarycollectionmainsandpumpingstations, Collection System. tion Systems Center completed a $3.7 million hasbeencompleted,butconnectionstohouses projecttotrainIraqirailwayemployeestooper- arestillongoing.A$7.6millionU.S.government ateandmaintaintherailways’DigitalMicrowave granttotheMinistryofMunicipalitiesandPublic Radio Communication Network. The training Works, coupled with an $85 million GOI construc- waspartofa$48.1millionprojecttocreatea tion project, is intended to complete the collec- digitalcommunicationssystemthatwillbeused tionsystemfortheentirecityofFallujaby2014. to operate Iraq’s railroads.530 AccordingtoU.S.Embassy-Baghdad,thereare

Road Construction USACEreportedthatconstructionoftworoad projects was ongoing this quarter. The first is the ESF-funded $4.1 million al-Amarah–al-Maymu- nahCarriageway,scheduledforcompletionin August2011,whichwillbeatwo-lanehighway roughly 14 miles long with three bridges.531 The secondprojectisa$2.1millionIRRF-fundedeffort toreplacethebridgesforafuturetwo-lanehighway adjacenttotheexistingal-Amarah–al-Maymunah Carriageway.532 It is also slated for completion in USACE reported completion this quarter of the Falluja Waste Water Treatment Plant and Collection August 2011.533 System in Anbar province. (USACE photo)

100 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 100 7/25/2011 10:38:15 AM PUBLIC SERVICES

telephone communications, and high-speed InternetservicefortheBaghdadarea.Completed nearlyfiveyearsafteritsoriginallyforecasted completion date of December 2006, the project sufferedfromsabotageandcontractingproblems and was re-awarded in 2009.539 DoSreportedthisquarterthatIraq’stelecommu- nications sector is hindered by poor infrastructure, high operating costs, and policy differences between the MOC and the Communications and Media Commission (CMC).540 It remains unclear what rolestheMOCandCMCplayinthetelecommuni- cationsindustry.TheCMCwascreatedbyCoalition ProvisionalAuthorityOrder65asacommunica- tionsregulator,butthereisnocorrespondingIraqi lawestablishingtheMOC.TheMOChasdeclared thatallfiberopticslaidinIraqareownedbythe GOIthroughitsstate-ownedenterprise,theIraqi Al-MamoonExchangeandCommunicationsCenterinBaghdadwasturnedovertotheGOIon June30,2011.(USACEphoto) Telecommunications and Post Company.541 currently4,500homesconnectedtothetreatment Afteryearsofneglectandanabsenceofamo- plant, with an additional 4,500 homes expected to bilephonemarketpriorto2003,Iraqboastsone Iraq boasts one of beconnectedbytheendof2011.537 ofthefastestgrowingcellphonemarketsinthe the fastest growing In addition to the grant for house connections in region,withanestimated23millionsubscribers cell phone markets in Falluja,USACEreportedoneotherongoingwater servicedbythreecompanies—AsiaCell,Zain,and the region, with an projectattheendofthequarter—the$1.3million Korek.542 Last quarter, the MOC announced plans estimated 23 million ESF-funded Rivers and Lakes Study that entails to issue a fourth mobile phone license, to be auc- subscribers. collectingwatersamplesfromtheShattal-Arab tioned by the end of 2011.543 However, companies waterwaynearBasrah,majorlakesinIraq,and27 complain of military jamming of mobile phone tributariesflowingintotheTigrisRiverfromIran. frequenciesandhighoperatingcosts—asmuchas Theprojectisexpectedtobecompletedbeforethe $700permegabytetooperatelocalcircuits,com- endofSeptember2011.538 paredwith$50to$80permegabyteintheUnited States and Europe.544 DoSreportedthattheuseoflandlineshasalso Communications steadilyriseninIraq.Since2003,anestimated 1.2 million homes and businesses have subscribed Thisquarter,USACEreportedthe$18.3million to landline service. Internet penetration has lagged IRRF-funded al-Mamoon Exchange and Com- behind,withonly3%ofthehomesorbusinesses municationsCenterinBaghdadwascompleted having access to the Web.545 Iraq’sMinisterof and finally inspected prior to its turnover to the Communications said this quarter that he intended Ministry of Communications (MOC) on June 30, touse$3.5billiontoquadruplethenumberof 2011.Thisseven-storyofficebuildingwillserve fixed-linephonesfrom2millionto8millionin asatelecommunicationshubfortheMOCandis thenextfiveyears.546 DoSreportedIraqiplansto designedtohousestate-of-the-artequipmentto increase Internet usage by 25% over the next five improveradiotransmissions,cellularandlandline yearsaswell.547

JULY 30, 2011 I REPORT TO CONGRESS I 101

July2011.indb 101 7/25/2011 10:38:16 AM DEVELOPMENTS IN IRAQ

Health Care ideally13,400—newelementaryandhighschools immediatelyandabout600newschoolsannually Thisquarter,USACEcontinuedconstructionof after that to accommodate population growth. the$12.6millionESF-fundedMissanSurgical Since2003,theministerestimatestherehavebeen Hospital,an80-bedfacilityinMissanprovince, 2,600newschoolsbuilt,including244constructed whichisscheduledforcompletioninOctober2011. by the MOE.550 Attheendof2010,USACEre- TheBasrahChildren’sHospital,a$165million portedithadcompleted1,166constructionprojects facility opened in October 2010, still does not have in the education sector.551 oncologyservicesavailable,butUSACEhasbegun The Minister of Education emphasized addi- toinstalldonatedmedicalequipment.Meanwhile, tionaleducationchallenges:outdatedcurricula, the$8millionBa’qubaGeneralHospitalhasbeen underpaid and insufficiently trained teachers, high turned over to the GOI, and all essential services illiteracy, and low achievement among students. He (including electricity) were hooked up this quarter. said curricula date back to the 1970s and 1980s and USACEalsocompletedupgradesatthe$3.5mil- characterizedimprovementsmadesincethenas lionIbnSenaCardiacCenterinMosul.548 “superficial.”Heestimatedthatabout70%ofIraq’s 442,000 teachers lack proper training and noted thathisministrylackedthebudgettoexecuteplans Education totrain100,000teachersperyear.Iraq’sstudents, he said, need more discipline, better food, better The Minister of GOI Efforts To Improve Education tutoring, and more private-school options. He Education described Iraqiofficialsfocusedthisquarteronincreasing describedIraq’silliteracyratesas“appalling.”552 In Iraq’s illiteracy rates as boththenumberofschoolsinoperationandthe May, the CoR’s Education Committee released a “appalling.” abilityofitsteachingstafftoeducatestudents. statement estimating that the number of illiterates Overcrowding continues to be a major concern, inIraqhadreached5million.553 as is the quality of teachers, according to Iraq’s MinistersofEducationandHigherEducation. U.S.-funded Education Projects WhileIraqboasts25universities(including6in USACE reported that the $940,000 ESF-funded theKurdistanRegion)and40technicalinstitutes, SemelSchoolinDahukprovincewascompleted thereisashortageofspacetoaccommodatein- this quarter. It also reported that construction of comingstudents.Insomecases,10highereduca- the$1.1millionESF-fundedHalabjaschoolin tionstudentsarevyingforevery4seats.549 Sulaymaniyah province and the $550,000 ESF- GOIofficialsnotedashortageofschoolbuilding fundedNuaymiaschoolinAnbarprovincewas attheelementaryandhighschoollevelsaswell.In ongoing.Halabjawasscheduledforcompletionin aninterviewwithSIGIR,theMinisterofEducation July2011,andNuaymiawasslatedforcompletion estimatedthatIraqneedsmorethan7,000—and by October 2011.554 ◆

102 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 102 7/25/2011 10:38:16 AM SIGIR OVERSIGHT

SIGIR Audits 104

SIGIR Investigations 119

SIGIR Hotline 132

SIGIR Website 133

Legislative Update 134 5section

July2011.indb 103 7/25/2011 10:38:16 AM SIGIR OVERSIGHT

SIGIR AUDITS

SinceMarch2004,SIGIRhasissued194auditre- SIGIR Audits Completed ports.FromMay1toJuly30,2011,SIGIRissuedsix This Quarter auditsaddressingawiderangeofreconstruction issues. They included: Control Weaknesses Remain in Oversight • a report addressing DoD’s management of con- of Theater-wide Internal Security Services tracts to provide static or site security Contracts • areportonDoDmanagementofasystemtoco- (SIGIR 11-018, 7/2011) ordinate, oversee, and report on private security contractorsinvolvedinseriousincidents Introduction • a report examining the use and outcomes of Private security contractors (PSCs) play an impor- CERP 2011 funds tantroleinIraqbyprotectingU.S.personnel,facili- • a report addressing Department of Defense ties,andpropertyrelatedtoreconstructionefforts. (DoD)managementofIraqifundsforCERP The Department of Defense (DoD) relies on PSCs type projects (I-CERP) toprovidestatic,orsite,securitythroughoutIraq • a report on the management and oversight of a byguardingandprotectingfixedlocationssuchas contractwithAnham,LLC,andwhethercosts forward operating bases. In September 2007, DoD chargedwerereasonableandfair awardedfiveTheater-wideInternalSecuritySer- • a report on Department of State (DoS) respon- vices(TWISS)contractstoPSCsforstaticsecurity siveness to SIGIR recommendations at various bases in Iraq.555 InApril2009,theSpecial Foralistoftheseauditproducts,seeTable5.1. InspectorGeneralforIraqReconstruction(SIGIR) SIGIRcurrentlyhas12announcedorongoing reported on the cost, requirements, and oversight audits,andothersareexpectedtostartthisquarter. ofthesecontracts,notingthatcontractingofficer’s SIGIRperformsauditworkundergenerallyac- representatives(CORs)sometimeshadinsufficient cepted government auditing standards. experience, training, and time to perform their oversight roles. In August 2009, DoD awarded another five TWISS contracts. The five current contractshaveacombinednot-to-exceedvalueof Table 5.1 SIGIR Audit Products since 5/1/2011 Report Number Report Title Date Issued

11-018 Control Weaknesses Remain in Oversight of Theater-wide Internal Security Services Contracts 7/2011 MonitoringResponsibilitiesforSeriousIncidentsInvolvingPrivateSecurityContractorsOnce 11-019 7/2011 U.S. Military Forces Leave Iraq Have Not Been Determined Commander’sEmergencyResponseProgramfor2011ShowsIncreasedFocusonCapacity 11-020 7/2011 Development Management of the Iraq Commander’s Emergency Response Program Needs To Be Improved 11-021 7/2011 (Interim Report) PoorGovernmentOversightofAnhamandItsSubcontractingProceduresAllowed 11-022 7/2011 Questionable Costs To Go Undetected DepartmentofStateReportsItHasTakenActiononMostOpenAuditRecommendations,but 11-023 7/2011 Documentation Is Needed

104 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 104 7/25/2011 10:38:16 AM SIGIR AUDITS

$485million,about$258millionofwhichhasbeen perform its contract administration and oversight disbursed as of June 9, 2011. responsibilities. ThisreportfocusesonthefivecurrentTWISS DespiteDCMA’sconcernsabouttheperfor- contractsandaddressesthemannerinwhichDoD manceofsomeCORs,itdidnotprovidetheCORs exercised control over the contractors’ performance ortheirratingofficialswithregularfeedbackon andDoD’sprocessforadjustingthecontractsas performance.Atthesametime,theCORs’rat- U.S. forces withdraw. ing officials did not request COR performance informationfromDCMA.SIGIRbelievesregular, Results writtenfeedbackwould(1)alerttheCORstoareas AlthoughCORdutiesarecriticaltotheU.S. wheretheyneedimprovement,(2)alertrating government’s oversight of the TWISS contracts, officials to the CORs’ weaknesses and the possible SIGIRfoundissuesthatcouldadverselyimpact needforadditionaltrainingorrelieffromother theirabilitytoperformtheseduties,leavingthe duties, and (3) provide rating officials with the U.S.governmentatriskofcontractorfraud,waste, informationtheyneedtocomplywiththeDeputy andabuse.Specifically,almost40%oftheCORs Secretary of Defense’s policy memorandum re- wesurveyedsaidthetrainingtheyreceiveddidnot quiring that raters evaluate COR performance in preparethemfortheirduties,and25%saidthey performance assessments. lack sufficient time to conduct effective oversight. SIGIR also notes that many locations lacked SIGIRfoundsimilarissuesthelasttimeitlookedat trainedbackupCORsforwhentheprimaryCOR theTWISScontractsin2009.Afterthatreport,the was not available. CORs may not always be avail- Defense Contract Management Agency (DCMA) able to perform their oversight duties because of increased training requirements but recognized in vacations, sickness, emergencies, and duty rota- anApril2011internalreviewthatnotalltraining tions. Sufficient numbers of trained backups would wasbeingconductedanddocumented.Regarding ensure continuity in contractor oversight during thelackoftime,DCMAsaidonlytheCORs’com- these times. manderscanrebalanceworkload,andthatduring Finally, the process to terminate TWISS task or- theprocesstonominateCORs,nominatingofficials ders as U.S. troops withdraw and the U.S. military areaffirmingCORshavethetimeandresourcesto closes or transfers bases to the Iraqis appears to be performtheirduties.Whilethatmaybetrue,SIGIR working well. believes DCMA should better inform the CORs’ nominatingofficialsofthetimerequiredtoperform Recommendations theirduties.USF-I,foritspart,needstoassessthe SIGIRrecommendstheDirector,DCMA,direct CORworkloadsandidentifyactionstorebalance actions to: those workloads. 1. ProvideregularfeedbackonCORs’ SIGIRalsofoundthatCORsarenotcompleting, performance. or DCMA is not maintaining, all monthly checklist 2. TrainandappointalternateCORs. reviews which DCMA developed to help CORs 3. VerifythatallCORandQualityAssurance review contractor compliance with task order Representativesreviewsareconducted. requirements.Evenwhencompleted,SIGIRfound 4. Provide COR nominating officials information mostreviewsappearedtobeofquestionablevalue aboutCORs’timeanddutyrequirements. or provided little assurance that COR oversight wasadequate,afactDCMAofficialsacknowledge. SIGIR recommends the Commander, U.S. ThesereviewsareimportanttoDCMA’sabilityto Forces-Iraq, direct actions to:

JULY 30, 2011 I REPORT TO CONGRESS I 105

July2011.indb 105 7/25/2011 10:38:16 AM SIGIR OVERSIGHT

1. AssessandrebalancetheworkloadofTWISS withtheGovernmentofIraq(GOI).SIGIRalso CORs. followeduponthestatusofrecommendationsin 2. Enforceexistingpolicythatratingofficials itsApril2009report.SIGIRwillbeissuingseparate evaluate COR performance during assessments. reportsonthecurrentstatusofthoserecommen- dations. SIGIR encountered significant constraints Management Comments imposed by the DoS Bureau of Diplomatic Security and Audit Response andunresponsivenessbytheBureautoSIGIR’s Managementcommentsareincludedinthefinal requests for information that adversely impacted report,whichcanbefoundontheSIGIRwebsite: andlimiteditsscope,methodology,andabilityto www.sigir.mil. fullyaccomplishitsauditobjectives.

Results Monitoring Responsibilities for Serious SIGIRfoundthatthesystemforreportingand Incidents Involving Private Security investigating serious incidents involving U.S. Contractors Once U.S. Military Forces governmentPSCshaschangedlittlesinceSIGIR’s Leave Iraq Have Not Been Determined 2009report.Moreover,DoD’ssystemisprojected (SIGIR 11-019, 7/2011) toremainunchangedthroughtheendofDecem- ber2011whenU.S.militaryforcesplantoleave Introduction Iraq. SIGIR was told by U.S. military officials that InSeptember2007,Blackwater,aprivatesecurity thepredominanttypesofseriousincidentshave contractor (PSC) under contract with the Depart- changedoverthelastfewyearsfromattacksand ment of State (DoS), was involved in an incident shotsfiredtotrafficaccidentsandharassmentsat that resulted in the death of 17 Iraqi civilians. As checkpoints.SIGIR’sreviewofseriousincidents aresultoftheincidentanditsrepercussions,the reportedfromSeptember2010throughMay2011 Department of Defense (DoD) and DoS took ac- confirmedthatthemajorityofreportedincidents tionstoimprovetheircoordinationandoversight aretrafficaccidentsandincidentsatcheckpoints. ofPSCsinvolvedinseriousincidents.556 In April Thesystem’sfutureislesscertain,asrespon- 2009,theSpecialInspectorGeneralforIraqRecon- sibilitiesformonitoringtheactivitiesofDoD struction (SIGIR) reported on the DoD system for PSCshavenotbeenfullydeterminedandmaybe reporting, investigating, and remediating serious disestablished—eventhoughU.S.-fundedPSCs incidentsinvolvingPSCsinIraq.557 Becauseofthe willcontinuetosupportDoDandDoSorgani- plannedwithdrawalofU.S.militaryforcesfrom zationsandtheU.S.AgencyforInternational IraqinDecember2011,SIGIRreviewedtheU.S. Development. SIGIR could not determine plans government’s current and planned oversight of foritsPSCs,whichcurrentlyreporttheirmissions PSCsinthatcountry.InApril2011,SIGIRreported andseriousincidentsthroughDoD’ssystem.DoS ontherelationshipbetweentheU.S.ArmyCorps wouldnotprovidethatinformation. of Engineers’ Gulf Region District’s reconstruc- U.S. agencies are coordinating serious incidents tion activities and its security contract require- that involve their PSCs with the GOI. Guid- mentswithAegisDefenseServices,Limited.558 ancerequiresthatDoDPSCsreporttheirserious SIGIR’sobjectivesforthisreportaretodetermine incidentstoU.S.militaryauthoritiesandtothe (1) changes in the serious incident reporting and localpoliceforincidentsinvolvingIraqinationals. investigating system since SIGIR’s 2009 report, SIGIR was told by U.S. military officials responsible (2) plans for the system after U.S. military forces foroverseeingPSCreportingthattheyrelyonthe leave Iraq, and (3) coordination of serious incidents PSCstoreporttheirincidentstothelocalpolice.

106 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 106 7/25/2011 10:38:16 AM SIGIR AUDITS

SIGIR was also told that U.S. military and Embassy iftherearelessonslearnedthatcanbeappliedto personnelperiodicallymeetwithGOIofficialsto other environments. discuss PSC operations and serious incidents. This wasconfirmedbyanofficialwiththeGOI’sMinis- Results tryofInteriorwhoexpressedsatisfactionwithU.S. TheUSF-ICommandingGeneralissuedFY2011 governmenteffortstoinformtheministry. CERP guidance explicitly directing that CERP projectsassisttheGOI’scivilcapacitydevelopment. Recommendations The guidance encourages commanders to fund BecauseoftheChiefofMission’sresponsibilities quickly implementable, small-scale projects that for the activities of U.S. government’s executive canbecompletedpriortothetroopwithdrawal agenciesinIraqonceU.S.militaryforcesleavethe deadline.SIGIRinterviewedmorethan30U.S. country,werecommendthattheChiefofMission governmentofficialsresponsibleforCERPman- be responsible for monitoring all U.S. government agement who stated that they are implementing PSCsoperatingincountryandtheincidentsin the program in accordance with the Commanding whichtheyareinvolved. General’s guidance. SIGIR found that many of the civil capacity- Management Comments development projects undertaken do not appear and Audit Response relatedtoDoD’scounterinsurgencymission.For Managementcommentsareincludedinthefinal example, some Provincial Reconstruction Teams report,whichcanbefoundontheSIGIRwebsite: (PRTs)aredeeplyinvolvedinidentifying,planning, www.sigir.mil. andimplementingCERPprojects.DoSrepresenta- tivesatthePRTsstatedthatUSF-Ireliesonthem, inpart,becauseoffrequentmilitarydeploy- Commander’s Emergency Response ment rotations, reduced troop presence, limited Program for 2011 Shows Increased Focus subject-matter expertise, and little experience in on Capacity Development themanagementofcapacitydevelopmentprojects. (SIGIR 11-020, 7/2011) WhileSIGIRsupportstheinvolvementofDoS in coordinating projects, this heavy DoS involve- Introduction mentraisesquestionsaboutwhethertheprojects The 2008 Security Agreement between the United undertaken support DoD’s counterinsurgency StatesandtheGovernmentofIraq(GOI)requires missionorwhetherCERPhasevolvedintoanother thatallU.S.combatforceswithdrawfromIraqby U.S.developmentprogram,similartothoserun December 31, 2011, although no final decision on bytheU.S.AgencyforInternationalDevelopment thewithdrawalhasbeenmade.U.S.Forces-Iraq (USAID) and DoS. (USF-I) repositioned U.S. combat brigades from The authoritative guidance for the CERP Iraqi cities, villages, and localities in June 2009 inIraqisDoD’sMoneyasaWeaponSystem in compliance with the Security Agreement and (MAAWS).CongressandtheArmyAudit began transitioning to an advise, train, and assist Agencyhaveraisedsimilarquestionsaboutfund- role.Asthemissionchanged,U.S.forcesbegan ingprojectsthatappeartogobeyondMAAWS’ their withdrawal. The Special Inspector General intentanddonotfocusoncounterinsurgencyob- forIraqReconstruction(SIGIR)initiatedthis jectives. Adding to the problem is that MAAWS review to determine how the Commander’s Emer- guidancecontainslittledirectiononhowprojects gencyResponseProgram(CERP)isbeingusedin should be selected to support military counterin- supportofthischangingmissionandtodetermine surgency objectives.

JULY 30, 2011 I REPORT TO CONGRESS I 107

July2011.indb 107 7/25/2011 10:38:16 AM SIGIR OVERSIGHT

The MAAWS states that performance metrics Management of the Iraq Commander’s are essential to ensure funds are applied to projects Emergency Response Program Needs To Be that will yield the greatest benefit to the Iraqi Improved (Interim Report) people.However,SIGIRfoundthatthedataunder- (SIGIR 11-021, 7/2011) lyingthesemetricsisnotwellsupported,resulting in output measures of limited usefulness. USF-I Introduction often relies on imprecise testimonial evidence from ThisletteraddressestheSpecialInspectorGeneral subject matter experts and local Iraqi contacts as forIraqReconstruction’s(SIGIR)concernsover thebasisforthedata.AUSF-Iofficialstatedthatas U.S. Forces-Iraq’s (USF-I) management of the Iraq aresultoftheimprecisedata,theeffectandimpact Commander’s Emergency Response Program of CERP projects are largely unknown. The CERP (I-CERP).TheGovernmentofIraq(GOI)provided ManagementCellintheOfficeoftheSecretaryof $270 million to the Department of Defense (DoD) Defense recognizes this problem and is working to inApril2008soitcouldexecuteurgentlyneeded developbettermetrics.Additionally,CERPproject reconstructionprojectsforthebenefitoftheIraqi sustainabilityisuncertainasmonitoringprojects people.SIGIRexaminedDoD’sprocessformanag- will largely cease following the withdrawal of U.S. ingtheI-CERPbecauseofpreviousDoDproblems forces,removingtheabilitytodeterminewhether inaccountingforGOIfundsprovidedforrecon- the GOI is sustaining the projects. struction.SIGIR’sobjectivesforthisreportareto examineUSF-I’s(1)managementofI-CERPfunds, Recommendations (2)reportingontheuseoffundstotheGOI,and SIGIRrecommendsthattheOfficeoftheSecretary (3) maintenance of I-CERP project files. of Defense: 1. Clarify the military’s role in civil capacity-devel- Results opment efforts where counterinsurgency is not a SIGIRisprovidingthisinterimreportbecause primary focus. $24.4millioninI-CERPfundsremainthatcould 2. Re-evaluateperformancemetricsandmeasures beusedforreconstructionprojectsinsteadofU.S. ofeffectivenessforCERPprojectswithparticu- funds, and the window to save U.S. funds is clos- lar attention on eliminating broad metrics. ing.SIGIRfoundthatU.S.fundswereusedinstead ofI-CERPfundsinsomecases.USF-Iobligated Matter for Congressional Consideration $245.6millioninI-CERPfundson2,474projects, IfCongressintendsforDoDtoundertakecivil asofApril30,2011.DoDguidanceprovidesnine capacitydevelopmenteffortswherecounterinsur- categoriesofprojectsthatshouldbefundedbythe gency is not a primary focus, it should consider I-CERP,ratherthantheCERP,ifsufficientfunding providing clarifying instructions or codifying that isavailablefortheprojectintheapplicableprov- missioninU.S.statutes. ince. However, SIGIR found that USF-I spent U.S.- appropriatedCERPfundsonanumberofprojects Management Comments in2009,2010,and2011insteadofI-CERPfunds. Managementcommentsareincludedinthefinal For example, 20 CERP school repair projects com- report,whichcanbefoundontheSIGIRwebsite: pleted in 2010 in Diyala province, totaling about www.sigir.mil. $1.4million,mettheI-CERPcriteriabutwerenot paidforwithI-CERPfunds. The report also discusses problems with USF-I’squarterlyreportstotheGOIandweak controls over key I-CERP project documents.

108 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 108 7/25/2011 10:38:16 AM SIGIR AUDITS

SIGIR reviewed the five quarterly reports559 USF-I Management Comments providedtotheGOIfromDecember31,2009, Managementcommentsareincludedinthefinal throughMarch31,2011,andfounderrorsineach report,whichcanbefoundontheSIGIRwebsite: report.Theseerrorsprimarilyoccurredinthreear- www.sigir.mil. eas—thebalanceofI-CERPfunds,thenumberof storyboardsprovidedtotheGOI,andtheaccuracy ofthestoryboardsprovidedtotheGOI.Finally, Poor Government Oversight of Anham and SIGIRfoundthatkeydocumentsaremissingfrom Its Subcontracting Procedures Allowed some I-CERP project files. SIGIR reviewed the Questionable Costs To Go Undetected I-CERPprogramin2009andreportedthatdespite (SIGIR 11-022, 7/2011) efforts to improve accountability and documentation within the program, project files lacked critical Introduction internalcontroldocumentationduetoinsufficient Overthepasteightyears,billionsofdollarsin program oversight as well as unclear and incom- contractshavebeenawardedtosupportreliefand pleteguidanceondocumentrequirements.560 reconstructionactivitiesinIraq.TheCongresshas In response to these recommendations, USF-I’s raisedquestionsaboutmanyofthesecontractsand predecessor, the Multi-National Force-Iraq, took particularly questioned subcontracting actions. correctiveaction.However,SIGIR’slimitedreview This report examines subcontracts associated with offiveI-CERPprojectfilesindicatedthatUSF-I acontractawardedinSeptember2007toAnham, maystillnotbefollowingitsguidancewithregard LLC(Anham),toprovideforthereceipt,storage, to key documents pertaining to project outcomes andonwardmovementofsuppliesandequipment and use of funds. needed to reconstitute the Iraqi Security Forces and SIGIRiscontinuingitsexaminationofI-CERP reconstruct the country’s infrastructure. The con- andplanstoissueacomprehensivereportonI-CERP tracthadobligationsofapproximately$119.2million, laterthisyear. ofwhichAnhamsubcontractorsprovidedatleast $55millioninsuppliesandservices. Recommendations SIGIR’s objectives for this report were to deter- SIGIRrecommendsthattheCommanding mine (1) the adequacy of government oversight of General, USF-I: Anham and its subcontracting procedures and 1. IdentifyplannedCERPprojectsthatcouldbe (2)whetherAnham’scostsunderthecontractare funded with I-CERP and, where appropriate fair and reasonable. andfeasible,useI-CERPfundstopayforthese projectssoU.S.fundscanbeputtobetteruse Results elsewhere. SIGIR found significant weaknesses in the govern- SIGIR further recommends that the Commander, ment’s oversight of Anham’s business systems and CENTCOM, and the Commanding General, USF-I: other contract administration functions that left 2. AdheretothetermsoftheMOUandprovide thegovernmentatsignificantriskofpayingunrea- theGOIcompleteandaccuratestoryboardsfor sonablecosts.InfourkeyAnhambusinesssystems all225projectscosting$50,000ormore,com- that were reviewed, SIGIR found the following: pleted from October 2009 through April 2011. • TheDefenseContractAuditAgency(DCAA) 3. IdentifyandlocatefilesforI-CERPprojects reviewed and approved Anham’s accounting completed between October 2009 and April system. 2011andnotifySIGIRwhenthesefilesareavail- • DCAA did not review Anham’s estimating able for review. system.

JULY 30, 2011 I REPORT TO CONGRESS I 109

July2011.indb 109 7/25/2011 10:38:16 AM SIGIR OVERSIGHT

Figure 5.1 Companies Invested in Anham and Certain Subcontractors with Common Owners and Managers

HII-Finance Munir Sukhtian Arab Supply and Corporation International Trading Company OWNER OWNER OWNER

Anham CEO is director of HII-Finance Anham FZCO Anham Anham CEO is CEO is director of director of Knowlogy Superior Anham Anham CEO is CEO is chairman of president of Unitrans Nour

American International Services

Knowlogy Corporation Unitrans International, Pioneer Iraqi General Nour USA Ltd. Superior Heavy SUBCONTRACTOR Inc. Trading Company SUBCONTRACTOR Equipment Company SUBCONTRACTOR SUBCONTRACTOR SUBCONTRACTOR

Note: Anham told SIGIR that a company called GMS Holdings, Inc. is a 50% owner of Anham.

Sources: Anham and its corporate filing data from the Virginia State Corporation Commission.

• DCAAreviewedAnham’sbillingsystembut verifyingthatthegoodsweredelivered,and found significant weaknesses. allowedAnhamemployeestosignforreceiptof • The Defense Contract Management Agency $10millioningoods. (DCMA) reviewed and recommended approval of Anham’s purchasing system despite Someoftheseissuescouldhavebeenidentified identifyingsignificantgapsindocumentation duringanincurredcostreview.Inthesetypesof onthedegreeofpricecompetitionobtained. reviews,DCAAdeterminesifthecontractor’scosts DCMA also did not ask important ques- areallowable,allocable,andreasonable.However, tionsaboutcloseand/oraffiliatedrelation- DCAA has not yet completed an incurred cost shipsthatAnhammayhavewithsomeofits reviewonAnhamandisseveralyearsbehindin subcontractors. meeting its incurred cost review requirement for • Contract oversight by the contracting officer’s Iraqcontracts.SIGIRconductedalimitedincurred representatives(CORs)wasweakinthatthe costreviewofAnhamandquestionedalmost39% CORsdidnotcomparevoucherstoreceiving of the sampled costs ($4.4 million) either because documents, signed for delivery of goods without SIGIRquestionswhetherthecostswerefairand

110 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 110 7/25/2011 10:38:17 AM SIGIR AUDITS

reasonable or because they were not properly Department of State Reports It Has documented. Reasons that SIGIR questions the Taken Action on Most Open Audit costs include questionable competition practices, Recommendations, but Documentation inappropriate bundling of subcontractor items, and Is Needed closeworkingrelationshipsorpossibleownership (SIGIR 11-023, 7/2011) affiliations between Anham and certain subcontractors.Forexample,SIGIRbelievesAnhammay Introduction have less than an arms-length relationship with six TheInspectorGeneralActof1978,561 as amended, subcontractors who were awarded approximately requirestheSpecialInspectorGeneralforIraqRe- $55millioninpurchasesandservicesunderthe construction (SIGIR) to identify in its semiannual reviewedcontract(seeFigure5.1).Asaresultofthe report each significant recommendation described multiple problems identified in this report, SIGIR is inprevioussemiannualreportsonwhichcorrec- questioningallthecostsonthiscontract. tive action has not been completed. This report follows up on 45 audit recommendations SIGIR made Recommendations totheDepartmentofState(DoS)thatwereopen SIGIRrecommendsthattheOfficeoftheSecre- (i.e.,unresolved)asofJuly8,2011.Theobjectivesof taryofDefensechangeitsguidancetocontracting this report are to determine whether DoS took ap- officerstogivethemresponsibility,incooperation propriateactiontoaddresstheserecommendations with DCAA, for reviewing the reasonableness of andwhetherDoShasasystemtotrackandoversee priceschargedtothegovernment. thestatusofSIGIR’sauditrecommendations. SIGIRrecommendsthattheCommander, CENTCOM, take the following actions: Results 1. Determine whether Anham and its subcontrac- DoSreportsthatithasactedonmostoftheopen torsonthiscontractare“affiliates”asdefinedby recommendations.InearlyJuly2011,DoSprovided the FAR. SIGIRwithareportstatingthatithasclosed38of 2. Reviewallvoucherssubmittedunderthiscon- the 45 recommendations. SIGIR closed 13 recom- tracttoensurethatappropriatepricinganalysis mendations based on information in the report. wasconductedandthatpricesarefairand DoSdidnotprovidesufficientinformationtoallow reasonable. SIGIRtoclosetheother25recommendationsthat 3. Initiateasystematicreviewofbillingprac- DoSsaidithadclosed.SIGIRalsofoundthatDoS ticesonallAnhamcontractsinIraqand hasafollow-upprocessandtrackingsystemforau- Afghanistan. ditreportsandrecommendationsandhasagreed tousethatprocessforSIGIRauditreportsandrec- SIGIRrecommendsthattheDirector,Defense ommendations. Nevertheless, DoS has not clearly ContractManagementAgency,conductanew delineatedanorganizationresponsibleforreport- contractor purchasing system review on Anham. ingthestatusofrecommendationstotheCongress orforresolvingdisagreementsandquestionsabout Management Comments recommendations, as required by Office of Man- Managementcommentsareincludedinthefinal agementandBudget(OMB)CircularA-50. report,whichcanbefoundontheSIGIRwebsite: SIGIRcommendsDoSforadaptingitsaudit www.sigir.mil. follow-up processes and systems to include SIGIR recommendationsandforworkingwithSIGIRto resolveauditfollow-upissues.Nevertheless,DoS audit follow-up processes still do not include an

JULY 30, 2011 I REPORT TO CONGRESS I 111

July2011.indb 111 7/25/2011 10:38:17 AM SIGIR OVERSIGHT

importantOMBrequirementtoincluderesolu- Announced or Ongoing Audits tion of disagreements over recommendations and SIGIRiscurrentlyworkingontheseaudits: reporting requirements. These responsibilities are • Project1112:AuditoftheDepartmentofDe- notonlycriticaltoimprovinginternalcontrolsand fense’sEffortsToAccountforFundsfromthe accountabilityandreportingthistotheCongress Development Fund for Iraq butalsoarenecessaryinthosecaseswhereDoS • Project 1111: Audit of the Department of State’s andSIGIRcannotagreeontheresolutionofan Process To Transfer Reconstruction Projects to open recommendation. theGovernmentofIraq • Project1110:AuditoftheIndirectCosts Recommendations ChargedbyNon-profitOrganizationsforAd- SIGIRrecommendsthattheSecretaryofState: ministeringSecurityContractsinIraq 1. Provide SIGIR supporting documenta- • Project1109:AuditoftheDepartmentof tiontoverifyactionstakenonopenaudit Defense’s Management of Selected Large-dollar recommendations. IraqReconstructionContractCloseouts 2. Designateanofficialwiththeauthoritytore- • Project1108:AuditoftheDepartmentof solvedisagreementsbetweenDoSandSIGIRon Defense’s Iraq Reconstruction Contract recommendations and with the responsibility to Terminations reportonthestatusofopenauditrecommenda- • Project 1107: Audit of the Results of Efforts To tionsasrequiredunderOMBA-50. DeveloptheCapacityoftheIraqiMinistriesof Defense and Interior Management Comments • Project1106:AuditoftheDepartmentofState’s Managementcommentsareincludedinthefinal InitiativesToDevelopIraqiPolice report which can be found on the SIGIR website: • Project1105b:AuditoftheUseofFundsPro- www.sigir.mil. videdfortheIraqCommander’sEmergency Response Program • Project1102:AuditoftheStatusofRecommen- Ongoing and Planned Audits dationsMadetotheDepartmentofDefense • Project1021:AuditoftheStatusofInternational SIGIRprimarilyconductsperformanceauditsthat NarcoticsandLawEnforcementFundsAppro- assesstheeconomy,efficiency,effectiveness,and priatedforIraqReconstruction resultsofIraqreconstructionprograms,oftenwith • Project 1020: Audit of the Departments of Justice afocusontheadequacyofinternalcontrolsandthe and State Management of Rule-of-law Activities potential for fraud, waste, and abuse. This includes in Iraq aseriesoffocusedcontractauditsofmajorIraqre- • Project 1018: Audit of the Cost, Outcome, and constructioncontracts,whichwillsupportSIGIR’s ManagementoftheFallujahWasteWaterTreat- response to congressional direction for a “forensic ment Plant Project audit” of U.S. spending associated with Iraq recon- • Projects9005,9012,and9013:AuditsofAppro- struction.Additionally,SIGIRhasconductedand priation,Obligation,andExpenditureTransac- willcontinuetoconductin-depthassessmentsof tionDataRelatedtoIraqReliefandReconstruc- thereasonableness,allowability,andallocabilityof tionoftheDepartmentofDefense,Department costschargedtotheUnitedStates.SIGIRwillalso ofState,andtheU.S.AgencyforInternational closelymonitorandreviewreconstructionactivities Development astheDoDpresencedeclinesandtheDoSmanage- ment responsibilities for reconstruction increase.

