Bilking the US led to raid on Chalabi's home: Iraqi official - Taipei Times
Sun, May 23, 2004 - Page 6 News List

Bilking the US led to raid on Chalabi's home: Iraqi official


An alleged corruption scandal in Iraq's finance ministry was behind the dramatic raid on the Baghdad home of Ahmad Chalabi, the leader of the Iraqi National Congress (INC), coalition officials said Friday.

Iraqi police and US troops who early on Thursday burst into his villa, as well as the INC headquarters nearby, seized items including computers and documents.

Chalabi, a prominent member of the US-appointed governing council, says the raid was a reprisal for his growing criticisms of the US role in Iraq.

Yesterday coalition officials suggested instead that senior members of Chalabi's INC -- a US-funded group that opposed former Iraqi president Saddam Hussein -- were involved in a scam earlier this year when cash went missing from the finance ministry.

The money apparently vanished when the old currency was replaced by new banknotes. The finance ministry found that money given out by banks during the changeover exceeded cash handed in, by the equivalent of about US$21.5 million. In many cases, counterfeit old dinars had been exchanged for genuine new ones.

Iraqi police initially arrested more than a dozen bank tellers, who were accused of fraud.

But in March, Sabah Nouri, a leading member of the INC and the head of the ministry's bank audit, was arrested. He has been in jail ever since, and coalition officials insist that the raid on Chalabi's villa was directly connected with the continuing investigation.

US officials say the Iraqi police were looking for 15 people in connection with "fraud, kidnapping, and associated matters," though they do not include Chalabi.

The kidnapping allegation is thought to relate to the detention of the bank tellers.

Coalition sources recently said Chalabi had insisted on having the old currency incinerated, rather than buried as originally planned -- with the incineration contract going to one of his associates. There have been claims that not all the money was destroyed.

This week the Pentagon announced it was ending monthly payments of US$40,000 to the INC for supplying intelligence. The organization has received a total of about US$33 million from the state department and US$6 million from the defense intelligence agency.

Last night members of the governing council held an emergency meeting and condemned Thursday's raid as a "violation."

"This is largely between the INC and America. But this is a violation of the governing council's rules," a council member, Mahmoud Othman, said.

"He is a member of the council. They should have told us about it. It isn't good," Othman said.

Asked why Chalabi and the US had fallen out, he said: "Lots of people including myself have been criticizing the US. The difference is that I haven't had any money from them."

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