Wednesday, April 15, 2009

XINHUA: UN/UNDP investigates itself over allegations of fraud in Afghanistan

UNITED NATIONS, April 14 (Xinhua) -- The United Nations Development Program (UNDP) is "clearly disturbed" over allegations that it has refused to cooperate with investigations into squandered grant money from a U.S. aid agency to be used in Afghanistan reconstruction projects, UNDP spokesman Stephane Dujarric told reporters here on Tuesday.

    "The UNDP is angry over any misconduct," Dujarric told a press conference here, adding that the United Nations was conducting an audit and an investigation of its own.

    A recent investigation conducted by the United States Agency for International Development (USAID) acquired by U.S. newspaper USA Today through the Freedom of Information Act depicted a scene of gross mismanagement of USAID funds by the UNDP under the Quick Impact Projects (QIP), a 25.6 million U.S. dollars cooperative agreement to generate jobs in reconstruction infrastructure projects throughout Afghanistan.

    The UNDP subcontracted QIP projects to the United Nations Office for Project Services (UNOPS), which then subcontracted the projects to local contractors, in what has been called "ill conceived from the beginning," according to one unnamed USAID contractor.

    Dujarric told reporters that the vast majority (of QIP projects)were completed successfully despite that the USAID investigation claimed projects worked on by UNOPS "were not completed as claimed" and had "defects and warranty issues that UNDP refuses to address."

    Even with design errors, missing equipment and materials, and shoddy repairs, investigators found that UNDP withdrew 6.7 million dollars from a U.S. line of credit without permission in 2007, several months after the project had officially ended. The report says the UNDP has failed to disclose where the money went.

    "Any money that is in dispute will be refunded to USAID," said Dujarric, adding that it would be "no more" than 1.5 million dollars.

    According to USA Today, USAID hired a collection agency seeking7.6 million dollars from the UNDP.

    About 10 million dollars of USAID grant money was siphoned to projects in other countries, including Sudan, Haiti, Sri Lanka and Dubai, according to a UN employee questioned during the investigation.

    The UN acting administrator is currently conducting an audit of the grant money spent, said Dujarric, as the QIP contract only allowed for UN audits.

    The USAID investigation raised concerns that UN envoys enjoy broad immunity, but Dujarric said that if investigations find "fraudulent" acts were committed, suspect parties would be held accountable in a court of law either in Afghanistan or in New York.

    "No one is hiding," Dujarric said and stressed that UNDP's relationships with donors are its "lifeblood."

    The 14-page report from the USAID investigation highlights several QIP projects that were labeled "complete" but were later deemed unsatisfactory by the USAID's inspector general investigation including:

    An unnamed employee, who worked for UNOPS for less than one year, called an airstrip in the southern town of Qalat "shocking," as it was little more than a dirt strip. The project cost 749 million dollars despite an original price tag of approximately 300million dollars.

    A central bank, which cost 375 million dollars to rebuild, lacked electricity or plumbing, and the basement flooded every time a tree outside was watered, destroying stacks of local currency. "The bank's manager built a clay dam at the base of the stairs in an unsuccessful attempt to stop this," said the report.

    A Dec. 31, 2006 UNOPS update mailed to the USAID/Kabul Mission, called the 250,000 dollars Tamak River Bridge "100 percent completed" by Dec. 31, 2005. But the USAID investigation found that "it was clear that significant work still needed to be done to make this bridge safe." 

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