112 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 112 7/25/2011 10:38:17 AM SIGIR AUDITS

Planned Audits of contracts and reconstruction activities; made SIGIR’s audit planning is aligned with three key recommendationstoimproveeconomyand goalscontainedinitsstrategicauditplan: efficiency of U.S. operations and make activities • improving business practices and accountability less vulnerable to fraud, waste, and abuse; and in managing contracts and grants associated providedlessonslearnedforuseinotherrecon- with Iraq reconstruction struction endeavors. • assessing and strengthening the economy, effi- Moreover, SIGIR has made 473 recommenda- ciency, and effectiveness of programs and opera- tionstoimprovereconstructionactivitiesinIraq, tionsdesignedtofacilitateIraqreconstruction andmanagementhasalreadyagreedtoandimple- • providing independent, objective leadership mented163ofthem.Theserecommendationsare and recommendations on policies designed to discussed more in depth later in this section. address deficiencies in reconstruction and stabi- Much of SIGIR’s audit results can be attributed to lizationeffortsinIraq SIGIR’spresenceinIraq.Thispresencehasenabled SIGIRtoprovidereal-timeaudits—oftenstarting SIGIR’s strategic plan recognizes the legisla- andcompletingwithinsixmonths—thataddress tivemandatetocompleteaforensicauditreport critical reconstruction issues. SIGIR’s in-country onallamountsappropriatedorotherwisemade auditactivitiesalsoenableface-to-facecommunica- available for Iraq reconstruction. As part of that tions and relationship building with Department effort,SIGIRhascompleted24focusedcontract of Defense (DoD), Department of State (DoS), and grant audits dealing with outcomes, costs, andGovernmentofIraq(GOI)officials,andthey and the oversight associated with major recon- provideanin-depthandhistoricalknowledgeofthe struction contracts in Iraq, as well as vulner- reconstruction program in the country. abilitiestofraud,waste,andabuse.Thisquarter, SIGIR has worked proactively with previous SIGIRcompletedareviewofamajorcontractthat and current U.S. ambassadors and commanding identifiedoversightissueswhichcontributedto generals,providinginsightsonissuesthatneedto suchvulnerabilities,andinwhichSIGIRidentified be addressed. For example, in August 2009, SIGIR questionable costs. identifiedfortheCommandingGeneralandthe SIGIR will continue to audit the management, U.S. Ambassador to Iraq areas that needed to be costs,andoutcomesofU.S.reconstructionefforts dealtwithtoensureasmoothtransitionasrecon- in Iraq. Additionally, SIGIR will maintain its over- structionmanagementshiftsfromDoDtoDoS, sightofissuesrelatedtothedownsizingoftheDoD astheU.S.presencedownsizesandtheministerial presenceinIraqandthetransitionofreconstruc- capacityoftheGOIincreases. tionactivities,suchaspolicetrainingandasset transfer,andDoDmanagementofDFIfunds. MajorIssuesAddressedinAudits Inthecourseofitswork,SIGIRhasidentified broad,recurringissuesthatwerethekeycontribut- SIGIRAudits:2003–2011 ingcausestothedeficienciesnotedinthebodyof SIGIR’s audits. To illustrate, in July 2008, SIGIR Since2003,SIGIRhaspublished194auditsad- issuedanauditreportthatdiscussedfourpersistent dressingawiderangeoftopics,suchasoversight issues affecting the management of reconstruction ofcontractsandspecificreconstructionprograms, activities in Iraq. They were: as well as the cost and oversight of private security • the need to better understand the problems as- contractors. Throughout its tenure, SIGIR audits sociatedwithimplementingreconstructionpro- have identified deficiencies in the management gramsinanunstablesecurityenvironment.(For

JULY 30, 2011 I REPORT TO CONGRESS I 113

July2011.indb 113 7/25/2011 10:38:17 AM SIGIR OVERSIGHT

example, security issues and their costs were (Theseinvolvedeficienciessuchasinadequatere- often not adequately taken into consideration view of contractor invoices, inadequate contrac- in designing and implementing reconstruction tor oversight, missing or incomplete documenta- activities and estimating costs.) tion of contract actions, and inadequate staffing.) • the impact of not having an integrated manage- • morethan35recommendationstoworkmore ment structure to provide clear lines of author- closelywiththeGOIinareassuchasdesign- ityonprogramcoordinationandsuccessful ing and transferring projects to improve the deliveryofprojects.(Thelackofsuchunity prospects that the GOI will sustain U.S.-funded of command led to situations where the U.S. facilitiesandprogramssothatU.S.effortswill governmentcouldnotdeterminethefullextent not be wasted ofallagencies’activitiesonasingleissue,suchas anticorruption or capacity development.) Additionally,SIGIRhasprovidedrecommenda- • the importance of anticipating staffing needs tionstoimprovethemanagement,efficiency,and and reducing staff turnover outcomeofsignificantandhigh-costprogramsthat • recognition of how essential working closely with willcontinueevenastheU.S.reconstructioneffort host governments is to the long-term success of inIraqscalesback: U.S.investmentsinreconstructionprojects • SIGIRhasissued12Commander’sEmergency Response Program (CERP) and Iraq-Command- Additionally, SIGIR audits of contracts have er’s Emergency Response Program (I-CERP) pointed out numerous areas where contract man- reports and made 29 recommendations address- agementneededtobeimprovedtoprovidebetter ingtheneedtoimprovetheirmanagement.The economyandefficiencyandmakethecontractless CERP authorizes U.S. field commanders to use vulnerable to fraud, waste, and abuse. CERPfundstorespondtourgenthumanitar- ian, relief, and reconstruction requirements SIGIR Recommendations that immediately assist indigenous populations To Improve the Management and achieve focused effects. This quarter, SIGIR of Reconstruction Activities completedareviewoftheusesandmanagement SIGIRmaderecommendationstodealwiththese of Fiscal Year 2011 CERP-funded projects and managementproblems.Inanumberofcases,a concluded that the emphasis to concentrate on single recommendation addressed more than one capacity-development projects likely does not oftheissuesoutlinedabove.Toillustrate,SIGIR meetDoDCERPobjectives,andthatthereare has provided: nomeaningfulmetricstomeasuretheimpactof • morethan190recommendationstoimprove these projects. Another report looked at DoD’s program management, including the need to management of the funds the GOI provided for adequately staff offices and reduce staff turnover CERP-type projects. Called the I-CERP, SIGIR • morethan70recommendationstoimprove foundthatDoDwasusingU.S.CERPfundsfor interagency coordination and cooperation and projects that would have been more appropri- to better share information atelyfundedunderI-CERP,andthatDoDwas • morethan200recommendationstoimprove not maintaining accurate information on the oversightofcontractsandcontractorstoencour- I-CERPfundsorprojects. ageeconomyandefficiencyandminimizethe • SIGIRhasissuedmorethan27reportswhich, potential for fraud, waste, and abuse to varying degrees, addressed U.S. efforts to • morethan190recommendationstoimprove develop a functioning Iraqi Security Forces accountability and internal control weaknesses (ISF).Thisefforttakesonincreasingimportance

114 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 114 7/25/2011 10:38:17 AM SIGIR AUDITS

astheU.S.militaryfootprintdecreasesandnow Financial Impacts of SIGIR Audits thattheprincipalagencycreatedtoimplement SIGIR’sauditshavehadfinancialimpactsasshown this goal—the Multi-National Security Transi- inTable5.2.Throughitsaudits,SIGIRhasbeen tion Command-Iraq (MNSTC-I)—has been able to identify: subsumedintotheU.S.Forces-Iraq(USF-I).As • fundsthatwouldbeputtobetteruse,meaning ofJuly2011,SIGIRhadmadefiverecommenda- thatfundscouldbeusedmoreefficientlyifman- tionsregardingministerialcapacitydevelop- agementtookanactionsuchasreducingoutlays ment,oversightofweaponsprovidedtotheISF, orde-obligatingfundsfromaspecificprogram asset transfer, use of CERP funds, anticorruption or operation efforts, and other topics—including logistics, • paymentsthatSIGIRquestionedandrecom- maintenance responsibilities, and training of mendedtheagencyconsiderrecoveringbecause securityforcespersonnel. SIGIRdeterminedthatthepaymentswereeither not adequately supported in documentation or did SIGIRhasinitiatedreviewsoftheactionsDoD, notappeartobeallowable,reasonable,orallocable DoS, and USAID have taken, or plan to take, to accordingtoregulationsandorotheragreements address open recommendations and report these governingtheexpenditureofthefunds actionstotheCongressasrequiredbyOMBCir- • funds that were actually saved because the cularA-50andtheInspectorGeneralActof1978, agency under review accepted SIGIR’s recom- asamended.Inareportissuedlastquarter,SIGIR mendationtoputfundstobetteruse,orrecover foundthatUSAIDhadtakencorrectiveactions monies that were inappropriately spent by a onfourofthesixopenSIGIRrecommendations contractor, grant recipient, or other organization andisworkingwithSIGIRtoclosetheremaining receivingU.S.funding two.Moreover,SIGIRfoundthattheagency’saudit tracking system is effective and well-managed. SIGIRhasidentifiedatotalof$641.64million Thisquarter,SIGIRisreportingonDoS’s thatcouldbeusedmoreefficientlyandeffectivelyif responsiveness to SIGIR recommendations. SIGIR used elsewhere. foundthatwhileDoSreportsthatithasactedon SIGIR has also questioned $217.80 million in most of the open recommendations and informed paymentstocontractorsandgrantrecipientsunder SIGIRthatithasclosed38ofthe45recommenda- cost-reimbursement contracts or grant agreements tions,SIGIRcouldcloseonly13becauseDoSdid becausethecostsclaimedwerenotsupportedbyad- not provide sufficient information to allow closure equate documentation, such as receipts or invoices; oftheothers.SIGIRalsofoundthatDoShasa were unallowable under government regulations; follow-upprocessandtrackingsystemforaudit wereunreasonablyhigh;orwerenotallocabletothe reportsandrecommendationsandhasagreedto project. For example, SIGIR found major problems usethatprocessforSIGIRauditreportsandrecom- inU.S.oversightofacontractwithAnham,LLC, mendations. Nevertheless, DoS has not clearly andisthereforequestioningtheentire$113million delineatedanorganizationresponsibleforreport- that has thus far been expended on the contract. ingthestatusofrecommendationstotheCongress Through July 30, 2011, agency management has orforresolvingdisagreementsandquestionsabout concurredwithcertainSIGIRauditfindingsand recommendations, as required by Office of Man- recommendations, which has resulted in about agement and Budget Circular A-50. $656.32millioninsavedandrecoveredfunds. Forexample,$23.91millionwassavedthrough improved contractor invoice review procedures in the Iraqi police training program.

JULY 30, 2011 I REPORT TO CONGRESS I 115

July2011.indb 115 7/25/2011 10:38:17 AM SIGIR OVERSIGHT

Table 5.2 SIGIR Potential and Actual Financial Impacts $ Millions Accomplishments This Quarter Cumulative

PotentialSavingsIfFundsArePuttoBetterUsea 0.00 586.62 PotentialSavingsIfAgenciesRecoverQuestionedCostsb 114.48 624.48 ActualSavedandRecoveredFundsBasedonAgencyActionsRespondingtoSIGIR c 563.82 656.32 Recommendations

Notes: a TheInspectorGeneralActof1978,§5.(f)states: (4)Theterm“recommendationthatfundsbeputtobetteruse”meansarecommendationbytheOfficethatfundscouldbeusedmore efficiently if management of an establishment took actions to implement and complete the recommendation, including— (A) reductions in outlays (B)de-obligationoffundsfromprogramsoroperations (C) withdrawal of interest subsidy costs on loans or loan guarantees, insurance, or bonds (D) costs not incurred by implementing recommended improvements related to the operations of the establishment, a contractor, or grantee (E) avoidance of unnecessary expenditures noted in pre-award reviews of contract or grant agreements, or (F)anyothersavingswhicharespecificallyidentified. b TheInspectorGeneralActof1978,§5.(f)states: (1)Theterm“questionedcost”meansacostthatisquestionedbytheOfficebecauseof— (A) an alleged violation of a provision of a law, regulation, contract, grant, cooperative agreement, or other agreement or document governingtheexpenditureoffunds (B)afindingthat,atthetimeoftheaudit,suchcostisnotsupportedbyadequatedocumentation,or (C) a finding that the expenditure of funds for the intended purpose is unnecessary or unreasonable. (2)Theterm“unsupportedcost”meansacostthatisquestionedbytheOfficebecausetheOfficefoundthat,atthetimeoftheaudit,suchcost is not supported by adequate documentation. c ThisrepresentsanaccumulationofallSIGIR’squestionedcostswhereagenciesultimatelytookactiontosavefunds.

Source: Analysis of SIGIR audit reports and recommendations as of 7/2011.

SIGIR continuously monitors whether agencies other reviews relevant to the DynCorp contract. haveachievedsavingsbyimplementingSIGIR DoSreportedsignificantsavingsinseveralareas, recommendationstoputfundstobetteruseorto includingthenegotiatedcostsofproposals, question whether costs incurred were allocable, invoices resubmitted for adjusted amounts, and allowable, or reasonable. For example, SIGIR processed refund requests. askedDoStoprovidedataonitsresponseto Table 5.3 lists SIGIR’s financial impact audit re- SIGIR recommendations regarding invoice and ports and the value of the financial accomplishments.

116 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 116 7/25/2011 10:38:17 AM SIGIR AUDITS

Table 5.3 SIGIR Potential and Actual Financial Impact Reports $ Millions Potential Savings from SIGIR Recommendations Actual Savings

Questioned Costs Funds That Unallowable Report Could Be Unallocable Unsupported Dollars Saved Number Report Title Better Used Unreasonable Costs & Recovered

04-003 Federal Deployment Center Forward Operations at the Kuwait 18.20 18.20 Hilton 04-011 Audit of the Accountability and Control of Materiel Assets of the 19.70 19.70 CoalitionProvisionalAuthorityinBaghdad 04-013 Coalition Provisional Authority’s Contracting Processes Leading Up 5.19 ToandIncludingContractAward

05-008 AdministrationofContractsFundedbytheDevelopmentFundof a 0.04 0.00 Iraq

05-015 Management of Rapid Regional Response Program Grants in a 2.70 0.00 South-Central Iraq

05-016 Management of the Contracts and Grants Used To Construct and a 1.30 0.00 OperatetheBabylonPoliceAcademy 05-017 Award Fee Process for Contractors Involved in Iraq Reconstruction 7.80 7.80

05-020 Management of the Contracts, Grant, and Micro-Purchases Used a 0.15 0.00 To Rehabilitate the Karbala Library

05-023 Management of Rapid Regional Response Program Contracts in a 0.57 0.00 South-Central Iraq 06-009 Review of Task Force Shield Programs 12.80 12.80 06-010 ReviewoftheMulti-NationalSecurityTransitionCommand-Iraq 1.51 3.46 4.97 ReconciliationoftheIraqiArmedForcesSeizedAssetsFund 06-016 InterimAuditReportontheReviewoftheEquipmentPurchased forPrimaryHealthcareCentersAssociatedwithParsonsGlobal 23.30 23.30 Services,ContractNumberW914NS-04-D-0006 06-029 ReviewofDynCorpInternational,LLC,ContractNumber S LMAQM-04-C-0030, Task Order 0338, for the Iraqi Police Training 5.46 5.46 Program Support 07-007 Status of U.S. Government Anticorruption Efforts in Iraq 3.80 3.80 08-018 Outcome,Cost,andOversightofWaterSectorReconstruction 0.57 Contract with Fluor/AMEC, LLC

09-003 Cost,Outcome,andOversightofLocalGovernanceProgram a 0.19 0.06 Contracts with Research Triangle Institute 09-004 Iraq Reconstruction Project Terminations Represent a Range of 16.62 16.62 Actions 10-008 Long-standing Weaknesses in Department of State’s Oversight of 448.49 502.25 508.66 DynCorp Contract for Support of the Iraqi Police Training Program 10-010 DepartmentofStateContractToStudytheIraqReconstruction 5.00 5.00 Management System 10-013 Commander’s Emergency Response Program: Projects at Baghdad Airport Provided Some Beneﬁts, but Waste and Management 16.10 16.10 Problems Occurred 10-022 Improved Oversight Needed for State Department Grant to the 0.69 .69 International Republican Institute 11-001 National Democratic Institute Grant’s Security Costs and Impact 0.08 .08 GenerallySupported,butDepartmentofStateOversightLimited 11-009 Iraqi Government Support for the Iraq International Academy 12.00 12.00 11-014 The Iraq Community Action Program: USAID’s Agreement with 1.08 1.08 CHFMetGoals,butGreaterOversightIsNeeded 11-022 Poor Government Oversight of Anham and Its Subcontracting 113.4 Procedures Allowed Questionable Costs To Go Undetected

Total 586.62 624.48 11.35 656.32

Note: AllSIGIRauditreportscanbefoundontheSIGIRwebsiteatwww.sigir.mil. a SIGIR previously reported that agencies saved some, or more money, but collection efforts were stopped for reasons such as the company went out of business,orthecostof collectionwouldhaveexceededthefundsrecovered.

JULY 30, 2011 I REPORT TO CONGRESS I 117

July2011.indb 117 7/25/2011 10:38:17 AM SIGIR OVERSIGHT

Collaborative Forensic Audits/ SIGIR’s approach combines automated data Investigations Initiative mining with standard audit and investigative techniques to detect problematic transactions SIGIR’s Audits and Investigations Directorates are and develop relevant evidence for use in adminis- engaged in a number of collaborative forensic audit trativeactionsorcivilorcriminalfraudprosecu- and investigation initiatives designed to identify tions. Matters most appropriately addressed by fraud,waste,andabuse.PublicLaw108-106,as administrativeresolution,suchascostdisal- amended, requires that SIGIR prepare a final forensic lowance and recovery, will be referred through auditreportonallfundingappropriatedforthe auditreportstoagencycontractingofficialsfor reconstructionofIraq,whichtodatetotalsmorethan appropriate action. $61billion.Overthepastfouryears,SIGIRhascon- The SIGIR Audits and Investigations Director- ductedaseriesof24auditsofmajorreconstruction ates continue to expand the proactive joint effort contractsthatwereintended,inpart,toidentifyin- thatwasestablishedinJanuary2009.Thiseffort ternal control weaknesses. Because such weaknesses focuses on Iraq relief and reconstruction programs provideopportunitiesforfraud,waste,andabuse, thataffordeasyaccesstocashassociatedwithweak SIGIRusedtheresultsoftheseauditstodevelop controlsoverexpenditures.Todate,SIGIRhas targetedforensicauditingapproachestoidentifypo- opened85criminalinvestigationsasaresultofthis tentialinstancesofwrongdoing.Aforensicauditisa effort.Thisprojecthasalsoprovidedsupportto systematic examination of the internal controls over ongoing criminal investigations. aprogram’sexpendituresorotherfinancialdatato Additionally,SIGIRcontinuestoprovide identifyanomaliesinindividualtransactionsthat supportonconductingforensicauditstothe maybeindicativeoffraud,waste,orabuse.Theana- Special Inspector General for Afghanistan lyticprocessisportrayedinFigure5.2. Reconstruction.◆

Figure 5.2 Forensic Audit Process

Source Data Analysis Results

Anomaly testing and data mining

Iraq Reconstruction Financial Data Identification of anomalous (financial analysis of all DoD, DoS, and activity indicative of potential USAID transactions 2003–2009) fraud, waste, and abuse

SIGIR Audits/Investigations Initiative (targeting programs with weak internal Criminal investigations resulting in indictments/convictions controls that afford easy access to cash) 0 10010 Focused Contract Audits 11 1010 Audits of vendors resulting in (audits that target costs, outcomes, 1 0 and oversight of specific contracts 1001 recoveries and addressing internal and vendors) 11 control weaknesses

118 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 118 7/25/2011 10:38:17 AM SIGIR INVESTIGATIONS

SIGIR INVESTIGATIONS

The SIGIR Investigations Directorate continues Figure 5.3 toactivelypursueallegationsoffraud,waste,and SIGIR Investigations: Criminal and Monetary Results abuseinIraq,with104activeinvestigationsasof 50 $90 July15,2011.Duringthisreportingperiod,SIGIR Monetary Results had2investigativepersonnelassignedtoBaghdad;

6atSIGIRheadquartersinArlington,Virginia; 40 $72 and11inofficesinPennsylvania,Florida,Texas, 13 10 Oklahoma, and California. Investigative accom-

30 $54 Millions $ plishmentsthisquarterincluded4arrests,8indict- 8 13 ments,4convictions,and1sentencing.Todate, 17 theworkofSIGIRinvestigatorshasresultedin35 20 $36 Criminal Results 13 arrests, 64 indictments, 54 convictions, and more than$153.9millioninfines,forfeitures,recoveries, 5 10 1 $18 restitution, and other monetary results. 6 4 Thisquarter,SIGIRcontinuedtoconducta 4 9611 17 17 number of significant criminal investigations 0 $0 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 relatedtoIraqreconstructionandtoworkclosely Q1–Q3 with prosecutors, U.S. partner investigative agen- Indictments Convictions Sentencings cies,coalitionpartnerinvestigators,andlaw • AformerU.S.Armymajorwaschargedwith enforcement personnel from other countries. As andpledguiltytomoneylaundering. aresultofSIGIRinvestigations,3defendantsare • A U.S. Army sergeant and associate were indict- pending indictment based upon arrest complaints, edandarrestedforanallegedbriberyscheme. 8defendantsareawaitingtrial,andanadditional • A former U.S. Army sergeant first class was charged 19defendantsareawaitingsentencing.Figure withandpledguiltytoconspiracyandtheft. 5.3showstheincreasesinthenumberofjudicial • AformerU.S.Armysergeantwasarrestedfor actionsandmonetaryresultsachievedineachof receivingstolencashfromIraq. thelasttwoyearsbasedonSIGIR’sinvestigations. • AnassociateofaU.S.MarineCorpscontracting Withprosecutorscurrentlyhandlingasubstantial officerinIraqwaschargedinamoney-launder- number of additional cases, this trend is expected ing conspiracy. to continue. For a comprehensive list of convictions • A U.S. Marine Corps major was sentenced for compiledbytheDepartmentofJustice(DoJ),see receiving illegal gratuities . Table5.4,attheendofthissection. SIGIRnotes these investigative activities this quarter: TwoDoSContractorsAgreeToPayMore • Two Department of State (DoS) contractors Than $8.7 Million to the U.S. Government agreedtopaytheU.S.governmentmorethan ToResolveAllegationsofFalseClaims $8.7milliontoresolveallegationsoffalseclaims. OnApril22,2011,theUnitedStatessettledawhis- • Aformercontractorandhissonwerechargedin tleblowerlawsuitagainstDynCorpInternational abriberyandconspiracyindictment. LLC(DynCorp)anditssubcontractor,TheSandi • AformerU.S.Armymajorwaschargedwith Group(TSG),whichallegedthatbothcompanies andpledguiltytobribery. submitted or caused to be submitted false claims

JULY 30, 2011 I REPORT TO CONGRESS I 119

July2011.indb 119 7/25/2011 10:38:17 AM SIGIR OVERSIGHT

forpaymentunderDynCorp’scontractwithDoS $1.2 million—to public officials in return for of- toprovidecivilianpolicetraininginIraq. ficialactsthathelpedhimobtainlucrativeDepart- DynCorpagreedtopaytheU.S.government mentofDefense(DoD)contracts.Thecontracts $7.7milliontoresolveallegationsthatitsubmitted included multi-million-dollar contracts for the inflatedclaimsfortheconstructionofcontainer storageofweaponsatvariouswarehousesinIraqas campsatvariouslocationsinIraq.TSGagreed well as for bottled water. topay$1.01milliontoresolveallegationsthatit Fourofthemilitarycontractingofficialswith soughtreimbursementfordangerpaythatitfalsely whom Justin Lee conspired have pled guilty: John claimedtohavepaiditsU.S.expatriateemployees Cockerham,Jr.,MarkusMcClain,KevinA.Davis, working in Iraq. and Levonda Selph. ThelawsuitwasinitiallyfiledbytwoformerTSG JustinLeefacesupto15yearsinprisonforeach employees, under the qui tam, or whistleblower, countofbribery,aswellasafineof$250,000or provisionsofthefederalFalseClaimsAct,which threetimesthevalueofthebribeforeachcount. permitsprivateindividuals,called“relators,”to Healsofacesuptofiveyearsinprisonforthecon- bringlawsuitsonbehalfoftheUnitedStatesand spiracycountaswellasafineof$250,000. receiveaportionoftheproceedsofasettlementor George Lee, the former chairman and chief execu- judgmentawardedagainstadefendant.Asaresult tiveofficerofLeeDynamicsInternational,remains ofthesettlement,thetworelatorswillreceiveupto atlarge.Anindictmentismerelyacharge,anda $481,710 as their share of the government’s recovery. defendantispresumedinnocentuntilprovenguilty. ThecaseisbeingconductedbySIGIRandthe ThecaseisbeingconductedbySIGIR,theDe- DoSOfficeoftheInspectorGeneral(DoSOIG). fenseCriminalInvestigativeService(DCIS),Army Criminal Investigation Command Division-Major Former President of Lee Dynamics Procurement Fraud Unit (CID-MPFU), Internal InternationalPleadsGuiltyto Revenue Service (IRS), Immigration and Customs ConspiracyandBriberyRelated Enforcement(ICE),andFederalBureauofInvesti- toDoDContractsinIraq gation (FBI). OnJuly15,2011,JustinW.Lee,theformerpresident ofLeeDynamicsInternational,adefensecontractor Former U.S. Army Major Charged with providingservicestotheU.S.militaryinIraq,pled and Pleads Guilty to Bribery guilty to an indictment charging him with a scheme OnJune13,2011,DerrickL.Shoemake,aformer tobribemilitaryofficialsinordertoobtaingovern- U.S.Armymajor,pledguiltytoacriminalinfor- mentcontracts.LeepledguiltyinU.S.DistrictCourt mation charging him with two counts of bribery. for the Eastern District of Pennsylvania to one count Accordingtocourtdocuments,Shoemakewas of conspiracy to commit bribery and four counts of deployed to Camp Arifjan, Kuwait, as a contracting bribery. Lee and his father, George H. Lee, Jr., were officer’s representative in charge of coordinating chargedinanindictmentunsealedonMay27,2011, and accepting delivery of bottled water in support in the Eastern District of Pennsylvania. of U.S. troops in Iraq. While serving in Kuwait, JustinLeeadmittedthatheconspiredwithhis Shoemakeagreedtoassistacontractorwithhis fatherandotherstobribemilitarycontracting delivery of bottled water. In return, the contractor officers in order to obtain government contracts to paid Shoemake a total of approximately $215,000, supportU.S.combatoperationsinIraq.According most of which was delivered to Shoemake’s designee tocourtdocuments,JustinLeeprovidedthingsof in Los Angeles. Shoemake received an additional value, including cash, airline tickets, meals, hotel $35,000fromasecondcontractorforhisperceived stays,spavisits,andjobs—valuedatmorethan influenceovertheawardofbottledwatercontracts

120 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 120 7/25/2011 10:38:18 AM SIGIR INVESTIGATIONS

in Afghanistan. In total, Shoemake admitted receiv- The indictment, returned by a federal grand jury ing approximately $250,000 from these two govern- intheNorthernDistrictofWestVirginiaonJune8, mentcontractorsin2005and2006. 2011,chargestheArmysergeantwithreceiving Shoemakefacesupto15yearsinprisonforeach morethan$170,000inbribesfromtwofirmsthat briberycount,aswellasafineof$250,000.Addi- hadDoDcontractsinKuwait.Theindictment tionally,Shoemakehasagreedtocriminalforfeiture also charges the sergeant and his associate with of$250,000totheU.S.government.Asentencing laundering the money through bank accounts in datehasnotyetbeenscheduledbythecourt. Kuwait and the United States. Both individuals ThecaseisbeingconductedbySIGIR,DCIS, werearrestedwithoutincidentonJune21,2011. CID-MPFU,IRS,ICE,andFBI. Theindictmentallegesthatthesergeant,asenior procurement non-commissioned officer who served Former U.S. Army Major Charged with at Camp Arifjan from February 2005 to December and Pleads Guilty to Money Laundering 2006,alongwithtwoformerArmymajors,awarded OnMay11,2011,CharlesJosephBowie,Jr.,a Army contracting business and improperly disclosed retiredU.S.Armymajor,pledguiltytoacriminal contractinginformationtotwofirmsthatwere informationfiledonApril14,2011,charginghim seekingcontractsfromtheU.S.military.According with one count of engaging in monetary transac- totheindictment,asaresultoftheactionstakenby tionsinpropertyderivedfromspecifiedunlawful thesergeantandthetwomajors,thesefirmsreceived activity.Accordingtocourtdocuments,Bowie, nearly$25millionfromcontractstodeliverbottled whileservinginKuwaitfromApril2004toApril water and other commodities to U.S. military bases 2005, became friends with former U.S. Army Ma- inIraqandKuwait,aswellastopaintandcleanDoD jorJohnCockerham,whodirectedagovernment facilitiesinKuwait.Inexchange,thesergeantandthe contractortopayBowiemoneyinexchangeforthe two majors allegedly received cash, airplane tickets, awardofabottledwatercontract.Bowieadmitted hotel accommodations, and the ability to conceal that he received four wire transfers of approximate- large amounts of cash in a hidden safe located in the ly $100,000 each from the contractor between July villaofaDoDcontractemployeewhoworkedinthe 2005andFebruary2006.Bowiealsoadmittedthat host-nationaffairsofficeatCampArifjan. heenteredintoashamconsultingagreementwith The indictment also alleges that the sergeant thecontractortoconcealthepayments. entrusted his bribe money to his associate, who Bowiefacesupto10yearsinprisonandafine fromOctober2005toDecember2008operateda of$250,000.Inaddition,Bowiehasagreedtopay concessiontosellclothingandotheritemsatvarious $400,000 in restitution to the U.S. government. A sen- U.S.militarybasesinKuwaitandmaintainedbank tencingdatehasnotyetbeenscheduledbythecourt. accounts in Kuwait and the United States. The indict- ThecaseisbeingconductedbySIGIR,DCIS, mentallegesthattheassociatearrangedtotransfer ArmyCID-MPFU,IRS,ICE,andFBI. thebribemoneyfromKuwaittotheUnitedStates andintothepossessionofthesergeant,hiswife,and U.S. Army Sergeant and Associate his girlfriend. Additionally, the indictment alleges Indicted and Arrested for Bribery that the sergeant and his associate assisted one of the On June 21, 2011, an 11-count indictment was un- majorsinhiseffortstoretrievebetween$200,000 sealed in federal court in Wheeling, West Virginia, and$250,000ofbribemoneyandtotransferthat chargingaU.S.Armysergeantfirstclassandhisas- moneyfromKuwaittotheUnitedStates. sociate,aformerU.S.Armymastersergeant,fortheir The sergeant is charged with several crimes: allegedrolesinabriberyandmoney-laundering • onecountofconspiracytocommitbribery, scheme at Camp Arifjan, Kuwait. whichcarriesa5-yearmaximumsentence

JULY 30, 2011 I REPORT TO CONGRESS I 121

July2011.indb 121 7/25/2011 10:38:18 AM SIGIR OVERSIGHT

• two substantive bribery counts, which carry a beingwiredtoNelson’saccountbythetransla- 15-yearmaximumsentenceforeachcount tor’sbrother.Intotal,Nelsonadmittedreceiving • onecountofconspiracytocommitmoney approximately $44,830 from this scheme. The launderingandsixsubstantivemoney-launder- investigationintothisconspiracycontinues. ingcounts,whichcarrya20-yearmaximum Atsentencing,Nelsonfacesuptofiveyearsin sentenceforeachcount prison,aswellasamaximumfineof$250,000and • obstruction,whichcarriesa5-yearmaximum uptothreeyearsofsupervisedreleasefollowing sentence aprisonterm.Additionally,Nelsonhasagreedto The sergeant’s associate is charged with one count criminalforfeitureof$44,830totheUnitedStates. of conspiracy to commit bribery and four substan- Sentencing is scheduled for October 5, 2011. tivemoney-launderingcounts.Shefacesupto20 ThiscaseisbeingprosecutedbyaSIGIRat- yearsinprisonforthemoney-launderingcon- torneyondetailtotheFraudSectionofDoJ’s spiracycountandeachofthesubstantivemoney- CriminalDivision.Thecaseisbeinginvestigated launderingcounts.Bothalsofacefinesandaterm by SIGIR, DCIS, and Army CID-MPFU. of supervised release, if convicted. The indictment alsoseekstheforfeitureofanypropertyormoney Former U.S. Army Sergeant Arrested involved in the alleged offenses. for Receiving Stolen Cash from Iraq ThecaseisbeingconductedbySIGIR,DCIS, OnJuly7,2011,aformerU.S.Armysergeantwas Army CID-MPFU, and FBI. arrested in Los Angeles County, California, based on a complaint filed in U.S. District Court, charging him with Former U.S. Army Sergeant Charged with receivingmorethan$12,000instolencashfromIraq. and Pleads Guilty to Conspiracy and Theft Accordingtocourtdocuments,themoneyhad OnJune28,2011,RobertA.Nelson,aformer beenstolenbyanotherU.S.Armysoldierwhowasde- U.S.Armysergeantfirstclass,pledguiltyinU.S. ployedtoTallil,Iraq,in2008,andmailedtotheformer District Court, to conspiring to steal U.S. Army U.S.Armysergeant.Thefundswereacashpayment equipmentrelatedtohisworkasanon-commis- forpickupbyalocalcontractorwhofailedtoappear sioned officer helping to train Iraqi Army person- for the payment. The cash was then stolen, concealed nelinMosul,Iraq,in2008.Nelsonwaschargedin inastuffedanimal,andsentthroughtheU.S.postal acriminalinformationwithonecountofcon- systemtotheformerArmysergeantinCalifornia. spiracytostealpublicproperty.Accordingtothe ThecaseisbeinginvestigatedbySIGIR,DCIS, courtdocument,NelsonwasdeployedtoForward Army CID-MPFU, and FBI. OperatingBaseDiamondback,Iraq,asthenon- commissioned officer-in-charge of the Ninewa AssociateofUSMCContractingOfﬁcer OperationsCommandMilitaryTransitionTeam. inIraqChargedinMoney-laundering ThistransitionteamhelpedtraintheIraqiArmy Conspiracy units stationed nearby. OnJuly19,2011,acriminalinformationwasfiled While serving in Iraq, Nelson agreed with a U.S. inU.S.DistrictCourtfortheDistrictofHawaii Armytranslatortostealeightgeneratorsfromalot charginganassociateofaU.S.MarineCorpscon- on base that held various pieces of used equipment. tractingofficerinIraqwithonecountofconspir- Once the generators were taken off the base, the acyinvolvingmoneylaunderingofapproximately translatorarrangedforthemtobesoldontheblack $150,000 in bribes from contractors in Iraq. market in Iraq. Nelson admitted that he received Accordingtocourtdocuments,themoneyhad half of the proceeds of the sales of stolen equip- beenreceivedbyaMarineCorpscontractingofficer ment,withapproximately$35,000ofthemoney stationedatCampFallujah,Iraq,between2005and

