The case of the missing $6.6 billion


Pallets of US currency arriving in Iraq. Source: US Congress, House Committee on Government Reform.

That’s “billion,” with a “B”:

After the U.S.-led invasion of Iraq in March 2003, the George W. Bush administration flooded the conquered country with so much cash to pay for reconstruction and other projects in the first year that a new unit of measurement was born.

Pentagon officials determined that one giant C-130 Hercules cargo plane could carry $2.4 billion in shrink-wrapped bricks of $100 bills. They sent an initial full planeload of cash, followed by 20 other flights to Iraq by May 2004 in a $12-billion haul that U.S. officials believe to be the biggest international cash airlift of all time.

This month, the Pentagon and the Iraqi government are finally closing the books on the program that handled all those Benjamins. But despite years of audits and investigations, U.S. Defense officials still cannot say what happened to $6.6 billion in cash — enough to run the Los Angeles Unified School District or the Chicago Public Schools for a year, among many other things.

The post-invasion chaos in Iraq was severe enough that massive sums of money regularly went missing, the majority thought to have found its way into the pockets of those Iraqis who were early to adopt dialogue with Coalition forces. Some of it undoubtedly funded the insurgency. In 2008, an Iraqi politician told the LWJ his positive assessment that the “major” corruption, the deals worth “hundreds of millions of dollars,” were over. But he anticipated that the “middle to lower-level corruption will continue for a long time and will be a huge problem.” This was progress of a depressing sort, I thought at the time.

The lack of effective accounting controls in place to manage Iraqi use of funds, both oil receipts and international aid, was shocking then, and continued to surprise, despite noticeable improvements at the ministry and ground levels. A relevant amount of corruption along the lines of baksheesh and “ghost soldiers” is culturally inevitable in Iraq, but the fact that individuals and organizations could steal that quantity of money is a big deal, and potentially very harmful to US security interests. It almost goes without saying that billions can buy lots of people, Kalashnikovs and IED components. In fact, the best case scenario is that a number of Americans, Iraqi political figures, and Iraqi businessmen are merely living incredibly large off ill-gotten gains and pumping most of the money into the economies of Jordan and Dubai. Fingers crossed.

A certain degree of error is expected and excusable in the circumstances of post-invasion Iraq. But $6.6 billion-worth is not.

Are you a dedicated reader of FDD's Long War Journal? Has our research benefitted you or your team over the years? Support our independent reporting and analysis today by considering a one-time or monthly donation. Thanks for reading! You can make a tax-deductible donation here.


  • blert says:

    I once ran the books for a tiny, very tiny, slice of a State Government.
    It was small enough to be indifferently audited. ( i.e. really small )
    Its loses were entirely due to the locals physically carting off the ‘white goods’ tunneling right through the floor boards to do so!
    This is the behavior of tribesmen ( they were all blood relatives — so the village was run tribally ) who were living by the Neolithic rule book. ( A non-cash based society )
    It’s a pretty good bet that the vast bulk of the missing money is merely undocumented expenditures. In chaotic times funds are often spent without a paper trail suitable for Federal auditors.
    Having dealt with such systems I can assure you that the auditors would consider ANY expenditure that did not have the full payment trail worked up to be ‘improper.’
    Further, the more the auditors can ‘fail’ the history of the accounts — the more they get paid. Audits are cost+ and on the clock. When you pay someone to find fault… they do!
    Beyond that, you can assume that everyone involved ‘touched’ the money.
    BTW, compared to the looting typical of our own Civil War…
    Anything under ten billion dollars is chicken feed.
    You may consider the funds to be the Iraqi version of the Marshall Plan. ( Which should’ve been known as the Truman Plan — Marshall merely read Truman’s speech! )

  • O P M says:

    We have yet to see the tally of central Asia…..
    all the ‘stans seem to be flowing with american benny’s.

  • USMC 02 says:

    At the start of OIF I, those of us running around in the boonies trying to clean up resistance and “police” large areas with far too few troops faced quite a different attitude from the DoD.
    USMC infantry companies were parsed out to be the entire government for recently liberated cities. Company Commanders were desperate for help and developed their own policies for the post-Sadam Iraq – because there was NO plan or guidance from the Land Forces Commander.
    These Captains, Majors and Lieutenant Colonels needed to start local governments on their own and needed money to pay the few Iraqi’s who were anxious to work with us – since most thought we would be leaving very quickly.
    We asked for a mere $100 in cash per Company and were told no, because we couldn’t guarantee a strong accounting system. An E-3 could fill his truck with $300 worth of fuel, I could draw a box of grenades with just a smile, but we couldn’t get $100 for a Captain charged with being Mayor, Police Chief, Judge and Public Works Commissioner for towns of 50,000 people. Most of us used what little cash of our own we’d brought with us before the invasion.
    It was wrong then and made exponentially worse knowing that billions in cash would later be wasted by bureaucrats in and out of uniform. It’s criminal, as was the lack of understanding the environment once we invaded, and the lack of a plan to deal with the chaos once the Iraqi Army was summarily disbanded. May we learn from those grave mistakes which cost so many lives (both Iraqi and Coallition) in the decade to follow.


Islamic state



Al shabaab

Boko Haram