Investigative Group

US May Have Accidentally Bought Fuel From Iran Then Had $150M Of It Stolen And Used To Destabilize Region

Fuel_Barrels | Circa April 2005 | By Trevor MacInnis [CC BY-SA 2.5 (https://creativecommons.org/licenses/by-sa/2.5)], from Wikimedia Commons

The U.S. military in Afghanistan and allied forces may be accidentally buying fuel from Iran, and also saw at least $154 million in fuel stolen.

The stolen fuel may have funded terrorists and destabilized the Afghanistan government, according to a Special Inspector General For Afghanistan Reconstruction (SIGAR) report. Much of it was lost due to corruption at virtually every level in the Afghanistan government, including a case where the “police chief, the mayor and the provincial governor … all shared the profits.”

President Donald Trump has exerted pressure on countries like China to pull back on buying fuel from the Iranian government due to concerns about it subsidizing Iran’s nuclear program, but it turns out the U.S. military itself may have unknowingly been doing the same thing.

The Department of State said “corruption is the most formidable obstacle to a stable Afghanistan,” the Friday SIGAR report noted. Price tag could, if siphoned off, feed corruption in the region, the report warns. Plans are in the works to spend $2 billion on fuel in the Afghanistan area, according to the report.

The Combined Security Transition Command–Afghanistan (CSTC-A) was concerned “about corruption and contract mismanagement within the Ministries of Defense and Interior,” the report says. In response, it moved to a contract the Expeditionary Contracting Command-Afghanistan (ECC-A) awarded, but that contract was only intended to be a backup and “had oversight and accountability weaknesses.” The contract didn’t require the vendors to tell the military where they got the fuel; they didn’t always know how much was actually being used; and “they did not have detailed knowledge of ANDSF fuel side storage capacities, infrastructure or personnel capabilities.”

“Vendors may have obtained fuel that was of poor quality or from prohibited sources, such as Iran, due to the fact the contract did not require the vendors to submit country-of-origin documentation for the fuel they delivered,” the report said.

The findings came days after Treasury undersecretary for terrorism and financial intelligence Sigal Mandelker said Iran was using money to support Hezbollah, Hamas and Syrian President Bashar Assad.

The $154 million in stolen fuel is a conservative estimate. “Because U.S. officials have usually detected fuel theft long after the theft began, it is likely that even more fuel has been stolen in Afghanistan,” the report says.

Huge networks of officials in the country whose government the U.S. is helping to reconstruct allegedly participated in ripping it off.

“The orders to steal the fuel and the locations authorized to purchase the stolen fuel were allegedly determined by the local police chief, the mayor and the provincial governor, who all shared the profits,” the report said.

In one case, $2.6 million of fuel was stolen in a scam in which corrupt Afghanis, who had previously been banned from military bases, would drive trucks up to the gates, siphon fuel, then swap drivers and have non-banned drivers take the trucks inside, the report said. Another Afghan company stole fuel by fraudulently obtaining U.S. government fuel credit cards.

Part of the corruption was made possible by U.S. soldiers slacking on their duties, such as not checking meter gauges. In other cases, US contractors and military personnel were culprits. In 2012, three U.S. Army service members stole 180,000 gallons of jet fuel, which they loaded onto trucks an Afghan trucking contractor owned.

In another case, an Army sergeant was bribed to create false documentation facilitating the theft of $10 million in fuel. Two co-conspirators hid nearly $500,000 in a pair of stereos. Separately, an Afghan official paid bribes to fuel depot personnel to overfill trucks, including a $5,000 bribe for $150,000 of fuel.

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