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ARAFAT'S RAMPANT CORRUPTION
.
COURAGEOUS PALESTINIAN
COUNCIL TAKES BOLD ACTION
ARAFAT DOES NOTHING.
CORRUPTION CONTINUES UNCHECKED
MER - Washington - 6 Sept:
There is no State of Palestine and the situation
is far more comparable to the Apartheid of old in South Africa than freedom.
Indeed, the Palestinian people face a situation far worse today than was
the case before the Intifada. The recent bold effort by the "Palestinian
Legislative Council" to expose the extreme and blatant corruption
by the Israeli-created "Palestinian Authority" is quite unique.
The following article will appear in the September-October issue of Challenge
Magazine about why and how the Palestinian Council spoke up in such an
unprecedented manner.
.
SOMETHING'S ROTTEN IN THE NONSTATE
OF PALESTINE
CORRUPTION UNDER ARAFAT: THE LEGISLATORS
SPEAK
by Roni Ben Efrat with Assaf Adiv &
Stephen Langfur
.
Within the Palestinian Authority (PA) there is
an office entitled General Control (GCO). In May it issued a report that
included a startling claim: because of corruption $326 million, roughly
one fourth of the PA's budget, disappeared in 1996. The Palestinian Legislative
Council (PLC), which is elected by the people, commissioned nine of its
members to check these findings. On July 29 they presented their report.
In a stormy Council session, which Arafat did not bother to attend, the
legislators called on the president to dissolve his government by September,
form a new one based on experts, and bring those suspected of corruption
to trial. Some of the gravest suspicions concern two of Arafat's senior
ministers, Nabil Sha'at and Jamil Tarifi.
.
I asked Dr. Kamal Sharafi, who headed the committee
of nine, why the Council found it necessary to check the report of the
PA's comptroller. Sharafi: "The GCO report was an important contribution
toward correct administrative procedures, but it had flaws. There were
simple arithmetical errors. In many cases the GCO inspectors had written
detailed accounts which did not make it into the final version. Many violations
were ignored or left hanging. The main problem, though - which we have
tried to correct - was the lack of conclusions. The GCO report failed to
accuse persons by name, whether directors or ministers. You might have
thought it was the Palestinian people that had stolen the money! The GCO
did not ask the Attorney General to formulate indictments. The result was
a series of wishy-washy, toothless recommendations, calling weakly for
reform and delivering a few hazy warnings, whereas what was needed was
a cry for legal action." The PLC Committee's "report on the report"
notes further flaws.
.
(1) The GCO failed to check important companies
and public institutions that receive funding from the PA. These include
the Petroleum General Commission, the al-Baher Company, the Tobacco Company,
and the Palestinian Broadcasting Corporation. (Challenge has reported on
the corruption in several of these; see Issues 39 and 43.)
(2) The GCO confined itself almost exclusively
to Gaza. Its report covered less than a tenth of the ministries, institutions,
municipalities, and non-governmental organizations receiving benefits from
the PA.
(3) It stayed clear of the many security forces,
although the Council turned up evidence that they are full of illegal practices,
meddling where they have no business. The GCO also kept away from President
Arafat's office. (PLC Report, pages 3,4, and 30.)
.
The PLC Committee's mandate restricted it to
checking the GCO report. It could not undertake an independent investigation
into areas which the latter had not touched. Despite this limitation, and
despite lack of cooperation on the part of the PA comptroller as well as
several ministries, the findings are chilling. The overall picture is one
of a mafia-style government, where the main point of being in public office
is to get rich quick. The Palestinian citizen, after thirty years of neglect
under Israel, has fallen into the hands of a ruling class whose motto appears
to be, "Eat, drink and be merry." The PA budget and the funds
from the donor nations flow around and around within the closed circle
of the few, who live a life of luxury while the people they are supposed
to serve go hungry. In matters of health care and basic commodities, says
the PLC Committee, the little person is a victim of dubious deals between
the Palestinian and Israeli ruling elites. This conclusion may seem sweeping,
but it arises from every page of the Committee's report. Except for the
Ministry of Education and that of Statistics, even the few untainted offices
are described as inefficient and unprofessional. The report notes excessive
duplication of tasks and overlapping of responsibilities, especially between
the West Bank and Gaza.
.
The PLC Committee cites many kinds of corruption.