122 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 122 7/25/2011 10:38:18 AM SIGIR INVESTIGATIONS

2008, from two contractors in Iraq. The associate of unsealedinU.S.DistrictCourtinNewark,New the contracting officer established bank accounts to Jersey,fortheirallegedrolesinabriberyand conceal and disguise the nature, location, source, kickbackschemeandfordefraudingtheU.S. ownership,andcontrolofthefunds.Thesefunds governmentinconnectionwiththeawardofmore werethentransferredfromIraqtotheUnitedStates than$50millioninUSACEconstructionandin- via cash and wire transfers. The associate deducted frastructure contracts in Iraq. The five defendants a20%shareandthentransferredthefundsbackto are:twoformerUSACEprojectengineersforGulf thecontractingofficeroradesignee. Region North, Iraq; an Iraqi citizen employed un- ThecaseisbeinginvestigatedbySIGIR,DCIS, deraUSACEservicescontractasadeputyresident Army CID-MPFU, and FBI. engineerforGulfRegionNorth;acitizenofGreat Britain residing in Greece and Iraq who was the USMC Major Sentenced for formervicepresidentofoperationsforaprivately Receiving Illegal Gratuities ownedforeignengineeringandconstructioncom- OnApril25,2011,MajorRichardHarrington, pany;andanIraqicitizen,whowasaseniorproject U.S. Marine Corps, was sentenced in U.S. District managerforaprivatelyownedforeignengineer- CourtinRaleigh,NorthCarolina,to12months ingandconstructioncompany.Theindictment and1dayimprisonmentfollowedby1yearsu- charges involve wire fraud, conspiracy, use of inter- pervised release. The sentencing was the result of state/foreignfacilitiestodistributebriberyproceeds hisguiltypleaonOctober18,2010,toacriminal orpromotebribery,illegalmoneytransactions, informationfiledonSeptember3,2010,inwhich subscribing false tax returns, and willful failure to Harringtonwasaccusedofusinghispositioninthe disclose foreign bank accounts. U.S.MarineCorpstoreceivemoney,watches,and TheindictmentchargesthattheUSACEemploy- aPersianruginexchangeforprovidingmilitary eesreceivedover$5millioninproceedsinconnec- contractstocompanies. tionwiththeawardandadministrationofover$50 During 2005, Harrington was stationed at millioninUSACEcontractsawardedtocompanies CampFallujah,Iraq,asacontractingofficer’s from2005to2008.TheUSACEemployeeswere representative.Taskedwithinspectingandac- involvedinthereviewandawardprocessfor ceptingworkfromcontractorsandmonitoring contractors seeking lucrative USACE contracts their compliance, he wrongfully solicited and in Gulf Region North, Iraq, as well as post-award acceptedgiftsfromacontractorwhileworking administration, oversight, and modification of such ona$2.2millioncontractwithal-JazaerGroup, contracts. The two USACE project engineers par- accordingtocourtdocuments. ticipatedinaschemetoprovidefavorableofficial This case was conducted jointly by SIGIR, DCIS, actionandassistancetothetwocontractorsforthe and the Naval Criminal Investigative Service (NCIS). benefit of their companies. These actions included: providing confidential information, including confidentialinternalcontract-pricingmaterials Other Agency Investigations preparedbytheUSACEandcompetitorcontrac- tors’ bid information; steering USACE contracts FormerU.S.ArmyCorpsofEngineers to the two contractors; and approving lucrative Employees and Others Indicted in payments for these companies. Bribery, Kickback Scheme Theallegedactionsweretakeninexchangefor OnJuly14,2011,threeformerU.S.ArmyCorps bribes and kickbacks that the USACE project en- ofEngineers(USACE)employeesandtwoforeign gineers accepted from the contractors, sometimes contractorswerechargedina54-countindictment throughtheUSACEdeputyresidentengineer.In

JULY 30, 2011 I REPORT TO CONGRESS I 123

July2011.indb 123 7/25/2011 10:38:18 AM SIGIR OVERSIGHT

addition to being a USACE contract employee, inthedevelopmentandprosecutionofcasesbeing the USACE deputy resident engineer acted as a workedbytheSIGIRInvestigationsDirectorate. “broker”foroneoftheprojectengineers,approach- ingforeigncontractorsinandaroundGulfRegion Northwillingtopaytheprojectengineerandthe Suspension and Debarment deputy resident engineer bribes and kickbacks in connectionwiththebidding,selection,award,and SinceDecember2005,SIGIRhasworkedclosely administration of USACE contracts. with DoJ, CID-MPFU, DCIS, and the Army Legal Theindictmentchargesthatsixforeignbank Services Agency’s Procurement Fraud Branch accounts in Jordan and Egypt were used to transfer (PFB)tosuspendanddebarcontractorsand illegalbribeandkickbackpaymentstoU.S.bank government personnel for fraud or corruption accounts,andatleastadozenoftheU.S.accounts within the Army, including those involved in Iraq were based in New Jersey. Under the indictment, reconstructionorArmysupportcontractsinIraq. oneoftheprojectengineersischargedwithwill- Thesecasesariseastheresultofcriminalindict- fully subscribing false tax returns and willfully fail- mentsfiledinfederaldistrictcourtsandallegations ingtofilereportsofforeignbankaccountswiththe of contractor irresponsibility that require fact- U.S.DepartmentofTreasury.TheU.S.government based examination by the Army’s Suspension and seeksforfeitureofmorethan$5millioninpro- Debarment Official. Investigative accomplishments ceeds relating to the illegal transactions, including thisquarterresultedin1suspension,18propos- theprojectengineer’sresidenceandsevenautomo- alsfordebarment,and3debarments.Between biles and motorcycles. April1andJune30,2011,theArmysuspended ThecaseisbeingconductedbyDCIS,IRS,ICE, one contractor based on allegation of fraud in Iraq andArmyCID-MPFU. andKuwait.Inaddition,theArmyproposed15 contractorsfordebarmentduringthatperiod.To date,theArmyhassuspended111individualsand SIGPRO Update companiesinvolvedinsustainmentandrecon- structioncontractssupportingtheArmyinIraq TheSIGIRProsecutorialInitiative(SIGPRO) andKuwait;and157individualsandcompanies continuestomakeasubstantiveimpact.Inlate havebeenproposedfordebarment,resultingin118 2009,inanefforttofurtheralignresourceswithits finalizeddebarmentsthatrangeindurationfrom9 expandingcaseload,SIGIRdevelopedaprogram months to 10 years. whereinithiredthreehighlyexperiencedandre- PFBisaggressivelypursuingadditionalcompa- spectedformerDoJprosecutors.Theyweredetailed nies and individuals associated with fraud related asaunittotheFraudSectionoftheDoJCriminal toArmycontractsinIraq,Kuwait,andother Division to prosecute SIGIR investigation cases, locationsinSouthwestAsia,withadditionalsus- handlingtheirownDoJcaseloads,andworking pension and debarment actions projected during closelywiththeSIGIRGeneralCounselandother 2011.Suspensionanddebarmentactionsrelated DoJprosecutorsassignedSIGIRcases.TheSIGPRO to reconstruction and Army support-contract attorneysarenowfirmlyensconcedatDoJwithfull fraudinAfghanistanarereportedtotheSpecial docketsofcriminalfraudmattersemanatingfrom Inspector General for Afghanistan Reconstruction theIraqreconstructioneffort.Theyarecurrently (SIGAR).Foralistofdebarments,seeTable5.5.For leadingorsignificantlyinvolvedinahostofpros- acompletelistofsuspensionsanddebarments,see ecutorialmattersandcontinuetoplayintegralroles Appendix E.◆

124 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 124 7/25/2011 10:38:18 AM SIGIR INVESTIGATIONS

Table 5.4 Convictions (as compiled by the Department of Justice) Date of Name Charges Conviction Sentence

Justin W. Lee, former DoD Conspiracy, bribery 7/15/2011 Pending contractor Robert A. Nelson, Conspiracy to steal public property 6/28/2011 Pending former USA sergeant Derrick Shoemake, Bribery 6/13/2011 Pending former USA major Charles Bowie, Engaging in monetary transactions in property derived 5/11/2011 Pending retired USA major from specified unlawful activity Richard Razo, former DoS Wire fraud, wire fraud conspiracy 2/28/2011 Pending contractor and DoS employee Maj. Kevin Schrock, USA Money laundering 2/8/2011 Pending Eddie Pressley, Bribery, conspiracy to commit bribery, honest services 2/8/2011 Pending former USA major fraud, money laundering conspiracy, engaging in monetary transactions with criminal proceeds Eurica Pressley, former Bribery, conspiracy to commit bribery, honest services 2/8/2011 Pending contractor and military spouse fraud, money laundering conspiracy, engaging in monetary transactions with criminal proceeds Osama Ayesh, former U.S. Theft of public money, engaging in acts affecting a 2/2/2011 42monthsinprison;36monthssupervised Embassy-Baghdad employee personal financial interest release; $243,416 restitution; and $5,000 fine Capt. Bryant Williams, USA Honest services fraud, accepting bribes 12/17/2010 Pending Mark Carnes, USAF master Bribery 12/16/2010 20monthsinprison;3yearssupervised sergeant release; and $4,000 fine Michelle Adams, former DoD Bribery 12/7/2010 15monthsinprisonfollowedbysupervised contractor release Frankie Hand, Jr., retired USN Fraud,bribery,andreceivingillegalgratuities 12/7/2010 3yearsinprisonandforfeitureof$757,525 lieutenant commander PeterDunn,formerDoD Bribery 11/19/2010 14monthsinprison;2yearssupervised contractor release Salvatore Pepe Conspiracy to defraud 11/5/2010 Pending Precy Pellettieri Conspiracy to defraud 11/5/2010 Pending Maj.RoderickSanchez,USA Bribery 10/27/2010 5yearsinprison;3yearssupervisedrelease; and $15,000 fine Maj.RichardHarrington,USMC Receivingillegalgratuities 10/18/2010 12monthsand1dayinprison;and restitution Lt.Col.BruceGillette,USAR Actsaffectingapersonalfinancialinterest 10/6/2010 1yearprobation;$2,000fine;160hours community service; and inability to possess a firearm Mariam Steinbuch, former Bribery 10/5/2010 5 years probation and $25,000 restitution USMC staff sergeant Ismael Salinas Kickbacks 10/1/2010 Pending Dorothy Ellis Conspiracy 9/2/2010 37 months in prison; 3 years probation; and $360,000 restitution WajdiBirjas,formerDoD Bribery, money laundering 8/11/2010 Pending contract employee Maj.MarkFuller,USMC Structuringfinancialtransactions 8/4/2010 1yearand1dayinprison;$198,510fine; and$200specialassessment Continuedonthenextpage

JULY 30, 2011 I REPORT TO CONGRESS I 125

July2011.indb 125 7/25/2011 10:38:18 AM SIGIR OVERSIGHT

Date of Name Charges Conviction Sentence

Maj. Charles Sublett, USA False statements 7/7/2010 21 months in prison; 2 years supervised release;andforfeit$107,900and17,120,000 in Iraqi dinar Capt. Faustino Gonzales, USA Receipt of a gratuity by a public official 6/24/2010 15 months in prison; 1 year supervised release;$10,000fine;$25,500restitution; and$100specialassessment MSGTTerranceWalton,USMC Bribery,graft,failuretoobeyadirectorder 5/17/2010 Reprimand;reductioninrankfromE-8to E-3; $65,000 fine; and 62 days confinement Capt.EricSchmidt,USMC Wirefraud,filingafalsefederaltaxform 5/17/2010 72monthsinprison;3yearsprobation;and $2,150,613 restitution WilliamCollins,USAcivilian Bribery 4/21/2010 42monthsinprison;3yearssupervised release;$1,725fine;andforfeit$5,775 SFC Ryan Chase, USA Illegal gratuities, money laundering, false statements 4/21/2010 1 year and 1 day in prison; 2 years probation; and $1.4 million restitution Marcus McClain Acceptance of illegal gratuities 4/15/2010 Pending Kevin A. Davis Acceptance of illegal gratuities 4/13/2010 Pending JanetSchmidt,contractor Filing a false tax return and fraud 3/18/2010 12 months home confinement; 3 years and military spouse probation; and $2,150,613 restitution TerryHall,contractor Conspiracy,bribery 2/17/2010 Pending Theresa Russell, former Money laundering 1/28/2010 5 years probation and $31,000 restitution USA staff sergeant Capt.MichaelD.Nguyen,USA Theftandstructuringfinancialtransactions 12/7/2009 30monthsinprison;3yearssupervised release; $200,000 restitution; and forfeit hisinterestinallpersonalpropertybought with the stolen money as well as the remainingfundsseizedbythegovernment atthetimeofhisarrest Ronald Radcliffe Bribery and money laundering 10/16/2009 40 months in prison and $30,000 fine JoselitoDomingo Bribery 11/19/2009 39monthsinprison;2yearssupervised release; and $70,000 fine GloriaMartinez Briberyandconspiracy 8/12/2009 5yearsinprison Robert Jeffery Conspiracy and theft 8/11/2009 4 years in prison William Driver Money laundering 8/5/2009 3 years probation, to include 6 months home confinement, and $36,000 restitution Nyree Pettaway Conspiracy to obstruct justice 7/28/2009 12 months and 1 day in prison; 2 years supervised release; and $5 million restitution MichelJamil Conspiracy 7/27/2009 40monthsinprison RobertYoung Conspiracyandtheftofgovernmentproperty 7/24/2009 97monthsinprison;3yearssupervised release; forfeiture of $1 million; and $26,276,472 restitution SamirItani Conspiracy 7/21/2009 24monthsinprison;3yearssupervised release;$100,000fine;and$100special assessment TijaniSaani Filingfalsetaxreturns 6/25/2009 110monthsinprison;1yearsupervised release; $1.6 million fine; and $816,485 restitutiontotheIRS DianeDemilta Wirefraud 5/27/2009 6monthsinprison;12-monthhousearrest; 2yearssupervisedrelease;$20,000fine; and $70,000 restitution BenjaminR.Kafka Misprisionofafelony 5/18/2009 Pending Continuedonthenextpage

126 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 126 7/25/2011 10:38:18 AM SIGIR INVESTIGATIONS

Date of Name Charges Conviction Sentence

Elbert W. George III Theft of government property; conspiracy 5/18/2009 60 days intermittent confinement; 2 years supervisedrelease;forfeit$103,000;and payjointlyandseverallywithco-conspirator Roy Greene $52,286.60 restitution RoyGreene,Jr. Theftofgovernmentproperty;conspiracy 5/18/2009 3yearssupervisedrelease;forfeit$103,000; and pay jointly and severally with co- conspiratorElbertGeorge$52,286.60 restitution Frederick Kenvin Conspiracy 4/30/2009 3 years probation and $2,072,967 restitution StephenDay ConspiracytodefraudtheUnitedStatesby 4/13/2009 3yearsprobation;$41,522restitution;and misrepresentation $2,000 fine JeffAlexMazon,contractor, MajorfraudagainsttheUnitedStatesandwirefraud 3/24/2009 1yearprobation;6monthshome KBR confinement; and $5,000 fine Carolyn Blake, Conspiracy and money laundering 3/19/2009 70 months in prison; 3 years of supervised Sister of Maj. John Cockerham release; and $3.1 million restitution Michael Carter, Project ViolatingtheAnti-KickbackAct 1/25/2009 61monthsinprisonand3yearssupervised Engineer, Force Protection release Industries Harith al-Jabawi, contractor Conspiracy, bribery, and false statements 1/22/2009 Pending Maj. Christopher Murray, Bribery and false statements 1/8/2009 57 months in prison; 3 years supervised USA contracting officer release; and $245,000 restitution Maj. Theresa Baker, Conspiracyandbribery 12/22/2008 70monthsinprisonand$825,000 USAR contracting officer restitution Col.CurtisWhiteford, Conspiracy,bribery,andwirefraud 11/7/2008 5yearsinprison;2yearssupervisedrelease; USARSeniorOfficial,CPA- and $16,200 restitution South Central Region Lt. Col. Michael Wheeler, USAR Conspiracy, bribery, wire fraud, interstate transportation of 11/7/2008 42monthsinprison;3yearssupervised CPAreconstructionadvisor stolen property, and bulk cash smuggling release;$1,200restitution;and$100special assessment David Ramirez, contractor, Bulk currency smuggling and structuring transactions 10/9/2008 50 months in prison; 3 years supervised Readiness Support release; and $200 special assessment Management, Inc. Lee Dubois, contractor, Theftofgovernmentproperty 10/7/2008 3yearsinprisonandrepaymentof Future Services General $450,000 that represented the illegal Trading and Contracting proceeds of the scheme Company Jacqueline Fankhauser Receipt of stolen property 8/28/2008 1 year probation; 180 days home confinement; 104 hours community service; $10,000fine;and$100specialassessment Robert Bennett, contractor, ViolatingtheAnti-KickbackAct 8/28/2008 1yearprobationand$6,000restitution KBR Maj. James Momon, Jr., Conspiracy and bribery 8/13/2008 Pending USA contracting officer Lt. Col. Debra M. Harrison, Conspiracy, bribery, money laundering, wire fraud, 7/28/2008 30monthsinprison;2yearssupervised USA Acting Comptroller for interstate transportation of stolen property, smuggling release; and $366,640 restitution CPA-South Central Region cash, and preparing false tax returns Capt. Cedar Lanmon, USA Accepting illegal gratuities 7/23/2008 1 year in prison and 1 year supervised release Maj. John Lee Cockerham, Jr., Bribery, conspiracy, and money laundering 6/24/2008 210 months in prison; 3 years of supervised USA contracting officer release; and $9.6 million restitution Melissa Cockerham, Conspiracy and money laundering 6/24/2008 41 months in prison; 3 years of supervised Wife of Maj. John Cockerham release; and $1.4 million restitution Continuedonthenextpage

JULY 30, 2011 I REPORT TO CONGRESS I 127

July2011.indb 127 7/25/2011 10:38:18 AM SIGIR OVERSIGHT

Date of Name Charges Conviction Sentence

Lt.Col.LevondaSelph, Conspiracy and bribery 6/10/2008 Pending USAR contracting officer RamanInternationalCorp. Conspiracyandbribery 6/3/2008 $500,000fineand$327,192restitution Capt.AustinKey, Bribery 12/19/2007 24 months confinement; 2 years supervised USA contracting officer release;$600assessment;andforfeit $108,000 Maj. John Rivard, Bribery, conspiracy, and money laundering 7/23/2007 10 years in prison; 3 years supervised USAR contracting officer release; $5,000 fine; and $1 million forfeiture order Kevin Smoot, ViolatingtheAnti-KickbackActandmakingfalse 7/20/2007 14monthsinprison;2yearssupervised Managing Director, statements release;$6,000fine;and$17,964restitution EagleGlobalLogistics,Inc. Anthony Martin, ViolatingtheAnti-KickbackAct 7/13/2007 1yearand1dayinprison;2years subcontractor administrator, supervised release; and $200,504 restitution KBR JesseD.Lane,Jr. Conspiracyandhonestserviceswirefraud 6/5/2007 30monthsinprisonand$323,228 USAR 223rd Finance restitution Detachment Steven Merkes, DoD civilian, Accepting illegal gratuities 2/16/2007 12 months and 1 day in prison and $24,000 operational support planner restitution Chief Warrant Officer Peleti Bribery and smuggling cash 2/9/2007 28 months in prison and $57,500 fine and “Pete” Peleti, Jr., USA, Army’s forfeiture food service advisor for Kuwait,Iraq,andAfghanistan Jennifer Anjakos, Conspiracy to commit wire fraud 11/13/2006 3 years probation; $86,557 restitution; and USAR 223rd Finance $100 assessment Detachment Sgt.CarlosLomeliChavez, Conspiracy to commit wire fraud 11/13/2006 3 years probation; $28,107 restitution; and USAR 223rd Finance $100 assessment Detachment Sgt. Derryl Hollier, Conspiracy to commit wire fraud 11/13/2006 3 years probation; $83,657.47 restitution; USAR 223rd Finance and $100 assessment Detachment Sgt.LuisLopez, Conspiracy to commit wire fraud 11/13/2006 3 years probation; $66,865 restitution; and USAR 223rd Finance $100 assessment Detachment Bonnie Murphy, Accepting unlawful gratuities 11/7/2006 1 year supervised release and contracting officer $1,500 fine Samir Mahmoud, employee of Making false statements 11/3/2006 1 day credit for time served and 2 years U.S. construction firm supervised release Gheevarghese Pappen, Solicitingandacceptingillegalgratuities 10/12/2006 2yearsinprison;1yearsupervisedrelease; USACE civilian and $28,900 restitution Lt. Col. Bruce Hopfengardner, Conspiracy, conspiring to commit wire fraud and money 8/25/2006 21monthsinprison;3yearssupervised USAR special advisor to CPA- laundering, and smuggling currency release;$200fine;and$144,500forfeiture South Central Region Faheem Mousa Salam, Violating the Foreign Corrupt Practices Act’s Anti-Bribery 8/4/2006 3 years in prison; 2 years supervised release; interpreter, Titan Corp. Provisions 250hourscommunityservice;and$100 special assessment Mohammad Shabbir Khan, ViolatingtheAnti-KickbackAct 6/23/2006 51monthsinprison;2yearssupervised director of operations for release; $10,000 fine; $133,860 restitution; Kuwait and Iraq, Tamimi and $1,400 assessment Global Co., Ltd. Witness tampering 8/10/2009 Pending Continuedonthenextpage

128 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 128 7/25/2011 10:38:18 AM SIGIR INVESTIGATIONS

Date of Name Charges Conviction Sentence

PhilipBloom,Owner:Global Conspiracy, bribery, and money laundering 3/10/2006 46 months in prison; 2 years supervised Business Group, GBG Holdings, release; $3.6 million forfeiture; and GBG-Logistics Division $3.6millionrestitution;and$300special assessment Stephen Seamans, Wire fraud, money laundering, and conspiracy 3/1/2006 12 months and 1 day in prison; subcontracts manager, KBR 3yearssupervisedrelease;$380,130 restitution; and $200 assessment Christopher Cahill, regional MajorfraudagainsttheUnitedStates 2/16/2006 30monthsinprison;2years vicepresident,MiddleEast supervisedrelease;$10,000fine;and$100 andIndia,EagleGlobal assessment (a civil settlement with EGL Logistics, Inc. arisingfromthesamefactsresultedina settlement of $4 million) Robert Stein, Feloninpossessionofafirearm,possessionofmachine 2/2/2006 9 years in prison; 3 years supervised CPA-South Central comptroller guns, bribery, money laundering, and conspiracy release; $3.6 million forfeiture; $3.5 million and funding officer restitution;and$500specialassessment Glenn Powell, MajorfraudandviolatingtheAnti-KickbackAct 8/1/2005 15monthsinprison;3yearssupervised subcontracts manager, KBR release;$90,973.99restitution;and$200 assessment

Note: Does not include non-U.S. court results from joint SIGIR/foreign law enforcement investigations.

JULY 30, 2011 I REPORT TO CONGRESS I 129

July2011.indb 129 7/25/2011 10:38:18 AM SIGIR OVERSIGHT

Table 5.5 Debarment List Name Debarred Name Debarred

JanetL.Schmidt 6/22/2011 MaythamJassimMohammad 9/22/2010 Mariam M. Steinbuch 6/6/2011 Michael Dung Nguyen 8/19/2010 Mark Carnes 6/3/2011 Michael Wheeler 7/28/2010 TerenceO.Walton 6/3/2011 Austin Key 7/14/2010 Al Aali Future Mario Company 5/11/2011 Ashraf Mohammad Gamal 4/16/2010 Eric K. Schmidt 4/20/2011 TripleAUnitedGeneralTrading 4/16/2010 and Contracting Mark R. Fuller 4/1/2011 Jeff Thompson 3/29/2010 AmmarTariqAlJazrawi 1/10/2011 John Cockerham 3/17/2010 AmmarTareqAlJazrawiGeneral 1/10/2011 Contracting Company Melissa Cockerham 3/17/2010 LibertyAl-AhliaGeneralTradingand Carolyn Blake 3/17/2010 12/13/2010 Contracting Company Nyree Pettaway 3/17/2010 Bronze Al-Taqoos Al-Afjan 12/13/2010 Robert Young 3/9/2010 International Quality Kitchens Ardiya 12/13/2010 ElbertWestleyGeorgeIII 1/21/2010 John Napolian 12/13/2010 Roy Greene 1/21/2010 Joseph Sebastian 12/13/2010 Ofelia Webb 1/21/2010 N.K. Ismail 12/13/2010 Patrick Faust 1/21/2010 Biju Thomas 12/13/2010 AliN.Jabak 9/30/2009 Combat General Trading Company 12/13/2010 LibertyA.Jabak 9/30/2009 Jank Singh 11/24/2010 Liberty'sConstructionCompany 9/30/2009 BlueMarineServices 11/24/2010 Tharwat Taresh 9/30/2009 BlueMarinesGeneralTrading,LLC 11/24/2010 Babwat Dourat Al-Arab 9/30/2009 Blue Marines 11/24/2010 Dourat Al-Arab 9/30/2009 Blue Marines Group 11/24/2010 Hussein Ali Yehia 9/30/2009 BMS Logistics 11/24/2010 Amina Ali Issa 9/30/2009 BMS Group 11/24/2010 Adel Ali Yehia 9/30/2009 BMS General Trading, LLC 11/24/2010 Javid Yousef Dalvi 9/25/2009 Christopher Murray 11/10/2010 MohamedAbdelLatifZahed 9/10/2009 Curtis Whiteford 10/22/2010 Gerald Thomas Krage 9/4/2009 William Driver 10/22/2010 Andrew John Castro 9/4/2009 Allied Arms Company, Ltd. 9/28/2010 Airaﬁdane, LLC 9/4/2009 Allied Arms Company, W.L.L. 9/28/2010 KevinArthisDavis 8/20/2009 Shahir Nabih Fawzi Audah 9/28/2010 Jacqueline Fankhauser 8/7/2009 Defense Consulting and Contracting 9/28/2010 Group, LLC Debra M. Harrison, LTC, USAR 8/7/2009 Amwaj Al-Neel Company 9/22/2010 Nazar Abd Alama 7/1/2009 Baladi Company 9/22/2010 San Juan Company 7/1/2009 MississippiCompanyforthe Desert Moon Company 9/22/2010 7/1/2009 General Contract AmeerS.Fadheel 9/22/2010 Lee Dynamics International 6/17/2009 Oday Abdul Kareem 9/22/2010 Lee Defense Services Corporation 6/17/2009 Continuednextcolumn Continuednextcolumn

130 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 130 7/25/2011 10:38:18 AM SIGIR INVESTIGATIONS

Name Debarred Name Debarred

George H. Lee 6/17/2009 Samir Mahmoud 11/29/2007 Justin W. Lee 6/17/2009 Robert Grove 10/30/2007 Oai Lee 6/17/2009 Steven Merkes 9/27/2007 Mark J. Anthony 6/17/2009 BruceD.Hopfengardner,LTC,USAR 9/20/2007 LevondaJ.Selph 6/17/2009 Robert J. Stein, Jr. 8/16/2007 Starcon Ltd., LLC 6/17/2009 PhilipH.Bloom 8/8/2007 Cedar J. Lanmon, CPT, USA 6/3/2009 Global Business Group S.R.L. 8/8/2007 D+JTradingCompany 5/14/2009 Stephen Lowell Seamans 7/27/2007 JesseD.Lane,Jr. 1/30/2009 Gheevarghese Pappen 6/28/2007 Jennifer Anjakos 1/30/2009 Faheem Mousa Salam 6/28/2007 Carlos Lomeli Chavez 1/30/2009 QAHMechanicalandElectricalWorks 6/27/2007 Derryl Hollier 1/30/2009 Abdullah Hady Qussay 6/27/2007 Luis A. Lopez 1/30/2009 Al Riyadh Laboratories and Electricity Co. 1/26/2007 Mohammed Shabbir Kahn 10/10/2008 Thomas Nelson Barnes 1/24/2007 Kevin Andre Smoot 9/30/2008 Danube Engineering and General 12/28/2006 Contracting 9/17/2008, GreenValleyCompany 5/18/2007 Alwan Faiq 12/28/2006 Triad United Technologies, LLC 9/17/2008 Christopher Joseph Cahill 11/9/2006 Dewa Europe 9/17/2008 AhmedHassanDayekh 9/26/2006 Dewa Trading Establishment 9/17/2008 5/14/2009, Diaa Ahmen Abdul Latif Salem 6/2/2006 Al Ghannom and Nair General Trading 9/17/2008 Company Jasmine International Trading and Service 5/14/2009, Company 6/2/2006 Dewa Projects (Private), Ltd. 9/17/2008 Custer Battles 3/17/2006 FutureAIMUnited 9/17/2008 Robert Wiesemann, CW2, USA 3/6/2006 FirstAIMTradingandContracting 9/17/2008 Glenn Allen Powell 2/16/2006 Vasantha Nair 9/17/2008 Amro Al Khadra 1/12/2006 K. V. Gopal 9/17/2008 DanTradingandContracting 1/12/2006 Falah Al-Ajmi 9/17/2008 Steven Ludwig 9/29/2005 Trans Orient General Trading 9/17/2008 DXB International 9/29/2005 Zenith Enterprises, Ltd. 9/17/2008 Peleti “Pete” Peleti, CWO, USA 6/15/2008 Al Sawari General Trading and 3/13/2008 Contracting Company JohnAllenRivard,MAJ,USAR 1/14/2008 Continuednextcolumn

JULY 30, 2011 I REPORT TO CONGRESS I 131

July2011.indb 131 7/25/2011 10:38:18 AM SIGIR OVERSIGHT

SIGIR HOTLINE

TheSIGIRHotlinefacilitatesthereportingof New Cases fraud, waste, abuse, mismanagement, and reprisal Duringthisreportingperiod,theSIGIRHotline inallprogramsassociatedwithIraqreconstruc- received 11 new complaints, bringing the cumula- tion efforts funded by the U.S. taxpayer. Cases tivetotalto856Hotlinecases.Thenewcomplaints received by the SIGIR Hotline that are not related were classified in these categories: toprogramsandoperationsfundedwithamounts • 7 involved contract fraud. appropriatedorotherwisemadeavailableforthe • 1 involved waste. reconstructionofIraqaretransferredtotheappro- • 3 involved personnel issues. priateentity.TheSIGIRHotlinereceiveswalk-in, telephone,mail,fax,andonlinecontactsfrom The SIGIR Hotline receives most reports of peopleinIraq,theUnitedStates,andthroughout perceivedinstancesoffraud,waste,abuse,mis- the world. management, and reprisal through the website andelectronicmail.OfSIGIR’s11newHotline Second Quarter Reporting complaints,9werereceivedthroughtheSIGIR AsofJune30,2011,theSIGIRHotlinehadinitiated website,1wasreceivedthroughthemail,and1was 856 cases. Of these cases, 802 have been closed, received by telephone. and54casesremainopen.Forasummaryofthese cases, see Table 5.6. Closed Cases Duringthisquarter,SIGIRclosed9Hotlinecases: Table 5.6 • 8 were referred to other inspector general Summary of SIGIR Hotline Cases, agencies. as of 6/30/2011 • 1 was dismissed as it was not within SIGIR’s Open Cases purview. Investigations 42 Audits 12 Referred Complaints Total Open 54 Afterathoroughreview,SIGIRreferred8com- plaintstooutsideagenciesforproperresolution: Closed 4th Qtr 1st Qtr 2nd Qtr Cases 2010 2011 2011 Cumulative* • 6 were sent to the Department of Defense Office of Inspector General. FOIA 0 0 0 4 • 1wassenttotheDepartmentofStateOfficeof OSC Review 0 0 0 2 Inspector General. Assists 1 0 0 47 • 1wassenttotheSpecialInspectorGeneralfor Dismissed 3 0 1 141 Afghanistan Reconstruction.◆ Referred 4 16 8 382 Inspections 0 0 0 80 Investigations 1 12 0 129 Audits 0 0 0 17 Total Closed 9 28 9 802 Cumulative* Open & Closed 856

*CumulativetotalscovertheperiodsincetheSIGIRHotlinebegan operations—from 3/24/2004 to 6/30/2011.

132 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 132 7/25/2011 10:38:18 AM SIGIR WEBSITE

SIGIR WEBSITE

During this reporting period, the SIGIR website Figure 5.4 (www.sigir.mil)recordedtheseactivities: Average Number of Visitors per Day to SIGIR Website, by Quarter, 4/1/2010–6/30/2011 • Morethan103,550usersvisitedtheSIGIRweb-

site—1,137 users per day. 1,500

• TheArabic-languagesectionofthesitereceived 1,257 1,227 3,998 visits. 1,152 1,137 1,090 • Themostfrequentlydownloadeddocuments were SIGIR’s most recent Quarterly Reports. 1,000 • TheSIGIRwebsitefedmorethan30,000content subscriptions. Information is updated to the web

feeds,whichareautomaticallydownloadedto 500 subscribers’computersandcanbeviewedby feed-reader programs.

0 ForanoverviewofdailyvisitstotheSIGIR Q2 Q3 Q4Q1 Q2 website, see Figure 5.4.◆ 2010 2011

Source: DoD, IMCEN, response to SIGIR data call, 7/11/2011.

