28 Jul 2010

US military asked to accound for Iraq funding

11:20 am on 28 July 2010

A federal agency says the United States military has failed to properly account for $US8.7 billion it received for rebuilding Iraq.

The Special Inspector General for Iraq Reconstruction says that $US8.7 billion out of just over $US9 billion is unaccounted for.

The US military said the funds were not necessarily missing, but that spending records might have been archived.

In a response attached to the report, the military said attempting to account for the money might require "significant archival retrieval efforts".

The BBC reports the funds are separate from the $US53 billion allocated by the US Congress for rebuilding Iraq.

Much of the money came from the sale of Iraqi oil and gas, and some frozen Saddam Hussein-era assets were also sold.

The money was in a special fund administered by the US Department of Defense, the Development Fund for Iraq and was earmarked for reconstruction projects.

But the report says that a lack of proper accounting and poor oversight makes it impossible to say exactly what happened to most of it.

According to the report, the Pentagon is unable to fully account for $US8.7 billion withdrawn between 2004 - 2007. Of that amount it "could not provide documentation to substantiate how it spent $US2.6 billion".