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The US Cuts Chalabi’s Funds


Amidst rumors of fraud and double-dealing, the tables have turned against the Ahmed Chalabi and his organization, once praised by the Bush administration. Just two days after Washington announced it would no longer fund Chalabi’s Iraqi National Congress, US troops and Iraqi police reportedly stormed the group’s offices and sacked its leader’s Baghdad residence.

Chalabi, a former exile from Iraq, was controversially appointed to the Iraq Governing Council (IGC) shortly after the US-led occupation began last year. He also remained head of the US-backed Iraqi National Congress (INC), the organization of Saddam-era exiles that White House and State Department officials credited with supplying much of the information they used to argue for the hurried March 2003 invasion of Iraq.


On Tuesday, both the Pentagon and the INC itself announced that US taxpayers would no longer be supplying the INC with the $335,000 per month the group had been receiving to provide information gathering services for US military units and intelligence agencies. A report released yesterday by Congressional auditors at the Government Accounting Office put the total paid to the INC since 1998 at $33 million.


Addressing an Iraqi audience, meanwhile, the INC denied it received US funding in the first place. In the INC’s own Arabic language newspaper, Al-Mutamar, an INC leader wrote that the organization is supported solely by member donations, according to an Institute for War and Peace Reporting brief .


That claim notwithstanding, the official reason support was to be halted, according to both Assistant Secretary of Defense Paul Wolfowitz and an INC spokesman who talked to the New York Times, is the planned June 30 transfer of limited authority in Iraq to a UN-appointed regime. In fact, according to Tuesday’s statements, US funding was to continue until that date.


But the funding policy change, which both parties explained as the natural evolution of the transfer of power in Iraq, appeared more adversarial after yesterday’s developments.


Iraqi police and American soldiers conducted early morning raids Thursday on two INC offices in Iraq as well as on Chalabi’s own upscale dwelling. Between the three sites, they confiscated numerous documents, computers and firearms, according to the Washington Post.


US-backed Iraqi forces also arrested at least three members of Chalabi’s private militia, reports the Post, pursuant to what Iraqi judge Hussein Muathin told reporters were warrants handed out against some 15 INC members. The arrest warrants were said to list charges involving theft, fraud, kidnapping, torture and “associated matters.” Both the judge and US officials refused to be more specific.


US officials insist the raid was an Iraqi-run operation, though INC members who witnessed the raids told several news sources that plain clothed American agents were present at two of the three scenes and gave orders to Iraqi personnel in at least one case. Coalition Provisional Authority (CPA) spokesperson Dan Senor said at a Thursday briefing that the entire investigation of the matter is being headed by Iraqi police.


At a press conference held shortly after the raids, Chalabi himself said that among the files confiscated yesterday morning were documents the INC was using to investigate alleged fraud in the United Nations Oil-for-Food program. The UN project provided humanitarian aid to Iraq under sanctions in exchange for crude oil exports, and also, according to the US government, lined various undeserving pockets.


Chalabi said the troops who stormed his house vandalized it and helped themselves to food in the refrigerator, reports the Times. He showed reporters around shortly after the raid, pointing to extensive damage consistent with the US Army’s heavy-handed method of searching Iraqi homes.


At the press conference, Chalabi was sharply critical of the Coalition Provisional Authority’s recent trend toward reinstating former Ba’athist officials. Claiming he is “America’s best friend in Iraq,” Chalabi also decried the plan to delay elections until early 2005 and called on the West to “let my people go.”


The week’s developments appear to be a climax of the tension and animosity that has developed between Chalabi and US government officials, most notably CPA chief Paul Bremer. A flurry of speculation and rumors accompanied the week’s events, blurring the story even further.


In one additional development, unnamed Pentagon officials have reportedly told Leslie Stahl of CBS News that Chalabi is suspected of providing intelligence to Iran, a charge Chalabi denies. Stahl said she was also told that one of Chalabi’s top aides is believed to be working for Iranian intelligence. The former exile is widely reported to have longstanding ties among hardline operatives in Iran.


In light of Chalabi’s fall from the Bush administration’s favor and severe doubts about his ability to gain popular support among Iraqis, the suggestion that he has turned to connections with a neighboring power currently considered hostile to US interests in the region would presumably be unsettling to Washington.


Such a development could lend weight to an argument made by journalist Andrew Cockburn who wrote in CounterPunch yesterday that Chalabi is scheming against the US, the UN and the interim Iraqi government, which is still in development. Citing an anonymous source close to Chalabi, Cockburn suggested that Chalabi has “in effect been laying the groundwork for a coup, assembling a Shia political coalition with the express aim of destabilizing” the government slated for installation on June 30, “even before it takes office.”


With Chalabi’s dependability in question, other concerns arise regarding the US-led coalition’s vulnerability to the former exile’s followers. According to United Press International, the Pentagon is highly dependent on the main INC operation it funded, known as the Information Collection Program. UPI quotes a US government official as saying the Program “provided the entire personnel list” to staff the new Iraqi Intelligence Service. Pentagon documents state the Program has been highly effective and plays a key role in coalition efforts to extinguish grassroots resistance to the occupation, suggesting agents close to Chalabi may have highly sensitive information and access of value to parties interested in undermining US efforts.


As many questions about these latest developments go unanswered, older controversies remain unsettled, and they are only likely to be rekindled by this week’s events. The Iraqi National Congress has faced increased scrutiny in recent hearings on Capitol Hill, as the Bush administration has blamed its poor pre-war intelligence largely on claims made and raw information provided by Chalabi and the Iraqi defectors he presented as informants.


Among the assertions leveled by the Iraqi National Congress in the run-up to war but later proved false: that Iraq possessed and was building weapons of mass destruction; that Saddam Hussein’s regime had ties with Al-Qaeda operatives; and that invading Western troops, as well as Chalabi himself, would be welcomed with open arms by the Iraqi people.


Some administration officials have conceded that Chalabi’s group intentionally misled the CIA and other agencies, and Chalabi himself has publicly stated that a misinformation campaign was part of the US-backed INC’s strategy to coax the world into removing Saddam Hussein.

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