JULY 30, 2011 I REPORT TO CONGRESS I 133

July2011.indb 133 7/25/2011 10:38:18 AM SIGIR OVERSIGHT

LEGISLATIVE UPDATE

Appropriations and • anupdateontrendsinSIGIR’sinvestigations, Authorization Legislation including such path-breaking programs as the SIGIRProsecutorialInitiative(SIGPRO) Thisquarter,theCongressbegan,butdidnotcom- • commentsontheCommission’srecommenda- plete,workontheFY2012appropriationsactsfor tions contained in its Second Interim Report theDepartmentofDefense(DoD),theDepartment ofState(DoS),andforeignoperations.TheHouse InhisstatementtotheCommission,theInspec- of Representatives, but not the Senate, passed the tor General said: DoDlegislation.TheDepartmentofState,foreign IviewtheCommission’sproposaltocreate“[a]new, operations,andrelatedprogramslegislationwas dual-hattedpositionatOMBandtheNSCtoprovide oversight and strategic direction for contingency op- thesubjectofpreliminaryworkonly,andneither erations” as a meaningful step in the right direction, house acted on it. but one that would not sufficiently strengthen U.S. managementcapacitiesinSROs.Thepasteightyears TheCongressalsocontinuedworkonthe inIraqdemonstratedthathigh-level“coordina- National Defense Authorization Act, which passed tion”betweenagencies,andespeciallybetweenand amongState,USAID,andDefense,willnotensure theHouseofRepresentativesandwasreportedout the level of integration and accountability required by the Senate Committee on Armed Services—but toachievesuccessinthesedifficultmissions.More- likewise was not completed. over, the Interagency Management System within theNSChasnotprovenitselftobeanenduringand effective model for managing SRO activities. ThemostcompellingSROissuenowbeforeU.S.poli- cymakers is not simply the contracting or oversight Congressional Appearances componentsofSROs,buthowtheSROoperationsare to be planned and managed in toto.Alittleoverayear SincethelastQuarterlyReport,theInspector ago,theCommissionconvenedahearingwithrepre- sentativesfromDefense,State,andUSAID,andwas Generalappearedbeforealegislativebranchentity unabletogetaclearanswertothesimplequestionof on one occasion—the April 25, 2011, Commission whoisinchargeoftheAfghanistanreconstruction on Wartime Contracting in Iraq and Afghani- operation. That salient and disturbing reality remains true today. The “whole of government” approach, stanhearingon“ImplementingImprovements ostensiblydrivenbytheNSCandOMB,hasbeen to Defense Wartime Contracting.” The Inspector largelyunsuccessfulasanSROmanagementtool. Expertsseemtobecomingtoagreementonthis General’s testimony included: point,andthusthetimeisripefordevelopingand • ideasforimprovingdefensewartimecontract- implementing new reforms. ing,drawnfromkeyresultsofSIGIR’saudits, The complete prepared statements of SIGIR officials inspections, and lessons learned reports whohavetestifiedbeforetheCongressoralegisla- • the status of the implementation of SIGIR’s tive branch entity can be found at www.sigir.mil/ recommendations publications/testimony/index.html.◆

134 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 134 7/25/2011 10:38:19 AM OTHER AGENCY OVERSIGHT

Introduction 136

Other Agency Oversight Reports 137

Other Agency Investigations 140 6section

July2011.indb 135 7/25/2011 10:38:19 AM OTHERAGENCYOVERSIGHT

INTRODUCTION

InMarch2004,SIGIRformedtheIraqInspec- ForDefenseContractAuditAgency(DCAA) torsGeneralCouncil(IIGC)toprovideaforum updates, see Appendix F. for discussion of oversight in Iraq and to enhance Inpreviousquarters,SIGIRhasprovidedup- collaboration and cooperation among the inspec- datesontheU.S.DepartmentoftheTreasuryand torsgeneral(IGs)oftheagenciesthatoverseeIraq theU.S.DepartmentofCommerce,buttheseagen- reconstruction funds. Representatives of member cieshavenocurrentIraqreconstructionoversight organizationshavemetquarterlytoexchangede- activities ongoing or planned for FY 2011. SIGIR no tails about current and planned audits, to identify longer reports on these agencies in this section. opportunitiesforcollaboration,andtominimize Section842oftheNationalDefenseAuthoriza- redundancies. tionActforFiscalYear2008(PublicLaw110-181) Inlightofthecontinuingscale-downofefforts requires that SIGIR, in consultation with other inIraq,theIIGCistransitioningitsworkunder inspectors general, develop “a comprehensive plan theumbrellaoftheDepartmentofDefenseOffice for a series of audits” of “federal agency contracts, of Inspector General (DoD OIG) Southwest Asia subcontracts,andtaskanddeliveryordersforthe JointPlanningGroup.Assuch,thequarterlyIIGC performanceofsecurityandreconstructionfunc- meetings will no longer take place. SIGIR plans to tionsinIraq.”FollowingtheenactmentofSection continue close cooperation with the entire over- 842,SIGIRhasworkedcloselywiththeDoDOIG sight community engaged in Iraq oversight and SouthwestAsiaJointPlanningGroup,whichhas anticipatesthecreationofasub-groupwithinthe facilitatedtheproductionoftheComprehensive Joint Planning Group that will ensure continued OversightPlanforSouthwestAsia.Thatdocument, focusontheIraqmission.InMay2011,theJoint compiledbytherelevantIGs(includingSIGIR), PlanningGrouphelditsseventeenthmeeting. summarizes ongoing and near-term planned Each quarter, SIGIR requests updates from auditsforIraqandtheregion.◆ memberorganizationsontheircompleted,ongoing, and planned oversight activities. This sec- tionsummarizestheauditsandinvestigations reportedtoSIGIRthisquarterbythefollowing organizations: •DoDOIG • DepartmentofStateOfficeofInspectorGeneral (DoS OIG) • GovernmentAccountabilityOffice(GAO) • U.S.ArmyAuditAgency(USAAA) • U.S.AgencyforInternationalDevelopment Office of Inspector General (USAID OIG)

136 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 136 7/25/2011 10:38:19 AM OTHER AGENCY OVERSIGHT REPORTS

OTHER AGENCY OVERSIGHT REPORTS

ThissectionupdatestheauditsthatIIGCmember • For more information on other agency oversight agencies reported to SIGIR: reports, including report summaries, see Ap- • For recently completed oversight report activity, pendix F. see Table 6.1. • Foracompletehistoricallistofoversightreports • For ongoing oversight report activity of other andreviewsonIraqreconstructionbyallenti- U.S. agencies during this reporting period, see ties, see Appendix G.◆ Table 6.2.

Table 6.1 RecentlyCompletedOversightReportsofOtherU.S.Agencies,asof6/30/2011 Agency Report Number Report Date Report Title

ContractsSupportingBaseOperationsinKuwaitNeedStronger DoD OIG D-2011-078 6/30/2011 Management and Administration IncompleteContractFilesforSouthwestAsiaTaskOrdersonthe DoD OIG D-2011-066 6/1/2011 WarfighterFieldOperationsCustomerSupportContract ExcessInventoryandContractPricingJeopardizetheArmyContract DoD OIG D-2011-061 5/3/2011 withBoeingtoSupportCorpusChristiArmyDepot Consistent Use of Supply Support Activities Could Increase Efficiency DoD OIG D-2011-056 4/14/2011 of Equipment Drawdown from Iraq Army Commercial Vendor Services Offices in Iraq Noncompliant with DoD OIG D-2011-059 4/8/2011 Internal Revenue Service Reporting Requirements Review of Embassy Baghdad Transition Planning–Phase II (DoD DoS OIG MERO-I-11-08 5/21/2011 Downsizing) Combating Terrorism: U.S. Government Should Improve Its Reporting GAO GAO-11-561 6/3/2011 on Terrorist Safe Havens Combating Terrorism: U.S. Government Strategies and Efforts to GAO GAO-11-713T 6/3/2011 Deny Terrorists Safe Haven Military Training: Actions Needed to Improve Planning and GAO GAO-11-456 5/26/2011 Coordination of Army and Marine Corps Language and Culture Training Contingency Contracting: Observations on Actions Needed to GAO GAO-11-580 4/25/2011 Address Systemic Challenges ContractforRecyclingandDisposingofWasteMaterialatCamp USAAA A-2011-0145-ALL 6/22/2011 Steeler, Iraq USAAA A-2011-0072-ALL 5/25/2011 U.S. Equipment Transferred to Iraq USAAA A-2011-0098-ALL 4/29/2011 Controls over Shipping Container Accountability and Visibility–Iraq LogisticsCivilAugmentationProgram(LOGCAP)III,ContractClose- USAAA A-2011-0101-ALC 4/28/2011 out FollowupAuditofRetrogradeOperationsinSouthwestAsia–Multi USAAA A-2011-0076-ALL 4/14/2011 Class Supplies USAAA A-2011-0077-ALL 4/12/2011 FollowupAuditofRetrogradeOperations–ClassVIIEquipmentinIraq USAID OIG E-267-11-002-P 5/16/2011 Audit of USAID/Iraq’s Agribusiness Program

JULY 30, 2011 I REPORT TO CONGRESS I 137

July2011.indb 137 7/25/2011 10:38:19 AM OTHERAGENCYOVERSIGHT

Table 6.2 Ongoing Oversight Activities of Other U.S. Agencies, as of 6/30/2011 Agency Project Number Date Initiated Project Title

DoD OIG D2011-D000JA-0212.000 4/25/2011 Theater-Provided Equipment Refurbishment Program for Tactical Wheeled Vehicles DoDOIG D2011-D00SPO-0203.000 3/25/2011 AssessmentoftheDoDEstablishmentoftheOfﬁceofSecurityCooperation-Iraq DoD Countermine and Improvised Explosive Device Defeat Systems Contracts–Vehicle Optics DoD OIG D2011-D000AB-0156.000 3/11/2011 Sensor System DoDOIG D2011-D000JB-0098.000 12/8/2010 ContractingforForceProtectionforU.S.InstallationsinIraq Follow-upofHealthCareProvidedbyMilitaryTreatmentFacilitiestoContractorsinSouthwest DoD OIG D2011-D000LF-0041.000 11/2/2010 Asia DoD OIG D2011-D000CH-0032.000 10/19/2010 Contractor Logistics Support Contract for Stryker Vehicles with General Dynamics Land Systems Controls and Processes Pertaining to the Defense Logistics Agency’s Procurement Automated DoD OIG D2010-D000LD-0264.000 8/30/2010 Contract Evaluation System DoDOIG D2010-D000JA-0241.000 7/21/2010 SpecialOperationsForcesPlansfortheDrawdownandResetofPropertyinIraq DoDOIG D2010-D00SPO-0209.000 4/16/2010 AssessmentofDoDWoundedWarriorMatters DoD OIG D2010-D000AE-0139.000 1/29/2010 DoD Countermine and Improvised Explosive Device Defeat Systems Interrogation Arm Material Purchases Made Through the Partnership Agreement with Sikorsky Aircraft DoD OIG D2010-D000CH-0077.001 11/18/2009 CorporationatCorpusChristiArmyDepot DoD OIG D2009-D000JB-0307.000 9/16/2009 Controls Over the Accountability and Disposition of Government Furnished Property in Iraq DoDOIG D2009-DIPOE3-0306.000 9/11/2009 ReviewofArmyResponsetoSodiumDichromateExposureatQarmatAli,Iraq—Part II U.S.GovernmentEffortstoTransitiontheSecurityAssistanceMissionSupportingthe DoD OIG D2009-D00SPO-0287.000 8/11/2009 GovernmentofIraqfromDepartmentofDefenseAuthoritytoDepartmentofStateAuthority FY 2008 Marine Corps Global War on Terror-Related Costs Processed Through the Standard DoD OIG D2009-D000FG-0183.000 4/7/2009 Accounting, Budgeting, and Reporting System Deployment of the Standard Procurement System in the Joint Contracting Command Iraq/ DoD OIG D2009-D000FB-0112.000 1/5/2009 Afghanistan DoDOIG D2009-D000CK-0100.000 12/9/2008 MaintenanceandSupportoftheMineResistantAmbushProtectedVehicle DoD OIG D2008-D000CD-0256.000 8/7/2008 DoD Body Armor Contracts DoDOIG D2007-D000FL-0252.000 8/31/2007 InternalControlsandDataReliabilityintheDeployableDisbursingSystem ProgramEvaluationoftheDepartmentofState’sAntiterrorismAssistanceProgram(ATA)in DoS OIG 11MERO3010 1/1/2011 Iraq DoS OIG 11MERO3004 12/1/2010 Audit of Embassy Baghdad’s Operations and Maintenance Contract with PAE GAO 351617 Notreported Biometrics,LastTacticalMile GAO 351603 Not reported Intelligence, Surveillance, and Reconnaissance Collection and Tasking Management GAO 320843 Not reported Transition to a Predominantly Civilian Presence in Iraq GAO 120976 Not reported State Contracting for Conﬂict Countries GAO 351552 10/21/2010 Marine Corps Equipping Strategies to Reset Equipment Returning from Iraq and Afghanistan GAO 351550 10/8/2010 Army’s Strategies to Reset Non-Standard Equipment Returning from Iraq GAO 120974 8/6/2010 ReviewofJointReportonContractinginIraqandAfghanistan GAO 351514 6/14/2010 ArmyAdviseandAssistBrigades GAO 351476 4/1/2010 DoD Iraq Drawdown Planning GAO 351431 1/7/2010 Army’s Equipping Strategies to Reset Equipment Returning from Iraq GAO 320734 11/1/2009 U.S. Strategy and Joint Campaign Plan for Iraq GAO 120931 7/1/2009 Close-out of Iraq Contracts USAAA A-2011-ALL-0414.000 3Q/FY 2011 Property Accountability of Organizational and Theater-Provided Equipment in Iraq USAAA A-2011-ALL-0346.000 2Q/FY 2011 Property Accountability in CONUS

Continuedonnextpage

138 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 138 7/25/2011 10:38:19 AM OTHER AGENCY OVERSIGHT REPORTS

Agency Project Number Date Initiated Project Title

USAAA A-2011-ALL-0342.000 2Q/FY 2011 Commander’s Emergency Response Program-Afghanistan USAAA A-2011-ALL-0344.000 2Q/FY 2011 Property Accountability in Afghanistan USAAA A-2011-ALL-0092.000 2Q/FY 2011 Foreign Excess Personal Property (FEPP) Program–Phase II USAAA A-2011-ALL-0135.000 1Q/FY2011 Micro-PurchasesofFieldOrderingOfﬁcers–Afghanistan USAAA A-2011-ALL-0107.000 1Q/FY 2011 The U.S. Equipment Transfer to Iraq (USETTI) Program–Phase II USAAA A-2011-ALL-0098.000 1Q/FY 2011 Bulk Fuel Operations in Afghanistan Management Controls Over Payments for Overseas Contingency Operations Transportation– USAAA A-2011-ALL-0087.001 1Q/FY 2011 ARCENT Management Controls over Department of Defense Activity Address Codes (DODAAC), U.S. USAAA A-2011-ALL-0087.000 1Q/FY 2011 Army Central Command USAAA A-2010-ALL-0541.000 4Q/FY 2010 Bulk Fuel Operations in Iraq USAAA A-2010-ALL-0480.000 3Q/FY2010 Agreed-UponProceduresAttestationforUSFOR-ALOGCAPCourseofAction–Afghanistan USAAA A-2010-ALM-0394.000 3Q/FY 2010 Follow-up Audit of Automatic Reset Induction USAAA A-2010-ALC-0125.003 3Q/FY 2010 Human Capital Issues–Current Plans (Reachback Capabilities) USAAA A-2010-ALL-0421.000 2Q/FY 2010 LOGCAP IV Contract Requirements Determination–Afghanistan USAAA A-2010-FFF-0372.000 2Q/FY 2010 Improvised Explosive Device Defeat (IED-D) Home Station Training USAAA A-2010-ALL-0311.001 2Q/FY2010 DisposalofArmyEquipmentandMaterialsIntoDumpSitesinIraq USAAA A-2009-ALL-0118.000 2Q/FY 2009 Controls over Vendor Payments–Southwest Asia (Phase II) Audit of Audit of the Sustainability of Selected USAID/Iraq-Funded Information Technology USAID OIG Not reported 3Q/FY 2011 Systems USAID OIG Not reported 2Q/FY 2011 Audit of USAID/Iraq’s Elections Support Program USAID OIG Not reported 4Q/FY 2010 Information Survey of USAID/Iraq’s Active Awards and Subawards During Fiscal Year 2010 AuditofAuditofUSAID/Iraq’sMicroﬁnanceActivitiesUnderitsProvincialEconomicGrowth USAID OIG Not reported 3Q/FY 2010 Program

AuditofUSAID/Iraq’sCommunityActionProgramIIIActivitiesImplementedbyInternational USAID OIG Not reported 2Q/FY 2010 Relief and Development

JULY 30, 2011 I REPORT TO CONGRESS I 139

July2011.indb 139 7/25/2011 10:38:19 AM OTHERAGENCYOVERSIGHT

OTHER AGENCY INVESTIGATIONS

SIGIR regularly coordinates with other government agencies conducting investigations in Iraq. Forstatisticsofinvestigativeactivitiesfromother agencies, see Table 6.3.◆

Table 6.3 Status of Investigative Activities of Other U.S. Agencies, as of 6/30/2011 Agency Investigators in Iraq Investigators in Kuwait Open/Ongoing Cases*

U.S. Army Criminal Investigation Command, Major Procurement 22110 Fraud Unit Defense Criminal Investigative Service 1 2 155 DoS OIG 2019 FBI 3151 NCIS 013 U.S. Air Force, Ofﬁce of Special Investigations 0 0 6 USAID 1013 Total 96357

*NumbersincludependingcasesworkedwithotheragencieswithintheJointOperationsCenter.

140 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 140 7/25/2011 10:38:19 AM ENDNOTES AND ACRONYMS AND DEFINITIONS

July2011.indb 141 7/25/2011 10:38:19 AM ENDNOTES

1. Admiral Mike Mullen, remarks as delivered Tables, FY 2009–FY 2011; USAID, responses 28. SIGIRanalysisofopen-sourcedocumentsin at the Pentagon Press Association luncheon, toSIGIRdatacalls,1/12/2009and4/8/2009; ArabicandEnglish,4/2011–7/2011. 7/7/2011, www.jcs.mil/speech.aspx?id=1623, OMB, response to SIGIR data call, 6/21/2010; 29. GOI,HJC,informationprovidedtoSIGIR, accessed 7/18/2011. U.S. Embassy-Baghdad, response to SIGIR 4/2011–7/2011. 2. DoD, news transcript, “Media Availability data call, 10/3/2009. 30. DoS, response to SIGIR data call, 7/17/2011. with Secretary Panetta at Forward Operating 14. P.L. 111-117; P.L. 112-10; USAID, response to 31. JianDeLeon,“U.S.ForcesIraqRe-evaluates Base Dwyer, Afghanistan,” 7/10/2011, SIGIRdatacall,7/7/2011;USACE,response Priorities,” Emerging Media, Defense Media www.defense.gov/transcripts/transcript. toSIGIRdatacall,7/5/2011;DoS,NEA-I, Activity, 5/31/2011, www.defense.gov/ aspx?transcriptid=4850, accessed 7/18/2011. responses to SIGIR data calls, 4/12/2011, news/newsarticle.aspx?id=64128, accessed 3. GOI,CoRmemberKenna,information 4/15/2011, 6/24/2011, 6/27/2011, and 7/7/2011. 6/14/2011. provided to SIGIR, 7/17/2011. 15. OUSD(C), response to SIGIR data call, 32. DoD,JimGaramone,AmericanForcesPress 4. SIGIR, analysis of open-source Arabic 7/15/2011;P.L.111-212;P.L.112-10. Service, “Extremists Use Iranian Weapons, documents, 7/2011. 16. U.S. Embassy-Baghdad, response to SIGIR IraqCommandSpokesmanSays,”7/11/2011, 5. USF-I, DCG-O, meeting with SIGIR, 5/5/2011. data call, 7/1/2011. www.defense.gov/news/newsarticle. 6. U.S. Embassy-Baghdad, response to 17. GOI,MinistryofFinance,“2011IraqBudget aspx?id=64630, accessed 7/15/2011. This SIGIRdatacall,7/1/2011;IraqTransition Schedules,”5/16/2011andGOI,Presidential articlediscussestherecentuseofIRAMsand Coordinator,meetingwithSIGIR,7/22/2011. Council,“FederalPublicBudgetLawforthe EFPs in Iraq. In several public statements 7. DoD, news transcript, “Media Availability Fiscal Year 2010,” 2/10/2010. this quarter, U.S. officials (including former with Secretary Panetta at Forward Operating 18. GOI,MinistryofFinance,“2011IraqBudget SecretaryofDefenseRobertGatesand Base Dwyer, Afghanistan,” 7/10/2011, Schedules,”5/16/2011andGOI,Presidential current Secretary of Defense Leon Panetta) www.defense.gov/transcripts/transcript. Council,“FederalPublicBudgetLawforthe acknowledgedtheincreaseduseofIranian- aspx?transcriptid=4850, accessed 7/18/2011. Fiscal Year 2010,” 2/10/2010. supplied weapons, but did not definitively link 8. SIGIRanalysisofU.S.andGOIdocuments 19. GOI,MinistryofFinance,“2011IraqBudget theirusetospecificincidents. and open-source information in Arabic and Schedules,”5/16/2011andGOI,Presidential 33. DoD, “DoD Identifies Army Casualties,” English, 4/2011-7/2011. Council,“FederalPublicBudgetLawforthe 6/9/2011, www.defense.gov/releases/release. 9. DoD, “Bloggers Roundtable with Major Fiscal Year 2010,” 2/10/2010. aspx?releaseid=14558, accessed 7/15/2011, GeneralJeffreyBuchanan,Spokesman, 20. GOI,MinistryofFinance,“2011IraqBudget and “DoD Identifies Army Casualty,” USF-I,” 5/27/2011, www.defense. Schedules,”5/16/2011andGOI,Presidential 6/18/2011, www.defense.gov/releases/release. gov/Blog_files/Blog_assets/BRT%20 Council,“FederalPublicBudgetLawforthe aspx?releaseid=14587, accessed 7/15/2011. The MajGenBUCHANAN.pdf, accessed Fiscal Year 2010,” 2/10/2010. fivecasualtiescitedintheDoDpressrelease 7/17/2011. 21. GOI,MinistryofFinance,“2011IraqBudget dated6/9/2011,andtheonecasualtyidentified 10. U.S. Embassy-Bagdad, OPA, information Schedules,”5/16/2011andGOI,Presidential in the DoD press release, dated 6/18/2011 provided to SIGIR, 7/23/2011. Council,“FederalPublicBudgetLawforthe diedasaresultofinjuriessustainedduringan 11. DoSOIG,“DepartmentofStatePlanning Fiscal Year 2010,” 2/10/2010. indirect-fire attack on their base in Baghdad. fortheTransitiontoaCivilian-ledMission 22. GOI,MinistryofFinance,“2011IraqBudget 34. DoD, “DoD Identifies Army Casualties,” inIraq,”5/2011,pp.18–19,oig.state.gov/ Schedules,”5/16/2011andGOI,Presidential 7/2/2011, www.defense.gov/releases/release. documents/organization/165037.pdf, accessed Council,“FederalPublicBudgetLawforthe aspx?releaseid=14625, accessed 7/15/2011, 7/17/2011. Fiscal Year 2010,” 2/10/2010. and “DoD Identifies Army Casualty,” 12. DoSOIG,“DepartmentofStatePlanning 23. GOI,CoR,“FederalPublicBudgetLawfor 7/4/2011, www.defense.gov/releases/release. fortheTransitiontoaCivilian-ledMission the Fiscal Year 2011,” 2/23/2011, Article 1; aspx?releaseid=14628, accessed 7/15/2011. inIraq,”5/2011,pp.19–20,oig.state.gov/ GOI, MOF, “2011 Iraq Budget Schedules,” The three casualties identified in these documents/organization/165037.pdf, accessed 5/16/2011, Schedule A. twopressreleasesdiedinaJune29,2011, 7/17/2011. 24. NEA-I,responsestoSIGIRdatacalls, indirect-fire attack on their base in Wassit 13. P.L.108-7;P.L.108-11;P.L.108-106;P.L. 7/6/2010,4/5/2011,and7/7/2011(Crudeoil province. 108-287;P.L.109-13;P.L.109-102;P.L.109- productionandexportfigurescalculatedby 35. CENTCOM,“2U.S.SoldiersKilledby 148;P.L.109-34;P.L.109-289;P.L.110-28; NEA-I and U.S. Treasury frequently differ BaghdadRoadsideBomb,”7/7/2011. P.L.110-92;P.L.110-116;P.L.110-137;P.L. because of different methodologies.); MEES, 36. SIGIR analysis of U.S. and GOI documents 110-149; P.L. 110-161; P.L. 110-252; P.L. 111-32; Weekly Report,Vol.54No.27,7/4/2011,p. and open-source information in Arabic and P.L. 111-117; P.L. 111-118; P.L. 111-212; P.L. 7; MEES, Weekly Report,Vol.54No.22, English, 5/2011–7/2011. 112-10;ABO,responsestoSIGIRdatacall, 5/30/2011, p. 6. 37. GOI,DPMal-Shahristani,meetingwith 7/14/2011 and 7/15/2011; USACE, response 25. MEES, Weekly Report,Vol.54No.24, SIGIR, 5/5/2011; “Beiji Targeted Again,” Iraq to SIGIR data call, 10/6/2008; DoS, DRL, 6/13/2011, pp. 20–21. Oil Report,6/24/2011,p.2;MEES,Weekly response to SIGIR data call, 4/12/2011; 26. GOI, COFE, www.cofe-iq.net/pages/e_home. Report,Vol.54No.28,6/13/2011,p.3;GOI, TFBSO, response to SIGIR data call, 1/4/2011; htm, accessed 6/23/2011; IAMB, www,iamb. MOI, information provided to SIGIR, USAID,“U.S.OverseasLoansandGrants info/, accessed 6/23/2011; IAMB, press release, 7/8/2011. [Greenbook],” 2008, gbk.eads.usaidallnet. “Statement by the International Advisory 38. EIU, Country Report: Iraq, 7/2011, p. 3; IMF, gov/query/do?_program=/eads/gbk/ and Monitoring Board of the Development CountryReportNo.11/75,“Iraq:Second countryReport&unit=N, accessed 4/15/2010; Fund for Iraq,” 5/9/2011, www.iamb.info/pr/ Review Under the Stand-By Arrangement, DoJ, Justice Management Division, responses Press%20release%20for%20April%202011%20 Requests for Waiver of Applicability, to SIGIR data call, 4/5/2011 and 4/11/2011; IAMB%20meeting.pdf, accessed 7/7/2011; Extension of the Arrangement, and DoS, NEA-I, responses to SIGIR data calls, UNSC 1483, 5/22/2003, www.uncc.ch/ RephrasingofAccess,”3/2011,p.16.TheIMF 10/4/2010, 10/6/2010, 4/5/2011, 4/15/2011, resolutio/res1483.pdf, accessed 6/15/2011; and estimates2011GDPgrowthof11.5%;theEIU and 7/7/2011; DoS, ECA, response to SIGIR WhiteHouse,OfficeofthePressSecretary, forecasts 9.5%. data call, 4/14/2010; OUSD(C), response to “NoticefromthePresidentRegardingthe 39. SIGIR analysis of U.S. and GOI documents SIGIRdatacall,10/14/2010;U.S.Treasury, Continuation of the National Emergency and open-source information in Arabic and OTA,“OfficeofTechnicalAssistance with Respect to the Stabilization of Iraq, English, 5/2011–7/2011. Overview,” 12/30/2005, ustreas.gov/offices/ 5/17/2011, www.whitehouse.gov/the-press- 40. ITAO/ESD, Electric Daily Performance internationalaffairs/assistance/, accessed office/2011/05/17/notice-president-regarding- Reports, 1/12009–7/16/2011. 10/16/2009; DoS, PM, response to SIGIR continuation-national-emergency-respect- 41. GOI,DPMal-Shahristani,meetingwith data call, 7/6/2011; BBG, response to SIGIR stab, accessed 7/10/2011. SIGIR, 5/5/2011. data call, 3/7/2011; Congressional Budget 27. CENTCOM, response to SIGIR data call, 42. GOI,COICommissioner,meetingwith Justification,ForeignAssistanceSummary 7/1/2011. SIGIR, 5/5/2011.

142 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 142 7/25/2011 10:38:19 AM ENDNOTES

43. GOI,COICommissioner,meetingwith gov/offices/internationalaffairs/assistance/, ABO, responses to SIGIR data call, 7/14/2011 SIGIR, 5/5/2011 and former Prime Minister accessed 10/16/2009; DoS, PM, response to and7/15/2011;DoS,NEA-I,responsetoSIGIR AyadAllawi,meetingwithSIGIR,5/5/2011. SIGIRdatacall,7/6/2011;BBG,response data call, 7/7/2011. 44. GOI,MOE,“TheInspectorGeneral’sOffice to SIGIR data call, 3/7/2011; Congressional 51. P.L. 108-7; P.L. 108-11; P.L. 108-106; P.L. 108- in the Ministry of Electricity: Achievements BudgetJustification,ForeignAssistance 287;P.L.109-13;P.L.109-102;P.L.109-148;P.L. ontheRoadtoExposingCorruptionand Summary Tables, FY 2009–FY 2011; USAID, 109-34;P.L.109-289;P.L.110-28;P.L.110-92; Improving Performance,” 7/3/2011, www. responses to SIGIR data calls, 1/12/2009 P.L. 110-116; P.L. 110-137; P.L. 110-149; P.L. moelc.gov.iq/detailsnews_ar.aspx?id=742, and 4/8/2009; OMB, response to SIGIR data 110-161; P.L. 110-252; P.L. 111-32; P.L. 111-117; accessed 7/4/2011. call,6/21/2010;U.S.Embassy-Baghdad, P.L.111-118;P.L.111-212;P.L.112-10;ABO, 45. GOI,COI,“Themostimportantindicators response to SIGIR data call, 10/3/2009; responses to SIGIR data call, 7/14/2011 and between1/1/2011and6/1/2011,”www. GOI,CoR,“FederalPublicBudgetLawfor 7/15/2011; DoS, response to SIGIR data call, nazaha.iq/pdf_up/300/The%20most%20 the Fiscal Year 2011,” 2/23/2011, Article 4/5/2007;INL,responsetoSIGIRdatacall, important%20indicators%20for%202011.pdf, 2; GOI, MOF, SIGIR request for data, 7/15/2011; DoS, NEA-I, response to SIGIR accessed 7/15/2011. 6/27/2011;U.S.Treasury,responsestoSIGIR data calls, 4/12/2011, 4/15/2011, 6/20/2011, 46. NDI,GreenbergQuinlanRosnerResearch, data calls, 1/4/2008 and 4/9/2009; “GOI 6/24/2011, 6/27/2011, and 7/7/2011; OUSD(C), “RelativeStabilityinIraqDespiteUnrest: Budget”(asapprovedbyTNAandwritten responses to SIGIR data calls, 4/10/2009 ReportonGreenbergQuinlanRosnerand into law December 2005); GOI, Presidency and7/15/2011;SIGIRAudit11-007,“Iraq NDISpring2011PublicOpinionResearch,” oftheIraqiInterimNationalAssembly, ReliefandReconstructionFund1:Reporton 6/2/2011, www.iauiraq.org/documents/1381/ “TheStateGeneralBudgetfor2005,”2005; Apportionments, Expenditures, and Cancelled NDI-Iraq%20-%20Spring%202011%20 GOI, “Budget Revenues and Expenses Funds,” 12/28/2010; U.S. Treasury, response to Opinion%20Research%20-%20Political%20 2003, July–December,” 2003; DoS, NEA-I, SIGIRdatacall,4/2/2009;USACE,response Landscape%20Report.pdf, accessed 7/19/2011 responses to SIGIR data calls, 4/5/2011, toSIGIRdatacall,7/5/2011;USAID,responses and musingsoniraq.blogspot.com/, accessed 4/7/2011, and 7/12/2011. The Iraqi funding toSIGIRdatacalls,7/8/2010and7/7/2011; 7/19/2011. total declined this quarter because SIGIR USTDA, response to SIGIR data call, 4/2/2009. 47. NDI,GreenbergQuinlanRosnerResearch, isnowusingthe2010Iraqicapitalbudget 52. P.L.108-106;P.L.109-102;P.L.109-234;P.L. “RelativeStabilityinIraqDespiteUnrest: execution figures rather than the previously 110-252;OMBCircularA-11,Preparation, ReportonGreenbergQuinlanRosnerand used CoR-approved 2010 capital budget. Submission, and Execution of the Budget, NDISpring2011PublicOpinionResearch,” When possible, SIGIR uses budget execution 8/2009,Sec.10,p.3,andSec.20,pp.15,20; 6/2/2011, www.iauiraq.org/documents/1381/ insteadofbudgetedamountsbecauseitmore DoS, NEA-I, response to SIGIR data call, NDI-Iraq%20-%20Spring%202011%20 accurately reflects actual GOI expenditures 6/20/2011; SIGIR, Quarterly and Semiannual Opinion%20Research%20-%20Political%20 on reconstruction. Reports to the United States Congress,7/2010– Landscape%20Report.pdf, accessed 7/19/2011 49. P.L.108-7;P.L.108-11;P.L.108-106;P.L. 4/2011.TheIRRFcomprises$20.86billion and musingsoniraq.blogspot.com/, accessed 108-287;P.L.109-13;P.L.109-102;P.L. made available through two appropriations: 7/19/2011. 109-148; P.L. 109-34; P.L. 109-289; P.L. IRRF1($2.48billion)andIRRF2($18.39 48. P.L. 108-7; P.L. 108-11; P.L. 108-106; P.L. 108- 110-28; P.L. 110-92; P.L. 110-116; P.L. billion).TheIRRF1wascanceled,buta 287;P.L.109-13;P.L.109-102;P.L.109-148; 110-137;P.L.110-149;P.L.110-161;P.L. portionoftheIRRF2remainsavailablefor P.L.109-34;P.L.109-289;P.L.110-28;P.L. 110-252; P.L. 111-32; P.L. 111-117; P.L. expenditureuntilSeptember30,2013.Asof 110-92;P.L.110-116;P.L.110-137;P.L.110- 111-118;P.L.111-212;P.L.112-10;ABO, June30,2011,$321millionofobligatedfunds 149; P.L. 110-161; P.L. 110-252; P.L. 111-32; responses to SIGIR data call, 7/14/2011 had not been expended from the IRRF 2. Over P.L. 111-117; P.L. 111-118; P.L. 111-212; P.L. and7/15/2011;USACE,responsetoSIGIR thepastyear,$78millionhasbeenexpended, 112-10;ABO,responsestoSIGIRdatacall, datacall,10/6/2008;DoS,DRL,response including$17millioninthequarterending 7/14/2011 and 7/15/2011; DoS, response to to SIGIR data call, 4/12/2011; TFBSO, June 30, 2011. SIGIRdatacall,4/5/2007;INL,response response to SIGIR data call, 1/4/2011; 53. USACE, response to SIGIR data call, to SIGIR data call, 7/15/2011; DoS, NEA-I, USAID,“U.S.OverseasLoansandGrants 10/6/2008; DoS, DRL, response to SIGIR response to SIGIR data calls, 4/12/2011, [Greenbook],” 2008, gbk.eads.usaidallnet. data call, 4/12/2011; TFBSO, response 4/15/2011, 6/20/2011, 6/24/2011, and gov/query/do?_program=/eads/gbk/ to SIGIR data call, 1/4/2011; USAID, 6/27/2011;OUSD(C),responsestoSIGIRdata countryReport&unit=N, accessed 4/15/2010; “U.S.OverseasLoansandGrants calls, 4/10/2009 and 7/15/2011; SIGIR Audit DoJ, Justice Management Division, [Greenbook],” 2008, gbk.eads.usaidallnet. 11-007,“IraqReliefandReconstructionFund responsestoSIGIRdatacall,4/5/2011and gov/query/do?_program=/eads/gbk/ 1: Report on Apportionments, Expenditures, 4/11/2011;DoS,NEA-I,responsestoSIGIR countryReport&unit=N, accessed 4/15/2010; and Cancelled Funds,” 12/28/2010; U.S. data calls, 10/4/2010, 10/6/2010, 4/5/2011, DoJ, Justice Management Division, Treasury, response to SIGIR data call, 4/15/2011, and 7/7/2011; DoS, ECA, response responsestoSIGIRdatacall,4/5/2011and 4/2/2009;USACE,responsetoSIGIRdata to SIGIR data call, 4/14/2010; OUSD(C), 4/11/2011;DoS,NEA-I,responsestoSIGIR call,7/5/2011;USAID,responsestoSIGIR response to SIGIR data call, 10/14/2010; data calls, 10/4/2010, 10/6/2010, 4/5/2011, data calls, 7/8/2010 and 7/7/2011; USTDA, U.S.Treasury,OTA,“OfficeofTechnical 4/15/2011and7/7/2011;DoS,ECA,response response to SIGIR data call, 4/2/2009; Assistance Overview,” 12/30/2005, ustreas. to SIGIR data call, 4/14/2010; OUSD(C), USACE, response to SIGIR data call, gov/offices/internationalaffairs/assistance/, response to SIGIR data call, 10/14/2010; 10/6/2008; DoS, DRL, response to SIGIR data accessed 10/16/2009; DoS, PM, response to U.S.Treasury,OTA,“OfficeofTechnical call,4/12/2011;TFBSO,responsetoSIGIR SIGIRdatacall,7/6/2011;BBG,response Assistance Overview,” 12/30/2005, ustreas. data call, 1/4/2011; USAID, “U.S. Overseas to SIGIR data call, 3/7/2011; Congressional gov/offices/internationalaffairs/assistance/, Loans and Grants [Greenbook],” 2008, gbk. BudgetJustification,ForeignAssistance accessed 10/16/2009; DoS, PM, response to eads.usaidallnet.gov/query/do?_program=/ Summary Tables, FY 2009–FY 2011; USAID, SIGIRdatacall,7/6/2011;BBG,response eads/gbk/countryReport&unit=N, accessed responses to SIGIR data calls, 1/12/2009 and to SIGIR data call, 3/7/2011; Congressional 4/15/2010; DoJ, Justice Management Division, 4/8/2009; OMB, response to SIGIR data call, BudgetJustification,ForeignAssistance responsestoSIGIRdatacall,4/5/2011and 6/21/2010; U.S. Embassy-Baghdad, response Summary Tables, FY 2009–FY 2011; USAID, 4/11/2011;DoS,NEA-I,responsestoSIGIR to SIGIR data call, 10/3/2009. responses to SIGIR data calls, 1/12/2009 and data calls, 10/4/2010, 10/6/2010, 4/5/2011, 50. P.L. 108-7; P.L. 108-11; P.L. 108-106; P.L. 108- 4/8/2009; OMB, response to SIGIR data call, 4/15/2011, and 7/7/2011; DoS, ECA, response 287;P.L.109-13;P.L.109-102;P.L.109-148; 6/21/2010; U.S. Embassy-Baghdad, response to SIGIR data call, 4/14/2010; OUSD(C), P.L.109-34;P.L.109-289;P.L.110-28;P.L. to SIGIR data call, 10/3/2009. response to SIGIR data call, 10/14/2010; 110-92;P.L.110-116;P.L.110-137;P.L.110-149; 54. P.L. 111-242; P.L. 111-290; P.L. 111-317; P.L. U.S.Treasury,OTA,“OfficeofTechnical P.L. 110-161; P.L. 110-252; P.L. 111-32; P.L. 111-322;P.L.112-4;P.L.112-6;P.L.112-8;P.L. AssistanceOverview,”12/30/2005,ustreas. 111-117; P.L. 111-118; P.L. 111-212; P.L. 112-10; 112-10.

