Volume 1 - Iraq Watch

office handling mail between MIC and the ministriesand between the headquarters’ directorates and theindividual companies.MIC: Beneficiary of Illicit FundsRevenues from oil protocols with Jordan, Syria, andTurkey increased the MIC budget by approximately6,400 percent between 1996 and 2003. During thisperiod, MIC Director and Deputy Prime Minister,Abd al-Tawab Mullah Huwaysh (see Figure 40),transformed the MIC into a more efficient and profitablebureaucracy.• According to a high-level MIC official, the MICbudget grew from $7.8 million in 1996 to $350million in 2002 to $500 million in 2003. The MICcovered its operating costs through internal ministry-to-ministrysales of goods and services, includinga 3 percent surcharge on items imported for theMoD by Al-Basha’ir—a MIC front company.• According to the same official, the MIC also had ahard currency budget of approximately $365 million,of which $300 million came from illicit oiltrade with Syria, Jordan and Turkey. The remainderof the hard currency budget came from the Presidency,sales to foreign companies in Iraq, profitsfrom the Arab Company for Detergent Chemicals(ARADET), and foreign investment (see Figure 41below for more detail).The MIC budgeting process started at the companylevel every June and continued through September.Companies gathered their plans for production,procurement, and salaries for the upcoming year andsubmitted them to the Directorate of Administrationand Finance in the MIC headquarters. The Directorateof Administration and Finance compared the figurewith the historical figures and tried to reduce the sizeof the budget. Then the Technical, Project, Trade, andResearch Directorates were asked to review and commenton the company figures.When the Directorate of Administration and Financehad processed the companies’ budgets, the 21 directors-generalof MIC discussed them during budgetmeetings. These budget meetings were conductedmuch like court proceedings, and the group madedecisions on each proposed budget. The budget figureswere adjusted accordingly, and a final budget foreach company was issued.The company budgets for the 51 subordinate MICcompanies, for MIC headquarters, and for the eightMIC training centers were consolidated into onebudget. Unlike other ministries, the MIC did nothave to submit its budget to the Finance Ministry,but it did send a summary report to the Secretaryof the CoM. The summary report did not containdetailed figures or descriptions. Abd al-Tawab MullahHuwaysh had the discretionary authority to reallocatefunds within the budget, as he felt necessary.MIC Banking and FinancingThe MIC had its own bank accounts—two each inJordan, Lebanon and Baghdad—that it used to storehard currency. Rather than having the purse stringscontrolled by many people in the organization, therewere actually only three men most responsible forthe transfer of funds from the Iraqi Governmentto the supplying companies: Jasim Ahmad Hasan,Muhammad Salih Abd al-Rahim, and HashimKarim ‘Abbas, of whom were all members of theMIC’s Commercial Directorate. The CommercialDirectorate was concerned mainly with payment andpayment methods, and with delivery of the contracteditems after MIC and the supplier signed contracts.The MIC could authorize payments for small contractamounts, but for larger amounts Huwaysh soughtpermission from Presidential secretary Abid Hamid orthrough the Presidential Diwan.• According to captured documents, Hasan and‘Abbas are listed on hundreds of bank accountsthroughout Jordan.• Captured documents also include bank statementsand correspondence directing MIC to release fundsto suppliers.• According to two sources in the Commercial Directorate,their department was funded with a monthlybudget of approximately $2 million.Funds originated at the Presidential Palace and wereauthorized to be transferred by Saddam. On behalfof Saddam Husayn, Ahmad Husayn Khudayir al-Samarra’i, President of the Diwan, authorized thefunds to be sent to the CBI. The Governor of CBI,Isam Rashid al-Huwaysh (no relation to Abd al-Tawab Mullah Huwaysh), forwarded the funds to theMIC accounts at the Rafidian Bank in Baghdad. Abd66