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Watchdog: Follow the Money

IG exposes USAID spending millions on Afghan program despite fraud risk

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Watchdog,Watchdog Blog,Michal Conger,Afghanistan,USAID,Inspectors General,Waste and Fraud,Follow the Money,France

American tax dollars funding a public health program in Afghanistan could be wasted by the Afghan government, but the U.S. agency overseeing the program isn't doing its job, according to the Special Inspector General for Afghan Reconstruction.

The U.S. Agency for International Development allocated $236 million in 2008 to the Afghan Ministry of Public Health for contracts with nongovernmental organizations providing health services at local clinics and hospitals.

The Afghan ministry's audit, budget and accounting processes are unreliable, putting the funds at risk of being lost due to waste or fraud, according to an assessment USAID released in April 2012.

The problem now is that USAID doesn't know if the Afghan government has addressed those weaknesses, but has continued to spend money through the program. About $127 million of the grant has been spent, and a total of $190 million has been obligated.

"In SIGAR’s view, USAID’s decision to continue disbursing funds to the Ministry of Public Health with little to no assurance that these funds are safeguarded from waste, fraud, and abuse raises serious concerns about the integrity of the ... program," said SIGAR Inspector General John F. Sopko in a report released Thursday.

USAID officials claim their agency's financial controls and the guidance they've given Afghan officials are sufficient to protect U.S. taxpayers, according to Sopko.

"Alarmingly, a USAID official told SIGAR that the agency has no obligation to address the deficiencies identified or to verify any corrective actions that the MoPH may have implemented for the ongoing PCH program. In SIGAR's view, this is a reckless disregard toward the management of U.S. taxpayer dollars," said a SIGAR spokesman in a statement.

With $49 million remaining in the program, the IG recommended that funding be withheld until USAID validates Afghan cost estimates, and make future funding contingent on stronger internal controls. SIGAR also recommended USAID return any improperly spent money to the U.S. Treasury or put the funds to better use.

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