“60 Minutes” correspondent Steve Kroft has done more than his share of crime and corruption stories over the years, but he was still shocked by what came to be called “The Mother of All Heists”—the outright theft of up to $800 million earmarked for equipping a new Iraqi military under U.S. supervision. Most of the vast sum apparently went to several well-connected insiders now living lives of luxury in exile, out of reach of the Iraqi judicial system.
The “60 Minutes” team traveled to Jordan, Poland and France to track down the story, which they first learned of in a Miami Herald article that didn’t seem to draw much attention. They obtained the Iraqi government report and had it translated.
“It was a really interesting story, but there was almost no coverage here because it didn’t really involve Americans, at least on the surface,” said Mr. Kroft. “We started pursuing it and found the Iraqi judge who was looking into it was going to be in Washington. We met with him in spring 2006, and we thought it was a great story. We tracked down the former head of procurement for the Iraqi government in Poland. He agreed to meet us in Europe.”
In addition, an assortment of arms dealers, bankers, money changers and even a chimney sweep were interviewed for the investigative report. Mr. Kroft and his colleagues discovered that most of the missing millions went to line the pockets of suspects who fled Iraq before they could be arrested.
“As we tried to find people who knew something about it, we were stunned to find no one in the U.S. government was trying to track the money down or arrest or find any of the people involved. The Iraqi government opened something like 2,000 corruption cases relating to this.”
In the “60 Minutes” piece, Mr. Kroft explained that much of the money was Iraqi oil money, some of which was confiscated by the U.S. government and put into the Iraqi treasury. The people in charge of building a new Iraqi military were under U.S. supervision, led by a man whose managerial experience consisted of selling used cars and running a pizza parlor. He was in charge of purchasing $1 billion worth of equipment for the Iraqi military.
“About half ended up in the private bank account of an Iraqi exile and a shell company with a P.O. box in Amman, Jordan. Some money went to other places in Jordan, Dubai and Lebanon. They could never find any of it,” Mr. Kroft said. “The documents were so vague that you didn’t know what was ordered or what was delivered.”
But the story didn’t end there. The funds used as intended bought useless, obsolete military equipment, including Russian helicopters that didn’t fly and Polish armored personnel vehicles that were so underpowered they couldn’t be used.
Part of the problem is that corruption is an endemic part of the culture in the Middle East, Mr. Kroft said. Also, none of the coalition partners seemed to care, much less offered assistance in tracking down the money or those who absconded with it.
For Mr. Kroft, “The “Mother of All Heists” was part of the larger picture of the Iraq war. “The dysfunctionality of the Iraqi government and the huge amounts of oil stolen and sold on the black market are undermining U.S. efforts there,” he said. “Corruption in Iraq is now recognized as one of the major reasons we have not been able to get things under control. There are people more concerned with lining their own pockets rather than seeing a responsible government that can protect the country.”
Credits: Steve Kroft, correspondent; Andy Court, Keith Sharman, producers; Daniel J. Glucksman, editor; Amjad Tadros, field producer, CBS News Amman; Tadd Lascari, Jonathan Schienberg, broadcast associates; Jan Morgan, Jurgen Neumann, camera; Rowland Fowles, Luigi Giuliani, sound; CBS News Baghdad bureau, additional reporting and translation; Michael R. Whitney, senior broadcast producer; Patti Hassler, executive editor; Jeff Fager, executive producer; Sean McManus, president, CBS News