JULY 30, 2011 I REPORT TO CONGRESS I 143

July2011.indb 143 7/25/2011 10:38:19 AM ENDNOTES

55. P.L. 112-10; DoS, NEA-I, response to SIGIR 68. P.L.109-102;P.L.109-234;P.L.110-28;P.L. p.3.ESFfundingisappropriatedtoDoS. data call, 7/7/2011. 110-92;P.L.110-137;P.L.110-149;P.L.110-161; InFY2006–FY2007,DoStransferreda 56. P.L. 112-10; OSD, response to SIGIR data call, P.L. 110-252; P.L. 111-32; P.L. 111-117; P.L. portionofESFappropriationstoUSACEfor 7/15/2011; INL, response to SIGIR data call, 112-10;USAID,responsetoSIGIRdatacall, project implementation through interagency 7/15/2011; ABO, responses to SIGIR data call, 7/7/2011;USACE,responsetoSIGIRdatacall, agreements in accordance with Section 7/14/2011 and 7/15/2011. 7/5/2011;DoS,NEA-I,responsestoSIGIR 632(b)oftheForeignAssistanceAct.DoS 57. P.L.112-10;DoS,“CongressionalBudget data calls, 4/12/2011, 4/15/2011, 6/24/2011, considered these funds fully obligated when Justification,Volume1:DepartmentofState 6/27/2011, and 7/7/2011. the interagency agreements were signed. Operations,FY2012,”2/14/2011,p.779; 69. P.L.109-102;HouseReport109-265,to 73. USAID, response to SIGIR data call, 7/7/2011; DoS, “Executive Budget Summary: Function accompanyH.R.3057,11/2/2005,p.86;P.L. USACE, response to SIGIR data call, 7/5/2011; 150&OtherInternationalPrograms,FY 109-234; House Report 109-494, to accompany DoS,NEA-I,responsestoSIGIRdata 2012,”2/14/2011,pp.155,162,167,171;DoS, H.R.4939,6/8/2006,pp.95–96;P.L.110-28; calls, 4/12/2011, 4/15/2011, 6/24/2011, and “CongressionalBudgetJustification:Foreign House Report 110-107,to accompany H.R. 6/27/2011; SIGIR, Quarterly and Semiannual Assistance Summary Tables, FY 2011,” p. 88; 1591, 4/24/2007, pp. 202–204; P.L. 110-92; Reports to the United States Congress, DoS, “Congressional Budget Justification: P.L.110-137;P.L.110-149;P.L.110-161;House 4/2007–4/2011. Foreign Assistance Summary Tables, FY Appropriations Committee, “Consolidated 74. USAID, “Community Stabilization Program,” 2012,” p. 101; DoD, “Fiscal Year 2012 Budget Appropriations Act, 2008, Committee Print: www.usaid.gov/iraq/accomplishments/csp. Request: Overview,” 2/2011, Chapter 6, p. Division J—Department of State, Foreign html,accessed7/5/2011;USAID,“Evaluation 6; DoS, NEA-I, response to SIGIR data call, Operations, and Related Programs Act, 2008,” of USAID’s Community Stabilization 7/7/2011;USAID,responsetoSIGIRdatacall, 1/30/2008, pp. 2177–2178, 2208; P.L. 110-252; Program (CSP) in Iraq: Effectiveness 7/7/2011. Senate Explanatory Statement, to accompany of the CSP Model as a Non-lethal Tool 58. P.L.109-13;P.L.109-234;P.L.109-289;P.L.110- H.R. 2642, 6/26/2008; P.L. 111-32; Conference for Counterinsurgency,” 7/22/2009, p. 1. 28;P.L.110-161;P.L.110-252;P.L.111-32; Report111-151,toaccompanyH.R.2346, AccordingtotheUSAIDevaluation,in P.L.111-212; P.L.112-10. 6/12/2009,pp.127–129;P.L.111-117;Conference additiontocomplementingthe“build”phase 59. DoS,“ExecutiveBudgetSummary:Function Report111-366,toaccompanyH.R.3288, of the “clear-hold-build” counterinsurgency 150&OtherInternationalPrograms, 12/8/2009,pp.1466,1470;DoS,“Foreign (COIN) strategy employed by the United FY2012,”2/14/2011,pp.139–140;White Operations Congressional Budget Justification, States,theCSPmayalsoserveapreventative House, “Fiscal Year 2012 Budget of the U.S. FY2006,”p.448;HouseDocument109-90, function,byreducingincentivesforviolence Government,” pp. 137–140. “Request for FY 2006 Budget Amendments,” inareaswherethepopulationisbeginningto 60. OUSD(C), response to SIGIR data call, 2/28/2006, p. 26; DoS, “Foreign Operations turn against the U.S. government or coalition 7/15/2011;P.L.111-212;P.L.112-10. CongressionalBudgetJustification,FY2008,” forces. However, as with its effectiveness in the 61. USF-I,“IraqSecurityForcesFund(ISFF), pp. 48, 128–129, 138, 490; DoS and USAID, post-kinetic (post-combat) “build” phase, the FY 2011 Spend Plan: Fourth Continuing “Supplemental Appropriations Justification, CSP’s effectiveness at prevention could not be Resolution through March 4, 2011,” 2/17/2011, FY2008,”p.38;DoS,“ForeignOperations determined by the evaluation. p. 2. The fourth FY 2011 continuing CongressionalBudgetJustification,FY2009,” 75. USAID, “Evaluation of USAID’s Community appropriation was preceded by P.L. 111-242, pp.543–544;DoSandUSAID,“Supplemental Stabilization Program (CSP) in Iraq: P.L. 111-290, and P.L. 111-317, all of which Justification,FY2009,”pp.40–43;DoS, EffectivenessoftheCSPModelasaNon- providedtemporaryextensionsofFY2010 “ForeignOperationsCongressionalBudget lethal Tool for Counterinsurgency,” 7/22/2009, ISFFbudgetauthorityintothenewfiscalyear. Justification,Annex:RegionalPerspectives,FY pp.2–3.Initsinitialdesign,CSPwasnot 62. P.L.112-4;P.L.112-6;P.L.112-8;P.L.112-10. 2010,”pp.421–426;DoS,“ForeignOperations intended to be sustainable. Rather than 63. P.L. 112-10. CongressionalBudgetJustification,Annex: focus on traditional long-term sustainable 64. OUSD(C), response to SIGIR data call, Regional Perspectives, FY 2011,” pp. 471–477; developmentobjectives,CSPwastobea 7/15/2011. DoS, “Foreign Operations Congressional short-term COIN program. 65. P.L. 109-102; P.L. 109-234; P.L. 110-28; BudgetJustification,Annex:Regional 76. USAID, “Evaluation of USAID’s Community P.L.110-92;P.L.110-137;P.L.110-149; Perspectives,FY2012,”pp.522–528;USAID, Stabilization Program (CSP) in Iraq: P.L. 110-161; P.L. 110-252; P.L. 111-32; “USAID Awards Community Stabilization EffectivenessoftheCSPModelasaNon- P.L. 111-117; P.L. 112-10; DoS, NEA-I, PrograminIraq,”8/11/2006,www.usaid.gov/ lethal Tool for Counterinsurgency,” 7/22/2009, response to SIGIR data call, 7/7/2011. This press/releases/2006/pr060811.html, accessed pp.14–15.Coordinationwiththehost quarter, SIGIR revised its record of ESF 6/27/2011. governmentwasalsocitedasimportant. appropriations, resulting in a net decrease 70. InthefourthquarterofFY2008,therate 77. USAID, “Evaluation of USAID’s intotalappropriationstothefund.The of obligation exceeded $6.2 million per day Community Stabilization Program (CSP) biggestchangewasremovalof$50million on average and dropped to approximately in Iraq: Effectiveness of the CSP Model as previously recorded as appropriated to the $2.2millionperdayonaverageinthefourth a Non-lethal Tool for Counterinsurgency,” ESFinIraqinFY2003.Thechangereflects quarters of FY 2009 and FY 2010. The average 7/22/2009,pp.3,15.Accordingtothe auditfindingsandagencyreporting.In obligation rate for the first three fiscal year evaluation, over the course of the main addition,SIGIRchangedthefiscalyear quartersofFY2006–FY2011was$1.2million program(May2006–June2009),theCSP: in which a rescission under P.L. 110-161 per day. generated 524,628 person-months of work wasrecordedfromFY2007toFY2006. 71. USAID, response to SIGIR data call, 7/7/2011; throughshort-termemployment;engaged SIGIR may make further refinements in USACE, response to SIGIR data call, 7/5/2011; 336,928 youth in non-formal educational, coming quarters as additional data becomes DoS, NEA-I, responses to SIGIR data calls, youth,andsportsprograms;createdor available. 4/12/2011, 4/15/2011, 6/24/2011 and 6/27/2011; restored more than 51,772 long-term jobs; 66. P.L.112-10;DoS,NEA-I,responsestoSIGIR SIGIR, Quarterly and Semiannual Reports to graduated41,443studentsfromvocational data call, 7/7/2011 and 7/8/2011. Last quarter, theUnitedStatesCongress,4/2007–4/2011. skills training programs; provided business SIGIRestimatedtheFY2011ESFallocation 72. USAID, response to SIGIR data call, skillstrainingtomorethan15,138potential toIraqtobe$346millionbasedonFY2010 7/7/2011;USACE,responsetoSIGIRdata entrepreneurs;startedorexpandedin allocationsandtheprovisionsoftheFY2011 call,7/5/2011;DoS,NEA-I,responsesto excess of 10,194 business grants; and placed full-year continuing appropriation (P.L. 112- SIGIRdatacalls,4/12/2011,4/15/2011, approximately 9,932 youth in apprenticeship 10).DoSprovidedupdatedallocationfigures 6/24/2011, and 6/27/2011; SIGIR, Quarterly positions. However, the evaluation also said on July 7, 2011. andSemiannualReportstotheUnitedStates thatmeasuringoutcomes(suchasareduction 67. DoS,“CongressionalBudgetJustification: Congress,4/2007–4/2011;SIGIRAudit10-018, inviolence),ratherthantheseoutputs,was Foreign Operations, Annex: Regional “MostIraqEconomicSupportFundsHave more appropriate for a development program Perspectives, FY 2012,” p. 523. Been Obligated and Liquidated,” 7/21/2010, of this sort.

144 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 144 7/25/2011 10:38:19 AM ENDNOTES

78. USAIDOIGAuditReportNo.E-267-08- 90. P.L. 108-7; P.L. 108-11; P.L. 108-106; P.L. 108- complete data set that is both accurate at the 001-P, “Audit of USAID/Iraq’s Community 287;P.L.109-13;P.L.109-102;P.L.109-148; aggregatelevelanddetailedattheproject-and Stabilization Program,” 3/18/2008, pp. 6–8. P.L.109-34;P.L.109-289;P.L.110-28;P.L. category-level. However, SIGIR discovered two 79. USAID, response to SIGIR data call, 7/7/2011; 110-92;P.L.110-116;P.L.110-137;P.L.110-149; unresolvable obstacles while trying to create USACE, response to SIGIR data call, 7/5/2011; P.L. 110-161; P.L. 110-252; P.L. 111-32; P.L. thisnewdatabase:1)priortoFY2008,USF-I DoS,NEA-I,responsestoSIGIRdata 111-117; P.L. 111-118; P.L. 111-212; P.L. 112-10; did not consistently include the document calls, 4/12/2011, 4/15/2011, 6/24/2011, and ABO, responses to SIGIR data call, 7/14/2011 referencenumber(DRN)initsCERPProject 6/27/2011; SIGIR, Quarterly and Semiannual and7/15/2011;DoS,responsetoSIGIRdata Tracker, making it impossible to use ABO data Reports to the United States Congress, call, 4/5/2007; INL, response to SIGIR data totrackindividualprojectstocompletionfor 4/2007–4/2011. call,7/15/2011;DoS,NEA-I,responsetoSIGIR the FY 2004–FY 2007 CERP appropriations; 80. USAID, response to SIGIR data call, 7/7/2011; data calls, 4/12/2011, 4/15/2011, 6/20/2011, and2)fortheFY2008–FY2010CERP USACE, response to SIGIR data call, 7/5/2011; 6/24/2011, 6/27/2011, and 7/7/2011; OUSD(C), appropriations, some projects (mostly CERP DoS,NEA-I,responsestoSIGIRdata responses to SIGIR data calls, 4/10/2009 microgrants)arebundledunderasingleDRN, calls, 4/12/2011, 4/15/2011, 6/24/2011, and and7/15/2011;SIGIRAudit11-007,“Iraq making it impossible to distinguish which 6/27/2011; SIGIR, Quarterly and Semiannual ReliefandReconstructionFund1:Report specific projects or grants under that DRN Reports to the United States Congress, on Apportionments, Expenditures, and werepaidoutandwhichwerecanceled. 4/2007–4/2011. CancelledFunds,”12/28/2010;U.S.Treasury, 99. SIGIR Audit 11-012, “Commander’s 81. DoS,“TheNewWayForward:FundingIraq’s response to SIGIR data call, 4/2/2009; USACE, Emergency Response Program Obligations Transition to Self-Reliance and Stabilization response to SIGIR data call, 7/5/2011; USAID, are Uncertain,” 1/31/2011, p. 6. in the President’s 2007 Supplemental and responses to SIGIR data calls, 7/8/2010 and 100. USF-I, response to SIGIR data call, 7/20/2011. 2008Requests,”2/2007,pp.5–6. 7/7/2011;USTDA,responsetoSIGIRdatacall, 101. USF-I, response to SIGIR data call, 7/20/2011. 82. USAID, response to SIGIR data call, 7/7/2011; 4/2/2009. 102. DoD,“DepartmentofDefenseReviewofthe USACE, response to SIGIR data call, 7/5/2011; 91. USAID, response to SIGIR data call, 7/7/2011; Commander’s Emergency Response Program DoS,NEA-I,responsestoSIGIRdata USACE, response to SIGIR data call, (CERP),” Report to Congress in Accordance calls, 4/12/2011, 4/15/2011, 6/24/2011, and 7/5/2011;DoS,NEA-I,responsestoSIGIR withP.L.111-118Sec.9005andP.L.111-84Sec. 6/27/2011; SIGIR, Quarterly and Semiannual data calls, 4/12/2011, 4/15/2011, 6/24/2011, 1222,7/2010,p.15;P.L.111-118;P.L.111-84. Reports to the United States Congress, 6/27/2011, and 7/7/2011; SIGIR, Quarterly 103. DoD, CMC, response to SIGIR data call, 4/2007–4/2011. andSemiannualReportstotheUnitedStates 1/13/2011. 83. USAID, response to SIGIR data call, 7/7/2011; Congress,4/2007–4/2011. 104. DoD, CMC, response to SIGIR data call, USACE, response to SIGIR data call, 7/5/2011; 92. DoS,NEA-I,responsetoSIGIRdatacall, 7/5/2011. DoS,NEA-I,responsestoSIGIRdata 7/8/2011. 105. DoD, CMC, response to SIGIR data call, calls, 4/12/2011, 4/15/2011, 6/24/2011, and 93. ABO, responses to SIGIR data call, 7/14/2011 7/5/2011. 6/27/2011; SIGIR, Quarterly and Semiannual and7/15/2011;P.L.112-10. 106. DoD, CMC, response to SIGIR data call, Reports to the United States Congress, 94. SIGIR Audit 11-020, “Commander’s 1/13/2011; DoD, Deputy Secretary of 4/2007–4/2011. Emergency Response Program for 2011 Shows Defense, memorandum, “Management of 84. USAID, response to SIGIR data call, Increased Focus on Capacity Development,” the Commander’s Emergency Response 7/7/2011;USACE,responsetoSIGIRdata 7/2011, pp. 8–9. Program,”5/10/2010.Asoriginallyestablished call,7/5/2011;DoS,NEA-I,responsesto 95. P.L. 112-10. bytheDeputySecretaryofDefense,CSCco- SIGIRdatacalls,4/12/2011,4/15/2011, 96. ABO,responsestoSIGIRdatacall,7/14/2011 chairswerelimitedtoUSD(P)andUSD(C). 6/24/2011, and 6/27/2011; SIGIR, Quarterly and 7/15/2011. 107. DoD, CMC, response to SIGIR data call, andSemiannualReportstotheUnitedStates 97. ABO,responsestoSIGIRdatacall,7/14/2011 7/5/2011. Congress,4/2007–4/2011.Formoredetails and 7/15/2011. 108. DoD, CMC, response to SIGIR data call, on the PRT Quick Response Fund, see: 98. USF-I’squarterlyreportstotheCongress 7/5/2011. SIGIR, Quarterly and Semiannual Report to havegenerallyoverstatedtheamountof 109. DoD,CMC,responsetoSIGIRdatacall, theUnitedStatesCongress,7/30/2010,pp. CERPfundsultimatelyobligatedfromany 7/5/2011. 30–34. given fiscal-year appropriation, presumably 110. DoD, CMC, response to SIGIR data call, 85. USAID, response to SIGIR data call, 7/7/2011; because some obligations are canceled 4/6/2011. USACE, response to SIGIR data call, 7/5/2011; during the five-year reporting and outlay 111. DoD,CMC,responsetoSIGIRdatacall, DoS,NEA-I,responsestoSIGIRdata phaseonwhichUSF-Idoesnotreport.The 7/15/2011. calls, 4/12/2011, 4/15/2011, 6/24/2011, and FY 2006 supplemental appropriation is a 112. DoD, “DoD Financial Management 6/27/2011; SIGIR, Quarterly and Semiannual notable exception. It was available for new Regulation,”Vol.12,Ch.27,1/2009. Reports to the United States Congress, obligationsuntilDecember31,2007,which 113. DoD, CMC, response to SIGIR data call, 4/2007–4/2011. meansthatUSF-IwasstillobligatingFY2006 7/15/2011. 86. OMB Circular A-11, Preparation, Submission, CERPafteritstoppedreportingonthose 114. DoD, CMC, responses to SIGIR data calls, and Execution of the Budget, 8/2009, Sec. 10, p. obligationstotheCongress.Additionally, 1/7/2011,4/6/2011,and7/5/2011. 3,andSec.20,pp.15,20. USF-I’squarterlyreportstotheCongress 115. USF-I, MoneyasaWeaponSystem(MAAWS), 87. USAID,“RecaponDeobligations, havegenerallyunderstatedtheamountof 3/2011,p.B-10. Reobligations, and Upward Adjustments: An CERPfundsultimatelyexpendedfromany 116. CENTCOM, response to SIGIR data call, Additional Help Reference for ADS Chapter given fiscal-year appropriation, presumably 7/5/2011;DoD,CMC,responsetoSIGIRdata 621,”9/28/2007.Tobeobligatedtonew because USF-I does not report on a CERP call, 7/15/2011. projects, the funds must be reapportioned by appropriation beyond the fiscal year in which 117. DoD, CMC, response to SIGIR data call, OMB. it was appropriated. Historically, more than 7/15/2011. 88. DoS, NEA-I, response to SIGIR data call, half of CERP expenditures occurred during 118. CENTCOM, response to SIGIR data call, 4/5/2011;USAID,responsetoSIGIRdatacall, thefive-yearreportingandoutlayphase, 7/5/2011. 7/7/2011. which contributes to the data and reporting 119. DoD, CMC, response to SIGIR data call, 89. USAID, response to SIGIR data call, 7/7/2011; gapattheprojectandcategorylevels.Inan 1/7/2011. USACE, response to SIGIR data call, efforttocreateadatabasethataccountedfor 120. DoD, CMC, response to SIGIR data call, 7/5/2011;DoS,NEA-I,responsestoSIGIR thedataandreportinggapattheprojectand 1/7/2011. data calls, 4/12/2011, 4/15/2011, 6/24/2011, categorylevels,ABOworkedwithSIGIRto 121. DoD, CMC, response to SIGIR data call, 6/27/2011, and 7/7/2011; SIGIR, Quarterly match the complete financial data it provides 7/5/2011. andSemiannualReportstotheUnitedStates to the abbreviated project-level data that USF-I 122. DoD, CMC, response to SIGIR data call, Congress,4/2007–4/2011. provides, which could conceivably yield a 1/13/2011.

JULY 30, 2011 I REPORT TO CONGRESS I 145

July2011.indb 145 7/25/2011 10:38:19 AM ENDNOTES

123. DoD, CMC, response to SIGIR data call, data calls, 10/4/2010, 10/6/2010, 4/5/2011, billion(3%)fromTaxes;$1.05billion(2%) 1/7/2011. 4/15/2011, and 7/7/2011; DoS, ECA, response fromGrants;$907million(1%)fromSalesof 124. DoD, CMC, response to SIGIR data call, to SIGIR data call, 4/14/2010; OUSD(C), Non-financial Assets; and $76 million (0%) 7/5/2011. response to SIGIR data call, 10/14/2010; from Social Contributions. 125. DoD, CMC, response to SIGIR data call, U.S.Treasury,OTA,“OfficeofTechnical 143. U.S. Treasury, response to SIGIR data call, 1/7/2011.Theseentitiesinclude:OUSD(P); Assistance Overview,” 12/30/2005, ustreas. 7/5/2011. OUSD(C); Joint Staff; USCENTCOM; gov/offices/internationalaffairs/assistance/, 144. UNSCR 1956, 12/15/2010, www.uncc.ch/ OfficeoftheUnderSecretaryofDefense accessed 10/16/2009; DoS, PM, response to resolutio/res1956.pdf, accessed 6/14/2011; for Acquisition, Technology, and Logistics SIGIRdatacall,7/6/2011;BBG,response UNSCR S/2011/290, “Note Verbale Dated 29 (OUSD(AT&L));ABO;GeneralCounsel; to SIGIR data call, 3/7/2011; Congressional April2011fromthePermanentMissionof LegislativeAffairs;PublicAffairs;andthe BudgetJustification,ForeignAssistance IraqtotheUnitedNationsAddressedtothe Business Transformation Agency (BTA). Summary Tables, FY 2009–FY 2011; USAID, PresidentoftheSecurityCouncil,”5/9/2011; 126. DoD, CMC, response to SIGIR data call, responses to SIGIR data calls, 1/12/2009 and IAMB, www.iamb.info/, accessed 6/23/2011. 1/7/2011. 4/8/2009; OMB, response to SIGIR data call, 145. UNSCR 1956, 12/15/2010, www.uncc.ch/ 127. DoD, CMC, responses to SIGIR data calls, 6/21/2010; U.S. Embassy-Baghdad, response resolutio/res1956.pdf, accessed 6/14/2011; 1/7/2011 and 7/5/2011. to SIGIR data call, 10/3/2009. UNSCR S/2011/290, “Note Verbale Dated 29 128. DoD, CMC, response to SIGIR data call, 135. GOI,CoR,“FederalPublicBudgetLawfor April2011fromthePermanentMissionof 7/5/2011. the Fiscal Year 2011,” 2/23/2011, Article 2; IraqtotheUnitedNationsAddressedtothe 129. SIGIR Audit 11-020, “Commander’s GOI, MOF, information provided to SIGIR, PresidentoftheSecurityCouncil,”5/9/2011; Emergency Response Program for 2011 Shows 6/27/2011;U.S.Treasury,responsestoSIGIR IAMB, www.iamb.info/, accessed 6/23/2011. Increased Focus on Capacity Development,” data calls, 1/4/2008 and 4/9/2009; “GOI 146. GOI, COFE, www.cofe-iq.net/pages/e_home. 7/2011. Budget”(asapprovedbyTNAandwritten htm, accessed 6/23/2011; IAMB, www.iamb. 130. P.L.109-234;P.L.110-5;P.L.110-28;P.L.110- into law December 2005); GOI, Presidency info/, accessed 6/23/2011; IAMB, press release, 161; P.L. 110-252; P.L. 111-32; P.L. 111-117; P.L. oftheIraqiInterimNationalAssembly, “Statement by the International Advisory 111-212;P.L.112-10;DoS,NEA-I,responseto “TheStateGeneralBudgetfor2005,”2005; and Monitoring Board of the Development SIGIR data call, 7/7/2011. GOI, “Budget Revenues and Expenses 2003, Fund for Iraq,” 5/9/2011, www.iamb.info/pr/ 131. P.L.111-212;P.L.112-10;DoS,NEA-I, July–December,” 2003; SIGIR, Quarterly Press%20release%20for%20April%202011%20 response to SIGIR data call, 7/7/2011. andSemiannualReportstotheUnitedStates IAMB%20meeting.pdf, accessed 7/7/2011. 132. P.L.109-234;P.L.110-5;P.L.110-28;P.L. Congress, 3/2004–4/2011. SIGIR calculates 147. UNSCR 1483, 5/22/2003, www.uncc.ch/ 110-161; P.L. 110-252; P.L. 111-32; P.L. 111-117; the GOI’s contribution to reconstruction resolutio/res1483.pdf, accessed 6/15/2011. P.L.111-212;P.L.112-10;INL,responseto by summing the following amounts: Iraqi 148. WhiteHouse,OfficeofthePressSecretary, SIGIRdatacall,7/15/2011.Thisquarter,INL fundsoverseenbytheCPA;theofficialcapital “NoticefromthePresidentRegardingthe correctedvaluesitprovidedlastquarter budgets for 2003–2005; MOF-reported capital Continuation of the National Emergency forthePublicIntegrityprogram,resulting expenditures for 2006–2010; and the official with Respect to the Stabilization of Iraq,” inadecreaseof$4millionincumulative capitalbudgetfor2011.Thistotallikely 5/17/2011, www.whitehouse.gov/the-press- obligations and expenditures. overstates the actual contribution made by the office/2011/05/17/notice-president-regarding- 133. USACE, response to SIGIR data call, GOIbecauseofficialcapitalbudgetstypically continuation-national-emergency-respect- 10/6/2008; DoS, DRL, response to SIGIR data exceed capital expenditures. Certified stabi, accessed 6/24/2011. call,4/12/2011;TFBSO,responsetoSIGIR expenditure data was not available from the 149. DoS, NEA-I, responses to SIGIR data calls, data call, 1/4/2011; USAID, “U.S. Overseas MOFfor2003–2005or2011. 4/5/2011,4/7/2011,and7/12/2011. Loans and Grants [Greenbook],” 2008, gbk. 136. GOI,CoR,“FederalPublicBudgetLawforthe 150. “Agreement Between the United States of eads.usaidallnet.gov/query/do?_program=/ Fiscal Year 2011,” 2/23/2011, Article 2. AmericaandtheRepublicofIraqOnthe eads/gbk/countryReport&unit=N, accessed 137. GOI,CoR,“FederalPublicBudgetLawforthe Withdrawal of United States Forces from 4/15/2010; DoJ, Justice Management Division, Fiscal Year 2011,” 2/23/2011, Articles 1–2. Iraq and the Organization of Their Activities responsestoSIGIRdatacall,4/5/2011and 138. GOI,CoR,“FederalPublicBudgetLawforthe duringTheirTemporaryPresenceinIraq,” 4/11/2011;DoS,NEA-I,responsestoSIGIR Fiscal Year 2011,” 2/23/2011, Article 2. 11/17/2008.TheSAwassignedonNovember data calls, 10/4/2010, 10/6/2010, 4/5/2011, 139. GOI,CoR,“FederalPublicBudgetLawfor 17, 2008, and entered into force on January 1, 4/15/2011, and 7/7/2011; DoS, ECA, response the Fiscal Year 2011,” 2/23/2011, Article 1; 2009;“StrategicFrameworkAgreementfora to SIGIR data call, 4/14/2010; OUSD(C), GOI, MOF, “2011 Iraq Budget Schedules,” Relationship of Friendship and Cooperation response to SIGIR data call, 10/14/2010; 5/16/2011, Schedule 1. betweentheUnitedStatesofAmericaandthe U.S.Treasury,OTA,“OfficeofTechnical 140. GOI,CoR,“FederalPublicBudgetLawfor RepublicofIraq,”11/17/2008.TheSFAwas Assistance Overview,” 12/30/2005, ustreas. the Fiscal Year 2011,” 2/23/2011, Article 1; signed on November 17, 2008, and entered gov/offices/internationalaffairs/assistance/, U.S. Treasury, response to SIGIR data call, into force on January 1, 2009. accessed 10/16/2009; DoS, PM, response to 7/5/2011. The average oil price for 2011 was 151. TheWhiteHouse,briefingbyPressSecretary SIGIRdatacall,7/6/2011;BBG,response derivedbydividingtotalrevenuesbythe Jay Carney, 7/5/2011, www.whitehouse.gov/ to SIGIR data call, 3/7/2011; Congressional numberofbarrelsexported.Notalloilexport the-press-office/2011/07/05/press-briefing- BudgetJustification,ForeignAssistance revenueaccruestotheGOI;5%ispaidin press-secretary-jay-carney-752011, accessed Summary Tables, FY 2009–FY 2011; USAID, war reparations to Kuwait. Reparations 7/7/2011. responses to SIGIR data calls, 1/12/2009 and paid to Kuwait for 2011 totaled $1.92 billion 152. OSD, response to SIGIR data call, information 4/8/2009; OMB, response to SIGIR data call, through6/30/2011.Crudeoilproductionand paper, 9/19/2009; U.S. Embassy-Baghdad, 6/21/2010; U.S. Embassy-Baghdad, response export figures calculated by NEA-I and U.S. response to SIGIR data call, 4/1/2011. to SIGIR data call, 10/3/2009. Treasury freqently differ because of different 153. FordetailsandsourcesofinformationforU.S. 134. USACE, response to SIGIR data call, methodologies. appropriations, obligations, and expenditures, 10/6/2008; DoS, DRL, response to SIGIR data 141. U.S. Treasury, response to SIGIR data call, seeSection2ofthisQuarterlyReport. call,4/12/2011;TFBSO,responsetoSIGIR 7/5/2011. 154. PatrickKennedy,UnderSecretaryofStatefor data call, 1/4/2011; USAID, “U.S. Overseas 142. GOI,CoR,“FederalPublicBudgetLawfor Management, testimony before CWC hearing Loans and Grants [Greenbook],” 2008, gbk. the Fiscal Year 2011,” 2/23/2011, Article 1; on Department of State Contracting: CWC’s eads.usaidallnet.gov/query/do?_program=/ GOI, MOF, “2011 Iraq Budget Schedules,” 2ndInterimReport,theQDDR,andIraq eads/gbk/countryReport&unit=N, accessed 5/16/2011, Schedule A. Anticipated revenue Transition,6/6/2011,p.29;U.S.Embassy- 4/15/2010; DoJ, Justice Management Division, sourcesinclude:$65.11billion(94%)from Baghdad, meeting with SIGIR, 7/22/2011. responsestoSIGIRdatacall,4/5/2011and OtherIncome,includingSalesofOil(of 155. USACE, response to SIGIR data call, Iraq 4/11/2011;DoS,NEA-I,responsestoSIGIR which$61.43billionisfromoilexports);$2.33 Transition Coordinator, 7/19/2011.

