US loses track of $12.4bn to Iraq

The United States occupation authority in Iraq disbursed US$8.8 billion ($12.4 billion) to Iraqi ministries "without assurance the monies were properly accounted for", an inspector-general has found.

Stuart Bowen, special inspector-general for Iraq reconstruction, said the money was transferred to government ministries, which lacked financial controls, security, communications and adequate staff.

The US officials relied on Iraqi audit agencies to account for the funds but those offices were not even functioning when the funds were transferred between October 2003 and June 2004

Some of the transferred funds may have paid "ghost" employees. The report said that 8206 guards were on the payroll at one ministry, but only 602 could be accounted for. At another ministry, US officials found 1417 guards on the payroll but could only confirm 642.

The audit also said that at least 232 civilians had been killed while working on US-funded contracts in Iraq.