Faulty Database Blinds Iraq Reconstruction Accounting

By Deborah Gage  |  Posted 2007-10-26 Email Print this article Print
 
 
 
 
 
 
 

A faulty database has prevented federal auditors from tracking more than $7.3 billion earmarked for the reconstruction of Iraq, according to USA Today. As a result, federal auditors still don't know how much waste and fraud has occurred.

A faulty database has prevented federal auditors from tracking more than $7.3 billion earmarked for the reconstruction of Iraq, according to USA Today. As a result, federal auditors still don't know how much waste and fraud has occurred.

The database was recommended in April 2005 by Stuart Bowen, the special inspector general for Iraq reconstruction. The following September, New York-based Reviewer Management International was hired to create the database so the U.S. could track which spending contracts were authorized by which officials. RMI was given a $1.5 million contract by an Army contracting office in Baghdad.

Bowen found that the contract didn't clearly describe how to build the database and RMI didn't deliver one that was usable. In a report on the status of reconstruction funding, a military contracting official described the database as "a collection of records that were not audited or effectively connected to one another."

The Army office that hired RMI finished the database and turned it over to the Iraqi government in December, Bowen said. His office is still investigating.

RMI was incorporated less than seven weeks before getting the contract, which was "sole-source," according to USA Today. Sole-source contracts are awarded when only one company is considered able to do the work in the time allotted. RMI's chairman Robert Raggio did not return calls from the newspaper seeking comment.

In September, USA Today reported that Raggio wrote the requirements for the contract to build the database at the same time he was negotiating to get it for RMI. Raggio was then managing finances for the U.S.'s Accelerated Iraq Reconstruction Program. He resigned his job the same day RMI got the contract.

The reconstruction money is funded by Iraq's oil proceeds and is in an account called the Development Fund for Iraq. It was authorized by the United Nations in 2003 after the invasion of Iraq. The U.N. gave the provisional Iraqi government, then led by the U.S., control over the fund.

Bowen's office has been investigating the fund since 2004 and has found several cases of fraud and mismanagement.

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Senior Writer
debbie_gage@ziffdavisenterprise.com
Based in Silicon Valley, Debbie was a founding member of Ziff Davis Media's Sm@rt Partner, where she developed investigative projects and wrote a column on start-ups. She has covered the high-tech industry since 1994 and has also worked for Minnesota Public Radio, covering state politics. She has written freelance op-ed pieces on public education for the San Jose Mercury News, and has also won several national awards for her work co-producing a documentary. She has a B.A. from Minnesota State University.

 
 
 
 
 
 

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