There are ministers who violated their responsibilities to the point of
endangering lives. There are unsupervised bank accounts containing what
are supposed to be public funds. There are cronyism and nepotism, monopolies,
releases from customs. Wherever greed can get its foot in, the space appears
to have been filled. In this article we shall concentrate on three ministries
where corruption is especially rife. We shall then briefly survey most
of the others.
.
1. The Ministry of Health (Minister:
Riad al-Z'anoun)
Bad or expired drugs were used to treat cancer
patients in ministry medical centers. With regard to other medicines as
well, the Gaza branch of the ministry used drugs which the West Bank branch
had rejected because they failed to meet specifications and had not been
registered. Suspicion: Health ministry officials were (and are) in cahoots
with a company called Al-Shifa, which imports medicines into Gaza. The
report names Dr. Ziad Sha'th, general director of the ministrys pharmaceutical
division, who allowed Al-Shifa to bring in the unregistered drugs on the
pretext that registration was underway.
.
On another get-rich note, Al-Shifa imported several
drugs as donations from Egypt: exempt, therefore, from customs and value-added
tax (VAT). It then turned around and sold them to the Health Ministry including
customs and VAT. Suspicion: Al-Shifa was aided in this exercise by one
Khamis Najjar, a director of the ministry in Gaza, and by the Minister
of Civil Affairs, Jamil Tarifi, a name we shall soon encounter again. The
Committee recommended that Arafat direct the PA Attorney General to prosecute
the three men named above.
.
In addition, a fifth of the Health Ministry's
budget went to medical expenses abroad. ("Abroad" includes Israeli
hospitals.) The Council found this figure rather high. In some cases it
was Arafat who ordered the transfer of patients abroad; he had the Finance
Ministry deduct the money from the Health Ministry's budget without notifying
the latter. There is also the case, still pending, of Dr. Ibrahim Abu Hmeid,
who was appointed to coordinate the distribution of patients among hospitals
in Jordan. Several Jordanian hospitals have accused him of receiving bribes
and embezzling funds. The Committee asserts that he had accomplices. Its
report also raises the inevitable question: Where in all this was the Minister
of Health? (PLC Report, pp. 7-8.)
.
2. The Ministry of Planning and International
Cooperation (Minister: Nabil Sha'at)
.
Nabil Sha'at is known to millions as one of the
chief Palestinian negotiators.
.
The council found many offenses. For example,
any ministry is supposed to open a separate account with the Ministry of
Finance for each of its projects. Thus Finance holds the money given by
funders for the project, and it can supervise expenditures. Sha'at's ministry,
however, opened separate accounts. Thus ministry officials could conspire
with officials of a donor country, open an account together, and manipulate
the funds without the knowledge of Finance. This practice has also opened
the door for ministry officials to appoint themselves to jobs in the ministry's
projects, giving themselves fat second salaries. The private account gives
rise to another perk as well: You hire someone to a project for a large
salary, but by prior agreement you pay the person less. The difference
goes into what is called a "black box." Sha'at and his director-general
control the black box. They hid it from the GCO, but the Council Committee
found it.
.
Other ills in the Ministry of Planning: * Tenders
were granted under suspicious circumstances to companies with family connections
to people in the ministry. * Within the ministrys projects, there was
often no regard for budgets; purchase prices were high; there was a lack
of competition and a lack of transparency. * The ministry used project
funds to cash personal checks for the Minister.
These practices have damaged the PA'ss credibility
with the donor nations.
The Committee has called for an investigation
of Nabil Sha'ath together with three of his deputies. (PLC Report, pp.
15-16.)
.
3. The Ministry of Civil Affairs (Minister:
Jamil Tarifi)
.
The Committee devotes four closely-written pages
to this ministry, to which the GCO had given only scant attention.
.
The largest area of offense concerns the granting
of exemptions on import duties, especially in the matter of automobiles.
This can be a lot of money: the duty can amount to half the price of the
(pre-duty) car. The right to grant customs exemptions is vested in the
Finance Ministry, not in Civil Affairs. The latter was able to get a foot
in, however, in the following manner: All imported goods must enter through
Israel. Israel collects the customs on goods which are destined for the
Palestinian areas and then transfers this money to the PA. Someone from
the PA had to be present at the Israeli gateways, therefore, to tell the
Israelis which goods to exempt. Logically, this should have been someone
from Finance, but in fact it was Civil Affairs Minister Jamil Tarifi who
got the task, perhaps because of his many Israeli connections, which date
from before the Intifada. Infringing on the prerogatives of Finance, Tarifi
personally exempted cars, furniture, and other goods, including the medicines
mentioned above. The paperwork was slipshod or nonexistent. Many cars,
after receiving Tarifi exemptions in the name of this or that governmental
body, were converted to private ownership. This was the case, for example,
with a certain Mercedes, which wound up belonging to none other than...
the Coordinator of Customs Exemptions in the Ministry of Civil Affairs.