146 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 146 7/25/2011 10:38:20 AM ENDNOTES

156. USACE, press release, “USACE’s Gulf 179. PatrickKennedy,UnderSecretaryofStatefor 191. Claire Russo, “The Maliki Government Region District Transfers Lead Construction Management, testimony before CWC hearing ConfrontsDiyala,”TheInstituteforthe Responsibilities in Iraq,” 6/8/2011, www.grd. on Department of State Contracting: CWC’s Study of War, 9/24/2008, p. 4, www. usace.army.mil/news/releases/NR11-06-08. 2ndInterimReport,theQDDR,andIraq understandingwar.org/files/reports/ pdf, accessed 7/18/2011. Transition, 6/6/2011. Backgrounder%2034.pdf, accessed 6/30/2011. 157. USACE, response to SIGIR data call, 180. Commissioner Katherine Schinasi, CWC 192. Claire Russo, “The Maliki Government 7/1/2011;GRD,“UnitedStatesArmyCorps hearingonDepartmentofStateContracting: ConfrontsDiyala,”TheInstituteforthe ofEngineersGulfRegionDistrict,”www. CWC’s2ndInterimReport,theQDDR,and Study of War, 9/24/2008, pp. 4–6, www. grd.usace.army.mil/10-history.asp, accessed Iraq Transition, 6/6/2011. understandingwar.org/files/reports/ 7/18/2011. 181. USD(AT&L),responsestoSIGIRdatacalls, Backgrounder%2034.pdf, accessed 6/30/2011; 158. USACE, response to SIGIR data call, 4/25/2011 and 7/5/2011. Diyala provincial government officials, 7/1/2011;USACE,GRD,pressrelease, 182. MosheSchwartz,“TheDepartmentof meetings with SIGIR, 7/5/2011–7/7/2011; “USACE’s Gulf Region District Transfers Defense’sUseofPrivateSecurityContractors SIGIRanalysisofopen-sourcedocumentsin Lead Construction Responsibilities in in Afghanistan and Iraq: Background, ArabicandEnglish,5/2011. Iraq,” 6/8/2011, www.grd.usace.army.mil/ Analysis, and Options for Congress,” CRS 193. SIGIRanalysisofopen-sourcedocuments news/releases/NR11-06-08.pdf, accessed ReportR40835,2/21/2011,p.11. inArabicandEnglish,2009–2011;SIGIR 7/18/2011. 183. Vice President Khudayer al-Khuz, meeting analysis of open-source documents in English, 159. U.S. Embassy-Baghdad, information provided with SIGIR, 7/2011. 7/2010. to SIGIR, 6/2011. 184. CEFMS, ESF, IRRF: Construction, IRRF: 194. Kimberly Kagan, “The Battle for Diyala: 160. U.S. Embassy-Baghdad, response to SIGIR Non-construction, ISFF, 4/1/2011 and February11,2007–April25,2007,”The data call, 7/7/2011. 7/9/2011;USAID,responsestoSIGIRdata Institute for the Study of War, 5/7/2007, 161. U.S. Embassy-Baghdad, OPA, information calls, 1/22/2010, 4/16/2011, and 7/7/2011. pp. 2–6, www.understandingwar.org/files/ provided to SIGIR, 7/23/2011. 185. USAID, response to SIGIR data call, 7/7/2011; reports/IraqReport04.pdf, accessed 7/1/2011. 162. U.S. Embassy-Baghdad, information provided USACE, response to SIGIR data call, 7/5/2011; 195. USF-I, response to SIGIR data call, 1/4/2011. to SIGIR, 7/2011. NEA-I, responses to SIGIR data calls, 196. Kimberly Kagan, “Securing Diyala: June 2007– 163. U.S. Embassy-Baghdad, press release, 4/12/2011, 4/15/2011, 6/20/2011, 6/24/2011, November 2007,” The Institute for the Study of “Opening of U.S. Consulate General— and6/27/2011;OUSD(C),responsetoSIGIR War, 12/4/2007, p. 3, www.understandingwar. Basrah,” 7/5/2011, iraq.usembassy.gov/ data call, 7/5/2011; SIGIR Audit 11-007, “Iraq org/files/reports/Iraq%20Report%207.pdf, press2011/openingof-usconsulategeneral. ReliefandReconstructionFund1:Report accessed 7/1/2011; Kimberly Kagan, “Securing html, accessed 7/18/2011. on Apportionments, Expenditures, and Diyala:June2007–November2007,”The 164. U.S. Embassy-Baghdad response to SIGIR CancelledFunds,”12/28/2010. Institute for the Study of War, 12/4/2007, p. data call, 7/13/2011. 186. CEFMS, ESF, IRRF: Construction, IRRF: 4, www.understandingwar.org/files/reports/ 165. SIGIR, Quarterly Report to the United States Non-construction, ISFF, 4/1/2011 and Iraq%20Report%207.pdf, accessed 7/1/2011. Congress,4/30/2011,p.47. 7/9/2011;USAID,responsestoSIGIRdata 197. Kimberly Kagan, “Securing Diyala: June 166. U.S. Embassy-Baghdad, information provided calls, 1/22/2010, 4/16/2011, and 7/7/2011. 2007–November 2007,” The Institute for to SIGIR, 6/24/2011. 187. Commander, 3rd Brigade Combat Team, theStudyofWar,12/4/2007,pp.2–4,www. 167. “DepartmentofStatePlanningforthe 1st Cavalry Division, as quoted by Kimberly understandingwar.org/files/reports/Iraq%20 TransitiontoaCivilian-ledMissionin Kagan, “Securing Diyala: June 2007– Report%207.pdf, accessed 7/1/2011. Iraq” (Report Number MERO-I-11-08, May November 2007,” The Institute for the Study of 198. Kimberly Kagan, “The Battle for Diyala: 2011), Middle East Regional Office, Office of War, 12/4/2007, p. 3, www.understandingwar. February11,2007–April25,2007,”The InspectorGeneral,U.S.DepartmentofState, org/files/reports/Iraq%20Report%207.pdf, Institute for the Study of War, 5/7/2007, pp. 37–38. accessed 7/1/2011. pp. 2–8, www.understandingwar.org/files/ 168. PatrickKennedy,UnderSecretaryofStatefor 188. UNHCR, “Diyala Governorate Assessment reports/IraqReport04.pdf, accessed 7/1/2011. Management, testimony before CWC hearing Report,” 11/2007, p. 6, www.unhcr. 199. Kimberly Kagan, “Securing Diyala: June on Department of State Contracting: CWC’s org/462cbf672.pdf,accessed7/1/2011;Diyala 2007–November 2007,” The Institute for the 2ndInterimReport,theQDDR,andIraq provincialgovernmentofficialsandcitizens Study of War, 12/4/2007, pp. 6–24, www. Transition, 6/6/2011. and PRT Diyala staff, meetings with SIGIR, understandingwar.org/files/reports/Iraq%20 169. SIGIR Audit 10-008, “Long-Standing 7/5/2011–7/6/2011; Kimberly Kagan, “Securing Report%207.pdf, accessed 7/1/2011. Weaknesses in Department of State’s Diyala:June2007–November2007,”The 200. Eric Hamilton, “Expanding Security in OversightofDynCorpContractforSupport Institute for the Study of War, 12/4/2007, p. Diyala:December2007–May2008,” of the Iraqi Police Training Program,” 5, www.understandingwar.org/files/reports/ 8/13/2008, pp. 2–28, www.understandingwar. 1/25/2010. Iraq%20Report%207.pdf, accessed 7/1/2011. org/files/reports/Security%20Diyala%20-%20 170. USF-I, response to SIGIR data call, 7/5/2011. 189. UNHCR, “Diyala Governorate Assessment Iraq%20Report%2010.pdf, accessed 7/16/2011. 171. USF-I, response to SIGIR data call, 7/15/2011. Report,” 11/2007, p. 6, www.unhcr. 201. Claire Russo, “The Maliki Government 172. USF-I, responses to SIGIR data call, 7/5/2011 org/462cbf672.pdf,accessed7/1/2011;IAU, ConfrontsDiyala,”TheInstituteforthe and 7/13/2011. “DiyalaGovernorateProfile,”6/2011,www. Study of War, 9/24/2008, pp. 2–3, www. 173. USF-I, responses to SIGIR data call, 7/5/2011 iauiraq.org/gp/print/GP-Diyala.asp, accessed understandingwar.org/files/reports/ and 7/15/2011. 7/1/2011. Backgrounder%2034.pdf, accessed 6/30/2011; 174. SIGIR, Quarterly Report to the United States 190. Claire Russo, “The Maliki Government SIGIRAudit11-010,“SonsofIraqProgram: Congress,4/30/2011,p.45. ConfrontsDiyala,”TheInstituteforthe ResultsAreUncertainandFinancialControls 175. USF-I, response to SIGIR data call, 7/5/2011. Study of War, 9/24/2008, pp. 4–6, www. Were Weak,” 1/28/2011. 176. OSD, “Justification for FY 2011 Overseas understandingwar.org/files/reports/ 202. SIGIRanalysisofopen-sourcedocumentsin ContingencyOperationsRequest,Iraq Backgrounder%2034.pdf, accessed 6/30/2011; ArabicandEnglish,6/2011. SecurityForcesFund,”2/2010,p.4. Claire Russo, “The Maliki Government 203. GOI,DiyalaChiefProsecutor,meetingwith 177. USF-I, response to SIGIR data call, 7/5/2011. ConfrontsDiyala,”TheInstitutefortheStudyof SIGIR, 7/6/2011. 178. PatrickKennedy,UnderSecretaryofStatefor War, 9/24/2008, www.understandingwar.org/ 204. GOI,DiyalaChiefProsecutor,meetingwith Management, testimony before CWC hearing files/reports/Backgrounder%2034.pdf, accessed SIGIR, 7/6/2011. on Department of State Contracting: CWC’s 6/30/2011; Diyala provincial government 205. Diyala provincial government officials and 2ndInterimReport,theQDDR,andIraq officials, meetings with SIGIR, 7/5/2011– citizens and PRT Diyala staff, meetings with Transition, 6/6/2011; U.S. Embassy-Baghdad, 7/7/2011 and UNHCR, “Diyala Governorate SIGIR, 7/5/2011–7/6/2011. OPA, information provided to SIGIR, Assessment Report,” 11/2007, p. 6, www.unhcr. 206. SIGIRanalysisofopen-sourcedocumentsin 7/23/2011. org/462cbf672.pdf, accessed 7/1/2011. ArabicandEnglish,2009–2011.

JULY 30, 2011 I REPORT TO CONGRESS I 147

July2011.indb 147 7/25/2011 10:38:20 AM ENDNOTES

207. SIGIRanalysisofopen-sourcedocumentsin 230. PRTDiyala,“OverviewofMajorSuqsin 254. USACE, response to SIGIR data call, 7/5/2011. ArabicandEnglish,6/2011–7/2011. Diyala”(draft),7/2011,andmeetingswith 255. U.S.-Embassy-Baghdad, response to SIGIR 208. UNAMI, “Elections Results,” Issue No. 30, SIGIR, 7/5/2011–7/6/2011. data call, 7/5/2011. 2/2009; GOI, IHEC, www.ihec.iq/arabic, 231. GOI,DiyalaChiefProsecutor,meetingwith 256. U.S.-Embassy-Baghdad, response to SIGIR SIGIR translation, accessed 2/22/2009, U.S. SIGIR, 7/6/2011. data call, 7/5/2011. Embassy-Baghdad, response to SIGIR data 232. GOI,DiyalaChiefProsecutor,meetingwith 257. SIGIRPA-08-138,KahnBaniSa’ad call,4/2/2009;SIGIRanalysisofopen-source SIGIR, 7/6/2011. CorrectionalFacility,KahnBaniSa’adIraq,” documentsinArabicandEnglish,2/2005and 233. GOI,DiyalaChiefProsecutor,meetingwith 7/25/2008. 2/2009. SIGIR, 7/6/2011. 258. SIGIRPA-08-138,KahnBaniSa’ad 209. UNAMI,“ElectionsResults,”IssueNo.30, 234. Diyala provincial government officials and CorrectionalFacility,KahnBaniSa’ad 2/2009; GOI, IHEC, www.ihec.iq/arabic, citizens and PRT Diyala staff, meetings with Iraq,”7/25/2008;Diyalaprovincialofficials, SIGIR translation, accessed 2/22/2009, U.S. SIGIR, 7/5/2011–7/6/2011. meetings with SIGIR, 7/5/2011–7/6/2011. Embassy-Baghdad, response to SIGIR data 235. GOI,COIofficials,meetingswithSIGIR, 259. U.S.-Embassy-Baghdad, response to SIGIR call,4/2/2009;SIGIRanalysisofopen-source 5/15/2011. data call, 7/5/2011. documentsinArabicandEnglish,2/2009. 236. GOI, COI, “The Most Important Indicators 260. GOIDPMal-Mutlaq,CoRSpeaker,and 210. GOI,CoR,informationprovidedtoSIGIR, for 2011 between 1/1/2011 to 6/1/2011,” www. COI Commissioner, meetings with SIGIR, 4/1/2010. nazaha.iq/pdf_up/300/The%20most%20 5/2/2011–5/5/2011. 211. Diyala provincial government officials and important%20indicators%20for%202011.pdf, 261. SIGIRanalysisofopen-sourcedocumentsand citizens and PRT Diyala staff, meetings with accessed 6/29/2011. videos in Arabic, 6/2011. SIGIR, 7/5/2011–7/6/2011. 237. Diyala provincial government officials and 262. GOI,AnbarInvestmentCommission,www. 212. Dunia Frontier Consultants, “Foreign citizensandPRTDiyalaofficials,meetings anbarinvest.net/eng/index.htm, accessed, Commercial Activity in Iraq: 2010 Year in with SIGIR, 7/5/2011–7/6/2011. 6/13/2011. Review,”2/2011,p.16. 238. Untitled2009GOIstudycitedinGOI, 263. GOI, NMC, “Electricity Opens an Office 213. PRTDiyala,“DiyalaProvincialBusinessand MoPDC, National Development Plan for for Citizens’ Affairs,” 7/6/2011, nmc.gov. Investment Organizations” (draft), 7/2011, pp. 2010–2014, 12/2009, p. 159. iq/ArticleShow.aspx?ID=1352, accessed 11–16. 239. Sourceforloadservedasapercentageof 7/7/2011. 214. PRT Diyala, “Draft—Agricultural Assessment demand,4/2007–6/2011:ITAO/ESF,Electric 264. GOI, COI, “Annual Report for 2010,” 7/2011/ DiyalaProvince,”9/6/2007,pp.1,4–8. Daily Performance Reports,4/1/2007– 265. USF-I, DCG-O, meeting with SIGIR, 5/5/2011. 215. PRT Diyala, “Draft—Agricultural Assessment 6/30/2011. 266. DoD, USF-I, response to SIGIR data call, Diyala Province,” 9/6/2007. 240. ITAO/ESD, Electric Daily Performance 7/13/2011. 216. Diyala provincial government officials and Reports, 4/1/2007–6/30/2011. 267. Insert source. citizens and PRT Diyala staff, meetings with 241. ITAO/ESD, Electric Daily Performance 268. VP al-Khuza’ie, meeting with SIGIR, SIGIR, 7/5/2011–7/6/2011. Reports, 4/1/2011–6/30/2011. 7/10/2011. 217. PRTDiyalaofficial,informationprovidedto 242. U.S. Embassy-Baghdad, response to SIGIR 269. CoR, information provided to SIGIR, SIGIR, 7/12/2011. data call, 7/14/2011. 7/17/2011. 218. GOI, Diyala Supervisor of Banking, meeting 243. IAU,“DiyalaGovernorateProfile,”6/2011, 270. Former Prime Minister Ayad Allawi, meeting with SIGIR, 7/6/2011. www.iauiraq.org/gp/print/GP-Diyala.asp, with SIGIR, 5/5/2011. 219. GOI, Diyala Supervisor of Banking, meeting accessed 7/1/2011. 271. CoRmemberKenna,meetingwithSIGIR, with SIGIR, 7/6/2011. 244. Al-Noor Universal Foundation, “Analytical 5/4/2011. 220. U.S. Embassy-Baghdad, response to SIGIR Study,” 2011. 272. GOI, CoR, information provided to SIGIR, data call, 10/22/2010. 245. Al-Noor Universal Foundation, “Analytical 7/2011. 221. GOI,MinistryofOil,“MinistryofOil Study,” 2011. 273. GOI, DPM for Energy Affairs, meeting with announces fourth licensing round,” 5/2011, 246. PRTDiyalaofficials,meetingswithSIGIR, SIGIR, 5/5/2011. www.oil.gov.iq, accessed 6/30/2011. 7/5/2011–7/6/2011; IAU, “Diyala Governorate 274. Former Prime Minister Ayad Allawi, meeting 222. PRT Diyala, “Diyala Large Business Profile,” 6/2011, www.iauiraq.org/gp/print/ withSIGIR,5/5/2011;GOI,CoR,information Overview”(draft),7/2010,p.61. GP-Diyala.asp, accessed 7/1/2011. provided to SIGIR, 6/2011. 223. PRTDiyala,“DiyalaProvincialBusinessand 247. UNHCR, “Monthly Statistical Update on 275. GOI, Deputy Minister of Planning, meeting Investment Organizations” (draft), 7/2011, Return—April 2011,” 4/2011, p. 9; UNHCR with SIGIR, 5/15/2011. p.33;PRTDiyala,“DiyalaLargeBusiness IraqOperation,“MonthlyStatisticalUpdate 276. NEA-I, responses to SIGIR data calls, Overview” (draft), 7/2011. on Return—April 2011,” www.iauiraq.org/ 4/12/2011, 6/20/2011, 6/24/2011, and 224. PRT Diyala, “Diyala Large Business documents/1362/Return%20Update%20 6/27/2011; USAID, responses to SIGIR Overview”(draft),7/2010,p.31. IRAQ%20APR%202011.pdf, accessed 7/4/2011. data calls, 7/8/2010 and 7/7/2011; USACE, 225. SIGIR analysis of open-source documents 248. UNHCR Iraq, “Diyala Initiative, UNHCR response to SIGIR data call, 7/5/2011; DoS, inArabicandEnglish,2009–2011;Diyala Activities, 1/1/2011– 3/31/2011,” www.iauiraq. response to SIGIR data call, 4/5/2007; provincialgovernmentofficials,meetings org/documents/1356/UNHCR%20Activities- IRMS, USF-I CERP Category Report, with SIGIR, 7/6/2011–7/7/2011; PRT Diyala, D.I-%20last%20version.pdf, accessed 7/1/2011; 9/20/2010. “DiyalaProvincialBusinessandInvestment UNHCRIraqOperation,“MonthlyStatistical 277. USAID, responses to SIGIR data call, Organizations” (draft), 7/2011, p. 33. Update on Return—April 2011,” www.iauiraq. 6/26/2011 and 7/7/2011. 226. SIGIRanalysisofopen-sourcedocuments org/documents/1362/Return%20Update%20 278. USAID, response to SIGIR data call, 7/7/2011; inArabicandEnglish,2009–2011;Diyala IRAQ%20APR%202011.pdf, accessed NEA-I, response to SIGIR data call, 6/24/2011; provincialgovernmentofficials,meetings 7/4/2011;PRTDiyalaofficials,meetingswith USAID, Iraq, Democracy and Governance, with SIGIR, 7/6/2011–7/7/2011. SIGIR, 7/5/2011–7/6/2011. CommunityActionProgram,“Program 227. PRTDiyala,“DiyalaProvincialBusinessand 249. PRT Diyala, information provided to SIGIR, Snapshot,” 7/5/2011, iraq.usaid.gov/node/121, Investment Organizations” (draft), 7/2011, p. 33. 7/5/2011–7/13/2011. accessed 7/10/2011. 228. USAID, “Tijara Provincial Economic Growth 250. USAID, response to SIGIR data call, 279. DoS, response to SIGIR data call, 3/31/2011. Program,”3/2010,pp.17–33,www.sbdc-iraq. 6/28/2011. 280. USAID, response to SIGIR data call, 7/7/2011; com/files/USAID-TIJARA_Market_ 251. USAID, response to SIGIR data call, NEA-I, response to SIGIR data call, 4/5/2011; Assessment_-_Diyala.pdf, accessed 7/1/2011; 6/28/2011. U.S. Embassy-Baghdad, response to SIGIR PRT Diyala, meetings with SIGIR, 7/2011. 252. USAID, response to SIGIR data call, data call, 7/14/2011. 229. PRTDiyala,“OverviewofMajorSuqsin 6/28/2011. 281. USAID, response to SIGIR data call, Diyala”(draft),7/2011,p.36;PRTDiyalastaff, 253. PRTDiyala,“DiyalaProvincialBusinessand 6/26/2011; U.S. Embassy-Baghdad, response meetings with SIGIR, 7/5/2011–7/6/2011. Investment Organizations” (draft), 7/2011, p. 16. to SIGIR data call, 7/14/2011.

148 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 148 7/25/2011 10:38:20 AM ENDNOTES

282. USAID, response to SIGIR data call, 304. Brookings Institution, “Project on Internal 323. U.S. Embassy-Baghdad, response to SIGIR 6/26/2011,and“TatweerNationalCapacity Displacement,” 4/20/2011, www.brookings. data call, 7/5/2011. Development Program, Final Evaluation,” edu/speeches/2011/0420_protracted_iraq_ 324. U.S. Embassy-Baghdad, response to SIGIR 4/2011,pp.viii,ix,x,2,6–8,pdf.usaid. cohen.aspx,accessed5/5/2011;DoS,PRM, data call, 7/5/2011. gov/pdf_docs/PDACR430.pdf, accessed response to SIGIR data call, 7/11/2011. 325. IRMS, USF-I CERP Category Report, 6/6/2011. 305. UNHCRRegion—IraqOperation,“Statistical 9/20/2010;NEA-I,responsestoSIGIRdata 283. USAID, “Tatweer National Capacity Report on UNHCR Registered Iraqis calls, 4/15/2011 and 6/20/2011; INL, response Development Program, Final Evaluation,” andNon-Iraqis,”5/31/2011,reliefweb.int/ to SIGIR data call, 7/15/2011; DoS, response to 4/2011,p.ix,pdf.usaid.gov/pdf_docs/ sites/reliefweb.int/files/resources/Full_ SIGIRdatacall,4/5/2007;OSD,responsesto PDACR430.pdf, accessed 6/6/2011. Report_1241.pdf, accessed 6/15/2011. SIGIRdatacalls,4/10/2009and7/15/2011. 284. USAID, response to SIGIR data call, 7/7/2011; 306. UNHCR,Refworld,“RefugeeProtectionin 326. USF-I, response to SIGIR data call, 7/1/2011. NEA-I, response to SIGIR data call, 4/5/2011. Countries Affected by Recent Events in the Arab 327. Jian DeLeon, “U.S. Forces Iraq Re-evaluates 285. USAID, response to SIGIR data call, 7/7/2011. World,” 6/23/2011, www.unhcr.org/refworld/cou Priorities,” Emerging Media, Defense Media 286. USAID,responsestoSIGIRdatacall, ntry,COI,,COUNTRYNEWS,YEM,4562d8cf2,4 Activity, 5/31/2011, www.defense.gov/ 6/29/2011 and 7/7/2011, and “Iraq LGP-Phase e04237e2,0.html, accessed 6/27/2011. news/newsarticle.aspx?id=64128, accessed III, Quarterly Report,” 10/7/2011, pdf.usaid. 307. UNESCO, “Education and Displacement: 6/14/2011. gov/pdf_docs/PDACR183.pdf, accessed Assessing Conditions for Refugees and 328. CENTCOM, response to SIGIR data call, 6/2/2011. Internally Displaced Persons Affected by 7/1/2011. 287. USAID, response to SIGIR data call, 7/7/2011. Conflict,” 3/1/2011, www.unhcr.org/refworld/ 329. Jian DeLeon, “U.S. Forces Iraq Re-evaluates 288. USAID, “Local Government Project III type,RESEARCH,,,4d7085712,0.html, Priorities,” Emerging Media, Defense Media Midterm Evaluation and Assessment of accessed 6/15/2011. Activity, 5/31/2011, www.defense.gov/ FutureOpportunities,”8/2010,pp.27,30. 308. UNHCR, 2011 UNHCR Country Operations news/newsarticle.aspx?id=64128, accessed 289. USAID, responses to SIGIR data call, 7/7/2011 Profile—SyrianArabRepublic,1/2011,www. 6/14/2011. and 7/14/2011. unhcr.org/pages/49e486a76.html, accessed 330. CENTCOM, press release, “Iraq Suicide Car 290. USAID, response to SIGIR data call, 7/7/2011; 6/20/2011. Bomb Killed 24 Police: Doctor,” 5/6/2011. NEA-I, response to SIGIR data call, 4/5/2011; 309. DoS, PRM, response to SIGIR data call, 331. CENTCOM,pressrelease,“12KilledinIraq USAID, “Community Action Program, 7/1/2011. Violence,” 5/3/2011. Program Snapshot,” www.usaid.gov/iraq/ 310. DoS, PRM, responses to SIGIR data call, 332. CENTCOM, press release, “Suicide Car accomplishments/cap.html, accessed 6/6/2011. 7/1/2011and7/11/2011;GOI,NMC,press BombinginIraqKillsupto15,Wounds60,” 291. USAID, response to SIGIR data calls, 7/7/2011; release, “Families Returning Increase 5/5/2011. Campaign for Innocent Victims in Conflict, Every Month,” 7/4/2011, www.nmc.gov.iq/ 333. GOI, MOI, information provided to SIGIR, “Backgrounder: The Marla Ruzicka Iraqi War articleShow.aspx?ID=1325, accessed 7/7/2011. 7/6/2011. Victims Fund,” www.civicworldwide.org/ 311. DoS, PRM, response to SIGIR data call, 334. UNSC,S/2011/435,“ThirdReportofthe storage/civicdev/marlafund_backgrounder. 7/11/2011. Secretary-GeneralpursuanttoParagraph6of pdf, accessed 5/30/2011. 312. DoS, PRM, response to SIGIR data call, Resolution 1936 (2010),” 7/7/2011, p. 11. 292. USAID, response to SIGIR data call, 7/7/2011; 7/1/2011. 335. CENTCOM, response to SIGIR data call, NEA-I, responses to SIGIR data calls, 313. DoS, PRM, response to SIGIR data call, 7/1/2011. 3/28/2011, 4/5/2011, and 6/27/2011. 7/11/2011. 336. DoD, news transcript, “Media Availability 293. DoS, DRL, response to SIGIR data call, 314. DoS,PRM,responsetoSIGIRdatacall, with Secretary Panetta at Forward 6/24/2011. 7/1/2011. Operating Base Dwyer, Afghanistan,” 294. DoS, DRL, response to SIGIR data call, 315. DoS, PRM, response to SIGIR data call, 7/10/2011, www.defense.gov/transcripts/ 6/24/2011. 7/1/2011. transcript.aspx?transcriptid=4850, accessed 295. DoS, DRL, response to SIGIR data call, 316. DoS, PRM, response to SIGIR data call, 7/18/2011. 3/31/2011. 7/1/2011. 337. CENTCOM, response to SIGIR data call, 296. U.S. Embassy-Baghdad, response to SIGIR 317. UNHCR,“DiyalaInitiative,”1/1/2011– 7/1/2011;DoD,newstranscript,“Media data call, 7/5/2011. 3/31/2011, reliefweb.int/sites/reliefweb.int/ AvailabilitywithSecretaryPanettaatForward 297. U.S. Embassy-Baghdad, OPA, information files/resources/Full_Report_661.pdf, accessed Operating Base Dwyer, Afghanistan,” provided to SIGIR, 7/23/2011. 5/17/2011. 7/10/2011, www.defense.gov/transcripts/ 298. DoS, response to SIGIR data call, 6/26/2011; 318. DoS, PRM, response to SIGIR data call, transcript.aspx?transcriptid=4850, accessed U.S. Embassy-Baghdad, response to SIGIR 1/28/2011. 7/18/2011. data call, 7/5/2011. 319. UNESCO, “Education and Displacement: 338. CENTCOM, “2 U.S. Soldiers Killed by 299. NEA-I, response to SIGIR data call, 7/1/2011. Assessing Conditions for Refugees and BaghdadRoadsideBomb,”7/7/2011. 300. U.S. Embassy-Baghdad, responses to SIGIR Internally Displaced Persons Affected by 339. USF-I, response to SIGIR data call, 7/13/2011. data call, 7/5/2011 and 7/14/2011. Conflict,” 3/1/2011, www.unhcr.org/refworld/ 340. GOI, MOI, information provided to SIGIR, 301. UNHCR,IraqOperation,“MonthlyStatistical type,RESEARCH,,,4d7085712,0.html, 7/14/2011. Update on Return—May 2011,” 6/2011, www. accessed 6/15/2011. 341. Jian DeLeon, “U.S. Forces Iraq Re-evaluates iauiraq.org/documents/1362/Return%20 320. UNHCR, 2011 UNHCR Country Operations Priorities,” Emerging Media, Defense Media Update%20IRAQ%20MAY%202011.pdf, Profile—Iraq, www.unhcr.org/cgi-bin/ Activity, 5/31/2011, www.defense.gov/ accessed 7/21/2011. texis/vtx/page?page=49e486426, accessed news/newsarticle.aspx?id=64128, accessed 302. UNHCR,IraqOperation,“MonthlyStatistical 6/20/2011; DoS, PRM, response to SIGIR data 6/14/2011. Update on Return,” 4/2011, www.iauiraq. call, 7/11/2011. 342. USF-I, response to SIGIR data call, 7/13/2011. org/documents/1362/Return%20Update%20 321. DoS, DRL, “International Religious Freedom 343. UNSC,S/2011/435,“ThirdReportofthe IRAQ%20APR%202011.pdf, accessed Report 2010,” 11/17/2011, p. 1, www.state. Secretary-GeneralpursuanttoParagraph6of 5/6/2011;UNHCR,2011UNHCRCountry gov/g/drl/rls/irf/2010/148821.htm, accessed Resolution 1936 (2010),” 7/7/2011, p. 11. Operations Profile—Iraq, www.unhcr.org/cgi- 6/15/2011; USCIRF, “Annual Report 2011,” 344. USF-I, DCG-O, meeting with SIGIR, 5/5/2011. bin/texis/vtx/page?page=49e486426, accessed pp.2,7,11,and88,www.uscirf.gov/images/ 345. U.S. Embassy-Baghdad, Ambassador’s Town 5/25/2011. book%20with%20cover%20for%20web.pdf, Hallmeeting,5/4/2011.Stickybombsare 303. UNHCRRegion—IraqOperation,“Statistical accessed 6/20/2011. riggedwithmagnetssothattheyadheretothe Report on UNHCR Registered Iraqis 322. USCIRF,“AnnualReport2011,”pp.2,7,11, undersideofavehicle;theyaredetonatedby andNon-Iraqis,”5/31/2011,reliefweb.int/ and 88, www.uscirf.gov/images/book%20 remotecontrolorwithtimers. sites/reliefweb.int/files/resources/Full_ with%20cover%20for%20web.pdf, accessed 346. SIGIRanalysisofopen-sourcedocumentsin Report_1241.pdf, accessed 6/15/2011. 6/20/2011. ArabicandEnglish,4/2011–7/2011.

