Billions over Baghdad

[unhappycamper]

Pallets of American currency arriving in Baghdad.

Between April 2003 and June 2004, $12 billion in U.S. currency—much of it belonging to the Iraqi people—was shipped from the Federal Reserve to Baghdad, where it was dispensed by the Coalition Provisional Authority. Some of the cash went to pay for projects and keep ministries afloat, but, incredibly, at least $9 billion has gone missing, unaccounted for, in a frenzy of mismanagement and greed. Following a trail that leads from a safe in one of Saddam's palaces to a house near San Diego, to a P.O. box in the Bahamas, the authors discover just how little anyone cared about how the money was handled.


Billions over Baghdad
by Donald L. Barlett and James B. Steele October 2007


Hidden in plain sight, 10 miles west of Manhattan, amid a suburban community of middle-class homes and small businesses, stands a fortress-like building shielded by big trees and lush plantings behind an iron fence. The steel-gray structure, in East Rutherford, New Jersey, is all but invisible to the thousands of commuters who whiz by every day on Route 17. Even if they noticed it, they would scarcely guess that it is the largest repository of American currency in the world.

Officially, 100 Orchard Street is referred to by the acronym eroc, for the East Rutherford Operations Center of the Federal Reserve Bank of New York. The brains of the New York Fed may lie in Manhattan, but xeroc is the beating heart of its operations—a secretive, heavily guarded compound where the bank processes checks, makes wire transfers, and receives and ships out its most precious commodity: new and used paper money.

On Tuesday, June 22, 2004, a tractor-trailer truck turned off Route 17 onto Orchard Street, stopped at a guard station for clearance, and then entered the eroc compound. What happened next would have been the stuff of routine—procedures followed countless times. Inside an immense three-story cavern known as the currency vault, the truck's next cargo was made ready for shipment. With storage space to rival a Wal-Mart's, the currency vault can reportedly hold upwards of $60 billion in cash. Human beings don't perform many functions inside the vault, and few are allowed in; a robotic system, immune to human temptation, handles everything. On that Tuesday in June the machines were especially busy. Though accustomed to receiving and shipping large quantities of cash, the vault had never before processed a single order of this magnitude: $2.4 billion in $100 bills.

Under the watchful eye of bank employees in a glass-enclosed control room, and under the even steadier gaze of a video surveillance system, pallets of shrink-wrapped bills were lifted out of currency bays by unmanned "storage and retrieval vehicles" and loaded onto conveyors that transported the 24 million bills, sorted into "bricks," to the waiting trailer. No human being would have touched this cargo, which is how the Fed wants it: the bank aims to "minimize the handling of currency by eroc employees and create an audit trail of all currency movement from initial receipt through final disposition."

Forty pallets of cash, weighing 30 tons, were loaded that day. The tractor-trailer turned back onto Route 17 and after three miles merged onto a southbound lane of the New Jersey Turnpike, looking like any other big rig on a busy highway. Hours later the truck arrived at Andrews Air Force Base, near Washington, D.C. There the seals on the truck were broken, and the cash was off-loaded and counted by Treasury Department personnel. The money was transferred to a C-130 transport plane. The next day, it arrived in Baghdad.

~snip~

What Washington did not do was mobilize to keep track of it. By all accounts, the New York Fed and the Treasury Department exercised strict surveillance and control over all of this money while it was on American soil. But after the money was delivered to Iraq, oversight and control evaporated. Of the $12 billion in U.S. banknotes delivered to Iraq in 2003 and 2004, at least $9 billion cannot be accounted for. A portion of that money may have been spent wisely and honestly; much of it probably wasn't. Some of it was stolen.


Rest of article: http://www.vanityfair.com/politics/features/2007/10/iraq_billions200710

[whistle]

1. Three quarters of the cash gone missing, any CPA/auditor from Las Vegas

...could have predicted that was going to happen!

[unhappycamper]

2. Kick to get off page 4. n/t

[City Lights]

3. Thanks for posting this, unhappycamper.

I don't have time to read this right now, but plan to read it later today.

[AuntPatsy]

4. Where is the outrage? One can hear a pin drop from our ever faithful

and factual news media outlets on this very issue that should have been more heavily investigated by now but has been virtually ignored, American tax payers should be protesting in the streets on a daily basis until this present regime is outed for it's many crimes.

[flashl]

5. Similar stories have been around for a long time and no takers

I am reasonably sure a search in a few search engines for C130+pallets+money will produce several stories.

Since Paul Bremer has resurfaced, this would be a good time to ask him again, where did the money go?

[bunkerbuster1]

6. umm... SURGE! PROGRESS! Lookee these MEDALS! Pay no attention

...to the missing pallets of cash.

I'm literally sick whenever I think about this, and I congratulate VF for getting this story out at a time when we badly need an antidote to this stupid "4-Star-General-Tells-Us-What-We-Expect-To-Hear" non-story.