At Oslo Israel permitted a few thousand PLO members
to return. The PA granted them exemptions from customs. This opened the
door to abuse: many a car was exempted on the fictitious claim that it
belonged to a returnee. Such a one is Ibrahim Awad Abdel Qader Salameh,
75 years old, supposedly the proud owner of a brand new Jaguar. He does
not get to use it much. The family members of Minister Tarifi are always
taking it out for a spin.
.
A country without industry or natural resources
depends heavily on customs duties. The loss of money through false exemptions
amounts to a serious blow.
.
Tarifi's list goes on. Israel issues work permits,
and the PA's ministries of Labor and Interior are supposed to distribute
them. But here too Civil Affairs got a foot in -- again, it seems, thanks
to Tarifi's connections with Israel; his ministry gets work permits and
hands them out without telling anyone.
.
Unknown to the Ministry of Finance, Tarifi illegally
imposed fees on trucks bringing goods to and from Jordan. At one point,
says the Committee, he got the Israelis to close the Jordanian border for
two weeks to all trucks bringing cement except those of a company called
al-Karmel, which belongs to his eldest son.
.
The Committee sums up Tarifi's offenses by calling
them "a blatant attack on public funds." It asks that the Attorney
General bring the Minister to justice. (PLC Report, pp. 17-21.) 4. Examples
from other Ministries.
.
* Finance (Minister: Muhammad Nashashibi): The
Council Committee criticizes this office for losing control in areas which
it is supposed to regulate, like customs exemptions and project accounts.
Several officials, it notes, took advantage of their positions to establish
private companies. (PLC Report, pp. 5-6.)
* Agriculture (Minister: Abdel Jawad Saleh):
The Committee found evidence of many violations, but it did not go into
detail. (Ibid.,p.9.)
* Public Works (Minister: Azzam al-Ahmad): Most
purchases were made by direct order, always from the same importers, rather
than by tender. Mr. al-Ahmad states that the violations took place before
there was a minister for Public Works. (Ibid.)
* Social Affairs (Minister: Intisar Wazzir):
This office failed to use proper procedures in the handling of large donations
and in distributions to the needy. (Ibid., pp. 9-10.)
* Post and Communication: Among various offenses,
this stands out: Many telephones which are supposed to be in government
offices have found their way to the private homes of officials and employees.
The PA pays their phone bills. (Ibid., p. 10.)
* Housing (Minister: Abdel Rahman Hamad): The
earlier GCO report noted serious administrative, legal, and financial violations,
most of which occurred during the term of the former minister, Dr. Zakarieh
al- Agha. The violations include (1) a housing project which was carried
out in defiance of regulations, using materials that did not match specifications;
(2) questionable allotments of land; and (3) the plunder of sand, one of
Gazas few and nonrenewable resources. The Committee made inquiries, but
the ministry failed to cooperate in response. (Ibid., p. 12.)
* Interior. The GCO report exposed the manipulation
of state funds. The ministry gave the Council Committee a "positive
and reliable response." (Ibid., p. 13.)
* Culture (Minister: Yasser Abed Rabo): The minister
charged the public $7,671 to install a central heating system in the house
he is renting. Almost 90% of the ministry employees are in administrative
positions, although many lack educational qualifications. (Ibid., p. 14.)
* Information (same minister). Large sums are
budgeted for purposes not connected to the ministry's work, including a
$10,000 personal allowance for the minister. (Ibid.)
* Supplies (also called Rations) (Minister: Ali
Shaheen): This winter people in Nablus got sick because they ate flour
whose date had expired. A PLC member, Khussam Khader, exposed the case,
showing that old flour had been repackaged. The Council laid the responsibility
on the Ministry of Supplies and passed a law redefining its role. Yet the
ministry continues to interfere in the sale of flour. It worked in cahoots
with a Finance Ministry official, Muhammad Jaradah, using public money
to import flour through a company which Mr. Jaradah heads. The Supplies
Ministry also blocked the border to other companies, so that Mr. Jaradah's
would have the monopoly. (Ibid., p. 21.)
