Wednesday, April 18, 2018

Ziad Qatan, Allawi Govt Defense Official Wanted For Corruption Extradited By Jordan


On April 15, 2018, a former Defense Ministry official under Prime Minister Iyad Allawi was extradited by Jordan. In September 2017, a Jordanian court approved Ziad Qatan’s deportation to Iraq, and he was arrested in January 2018. He finally arrived in Baghdad in April to coincide with the 6th ministerial conference of the Arab Network for the Promotion of Integrity and Combating Corruption. Premier Haidar Abadi’s office trumpeted his detention as a sign that the government was following through with its promise to fight corruption. That is a main part of the PM’s re-election campaign. Ziad Qatan is accused of stealing up to $800 million during the Allawi period.

Qatan was the head of procurement for the Defense Ministry during the interim government, and used that position to enrich himself. Qatan spent 27 years in exile in Europe before the 2003 invasion. He was hired by the Coalition Provisional Authority as a district councilor and then moved to the Ministry of Defense. While there he claimed to have signed arms deals with Poland, Arab countries, and the U.S., but they were in fact with Iraqi businessmen who acted as middlemen. In August 2005, the Jaafari government opened an investigation into some of these purchases and found huge amounts of graft. (1) In one case, $236 million was spent to buy helicopters, ambulances, pistols, machine guns, armored cars, and water tanks. The helicopters turned out to be 28 years old, the armored cars were made so badly that small arms fire could penetrate them, and MP5 sub machine guns bought for $3,500 each turned out to be Egyptian copies that only cost $200 a gun. The equipment was so bad that the Defense Ministry refused all of it. In another deal ammunition that only cost ¢4-¢6 apiece was bought for ¢16 a bullet. This was just the tip of a larger iceberg of Defense Ministry officials who might have stolen over $1 billion.

The Board of Supreme Audit found that Qatan and other Defense Ministry officials were using three main Iraqi middlemen for these arms deals. They were given no bid contracts that were never approved by the prime minister’s office. All were paid in cash up front. For example, Nair Mohammed al-Jamili who was a former currency exchanger received 43 contracts worth at least $759 million. U.S. and British advisers warned PM Allawi about the corruption, but nothing was done at the time. In May 2005 Qatan was fired and an arrest warrant was quickly issued for him. He ended up fleeing Iraq.

This was the second major ex-official to be extradited to Iraq for corruption. In January 2018, former Trade Minister Abdul Falah al-Sudani was detained by Lebanon and sent to Baghdad. This is part of PM Abadi’s anti-corruption campaign, which he announced after the victory in the war against the Islamic State. There are two mitigating factors however. First, theft and bribery is institutionalized within Iraq and is used by the ruling parties to run the country. Until there is political will to challenge this system, and those at the top are held accountable there is no serious effort to fight it. Hence both Qatan and Sudani are from former governments, and can therefore be put on trial and jailed because their patrons and political parties have no vested interest in them anymore as they hold no office. Second, the Amnesty Law allows those charged with financial improprieties to pay back the money they stole and be released. Sudani who was accused of embezzling billions will likely go free under this legislation. It’s unknown if Qatan still has any of his riches, but it shows another loophole through which the corrupt can escape justice.

FOOTNOTE

1. Mroue, Bassem, “Defense Ministry accused of corruption in overspending,” San Francisco Chronicle, 8/3/05

SOURCES

Abu Zeed, Adnan, “Iraq takes custody of officials wanted in corruption probes,” Al Monitor, 1/31/18

Al Alam, “Al-Abadi announces the arrest of Ziad al-Qatan,” 4/15/18

Allam, Hannah, “Audit: Fraud drained $1 billion from Iraq’s defense efforts,” Knight Ridder, 8/11/05

Cloud, David, “Worry Grows as Iraq’s Defense Ministry Falls Short of Expectations,” New York Times, 8/3/05

Cockburn, Patrick, “What has happened to Iraq’s missing $1bn?” Independent, 9/19/05

Kazimi, Nibras, “In New Book, Bremer Mistakenly Exposes Relationship with Former Protégé, Wanted Fugitive,” Talisman Gate, 1/19/06

Mroue, Bassem, “Defense Ministry accused of corruption in overspending,” San Francisco Chronicle, 8/3/05

NINA, “Abadi Office Announces The Arrest Of One Of The Biggest Accused Of Corruption And Brought Him To Iraq,” 4/15/18
- “Al-Abadi Sponsors the 6th Ministerial Conference of the Arab Network for the Promotion of Integrity and Combating Corruption,” 4/15/18

Sotaliraq, “New details about the arrest of Qatan in Baghdad,” 4/17/18

Vulliamy, Ed and Norton-Taylor, Richard, “Millions embezzled at Iraqi ministry,” Guardian, 8/22/05


2 comments:

Humam Misconi said...

Joel,

The report mentioned Iyad Allawi 3 times but never mentioned Hazim Al Sha’alan, the Minister of Defense, Qatan’s direct supervisor, who is fugitive as well and lives in UK.

Also, there is no way that Qatan can manage this huge corruption alone without collaborators within the Ministry of Defense, but Qatan is the scapegoat!

Joel Wing said...

There were a bunch of Defense officials accused of corruption at the time. Qatan as head of procurement was obviously at the top of the list at the time. For whatever reason the Defense Minister wasn't singled out as much.

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