JULY 30, 2011 I REPORT TO CONGRESS I 149

July2011.indb 149 7/25/2011 10:38:20 AM ENDNOTES

347. USF-I, response to SIGIR data call, 7/5/2011. 377. CENTCOM, response to SIGIR data call, 402. GOI,COIBudgetDirector,COIDirectorof USF-IdoesnottrackattacksonSOImembers 7/5/2011; U.S. Embassy-Baghdad, RoLC, “Rule StrategicPlanning,andCOIinvestigators, or their families; it receives information from of Law—Iraq Monthly Highlights,” 4/2011 meetings with SIGIR, 5/15/2011. theGOI-ledprogram. and 5/2011. 403. GOI, COI, “Annual Report for 2010,” 7/2011, 348. USF-I, response to SIGIR data call, 7/5/2011. 378. U.S. Embassy-Baghdad, RoLC, “Rule of pp. 24–29. 349. USF-I, response to SIGIR data call, 7/15/2011. Law—Iraq Monthly Highlights,” 5/2011. 404. GOI,MOIIG,meetingwithSIGIR,5/3/2011. 350. DoL, response to SIGIR data call, 7/8/2011. 379. U.S. Embassy-Baghdad, RoLC, response to 405. GOI,MOIIG,meetingwithSIGIR,5/3/2011. 351. “OilPoliceDoublesDownonSecurity,”Iraq SIGIR data call, 7/1/2011. 406. U.S. Embassy-Baghdad, INL/ACCO, meetings Oil Report, www.iraqoilreport.com/, accessed 380. U.S. Embassy-Baghdad, INL/ACCO, response with SIGIR, 5/15/2011. 7/7/2011. to SIGIR data call, 7/5/2011. 407. U.S. Embassy-Baghdad, response to SIGIR 352. MEES, Weekly Report,Vol.54No.28, 381. U.S. Embassy-Baghdad, INL/ACCO, data call, 7/14/2011. 7/11/2011, p. 3. 5/15/2011. 408. GOI, HJC, Chief Justice Medhat, meeting 353. “Beiji Targeted Again,” Iraq Oil Report, 382. U.S. Embassy-Baghdad, INL/ACCO, meetings with SIGIR, 5/4/2011. 6/24/2011. with SIGIR, 5/15/2011. 409. GOI, HJC, Chief Justice Medhat, meeting 354. “Beiji Targeted Again,” Iraq Oil Report, 383. DoJ, ICITAP,meetings with SIGIR, 5/15/2011. with SIGIR, 5/4/2011. 6/24/2011, p. 1. 384. U.S. Embassy-Baghdad, RoLC, response to 410. U.S. Treasury, response to SIGIR data call, 355. USF-I, response to SIGIR data call, 4/12/2011. SIGIR data call, 7/5/2011, and INL/ACCO 7/5/2011; EIU, Country Report: Iraq,6/2011,p. 356. GOI, MOI, Baghdad Operation Center, meetings with SIGIR, 5/15/2011; DoJ, ICITAP, 3. information provided to SIGIR, 7/17/2012. meetings with SIGIR, 5/15/2011. 411. EIU, Country Report: Iraq, 7/2011, p. 3; IMF, 357. “Beiji Targeted Again,” Iraq Oil Report, 385. DoJ, ICITAP official, information provided to CountryReportNo.11/75,“Iraq:Second 6/24/2011, p. 2; GOI, MOI, information SIGIR, 5/15/2011. Review Under the Stand-By Arrangement, provided to SIGIR, 7/8/2011. 386. DoJ, ICITAP, “COI Quarterly Report on Requests for Waiver of Applicability, 358. MEES, Weekly Report,Vol.54No.28, Technical Assistance and Training, Second Extension of the Arrangement, and 6/13/2011, p. 3; GOI, MOI, information QuarterFY2011,”4/2011,p.9. RephrasingofAccess,”3/2011,p.16.TheIMF provided to SIGIR, 7/8/2011. 387. DoS, INL, response to SIGIR data call, estimates2011GDPgrowthof12.27%;the 359. USF-I, response to SIGIR data call, 7/5/2011. 7/1/2011. EIU forecasts 9.5%. 360. CENTCOM, press release, “Asiacell 388. GOI, COI, “Annual Report for 2010,” 7/2011, 412. MEES, Weekly Report,Vol.54No.21, Communication Towers under Attack,” p. 23. 5/23/2011, p. 7; MEES, Weekly Report,Vol. 7/14/2011. 389. U.S. Embassy-Baghdad, RoLC, response 54No.20,5/16/2011,p.16;IMF,Country 361. GOI, MOI, information provided to SIGIR, toSIGIRdatacall,7/5/2011;U.S.Embassy- Report No. 11/75, “Iraq: Second Review 7/14/2011. Baghdad, INL/ACCO, and GOI, COI, Under the Stand-By Arrangement, Requests 362. USF-I, response to SIGIR data call, 7/1/2011. meetings with SIGIR, 5/15/2011; GOI, COI, for Waiver of Applicability, Extension of the 363. USAF-Central, press release, “Air Force Units “AnnualReportfor2010,”7/2011,p.23. Arrangement, and Rephrasing of Access,” CombineEfforts,TeachIraqiForcesAbilities 390. GOI, Official Gazette, Amendment to 3/2011,p.5. for the Future,” 5/7/2011, www.dvidshub.net/ Criminal Procedure Code No. 23 of 1971, 413. MEES, Weekly Report,Vol.54No.24, news/70014/air-force-units-combine-efforts- 6/13/2011. 6/13/2011, p. 20. teach-iraqi-forces-abilities-future, accessed 391. GOI, COI Commissioner, meeting with 414. IMF,CountryReportNo.11/75,“Iraq: 7/8/2011. SIGIR, 5/5/2011. Second Review Under the Stand-By 364. USF-I, response to SIGIR data call, 7/5/2011. 392. U.S. Embassy-Baghdad, “Iraq April Anti- Arrangement, Requests for Waiver of 365. SIGIR, Hard Lessons: The Iraq Reconstruction Corruption Round-Up,” No. 1168, 5/19/2011, Applicability, Extension of the Arrangement, Experience,2/2009. and“IraqAnti-CorruptionRound-upfor andRephrasingofAccess,”3/2011,p.22; 366. USF-I, press brief in Baghdad, Iraq, 7/11/2011. May,”No.11BAGHDAD1168,6/23/2011; GOI,CoR,“FederalPublicBudgetLawfor 367. USF-I, response to SIGIR data call, 7/15/2011. GOI, COI, information provided to SIGIR, the Fiscal Year 2011,” 2/23/2011, Article 1; 368. USF-I, DCG-O, meeting with SIGIR, 5/5/2011. 5/2011; SIGIR analysis of open-source GOI, MOF, “2011 Iraq Budget Schedules,” 369. Jian DeLeon, “U.S. Forces Iraq Re-evaluates English and Arabic documents, 4/2011– 5/16/2011, Schedule A. Priorities,” Emerging Media, Defense Media 7/2011; EIU, Country Report: Iraq,6/2011, 415. U.S. Treasury, response to SIGIR data call, Activity, 5/31/2011, www.defense.gov/ pp. 11–12. 7/5/2011;GOI,CoR“FederalPublicBudget news/newsarticle.aspx?id=64128, accessed 393. U.S. Embassy-Baghdad, “Iraq Anti- Law for the Fiscal Year 2011,” 2/20/2011, 6/14/2011. Corruption Round-up for May,” No. 11 Article 1. 370. Admiral Mike Mullen, remarks as delivered BAGHDAD 1168, 6/23/2011. 416. GOI, NMC, press release, “Approve the Bill at the Pentagon Press Association luncheon, 394. SIGIR site visit to Academy and conversations Payment Infrastructure Reconstruction 7/7/2011, www.jcs.mil/speech.aspx?id=1623, with Academy officials, 5/15/2011. Resolution with $37 Billion,” www.nmc. accessed 7/18/2011. 395. GOI,MOIIG,meetingwithSIGIR,5/3/2011. gov.iq/ArticlesShow.aspx?ID=882, accessed 371. GRD, press release, “USACE Celebrates 396. U.S. Embassy-Baghdad, “Iraq Anti- 4/29/2011, and NIC, press release, “NIC theCompletionofNewIraqiAirForce Corruption Round-up for May,” No. 11 chairmanSignsDealforConstruction Operations Center,” 6/9/2011, www.grd. BAGHDAD 1168, 6/23/2011. of 100,000 Housing Units in Baghdad,” usace.army.mil/news/releases/NR11-06-09. 397. DoJ,ICITAP,“COIAnti-Corruption 5/29/2011, www.investpromo.gov.iq/index. pdf, accessed 6/15/2011; USACE, response to Performance Measurements, 2008–2011,” php?id=13&items=492, accessed 6/6/2011; SIGIR data call, 4/5/2011. 5/14/2011, slide 5. Dunia Frontier Consultants, “Foreign 372. GRD, press release, “USACE Celebrates 398. U.S. Embassy-Baghdad, INL/ACCO, meeting Commercial Activity in Iraq: 2010 Year in OpeningofaNewIraqiArmyMilitaryFacility,” with SIGIR, 5/15/2011; GOI, COI, meetings Review,”2/2011,p.11. 5/4/2011, www.grd.usace.army.mil/news/ with SIGIR, 5/15/2011. 417. Dunia Frontier Consultants, Informal releases/NR11-05-04-02.pdf, accessed 7/9/2011. 399. COIofficials,meetingswithSIGIR,5/15/2011 Mid-Year Analysis of Foreign Commercial 373. OSD, response to SIGIR data call, 7/5/2011. andDoJ,ICITAP,“COIAnti-Corruption Activity, conclusion provided to SIGIR, 374. OSD, response to SIGIR data call, 7/5/2011. Performance Measurements, 2008–2011,” 7/21/2011. 375. USF-I, response to SIGIR data call, 7/15/2011. 5/14/2011, slide 6. 418. IMF,RegionalEconomicOutlook,Middle 376. NEA-I, responses to SIGIR data calls, 400. GOI,COIBudgetDirectorandCOIDirector EastandCentralAsia,4/2011,p.20. 4/15/2011 and 6/20/2011; INL, response to of Strategic Planning, meetings with SIGIR, 419. GOI, CBI, “Economic Indicators,” www.cbi.iq, SIGIR data call, 7/15/2011; OSD, response to 5/15/2011. accessed 6/28/2011. SIGIR data call, 4/10/2009; DoS, response to 401. GOI,COIBudgetDirector,COIDirectorof 420. EIU, Country Report: Iraq,5/2011,p.8; SIGIR data call, 4/5/2007, IRMS, USF-I CERP StrategicPlanning,andCOIinvestigators, MEES, Weekly Report,Vol.54No17, Category Report,9/20/2010. meetings with SIGIR, 5/15/2011. 4/25/2011, p. 11.

150 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 150 7/25/2011 10:38:20 AM ENDNOTES

421. DoS, Iraq Status Report,12/15/2010,slide14; 437. KRG, press release, “Prime Minister Salih’s 459. MEES, Weekly Report,Vol.54No.27, IMF,RegionalEconomicOutlook:Middle StatementonOilExportPayment,”5/5/2011, 7/4/2011,p.8. EastandCentralAsia,4/2011,p.25,www. www.krg.org/articles/detail,asp?rnr=223& 460. GOI, NMC, press release, “Approve the Bill imf.org/external/pubs/ft/reo/2011/mcd/eng/ Ingnr=12&smap=020110100&anr=39875, Payment Infrastructure Reconstruction pdf/mreo0411.pdf, accessed 6/27/2011; EIU, accessed 5/9/2011. Resolution with $37 Billion,” 4/27/2011, Country Report: Iraq,7/2011,p.8. 438. MEES, Weekly Report,Vol.54No.27, www.nmc.gov.iq/ArticleShow.aspx?ID=882, 422. GOI, CBI, “Currency,” www.cbi.iq, accessed 7/4/2011,p.8. accessed 4/29/2011. 6/28/2011; EIU, Country Report:Iraq, 7/2011, 439. MEES,EnergyandGeopoliticalRisk,Vol.2 461. “Iraq Infrastructure Report Q2 2011,” p. 8. No.5,5/2011,p.31,andWeekly Report,Vol.54 BusinessMonitorInternational,4/2011,p. 423. IMF,CountryReportNo.11/75,“Iraq:Second No. 22, 5/30/2011, p. 6. 86, accessed via Research and Markets, www. Review Under the Stand-By Arrangement, 440. Dodsal Engineering and Construction Pte., researchandmarkets.com/reports/1770525/ Requests for Waiver of Applicability, Ltd., Country Manager, Iraq, information iraq_infrastructure_report_q2_2011, Extension of the Arrangement, and provided to SIGIR, 6/30/2011. 5/12/2011. Rephrasing of Access,” 3/2011, pp. 13–14. 441. MEES, Weekly Report,Vol.54No.21, 462. GOI, Minister of Communications 424. UNSCS/2011/290,“NoteVerbaleDated29April 5/23/2011, p. 6–7. MohammedTawfiqAllawi,meetingatthe 2011fromthePermanentMissionofIraqtothe 442. GOI, MOI, www.moi.gov.iq, accessed U.S.ChamberofCommerce,Washington, United Nations Addressed to the President of the 6/15/2011; MEES, Weekly Report,Vol.54No. DC, 5/26/2011. Security Council,” 5/9/2011, p. 4. 24,6/13/2011,p.21. 463. GOI, NIC, press release, “With the Attendance 425. DoS, Iraq Status Report,6/9/2011,p.2. 443. MEES, Weekly Report,Vol.54No.24, ofPrimeMinisterNurial-Maliki,NIC 426. GOI, CBI, “Government Debt,” www.cbi. 6/13/2011, pp. 20–21. Chairman Signs the Deal of Constructing iq/index.php?pid=GovernmentSecurities, 444. RobertDudley,BPChiefExecutive,statement 100ThousandsHousingUnitinBaghdad,” accessed 6/15/2011. at the presentation of the Global Energy 5/29/2011, www.investpromo.gov.iq/index. 427. United Nations Compensation Commission, Review, London, 6/8/2011. php?id=13&items=492, accessed 6/6/2011. “StatusofProcessingandPaymentofClaims,” 445. NEA-I, responses to SIGIR data calls, 464. GOI, GOI officials, information provided to www.uncc.ch/status.htm, accessed 6/15/2011; 7/6/2010,5/5/2011,and7/7/2011. SIGIR, 7/16/2011. United Nations Compensation Commission, 446. MEES, Weekly Report,Vol.54No.22, 465. Marriott International, Press Release, press release, “United Nations Compensation 5/30/2011, p. 6, and Weekly Report,Vol.54No. “Marriott International Announces its Commission Pays Out US$880 Million,” 27, 7/4/2011, p. 7; NEA-I, response to SIGIR FirstTwoHotelsinIraq,”news.marriott. www.uncc.ch/pressrel/Press%20release%20 data call, 7/15/2011; U.S. Embassy-Baghdad, com/2011/07/marriott-international- -%20Payment%20of%2028%20April%202011. response to SIGIR data call, 7/14/2011. announces-its-first-two-hotels-in-iraq.html, pdf, accessed 7/12/2011. 447. MEES, Weekly Report,Vol.54No.24, accessed 07/22/2011. 428. EIU, Country Report: Iraq,5/2011,p.13; 6/13/2011, p. 21; U.S. Embassy-Baghdad, 466. FAO, GIEWSCountryBrief:Iraq,5/17/2011, Director, Iraqi Airways, meeting with SIGIR, response to SIGIR data call, 7/14/2011. www.fao.org/giews/countrybrief/country. 4/19/2011. 448. IAMB, press release, “Statement by the jsp?code=IRQ/, accessed 6/20/2011. 429. GOI, Ministry of Oil, www.oil.gov.iq, accessed International Advisory and Monitoring Board 467. FAO, GIEWSCountryBrief:Iraq,5/17/2011, 5/10/2011; MEES, Weekly Report,Vol.54No. oftheDevelopmentFundforIraq,”5/9/2011, www.fao.org/giews/countrybrief/country. 23, 6/6/2011, p. 24. www.iamb.info/pr/Presss%20release%20 jsp?code=IRQ/, accessed 6/20/2011. 430. Iraq Oil Report, “The Bill Pushers,” 7/14/2011. for%20April%202011%20IAMB%20meeting. 468. USDA, FAS, information provided to SIGIR, 431. NEA-I, responses to SIGIR data calls, pdf, accessed 5/10/2011; PwC, “Results of Year 6/20/2011. 7/6/2010,4/5/2011,and7/7/2011(Crudeoil EndAuditPresentedtotheIAMBandCOFE, 469. USAID OIG Audit E-267-11-002-P, “Audit productionandexportfigurescalculatedby 4/27/2011,pp.14–16;IAMB,FirstInterim of USAID/Iraq’s Agribusiness Program,” NEA-I and U.S. Treasury frequently differ IAMB Report, 12/14/2004, www.iamb.info/ 5/16/2011,pp.1–2,5,www.usaid.gov/oig/ because of different methodologies.); MEES, pdf/iamb_12142004.pdf, accessed 7/7/2011. public/fy11rpts/e-267-11-002-p.pdf, accessed Weekly Report,Vol.54No.27,7/4/2011,p.7, 449. NEA-I, responses to SIGIR data calls, 7/5/2011. and Weekly Report,Vol.54No.22,5/30/2011, 7/6/2010,5/5/2011,and7/7/2011. 470. U.S. Embassy-Baghdad, response to SIGIR p. 6. 450. Iraq Oil Report,“BeijiTargetedAgain,”6/24/2011. data call, 7/14/2011. 432. MEES, Weekly Report,Vol.54No.13, 451. NEA-I, responses to SIGIR data calls, 471. USAID, response to SIGIR data call, 6/27/2011, 3/28/2011,p.3;NEA-I,responsestoSIGIR 6/4/2010, 7/6//2010, and 7/7/2011. “USAID Iraq Financial Development Project, data calls, 6/4/2010, 7/6/2010, 4/5/2011, and 452. GOI, NMC, press release, “Ministry of Third Quarterly Report,” 4/15/2011, pp. 7/7/2011. Electricity Contracts with Iranian Oil 3,6,and“IraqPrivateSectorGrowthand 433. NEA-I, response to SIGIR data call, 7/15/2011; Ministry To Import Fuel,” 6/23/2011, www. EmploymentGeneration,AnOverviewofthe U.S. Embassy-Baghdad, response to SIGIR nmc.gov.iq/ArticleShow.aspx?ID=1226, IraqiBankingSystem,”3/30/2007,p.7. data call, 7/14/2011. accessed 6/29/2011. 472. EIU, Country Report: Iraq,6/2011,pp.11–12. 434. Iraq Oil Report, “Q-A with Exxon’s Iraq 453. Iraq Oil Report, “Shell Gas Deal Gets Initial 473. U.S. Embassy-Baghdad, discussions with ChiefJamesAdams,”5/24/2011,www. OK,IncludingExports,”7/13/2011. SIGIR, 7/12/2011. iraqoilreport.com/oil/qa-exxon’s-iraq-chief- 454. MEES, Weekly Report,Vol.54No.24, 474. USAID, “Iraq Private Sector Growth and james-adams-5763/, accessed 6/20/2011; 6/13/2011, p. 21. EmploymentGeneration,AnOverviewof ExxonMobil, press release, “Iraq’s West Qurna 455. MEES, Weekly Report,Vol.54No.23, theIraqiBankingSystem,”3/30/2007,p.23; 1FieldReachesOilProductionMilestone,” 6/6/2011, p. 16; U.S. Embassy-Baghdad, GOI,TBIChairman,meetingwithSIGIR, www.businesswire.com/portal/site/ response to SIGIR data call, 7/14/2011. 4/11/2011; GOI, TBI, home page, www.tbiiraq. exxonmobil/index.jsp?ndmViewId=news_vie 456. NabuccoGasPipelineInternationalGmbH, com, accessed 6/20/2011. w&ndmConfigId=1001106&newsId=2011032 press release, “NIC Announces New Timeline 475. DoS, Iraq Status Report,5/26/2011,p.2; 7005052&newsLang=en, accessed 7/6/2011. for Nabucco Pipeline,” 5/6/2011, www. USAID, information provided to SIGIR 435. GovernmentoftheRussianFederation, nabucco- pipeline.com/portal/page/portal/en/ 5/24/2011, and response to SIGIR data call, Ministry of Natural Resources and press/NewsText?p_item_id=A297E805CEAD 7/7/2011; International Telecommunication Environment, “The Regulations on the AB20E040A8C002017939, accessed 5/9/2011. Union,“MobileCellularSubscriptionsper100 Ministry of Natural Resources and the 457. MEES, Weekly Report,Vol.54No.23, Inhabitants,” 2009, www.itu.int/ITU-D/ict/ EnvironmentoftheRussianFederation,”No. 6/6/2011, p. 19. statistics/, accessed 6/22/2011. 440, 5/28/2008, www.mnr.gov.ru/news/detail. 458. SNC-Lavalin, vice-president, Global Corporate 476. USAID, response to SIGIR data call, php?ID=126499, accessed 6/20/2011. Communications, email exchange, information 6/27/2011,and“USAIDIraqFinancial 436. MEES, Weekly Report,Vol.54No.21, provided to SIGIR, 6/30/2011; MEES, Weekly Development Project, Third Quarterly 5/23/2011, p. 7. Report,Vol.54No.24,6/13/2011,p.21. Report,”4/15/2011,pp.3,4.

JULY 30, 2011 I REPORT TO CONGRESS I 151

July2011.indb 151 7/25/2011 10:38:20 AM ENDNOTES

477. USAID, response to SIGIR data call, 6/27/2011. to Iraq’s Electricity,” undated, www.calik.com/ 510. GOI, NMC, press release, “Ministry of 478. GOI,MIM,meetingwithSIGIR,711/2011, EN/News/calik-signs-on-to-iraqs-electricity, Electricity Contracts with Iranian Oil Ministry and Iraq Task Force for Economic Reform accessed 7/1/2011. To Import Fuel,” 6/23/2011, nmc.gov.iq/ (withtheUNandWorldBank),Roadmap for 493. GOI, MOE, press release, “Minister of ArticleShow.aspx?ID=1226, accessed 6/29/2011. Restructuring State Owned Enterprises in Iraq, ElectricityLaystheCornerstonetothe 511. GOI,MOE,“TheInspectorGeneral’sOffice 8/17/2010,p.14;WorldBank,SeniorPrivate QudasPowerPlantExpansionProjectand in the Ministry of Electricity: Achievements Sector Development Specialist, Baghdad, PromisesToEndtheEnergyCrisisby2015,” ontheRoadtoExposingCorruptionand SIGIR interview, 5/10/2011. 5/16/2011, www.moelc.gov.iq/detailsnews_ Improving Performance,” 7/3/2011, www. 479. GOI, Iraq Task Force for Economic Reform ar.aspx?id=693, accessed 6/9/2011. moelc.gov.iq/detailsnews_ar.aspx?id=742, (withtheUNandWorldBank),Roadmap 494. GOI,MOE,DirectorofInformationOffice, accessed7/4/2011;GOI,MOEIG,information for Restructuring State Owned Enterprises in information provided to SIGIR, 7/10/2011. provided to SIGIR, 7/15/2011. Iraq,8/17/2010,p.14,andMIM,meetingwith 495. ITAO/ESD, Electric Daily Performance 512. GOI, MOE, press release, “Ministry of SIGIR,711/2011;WorldBank,SeniorPrivate Reports, 1/1/2008–6/30/2011. ElectricitySignsaContractwithKorean Sector Development Specialist, Baghdad, SIGIR 496. ITAO/ESD, Electric Daily Performance CompanySTXToBuild25Quick-deploy interview, 5/10/2011; U.S. Embassy-Baghdad, Reports, 4/1/2011–6/30/2011. PowerPlants,”5/19/2011,www.moelc.gov. response to SIGIR data call, 7/14/2011. 497. KRG,OfficeofthePrimeMinister, iq/detailsnews_ar.aspx?id=697, accessed 480. U.S.CensusBureau,“U.S.Tradeingoods information provided to SIGIR, 7/15/2011. 5/19/2011;STXCorporation,GroupNews, with Iraq”, 1992-2011, www.census.gov/ 498. ITAO/ESD, Electric Daily Performance “STX Heavy Industries Won Contract for foreign-trade/balance/c5050.html, accessed Reports, 6/1/2011–6/30/2011. DieselPowerGenerationPlantsfromIraq,” 7/18/2011,“StatisticalAbstractoftheUnited 499. U.S. Embassy-Baghdad, response to SIGIR 5/18/2011, www.stx.co.kr/FrontEN/PR/ States,1987,107thEdition,”www2.census. data call, 7/14/2011. PR_00100_01.aspx?L=RU41&IDX=NTEx0, gov/prod2/statcomp/documents/1987-01. 500. ITAO/ESD, Electric Daily Performance accessed 6/10/2011. pdf,p.794,accessed7/18/2011,“Statistical Reports, 4/1/2010–6/30/2011. 513. U.S. Embassy-Baghdad, response to SIGIR Abstract of the United States, 1991, 111th 501. ITAO/ESD, Electric Daily Performance data call, 7/14/2011. Edition,” www2.census.gov/prod2/statcomp/ Reports, 4/1/2010–6/30/2011. 514. GOI, NMC, press release, “Electricity documents/1991-01.pdf, p.808, accessed 502. GOI, MOE, press release, “Cornerstone Laid ContractswithCanadianCapgentCompany 7/18/2011,“StatisticalAbstractoftheUnited forthe750MWal-QayyarahGasPowerPlant ToBuild10Plants,”7/23/2011,www.nmc. States,1994,114thEdition,”www2.census. in Ninewa Province,” 5/24/2011, www.moelc. gov.iq/ArticleShow.aspx?ID=1307, accessed gov/prod2/statcomp/documents/1994-01.pdf, gov.iq/detailsnews_ar.aspx?id=706, accessed 7/4/2011. p. 824, accessed 7/18/2011. 5/24/2011. 515. GOI, MOE, press release, “Ministry of 481. U.S.ChamberofCommerce,SeniorManager, 503. GOI,MOE,pressrelease,“MinistryofElectricity Electricity Contracts with German Company Middle East Affairs, SIGIR interview, SignsContractwithIncoofIndiaToBuild fortheConstructionofFivePowerPlantswith 7/7/2011; U.S. Chamber of Commerce, AkkazGasOperatedPowerPlantinAnbar Capacityof500MW,”7/7/2011,www.moelc. Director,MiddleEastAffairs,SIGIR Province,” 6/21/2011, www.moelc.gov.iq/ gov.iq/detailsnews_ar.aspx?id=746, accessed interview,12/15/2010;U.S.Embassy-Baghdad, detailsnews_ar.aspx?id=728, accessed 6/22/2011. 7/7/2011. response to SIGIR data call, 7/5/2011. 504. GOI, MOE, press release “Ministry of 516. GOI, NMC, press release, “Dabbag: Free 482. U.S. Embassy-Baghdad, response to SIGIR Electricity Contracts with Baghdad Company Fuel for Civil Generator To Offer 12 Hours data call, 7/5/2011. ToBuild500MWAlhaidariyaGasPower ElectricityaDayNational,”5/25/2011,nmc. 483. Al-Noor Universal Foundation, “Analytical Plant in Najaf,” 7/7/2011, www.moelc.gov. gov.iq/ArticleShow.aspx?ID=1017, accessed Study,” 2011. iq/detailsnews_ar.aspx?id=689, accessed 5/25/2011,and“CabinetResolutionsin 484. NEA-I, response to SIGIR data call, 6/20/2011; 7/12/2011. Session No. (25) in 5/24/2011,” nmc.gov.iq/ USACE, response to SIGIR data call, 7/5/2011; 505. U.S. Embassy-Baghdad, response to SIGIR ArticleShow.aspx?ID=1015, accessed 6/8/2011. IRMS, USF-I CERP Category Report, data call, 7/14/2011. 517. GOI,MOE,DirectorofInformationOffice, 9/20/2010; OSD, response to SIGIR data call, 506. GOI,MOE,“MinistryofElectricitySigns information provided to SIGIR, 7/10/2011. 4/10/2009. ContractToExpandtheWassitThermalPower 518. KRG, press release, “Power Projects: Request 485. GOI, MOF, “2011 Iraq Budget Schedules,” PlantBringingItsTotalCapacityto2,540MW,” for Expressions of Interest,” 7/7/2011, www. 5/16/2011. 4/26/2011, www.moelc.gov.iq/detailsnews_ krg.org/articles/detail.asp?lngnr=12&smap 486. GOI, MOE, press release, “Cabinet Adds $927 ar.aspx?id=681, accessed 4/26/2011. =02010100&rnr=223&anr=40632, accessed Million on the Supplementary Budget for the 507. GOI, MOE, press release, “His Excellency 7/12/2011. Ministry of Electricity for the Current Year,” Minister of Electricity Opens the al-Sadr Gas- 519. USACE, response to SIGIR data call, 6/15/2011, www.moelc.gov.iq/detailsnews_ fueledPowerPlantinBaghdadProvince,” 7/18/2011. ar.aspx?id=726, accessed 6/15/2011. 4/25/2011, www.moelc.gov.iq/detailsnews_ 520. SIGIRanalysisofGOIandU.S.government 487. ParsonsBrinckerhoff,“MinistryofElectricity ar.aspx?id=679, accessed 4/26/2011. documents, and open-source information in Master Plan Conference Summary,” 508. Sunir,LatestNews,“IranToOpenAlSadr Arabic and English. presentation at Ministry of Electricity Master PowerPlantPhase2inIraq,”5/9/2011,www. 521. GOI, Basrah Investment Commission, press Plan Conference, Istanbul, Turkey, 2/2/2011; sunir-co.com/index.php?option=com_ release, “Laying the Corner Stone of Al U.S. Embassy-Baghdad, response to SIGIR content&view=article&id=204:iran-to- Faw Great Port Project,” 4/11/2011, www. data call, 7/7/2011. open-al-sadr-power-plant-phase-2-in- investbasrah.com/indes.pho?option=com_ 488. ITAO/ESD, Electric Daily Performance iraq&catid=3:latest-news&Itemid=23, content&view=article&id=269%3, accessed Reports, 4/1/2007–7/15/2011. accessed 6/22/2011; ITAO/ESD, Electric Daily 5/15/2011; U.S. Embassy-Baghdad, response to 489. ITAO/ESD, Electric Daily Performance Performance Reports, 4/1/2010–6/30/2011. SIGIR data call, 7/14/2011. Reports, 4/1/2009–6/30/2011. 509. GOI,MOE,“MinistryofElectricitySignsa 522. SIGIRanalysisofGOIandU.S.government 490. ITAO/ESD, Electric Daily Performance Memorandum of Understanding with the documents, and open-source information in Reports, 4/1/2010–6/30/2011. IranianOilMinistryToImportNaturalGas,” Arabic and English. 491. ITAO/ESD, Electric Daily Performance 5/23/2011, www.moelc.gov.iq/detailsnews_ 523. GOI, Basrah Investment Commission, press Reports, 4/1/2010–6/30/2011. ar.aspx?id=702, accessed 5/23/2011, “Ministry release, “Laying the Corner Stone of Al 492. GOI, MOE, press release, “Cornerstone ofElectricityConcludesContractfor Faw Great Port Project,” 4/11/2011, www. Laidattheal-Qaryat1,250MWGas-fueled PipelineToImportIranianNaturalGas,” investbasrah.com/indes.pho?option=com_ PowerPlantintheHolyCityofKarbala,” 7/3/2011, www.moelc.gov.iq/detailsnews_ content&view=article&id=269%3, accessed 5/9/2011, www.moelc.gov.iq/detailsnews_ ar.aspx?id=741,accessed7/4/2011;ITAO/ 5/15/2011; U.S. Embassy-Baghdad, response to ar.aspx?id=689, accessed 5/10/2011; Çalık ESD, Electric Daily Performance Reports, SIGIR data call, 7/14/2011; UNSC, 5/2011/435, Holding, press release, “Çalık Enerji Signs On 4/1/2011–6/30/2011. 7/7/2011.

152 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 152 7/25/2011 10:38:20 AM ENDNOTES

524. U.S. Embassy-Baghdad, response to SIGIR 542. DoS, Iraq Status Report,5/12/2011,p.4;EIU, data call, 7/5/2011. Country Report: Iraq,4/2011,p.10. 525. U.S. Embassy-Baghdad, response to SIGIR 543. EIU, Country Report: Iraq,4/2011,p.10. data call, 7/5/2011. 544. DoS, Iraq Status Report,5/12/2011,p.4. 526. U.S. Embassy-Baghdad, response to SIGIR 545. DoS, Iraq Status Report,5/12/2011,p.4. data call, 7/5/2011. 546. GOI, Minister of Communications 527. U.S. Embassy-Baghdad, response to SIGIR MohammedTawfiqAllawi,meetingatthe data call, 7/5/2011; GOI, MOT, press release, U.S.ChamberofCommerce,Washington, “StartingFirstFlightoftheAustrianAirlines DC, 5/26/2011. to Baghdad,” 6/7/2011, www.motrans.gov.iq/ 547. DoS, Iraq Status Report,5/12/2011,p.4. english/index.php?name=News&file=article& 548. USACE, responses to SIGIR data call 4/5/2011 sid=46, accessed 7/7/2011. and 7/6/2011; U.S. Embassy-Baghdad, 528. CENTCOM, News Alert, “Turkey, Iraq response to SIGIR data call, 7/5/2011; SIGIR, Sign Agreement on Air Transportation,” PA-08-160,“ReportontheBasrahChildren’s 6/24/2011; Iraq, Business News, “First Direct Hospital, Basrah, Iraq,” 7/28/2009. Flight from Istanbul to Najaf,” 6/6/2011, www. 549. GOI, MOHE and MOE, SIGIR interviews, iraq-businessnews.com/2011/07/06/first-direct- 4/13/2011 and 4/14/2011. flight-from-istanbul-to-najaf, accessed 7/1/2011. 550. GOI, MOE, SIGIR interview, 4/14/2011. 529. GOI, MOT, press release, “Signing an 551. USACE,“CumulativeReconstructionFact AgreementtoConductFlightswithItaly,” Sheet,” 1/1/2011. 6/9/2011, www.motrans.gov.iq/english/index. 552. GOI, MOE and MOHE, SIGIR interviews, php?name=News&file=article&sid=48, 4/13/2011 and 4/14/2011. accessed 6/20/2011. 553. SIGIRanalysisofGOIandU.S.government 530. U.S. Embassy-Baghdad, responses to SIGIR documents, and open-source information in data call, 7/5/2011 and 7/14/2011. Arabic and English. 531. USACE, response to SIGIR data call, 7/6/2011; 554. USACE, response to SIGIR data call, 7/6/2011. U.S. Embassy-Baghdad, response to SIGIR 555. ThefivePSCswere:AegisDefenseServices, data call, 7/14/2011. Limited; EOD Technology, Inc; Sabre 532. USACE, response to SIGIR data call, 7/6/2011. International Security; Special Operations 533. USACE, response to SIGIR data call, Consulting-SecurityManagementGroup;and 7/18/2011. Triple Canopy, Inc. 534. USACE, response to SIGIR data call, 7/5/2011; 556. AccordingtoDoDguidance,aserious NEA-I, response to SIGIR data call, 6/20/2011; incident includes, but is not limited to, “any IRMS, USF-I CERP Category Report,9/20/2010. damageofequipmentorinjurytopersons, 535. USACE, responses to SIGIR data call, 7/6/2011 attacks, any weapons discharge, criminal acts, and 7/18/2011. trafficaccidents,incidentsinvolvingISF[Iraqi 536. USACE, responses to SIGIR data call, 7/6/2011 Security Forces] and any incident believed to and 7/18/2011. havepossiblestrategicoroperationalimpact. 537. GRD, Newsletter, “USACE Celebrates Incidentswhereaggressivepersonalbehavior OpeningoftheFallujahWasteWater and share-the-road policies are violated shall Treatment System,” 6/2011, www.grd.usace. be reported.” army.mil/Newsletters/GRD-Newsletter-0611. 557. SIGIR Audit 09-019, “Opportunities pdf,accessed7/1/2011;USACE,response To Improve Processes for Reporting, toSIGIRdatacall,7/6/2011;U.S.Embassy- Investigating, and Remediating Serious Baghdad, response to SIGIR data call, Incidents Involving Private Security 7/14/2011. ContractorsinIraq,”4/30/2009. 538. USACE, responses to SIGIR data call, 7/6/2011 558. SIGIR Audit 11-015, “Gulf Region District and 7/18/2011; U.S. Embassy-Baghdad, Is Adjusting Its Aegis Security Contract responses to SIGIR data call, 7/14/2011 and Requirements for Changes in Reconstruction 7/18/2011. Activities in Iraq,” 4/27/2011. 539. GRD, response to SIGIR data call, 10/15/2009; 559. USF-Ididnotproduceaquarterlyreport GRD, Weekly Situation Report, 8/7/2009; forDecember2010butinsteadprovidedthe USACE, response to SIGIR data call, 7/6/2011; information for that quarter in the March U.S. Embassy-Baghdad, response to SIGIR 2011 quarterly report. data call, 7/14/2011; USACE, information 560. SIGIR Audit 10-003, “Iraq Commander’s provided to SIGIR, 7/19/2011. Emergency Response Program Generally 540. DoS, Iraq Status Report,5/12/2011,p.3. ManagedWell,butProjectDocumentation 541. DoS, Iraq Status Report,5/12/2011,p.4;U.S. andOversightCanBeImproved,”10/27/2009. Embassy-Baghdad, response to SIGIR data 561. ‘‘InspectorGeneralActof1978’’(P.L.95-452, call, 7/14/2011. §1,Oct.12,1978,92Stat.1101).

JULY 30, 2011 I REPORT TO CONGRESS I 153

July2011.indb 153 7/25/2011 10:38:20 AM SOURCESFORQUICKFACTS

MajorU.S.Funds:P.L. 108-7; P.L. 108-11; P.L. 108-106; P.L. 108-287; P.L. 109-13; P.L. 109-102; P.L. QUICK FACTS 109-148;P.L.109-34;P.L.109-289;P.L.110-28;P.L. 110-92;P.L.110-116;P.L.110-137;P.L.110-149;P.L. SOURCES 110-161; P.L. 110-252; P.L. 111-32; P.L. 111-117; P.L. 111-118;P.L.111-212;P.L.112-10;ABO,responses Cumulative Funding: P.L. 108-7; P.L. 108-11; P.L. to SIGIR data call, 7/14/2011 and 7/15/2011; DoS, 108-106; P.L. 108-287; P.L. 109-13; P.L. 109-102; P.L. responsetoSIGIRdatacall,4/5/2007;INL,response 109-148;P.L.109-34;P.L.109-289;P.L.110-28;P.L. to SIGIR data call, 7/15/2011; NEA-I, response to 110-92;P.L.110-116;P.L.110-137;P.L.110-149;P.L. SIGIRdatacalls,4/12/2011,4/15/2011,6/20/2011, 110-161; P.L. 110-252; P.L. 111-32; P.L. 111-117; P.L. 6/24/2011, and 6/27/2011; OUSD(C), responses to 111-118;P.L.111-212;P.L.112-10;ABO,responses SIGIRdatacalls,4/10/2009and7/15/2011;SIGIR to SIGIR data call, 7/14/2011 and 7/15/2011; DoS, Audit11-007,“IraqReliefandReconstruction responsetoSIGIRdatacall,4/5/2007;INL,response Fund 1: Report on Apportionments, Expenditures, to SIGIR data call, 7/15/2011; DoS, NEA-I, responses and Cancelled Funds,” 12/28/2010; U.S. Treasury, toSIGIRdatacalls,4/12/2011,4/15/2011,6/20/2011, response to SIGIR data call, 4/2/2009; USACE, 6/24/2011, and 6/27/2011; OUSD(C), responses to response to SIGIR data call, 7/5/2011; USAID, SIGIRdatacalls,4/10/2009and7/15/2011;SIGIR responses to SIGIR data calls, 7/8/2010 and 7/7/2011; Audit11-007,“IraqReliefandReconstruction USTDA, response to SIGIR data call, 4/2/2009. Fund 1: Report on Apportionments, Expenditures, and Cancelled Funds,” 12/28/2010; U.S. Treasury, MBPD, by Month (1/2010–6/2011): NEA-I, response to SIGIR data call, 4/2/2009; USACE, responses to SIGIR data calls, 6/4/2010, 7/6/2010, response to SIGIR data call, 7/5/2011; USAID, 1/11/2011, 4/5/2011, and 7/7/2011. responses to SIGIR data calls, 7/8/2010 and 7/7/2011; USTDA, response to SIGIR data call, 4/2/2009; AveragePriceperBarrel,byWeek(1/2010– USACE, response to SIGIR data call, 10/6/2008; 6/2011): EIA,“WeeklyIraqKirkukNetbackPrice DoS, DRL, response to SIGIR data call, 4/12/2011; at U.S. Gulf,” www.eia.gov/dnav/pet/hist/LeafHan- TFBSO, response to SIGIR data call, 1/4/2011; dler.ashx?n=PET&s=WEPCKIRK&f=W, accessed USAID,“U.S.OverseasLoansandGrants[Green- 7/14/2011. book],” 2008, gbk.eads.usaidallnet.gov/query/ do?_program=/eads/gbk/countryReport&unit=N, Supplyvs.Demand(1/1/2010–6/30/2011): accessed 4/15/2010;DoJ,JusticeManagement ITAO/ESD, Electric Daily Performance Reports, Division,responsestoSIGIRdatacall,4/5/2011and 1/1/2010–6/30/2011. 4/11/2011;DoS,NEA-I,responsestoSIGIRdata calls, 10/4/2010, 10/6/2010, 4/5/2011, 4/15/2011, and AverageDailySecurityIncidents,byWeek 7/7/2011;DoS,ECA,responsetoSIGIRdatacall, (1/2010–6/2011): USF-I, responses to SIGIR data 4/14/2010; OUSD(C), response to SIGIR data call, calls,1/4/2011,4/8/2011,and7/1/2011. 10/14/2010;U.S.Treasury,OTA,“OfficeofTechni- calAssistanceOverview,”12/30/2005,ustreas.gov/ Persons Killed (4/1/2011–6/30/2011): CENTCOM, offices/internationalaffairs/assistance/, accessed responsetoSIGIRdatacall,7/1/2011;DoL,response 10/16/2009;DoS,PM,responsetoSIGIRdatacall, to SIGIR data call, 7/8/2011; DoD, news transcript, 7/6/2011;BBG,responsetoSIGIRdatacall,3/7/2011; “Media Availability with Secretary Panetta at CongressionalBudgetJustification,ForeignAssis- Forward Operating Base Dwyer, Afghanistan,” tance Summary Tables, FY 2009–2011; USAID, re- 7/10/2011. sponses to SIGIR data calls, 1/12/2009 and 4/8/2009; OMB, response to SIGIR data call, 6/21/2010; U.S. Embassy-Baghdad, response to SIGIR data call, 10/3/2009;GOI,CoR,“FederalPublicBudgetLaw fortheFiscalYear2011,”2/23/2011,Article2;GOI, MOF, SIGIR request for data, 6/27/2011; U.S. Trea- sury,responsestoSIGIRdatacalls,1/4/2008and 4/9/2009;“GOIBudget”(asapprovedbyTNAand writtenintolawDecember2005);GOI,Presidency oftheIraqiInterimNationalAssembly,“TheState General Budget for 2005,” 2005; GOI, “Budget Rev- enues and Expenses 2003, July–December,” 2003; DoS, NEA-I, responses to SIGIR data calls, 4/5/2011, 4/7/2011, and 7/12/2011.

