Utah Rep. Chaffetz: Probe USAID's Afghan 'Slush Fund'

Image: Utah Rep. Chaffetz: Probe USAID's Afghan 'Slush Fund'

Monday, 14 Apr 2014 10:20 AM

By Sharon Churcher

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The chairman of a key House oversight panel is calling for an investigation into whether the U.S. Agency for International Development is using a $175 million "slush fund" to make payoffs to Afghan government officials.

The aid agency claims it set up the Afghan Incentive Fund to "drive reforms" in the war-torn nation, which has long been plagued by corruption.

But Utah Republican Rep. Jason Chaffetz, whose House Oversight and Government Reform subcommittee oversees USAID spending in Afghanistan, told The Washington Times that he didn't hear about the fund until a heated exchange with the agency’s top official at a hearing last week. "Something here doesn’t smell right," he said.

Comments by the official made the money "sound like a slush fund for manipulating how members of the Afghan parliament act," he told the newspaper. "How has it been used, and who did we pay off with it?"

In a letter April 11, Chaffetz requested an investigation by the Special Inspector General for Afghanistan Reconstruction (SIGAR), John F. Sopko, into the fund, saying he questioned whether it "is necessary and effective.’

About $20 billion has been channeled into Afghan reconstruction over the past 12 years.

Sopko's auditors recently accused USAID of attempting to conceal corruption within all 16 of the Afghan government ministries that receive agency money.

They reported that there is a high risk of assistance being stolen or wasted. One example is the Afghan Mine Ministry, which it said is potentially "paying higher prices for commodities and services to finance kickbacks and bribes."

In another, the Afghan Ministry of Rural Rehabilitation and Development does not have a mechanism "for screening of beneficiaries for their possible links with terrorist organizations before signing contracts or providing funds to the suppliers."

The study was so negative that USAID officials pushed SIGAR to keep it a secret. Their request was denied based on the public’s right to know.

USAID defended its oversight.

"The funds earned by the Afghan government for achieving the reform targets are placed into the World Bank’s Afghanistan Reconstruction Trust Fund, which is subject to strict oversight and safeguards," said Kathleen Campbell, deputy assistant administrator in USAID’s Office of Afghanistan and Pakistan Affairs.

"The incentive funds for civilian aid projects are drawn from existing Afghan assistance programs and do not represent an increase in overall Afghanistan funding. The United States committed to tie $175 million to incentive funding to drive reforms within the Afghan government. There has been some progress, but we have already withheld $30 million because the Afghan government has not achieved all of the targeted reforms."

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