US taxpayers’ Afghan aid money buys rich Afghans’ Dubai villas

By
John Byrne

Tuesday, July 6th,
2010 — 8:57 am


You already might have heard
that it costs the United States $1 million for each
solider
per year in Afghanistan, to cover the cost of the soldiers’
benefits, troop transports and other material. What you might not have
heard is that your hard earned taxpayer dollars are also being used to
buy well-connected Afghans posh villas in Dubai.

Der
Spiegel remarks curtly
, "Amid concerns that the money could be the
result of corruption, American politicians have temporarily cut off aid
to the Afghan government." The German daily adds:

…Huge amounts of money [are] regularly being secreted out of
Afghanistan by plane in boxes and suitcases. According to some
estimates, since 2007, at least $3 billion (€2.4 billion) in cash has
left the country in this way. The preferred destination for these funds
is Dubai, the tax haven in the Persian Gulf. And, given the fact that
Afghanistan’s total GDP amounts to the equivalent of $13.5 billion,
there is no way that the funds involved in this exodus are merely the
proceeds of legal business transactions…

It is clear that much
more money is making its way out of Afghanistan through Kabul’s airport
than is being officially declared and logged. For example, important
politicians and businesspeople can often board planes from the airport’s
special VIP area without being searched. And if customs officials do
conduct a search and find a suitcase stuffed with millions of dollars in
cash, people with powerful connections often step in to make sure that
the luggage makes it out of the country with its owner — no questions
asked. "A couple phone calls are made," General Jabarkhel says with
frustration in his voice, "and the person can carry on."

To
where does this generous US foreign aid travel?

A number of Afghan businesspeople have purchased expensive villas in
Dubai, once only attractive as a golfer’s paradise. These include a
brother and a cousin of Afghan President Hamid Karzai, one of Karzai’s
former vice presidents and the brother of Mohammad Qasim Fahim, one of
the country’s two current vice presidents. Asking prices for the
stylish, Roman-style houses built along the beaches of the man-made
island Palm Jumeirah, for example, start at $2 million. Until just a few
years ago, many of their current inhabitants were far from wealthy.

As
the Washington Post has discovered, these properties are often only
registered under the names of the individuals issuing the loans, such as
Sherkhan Farnood, the founder and chairman of Kabul Bank, Afghanistan’s
largest private bank, who was also a key supporter of President Karzai
during his 2009 re-election campaign. Like many of his clients, Farnood
now spends the majority of his time in Dubai. And among the 16
shareholders in his bank are Mahmoud Karzai, the president’s
business-minded older brother, and Haseen Fahim, the brother of Afghan
Vice President Mohammad Qasim Fahim.

Most financial transactions
in Afghanistan continue to be conducted through so-called "hawalas,"
traditional Islamic money-transferring outfits based more on honor and
good faith than receipts, a fact that makes it more or less impossible
for Western corruption investigators to trace the flow of money.

US
taxpayers are also footing an enormous bill for the Pentagon’s use of
fuel in the landlocked nation. In 2008, the price of gasoline in the
United States topped the $4 per gallon mark.

This year in
Afghanistan, the price has topped $400.

The stunning
revelation emerged in October 2009
in a report from the Pentagon to
House officials. The information conveyed offers new insight into a
recent report by the Congressional Research Service, which found that
the US spends $1 million per year for each servicemember on the ground
in Afghanistan.

Why so much? The cost includes shipping, which
sometimes includes the pricetag of a helicopter flight. Sending fuel by
helicopter is woefully inefficient, because it uses up almost as much
fuel as it carries.

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