154 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 154 7/25/2011 10:38:20 AM INSERT NOTES AND SOURCES

Telecommunication Union, “Mobile Cellular Sub- Oil and Gas Production Comparison: IEA, scriptionsper100Inhabitants,”2009,www.itu.int/ WorldEnergyOutlook2010,PartI,“GlobalEnergy SOURCES AND ITU-D/ict/statistics/, accessed 6/22/2011; Federal Trends,” pp. 133, 191. Highway Administration, “Table VM-1: Annual NOTES FOR THE VehicleDistanceTraveledinMilesandRelated OilProductionAnnualGrowth,2009–2035:IEA, Data,” 4/2011, www.fhwa.dot.gov/policyinforma- WorldEnergyOutlook2010,PartI,“GlobalEnergy INSERT tion/statistics/2008/vm1.cfm, accessed 6/19/2011; Trends,”p.133. BrianStelter,“OwnershipofTVSetsFallsinU.S.,” Iraq’s Trade Balance: IMF, Regional Economic TheNewYorkTimes,5/3/2011;Departmentof Oil Infrastructure Challenges: IEA, World Energy Outlook: Middle East and Central Asia, 10/2009, pp. Energy,EnergySavers,“AirConditioning,”www. Outlook 2010,PartI,“GlobalEnergyTrends,”p.132; 55–57,and4/2011,pp.87–89. energysavers.gov/your_home/space_heating_cool- MEES, Weekly Report,Vol.53No.47,11/22/2010, ing/index.cfm/mytopic=12370, accessed 6/18/2011; p. 5, and Energy and Geopolitical Risk,Vol.2No.5, Interest, Inflation, and Exchange Rates: GOI, Energy Information Administration, “United 5/2011,p31. Central Bank of Iraq, “Key Financial Indicators,” States,” 6/2010, www.eia.gov/countries/country- 6/1/2011, www.cbi.iq, accessed 6/5/2011. data.cfm?fips=US, accessed 6/22/2011; U.S. Census Starting a New Business Requires: World Bank, Bureau,“HouseholdIncomeforStates:2008and IFC, “Doing Business 2011,” 6/1/2010, pp. 170, 172, How the Iraqi Household Measures Up: Iraq— 2009,” 10/2010, www.census.gov/prod/2010pubs/ 191, 197, 202. Methodology for developing this table World Bank, World Development Indicators, acsbr09-2.pdf, accessed 6/22/2011. is available at: www.doingbusiness.org/methodol- 4/2011, data.worldbank.org/data-catalog/world- ogy/starting-a-business. development-indicators, accessed 6/15/2011; World Share of Employment and Share of GDP, by Sec- Food Programme, ComprehensiveFoodSecurity tor: Employment—GOI, COSIT, Iraq Household NumberofIraqiswithanAccountinaPrivate and Vulnerability Analysis (CFSVA), 2008, pp. Socio-Economic Survey,2008;GDP Share—COSIT Sector Bank: USAID, response to SIGIR data call, 92–93; International Telecommunication Union, national accounts data, as reported in GOI, Poverty 6/27/2011,and“USAIDIraqFinancialDevelopment “MobileCellularSubscriptionsper100Inhabit- ReductionStrategyHighCommittee,andWorld Project, Third Quarterly Report,” 4/15/2011, p. 6. ants,” 2009, www.itu.int/ITU-D/ict/statistics/,ac- Bank,MiddleEastDepartment,“IraqPovertyData cessed 6/22/2011; Brookings Institution, Iraq Index, Report,”Vol1:MainFindings,3/2010,p.33. HowWellCountriesControlCorruption:World 4/26/2011, p. 26; GOI, COSIT, Iraq Household Bank,“WorldwideGovernanceIndicators:Control Socio-Economic Survey, 2008, p. 636. Iran—World GrossDomesticProduct,bySector:GOI, COSIT of Corruption,” 2009, info.worldbank.org/gover- Bank, World Development Indicators,4/2011,data. NationalAccountsUnit,“Iraq:GrossDomestic nance/wgi/mc_chart.asp, accessed 5/19/2011. worldbank.org/data-catalog/world-development- ProductbyEconomicActivitiesatCurrentPrices, indicators,accessed6/15/2011;StatisticalCentre ShareinGDP,”1968–2010.Dataconfirmedinmeet- IraqStockExchangevs.S&PPan-ArabCom- of Iran, Bureau of Population, Labour Force, and ingwithSIGIR,7/17/2011.2010dataforGDPsector- posite Index: Standard&Poor’s“S&PPan-Arab Census,“SummaryResultsoftheUrbanand by-sectorbreakdownincludesthefirstthreequarters Indicies,” 12/2010, www.indices.standardandpoors. RuralHouseholdIncomeandExpenditureSur- only.IntheCOSITdata,crudeoilislistedasasub- com,accessed4/1/2011;IraqStockExchange, vey—2009,” 2009, pp. 9, 10; International Telecom- setoftheMiningandQuarryingsector;theSocial www.isx-iq.net/isxportal/sectorProfileContainer. munication Union, “Mobile Cellular Subscriptions Services sector comprises General Government and html?sectpr=1,accessed4/1/2011.TheS&PPan- per100Inhabitants,”2009,www.itu.int/ITU-D/ averysmallcategorycalledPersonalServices. Arab Composite index includes stocks from 363 ict/statistics/,accessed6/22/2011;CentralBankof listedcompaniesinthecountriesofBahrain,Egypt, theIslamicRepublicofIran,GeneralDirectorateof Economic Reliance on Oil among Selected Jordan, Kuwait, Lebanon, Morocco, Oman, Qatar, Economic Statistics, “Household Budget Survey In MiddleEastandNorthAfricaNations,2010: SaudiArabia,Tunisia,andtheUAE. UrbanAreasinIran,1384(March20,2005–March IMF, Regional Economic Outlook: Middle East and 20, 2006),” 12/2006, p. 3; Energy Information Central Asia,10/2010,p.15;GOI,COSITNational Government as Single Largest Employer: GOI, Administration,“Iran:CountryAnalysisBrief,” AccountsUnit,“Iraq:GrossDomesticProductby IraqTaskForceforEconomicReform(withtheUN 4/16/2010, pp. 10–11, www.eia.gov/EMEU/cabs/ Economic Activities at Current Prices, share in and World Bank), Roadmap for Restructuring State Iran/pdf.pdf, accessed 6/22/2011. Saudi Arabia— GDP,”1968–2010.Dataconfirmedinmeetingwith Owned Enterprises in Iraq,8/17/2010,p.36. R.J.Struyk,“HousingPolicyIssuesinaRich SIGIR, 7/17/2011. 2010 data for GDP sector-by- CountrywithHighPopulationGrowth:theCaseof sectorbreakdownincludesthefirstthreequarters ReduceGOIspendingonPublicSafetyNets:GOI, Riyadh, Saudi Arabia,” Review of Urban & Regional only.Iraq’soilrevenuesasapercentageoftotalGDP IraqTaskForceforEconomicReform(withtheUN Development Studies,Vol.17No.2,p.148;World are calculated using COSIT data. and World Bank), Roadmap for Restructuring State Bank, World Development Indicators,4/2011,data. Owned Enterprises in Iraq,8/17/2010,p.8;Weigand worldbank.org/data-catalog/world-development-in- Value of Foreign Commercial Activity in Iraq, andGrosh,SocialProtectionDiscussionPaper dicators, accessed 6/15/2011; International Telecom- 2005–2010: Dunia Frontier Consultants, “Foreign No.0817,WorldBank:Washington,DC,2008as munication Union, “Information Society Statistical Commercial Activity in Iraq: 2010 Year in Review,” reported in GOI, Poverty Reduction Strategy High Profiles 2009: Arab States,” 2009, p. 12; Interna- 2/2011,p.17. Committee,andWorldBank,MiddleEastDepart- tional Telecommunication Union, “Mobile Cellular ment,“IraqPovertyDataReport,”Vol1:Main Subscriptionsper100Inhabitants,”2009,www.itu. Foreign Commercial Activity in 2010: Dunia Findings, 3/2010, p. 53. int/ITU-D/ict/statistics/, accessed 6/22/2011; The Frontier Consultants, “Foreign Commercial Activi- NielsenCompany,“AmericansLeadstheWorld ties in Iraq: 2010 Year in Review,” 2/2011, pp. 9, 11. PublicSpendingonSafetyNetsasa%ofGDP, inCarOwnership,ChinaandIndiaFastCatching OilDominatesIraq’sEconomy:IMF,Country 2008: WeigandandGrosh,SocialProtectionDis- UpinAbsoluteNumberofCarsOwned,”5/7/2007, ReportNo.11/75,“Iraq:SecondReviewUnderthe cussionPaperNo.0817,WorldBank:Washington, img.scoop.co.nz/media/pdfs/0705/carowners.pdf, Stand-By Arrangement, Requests for Waiver of DC,2008asreportedinGOI,PovertyReduction accessed6/14/2011;PyramidResearch,“Africa& Applicability,ExtensionoftheArrangement,and Strategy High Committee, and World Bank, Middle MiddleEastTelecomInsider,”Vol.1No.1,2/2009, RephrasingofAccess,”3/2011,p.22;GOI,CoR, EastDepartment,“IraqPovertyDataReport,”Vol1: p. 8; Energy Information Administration, “Saudi “FederalPublicBudgetLawfortheFiscalYear Main Findings, 3/2010, p. 52. Arabia: Country Analysis Brief,” 1/4/2011, p. 9, 2011,”2/23/2011,Article1;GOI,MOF,“2011Iraq www.eia.gov/EMEU/cabs/Saudi_Arabia/pdf.pdf, BudgetSchedules,”5/16/2011,ScheduleA. 80% Food Imports: GOI, Iraq Task Force for accessed 6/22/2011. United States—World Bank, EconomicReform(withtheUNandWorldBank), World Development Indicators,4/2011,data.world- Proved Oil Reserves: GOI, NMC, press release, Roadmap for Restructuring State Owned Enterprises bank.org/data-catalog/world-development-indica- “NewOilReservesReach143BillionBarrels, in Iraq,8/17/2010,p.54. tors, accessed 6/15/2011; “Computer Ownership,” 10/4/2010, www.nmc.gov.iq/english/lnews_ The Economist, 12/18/2008, www.economist.com/ e2010/10/4_2htm, accessed 10/16/2010; MEES, node/12758865, accessed 6/14/2011; International Weekly Report,Vol.53No.41,10/11/2010,p.1.

JULY 30, 2011 I REPORT TO CONGRESS I 155

July2011.indb 155 7/25/2011 10:38:21 AM INSERT NOTES AND SOURCES

Average Iraqi Electricity Supply and Estimated AnnualGOISubsidiesforSOEs:GOI, Iraq Task Demand, 2004–2010: ITAO/ESD, Electric Daily Force for Economic Reform (with the UN and Performance Reports, 6/1/2006−6/30/2011; DoS, World Bank), Roadmap for Restructuring State Iraq Status Reports, 10/25/2006, slide 11, and Owned Enterprises in Iraq,8/17/2010,p.11;GOI, 5/9/2007, slide 11. Ministry of Finance, information provided to SIGIR, 5/19/2011. Supply and Demand for Electricity: ITAO/ESD, Electric Daily Performance Reports,6/1/2006– EaseandCostofExports/Imports:World Bank, 6/30/2011; DoS, Iraq Status Report, 10/25/2006, slide IFC, “Doing Business 2011,” 6/1/2010, pp. 170, 172, 11, and 5/9/2007, slide 11. 191, 197, 202. Methodology for developing this table is available at: www.doingbusiness.org/methodol- Important Agricultural Crops: FAO, GIEWS ogy/trading-across-borders. CountryBrief:Iraq,5/17/2011,www.fao.org/giews/ countrybrief/country.jsp?code=IRQ, accessed DroppingLiteracyRates:UNESCO Iraq Office, 7/20/2011. Education Sector, head of Amman office, telephone interviewwithSIGIR,6/29/2011. CoMvotes$5billionforagriculture:GOI, NMC, press release, “Approve the Bill Payment Infrastruc- GDP, by Sector, 1970–2009: GOI, COSIT National tureReconstructionResolutionwith$37Billion,” AccountsUnit,“Iraq:GrossDomesticProductby www.nmc.gov.iq/ArticleShow.aspx?ID=882,ac- Economic Activities at Current Prices, share in cessed 6/20/2011. GDP,”1968–2010,dataconfirmedinmeetingwith SIGIR, 7/17/2011; Alan Heston, Robert Summers, Dates—aSymbolofAgriculture’sDecline:Amer andBettinaAten,“PennWorldTableVersion6.3,” Jabarin and Faraoun A. Hussein, “Iraqi Date In- Center for International Comparisons of Produc- dustry:MarketingandPost-harvestIssues,”www. tion,IncomeandPricesattheUniversityofPennsyl- usaid.gov/iraq/contracts/pdf/ARDI14-IraqiDateIn- vania, 8/2009, pwt.econ.upenn.edu/php_site/pwt_ dustry.pdf, accessed 6/6/2011. index.php, accessed 6/22/2011. Data not audited. Numbers affected by rounding. Total purchasing DateExports(Iraqvs.AllOtherCountries), powerparity-convertedgrossdomesticproduct, 1975–1999: Amer Jabarin and Faraoun A. Hussein, Geary-Khamis (G-K) method, at current prices. “IraqiDateIndustry:MarketingandPost-harvest Issues,” www.usaid.gov/iraq/contracts/pdf/ARDI14- SelectedNon-U.S.LoanandGrantDonorCommit- IraqiDateIndustry.pdf, accessed 6/6/2011. ments, as of 6/30/2011: NEA-I,responsestoSIGIR data calls, 4/5/2011, 4/7/2011, and 7/12/2011. Figures Ease of Doing Business Rankings, 2011: World intheInsertdonotnecessarilycorrelatewiththose Bank,IFC,“Doing Business 2011,” 6/1/2010, pp. inSection2ofthisQuarterlyReport.Commitments 170, 172, 191, 197, 202. Methodology for developing undertheInternationalReconstructionFundFacility this table is available at: www.doingbusiness.org/ for Iraq are included in the country commitments Methodology/. shownintheInsert.TheyarelistedseparatelyinTable 2.11 of the Quarterly Report. A1PercentagePointIncreaseinAgriculture’s ShareofGDPandEffectonEmployment:DoS, Countries with the Largest Commercial Activity Iraq Status Report,5/15/2011,p.3. in Iraq, 2010: Dunia Frontier Consultants, “Foreign Commercial Activities in Iraq: 2010 Year in Re- Manfuacturing,Agriculture,SocialServices view,”2/2011,p.9. Share of Employment and GDP: Employment— GOI, COSIT, Iraq Household Socio-Economic MajorU.S.ReconstructionAssistancetoIraq, Survey,2008;GDP Share—COSIT National Ac- byArea,asof6/30/2011andMajorU.S.-funded countsData,asreportedinGOI,PovertyReduction Reconstruction Programs Supporting Iraq’s Strategy High Committee, and World Bank, Middle Economic Recovery: ABO,responsestoSIGIR EastDepartment,“IraqPovertyDataReport,”Vol1: datacall,7/14/2011and7/15/2011;DoS,responseto Main Findings, 3/2010, p. 33. SIGIR data call, 4/5/2007; INL, response to SIGIR datacall,7/15/2011;NEA-I,responsestoSIGIRdata Growth of Public Sector Employment: GOI, Iraq calls, 4/12/2011, 4/15/2011, 6/20/2011, 6/24/2011, Task Force for Economic Reform (with the UN and6/27/2011;OUSD(C),responsestoSIGIRdata and World Bank), Roadmap for Restructuring State calls, 4/10/2009 and 7/15/2011; SIGIR Audit 11-007, Owned Enterprises in Iraq,8/17/2010,p.32. “IraqReliefandReconstructionFund1:Report on Apportionments, Expenditures, and Cancelled Manufacturing History: GOI,MIM,meetingwith Funds,”12/28/2010; U.S. Treasury, response to SIGIR, 7/11/2011. SIGIRdatacall,4/2/2009;USACE,responseto SIGIRdatacall,7/5/2011;USAID,responsesto Important Manufacturing Branches: GOI, MIM, SIGIRdatacalls,7/8/2010and7/7/2011;USTDA, meetingwithSIGIR,7/11/2011. response to SIGIR data call, 4/2/2009; IRMS, Global Benchmark, 9/3/2010; TFBSO, response to SIGIR Manufacturing Restructuring Benefits: GOI, Iraq data call, 1/4/2011. Task Force for Economic Reform (with the UN and World Bank), Roadmap for Restructuring State Photosnotcreditedonthegraphic:Oil sector Owned Enterprises in Iraq,8/17/2010,pp.7–9. photocourtesyofBP;others,TaskForceforBusi- ness and Stability Operations, tfbso.defense.gov/ Problems Drawing Foreign Partners in Manufac- www/photo-essay.aspx#iraq,7/2011. turing: GOI,MIM,meetingwithSIGIR,7/11/2011.

156 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 156 7/25/2011 10:38:21 AM ACRONYMS AND DEFINITIONS

Acronym Deﬁnition Acronym Deﬁnition

U.S. Army Criminal Investigation U.S. Defense Contract Audit ACRONYMS AND DCAA CID-MPFU Command-Major Procurement Agency Fraud Unit DEFINITIONS Deputy Commanding General DCG-A&T Combined Information Data for Advising and Training CIDNE Thissectioncontainsalloftheabbrevia- Network Exchange Deputy Commanding General DCG-Support tions and acronyms found in this Report. Council of the Inspectors for Support CIGIE GeneralonIntegrityand Defense Criminal Investigative Efficiency DCIS Acronym Definition Service Contributions to International CIO Defense Contract Management AdviseandAssistBrigade Organizations (United States) AAB DCMA (USF-I) Agency CMC CERP Management Cell Diyala Economic Development U.S. Army and Air Force DEDC AAFES Communications and Media Center Exchange Service CMC Commission Diyala State Company for ABO U.S.ArmyBudgetOffice DEI ChinaNationalPetroleum Electrical Industries CNPC ABOT al-Basrah Oil Terminal Corporation Democracy Democracy Fund Anti-Corruption Coordination CommitteeofFinancialExperts ACCO COFE U.S. Defense Finance and Office (U.S. Embassy-Baghdad) (Board of Supreme Audit) DFAS Accounting Service AFAA U.S.AirForceAuditAgency COI CommissionofIntegrity DFI Development Fund for Iraq U.S. Air Force Center COIN counterinsurgency Deputy General (USF-I) and AFCEE forEngineeringandthe DG Environment COM Chief of Mission Director General (Iraqi) AIC Anbar Investment Commission CoM CouncilofMinisters DG Director General contracting officer’s Department of Health and Amanat Baghdad mayoralty COR DHHS representative Human Services AMC U.S.ArmyMaterielCommand CoR CouncilofRepresentatives(GOI) DIA Defense Intelligence Agency AMERCO American Equipment Company Central Organization for Defense Information Systems DISA AQI al-QaedainIraq COSIT Statistics and Information Agency Technology (GOI) ARCENT U.S. Army Central DLA Defense Logistics Agency CPA Coalition Provisional Authority Antiterrorism Assistance DoD Department of Defense ATA Program (DoS) Congressional Research Service CRS DepartmentofDefenseOffice (Library of Congress) DoD OIG Broadcasting Board of of Inspector General BBG Governors CSC CERPSteeringCommittee Department of Defense Activity BPA blanket purchase agreement Child Survival and Health DoDACC Address Codes (U.S. Army CSH Programs Fund Central Command) BPD barrels per day Community Stabilization DoI Department of Interior BRU Bank Reconciliation Unit CSP Program (USAID) DoJ Department of Justice BSA Board of Supreme Audit Case Tracking Application CTA DoL Department of Labor BTA Business Transformation Agency (funded through ESF) DoS Department of State U.S. CENTCOM Contracting Commission on Wartime C3 Command CWC Contracting in Iraq and DepartmentofStateOfficeof DoS OIG Afghanistan Inspector General CAG community action group CWG CERP Working Group DOT Department of Transportation Community Action Program CAP Democracy&CivilSociety (ESF) D&CS DPM Deputy Prime Minister Program (ESF) Canadian Alliance for Power Bureau of Democracy, Human CAPGENT DRL Generation Equipment Development Assistance Rights,andLabor(DoS) DAD Database (United Nations CBI Central Bank of Iraq Development Program) document reference number DRN (used for USF-I CERP Project CCC-I Central Criminal Court of Iraq Defense Advanced Research DARPA Tracker) Corps of Engineers Financial Projects Agency CEFMS DS Diplomatic Security (DoS) Management System DATT Iraqi Defense Attache EBO EmbassyBranchOffice CENTCOM U.S. Central Command Department of Border DBE Bureau of Educational and Commander’s Emergency Enforcement (GOI) ECA CERP Cultural Affairs (DoS) Response Program DCA U.S. Defense Contract Agency Continuednextcolumn Continuednextcolumn Continuednextcolumn

JULY 30, 2011 I REPORT TO CONGRESS I 157

July2011.indb 157 7/25/2011 10:38:21 AM INSERT NOTES AND SOURCES

Acronym Definition Acronym Definition Acronym Definition

Education and Cultural IA Iraqi Army IOC international oil company ECA Exchange Programs International Anti-Corruption International Organization for IACA IOM excess defense articles Academy Migration EDA (U.S. Military) IAF Iraqi Air Force IP Iraqi Police explosively formed penetrator EFP International Advisory and IPP independent power producer (Iranian-supplied) IAMB Monitoring Board (UN-created IPS Iraq Payment System Energy Information for Iraq) EIA Administration (DoE) improvised rocket-assisted IAO Iraq Area Office (USACE MED) IRAM munitions Eni International Resources Inter-Agency Information and ENI (Italian oil and refinery IAU Iraq Rapid Assistance Program Analysis Unit (UN) company) IRAP (USAID component of QRF ICAA Iraq Civil Aviation Authority program) engineering, procurement, EPC and construction U.S. Immigration and Customs International Reconstruction ICE IRFFI (projects or contracts) Enforcement Fund Facility for Iraq Emergency Refugee & Iraq Commander’s Emergency International Republican ERMA I-CERP IRI Migration Assistance Response Program Institute ESF Economic Support Fund Iraqi Company for Financing Iraq Reconstruction ICF-SME IRMS Small-Medium Enterprises Management System European Union Integrated Rule EUJUST LEX ofLawMissionforIraq International Criminal IRR Iraqi Republic Railway Company ICITAP Investigative Training Assistance Food and Agriculture Iraq Relief and Reconstruction FAO Program (DoJ) IRRF Organization (United Nations) Fund-IRRF1andIRRF2 International Development FBI Federal Bureau of Investigation IDA Internal Revenue Service- Association (World Bank) IRS-CI Criminal Investigation Foreign Excess Personal FEPP International Disaster Assistance Property program ISAM Iraq Security Assistance Mission IDA (USAID humanitarian trust FMF Foreign Military Financing fund) ISCI Islamic Supreme Council of Iraq Financial Management International Disaster and FMR IDFA ISF Iraqi Security Forces Regulation (DoD) Famine Assistance ISFF Iraq Security Forces Fund FMS Foreign Military Sales IDP internally displaced person IraqiSpecialOperationsForce ISOF FOB forward operating base IEA International Energy Agency (also, Counter-Terrorism Force) Facilities Protection Service IED improvised explosive device FPS ISP Infrastructure Security Program (GOI) IFF Iraq Freedom Fund ISPO Iraq Strategic Partnership Office Federal Reserve Bank of New FRBNY Iraq Financial Management Iraq Training and Advisory York IFMIS ITAM Information System Mission FinancialSectorDevelopment FSD IG inspector general Program (ESF) ITAO Iraq Transition Assistance Office Independent High Electoral Iraq Transition Assistance FY fiscal year IHEC ITAO/ESD Commission Office/Electric Services Division U.S. Government Accountability GAO IIGC Iraq Inspectors General Council Office IZ International Zone IJ investigative judge Private Sector Development GDP gross domestic product Izdihar funds (ESF) International Military Education GE General Electric IMET and Training program KAAOT Khawr al-Amaya Oil Terminal Global Information and Early GIEWS IMF International Monetary Fund Warning System KDP Kurdistan Democratic Party INA Iraqi National Alliance Geographic Information System km kilometer GIS (Tatweer) International Narcotics Control Kogas KoreanOilandGasCompany INCLE and Law Enforcement account GOI Government of Iraq (INL) KRG Kurdistan Regional Government GRD Gulf Region District (USACE) ING Iraqi National Guard KRG-MOE KRG Ministry of Electricity GSA General Services Administration Bureau of International kV kilovolt H.R. House Resolution INL NarcoticsandLawEnforcement LocalGovernanceProgram Affairs (DoS) LGP HJC Higher Judicial Council (USAID) “Growth”inArabic— Headquarters, U.S. Department Inma LOA letters of acceptance HQDA Agribusiness Program (USAID) of the Army Continuednextcolumn Continuednextcolumn Continuednextcolumn

158 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 158 7/25/2011 10:38:21 AM ACRONYMS AND DEFINITIONS

Acronym Definition Acronym Definition Acronym Definition

Logistics Civil Augmentation Nonproliferation, Anti- OfficeofTechnicalAssistance LOGCAP Program NADR terrorism, Demining, and OTA (U.S.Departmentofthe Related Programs Treasury) LPG liquefied petroleum gas National Capacity Development OfficeoftheUnderSecretaryof MoneyasaWeaponSystem OUSD(C ) MAAWS NCD Program (USAID) (also referred Defense (Comptroller) (DoD) to as Tatweer) P.L. Public Law Marla Ruzicka Iraqi War Victims Marla Fund National Council for Higher Fund (IRRF) NCHP PA Paying Agent Policies (GOI) MBPD million barrels per day PC Provincial Council U.S. Naval Criminal Investigative NCIS Ministerial Capacity Service PCO Project and Contracting Office MCD Development Program National Defense Authorization Police Development Program (DoS or USAID) NDAA PDP Act (DoS INL) MCF million cubic feet NDI NationalDemocraticInstitute PDS Public Distribution System MCFD million cubic feet per day Iraq’s National Development Tijara Provincial Economic NDP PEG MDA Missile Defense Agency Plan (2010-2014) Growth (USAID) (ESF) Bureau of Near Eastern Affairs- MEC Minimum Essential Capabilities NEA-I PEZ Pipeline Exclusion Zone Iraq (DoS) MED MiddleEastDistrict(USACE) Procurement Fraud Branch National Geospatial-Intelligence PFB NGA (Army Legal Services Agency) MEES MiddleEastEconomicSurvey Agency` PrimaryHealthCareProgram MeK Mujaheddin e-Khalq PHCP NGO nongovernmental organization (ESF) MiddleEastPartnership MEPI National Investment Provincial Investment Initiative NIC PIC Commission (GOI) Commission (GOI) MFI microfinance institution NMC National Media Center (GOI) Bureau of Political-Military PM Ministry of Industry and Affairs (DoS) MIM NaturalResourcesRisk Minerals NRRRF Remediation Fund PM Prime Minister MNC-I Multi-National Corps-Iraq Operation and Maintenance PrimeMinister’sOffice(and O&M PMO MNF-I Multi-National Force-Iraq funds (U.S. Army) Secretariat) (GOI) O&M operations and maintenance Provincial Reconstruction MOD MinistryofDefense PRDC Development Council OfficefortheCoordinationof Ministry of Displacement and OCHA MoDM Humanitarian Affairs (UN) Bureau of Population, Refugees, Migration PRM and Migration (DoS) Overseas Contingency MOE MinistryofElectricity(GOI) OCO Operations (DoS) PRT ProvincialReconstructionTeam Ministry of Electricity Inspector MOE IG OfficeofForeignDisaster General OFDA ProvincialReconstructionTeam/ Assistance (USAID) PRT/PRDC Provincial Reconstruction MOF MinistryofFinance Development Council Overseas Humanitarian, Disaster OHDACA MOH MinistryofHealth and Civic Aid PSC private security contractor MoHR Ministry of Human Rights OIF Operation Iraqi Freedom PUK Patriotic Union of Kurdistan MOI Ministry of Interior Office of Management and OMB PwC PricewaterhouseCoopers Ministry of Interior Inspector Budget MOI IG QRF Quick Response Fund General OP Oil Police (GOI) QuickResponseFund-State(DoS MOJ MinistryofJustice OfficeofProvincialAffairs QRF-State OPA component of QRF program) (U.S. Embassy-Baghdad) Ministry of Planning and Regime Crimes Liaison Office MoPDC RCLO Development Cooperation OfficeofOverseasProsecutorial (DoS) (ESF) MOT Ministry of Transportation OPDAT Development and Assistance Training (DoS) requests for information Migration and Refugee RFIs (purchase contracts between MRA Overseas Private Investment Assistance OPIC U.S. and Iraq) Corporation Mine Resistant Ambush Resident Legal Advisors MRAP OfficeofSecurity RLAs Protected (armored vehicles) OSC-I (DoS INL) Cooperation-Iraq MW megawatt Rule of Law Coordinator OfficeoftheSecretaryof RoLC OSD (U.S. Embassy-Baghdad) MWh megawatt-hour Defense Continuednextcolumn Iraq’s National Anti-Corruption NACS Continuednextcolumn Strategy for 2010–2014 Continuednextcolumn

JULY 30, 2011 I REPORT TO CONGRESS I 159

July2011.indb 159 7/25/2011 10:38:21 AM INSERT NOTES AND SOURCES

Acronym Deﬁnition Acronym Deﬁnition

rough order of magnitude Theater-wide Internal Security TWISS ROM (refers to pricing on purchasing Services (DoD) contractsbetweenU.S.andIraq UK United Kingdom RTI Research Triangle Institute UN United Nations SA Security Agreement (U.S.-Iraq) United Nations Assistance UNAMI SAT Security Assistance Team Mission for Iraq SBA Stand-By Arrangement (IMF) United Nations Compensation UNCC Commission Small Business Development SBDC Center (Diyala) United Nations Development UNDP Programme Supervisory Control and Data SCADA Acquisition United Nations Educational, UNESCO Scientific and Cultural SDO Senior Defense Official Organization SocietyofEnvironmental SETAC United Nations High Toxicology and Chemistry UNHCR Commissioner for Refugees SFA Strategic Framework Agreement United Nations Office on Drugs UNODC SpecialInspectorGeneralfor and Crime SIGAR Afghanistan Reconstruction United Nations Office of Project UNOPS SpecialInspectorGeneralfor Services SIGIR Iraq Reconstruction UNSC United Nations Security Council SIGPRO SIGIR Prosecutorial Initiative United Nations Security Council UNSCR SIV special immigrant visa Resolution Space and Missile Defense USAAA U.S. Army Audit Agency SMDC Command USACE U.S.ArmyCorpsofEngineers SOC South Oil Company (Iraq) U.S. Agency for International USAID SOE state-owned enterprise Development SOI SonsofIraq U.S. Agency for International USAID OE Development Operating StateofLawCoalition SoL Expenses (headedbyNurial-Maliki) U.S. Agency for International Synchronized Predeployment SPOT USAID OIG Development Office of and Operational Tracker Inspector General Iran Power & Water Equipment U.S. Commission on Sunir USCIRF and Services Export Company International Religious Freedom suq market (in Arabic) Under Secretary of Defense USD(P) National Capacity Development (Policy) Tatweer Program (USAID) U.S. Equipment Transfer to Iraq USETTI TBI Trade Bank of Iraq program TCF trillion cubic feet USF-I U.S. Forces-Iraq Task Force for Business and USMC U.S. Marine Corps TFBSO Stability Operations (DoD) U.S. Special Operations USSOCOM Provincial Economic Growth Command Tijara Program (USAID) U.S. Transportation Command USTRANSCOM TNA Transitional National Assembly (DoD) TurkishNationalOilandGas VP vice president TPAO Company WFP World Food Programme (UN) Treasury U.S. Department of Treasury Washington Headquarters WHS The Sandi Group Service (DoD) TSG (DynCorp subcontractor) WTO World Trade Organization Continuednextcolumn

160 I SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

July2011.indb 160 7/25/2011 10:38:21 AM For inquiries, please contact SIGIR Public Affairs: Email: [email protected] Phone: 703.428.1100 Mail: Ofﬁce of the Special Inspector General for Iraq Reconstruction 2530 Crystal Drive Arlington, VA 22202-3940

224-241 Cover CX.indd 2 7/25/2011 9:25:38 AM Help prevent fraud, waste, and abuse by reporting suspicious or illegal activities. Contact the SIGIR Hotline:

WEB: www.sigir.mil/submit_fraud.html PHONE: 703.602.4063 TOLL FREE: 866.301.2003

224-241 Cover CX.indd 1 7/25/2011 9:25:36 AM