The U.S. Agency for International Development has suspended a $644 million Iraqi jobs program amid concerns about misspending and an allegation that millions of dollars may have ended up in the hands of insurgents, according to a USA Today report.
The Community Stabilization Program began in 2006 and "is generally thought of as one of the most effective counterinsurgency efforts in Iraq," Deputy Secretary of State Jacob Lew told USA Today.
The program is designed to pay Iraqis for performing jobs such as trash removal and ditch digging. However, a March 2008 audit by USAID’s inspector general found overbilling and payments to ghost employees, the paper noted.
Included in the audit was a letter from an official with a provincial reconstruction team. The official wrote that "millions of dollars from these projects were fraudulently going to insurgents, as well as to corrupt community leaders and [program] representatives."
Financial safeguards were put in place, but this year the inspector general said that "inconsistencies" regarding payouts continued, and USAID halted payments to the program on July 4, USA Today wrote.
Four former employees of International Relief and Development, which ran the program, told the paper that $10 million was spent questionably in the city of Mosul alone.
One employee said millions were allocated for projects that didn’t exist, and documents for them were faked.