* Transport (Minister: Ali Qawasmeh): Because
of slipshod office procedures the PA has lost control over the use of government
cars, though it pays all the costs. The Transport Ministry illegally converted
some government cars to private ownership without notifying Finance, which
is supposed to oversee public property. (Ibid., pp. 22-23.) * Youth and
Sport: Ministry officials used donated money, intended for renovating playgrounds,
to cover private expenses. (Ibid., p. 23.) * Local Governance (Minister:
Sa'eb Erakat) This ministry supervises municipalities and village councils.
The GCO report covered only thirty of the latter, but it exposed administrative,
financial and legal violations. The Committee demanded a response to the
GCO findings, but the ministry has refused to cooperate. (Ibid., pp. 25-26.)
* Monetary Authority. The committee found excessive
and unjustified expenses, as well as discrepancies between financial files
and daily books. (Ibid., p. 26.)
* TV and Radio Broadcasting Agency. Purchases
and tenders are not subject to supervision. As in the case of all ministries
and agencies, income is supposed to be transferred to the Finance Ministry
for supervision and control, but this is not done. (Ibid., p. 27.)
All nations suffer from corruption, but who would
have expected so much so soon? One reason, the Committee report makes clear,
is the chaos that prevails in rules and regulations, in defining spheres
of authority, and in norms of financial management. (Ibid., p. 28.) All
beginnings are difficult, and this is no exception. But other beginnings
have a grace which this one lacks. Such widespread corruption could not
take hold if the leaders had any national feeling, or sense of community,
or higher purpose. These things were surrendered at Oslo. The PA is the
creature of Oslo, where a national hope was betrayed for the sake of personal
power. That was the arch-corruption. The present examples are its offspring.
.
Amid the gloom there remains a spark of light:
the fact that the PLC Committee report could appear at all. Once again
the legislative council has proved, despite its limitations, that there
are those who seek to establish a new Palestinian society on foundations
of sound administration and public rectitude. We spoke, for example, with
Ali Girbawi, a professor in Political Science at Bir Zeit University and
head of the Palestinian Independent Commission for Citizens Rights. In
response to the Committee report, he said, "I think that the Palestinian
Legislative Council has found its own strength. I don't think they were
aware that they could do what they have done. Now they have realized that
they have an impact. If they will hold the executive to account, the people
will support them."
.
The Committee report exposed the alienation,
even hostility, between the PA's executive and legislative branches. The
entire Council approved the report, including PLO supporters close to Arafat,
whereas most cabinet ministers took it as a declaration of war. Soon after
its publication, sixteen ministers gave letters to Arafat signaling their
readiness to resign if he wished. (The sixteen did not include Nabil Sha'ath,
Jamil Tarifi, and Yassir Abed Rabu.) Public opinion in the West Bank saw
this collective performance merely as a ploy aimed at taking the sting
from the report. Kamal Sharafi, head of the Committee, told Challenge:
"We didn't ask anyone to resign. We only demanded that Arafat disperse
the cabinet, bring in the Attorney General, and put the guilty on trial.
As far as we're concerned, any ministers who are cleared can become part
of the new cabinet."
In the meantime an additional factor has emerged.
Even as the PLC Committee was conducting its investigation, Arafat appointed
Taib Abed al-Rahim, General Secretary of the Presidential Office, to make
a detailed inquiry into acts of corruption. The result has been yet another
report, 200 pages long, which Arafat is keeping to himself. There are,
then, three studies of corruption: that of the GCO, that of the PLC, and
now this. The bevy of reports may reduce the overall impact. If Arafat
refuses to deal with that of the PLC and ignores its recommendations, the
Council will be exposed in all its impotence. Kamal Sharafi, however, counsels
against despair. "Lets wait till September," he says. Meanwhile,
corruption is thriving.
* * * * * * * *
*CHALLENGE Magazine is an independent
journal in English which reflects on the realities of the Israeli Palestinian
conflict. It is published bi-monthly and is one of the most forthright
and courageous English publications. Challenge Magazine, POB 41199, Jaffa
61411, Israel.
.
M I D - E A S T R E
A L I T I E S
(202) 362-5266, Ext 638 Fax:
(202) 362-6965 MER@MiddleEast.Org
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