USAID OIG Afghanistan and Pakistan Oversight Report, April-June ...

Closeout Financial Audit of the Fund Accountability Statement of USAID ResourcesManaged by the Government of the Islamic Republic of Afghanistan through the Ministryof Transport and Civil Aviation Under the Regional Airports Project, USAID AwardNo. 306-IL-11-05-17, for the Period January 9, 2011, to July 31, 2012.Thirty-five other financial audits of USAID funds in Afghanistan were in the planning stage at theend of the quarter. In addition to these audits, OIG plans to audit USAID/Afghanistan’s financialstatements as part of its overall USAID financial statement audit for FY 2012.InvestigationsAs of June 30, 2012, USAID OIG had 62 ongoing investigations pertaining to Afghanistan. Duringthe reporting period, OIG investigators opened 6 cases in Afghanistan and closed 11 others. SinceFY 2003, OIG has initiated 188 investigationsrelated to Afghanistan. These investigations havebeen associated with a range of different types ofallegations. In most cases, underlying allegationshave pertained to program fraud (37 percent) orbribery and kickbacks (24 percent).During the April 1 through June 30, 2012, reportingperiod, one OIG investigation led to thetermination of a local USAID employee, and anotherresulted in the debarment of an employeeof a USAID implementing partner in Afghanistan:Investigative OutcomesSince FY 2003, OIG investigations in Afghanistanhave resulted in:38 referrals for civil or criminal prosecution13 arrests13 indictments11 convictions and pleadings102 administrative actions (e.g., contract andemployee terminations)$163 million in savings and recoveriesAfghan National Employee Terminated forTheft. A local employee of USAID/Afghanistan was terminated after an OIG investigationrevealed that he had stolen cell phone cards valued at approximately $2,000. The terminatedemployee was responsible for purchasing and distributing cards to other Afghans working forUSAID for use with their government cell phones. The investigation also revealedUSAID/Afghanistan had weak internal controls related to phone card accountability. Afterreceiving a referral memorandum from OIG, USAID/Afghanistan improved its internal controlsin this area to prevent similar incidents from occurring in the future.Implementing Partner’s Employee Debarred for Theft of More Than $250,000. An Afghanemployee of a contractor implementing several USAID programs in Afghanistan was debarredby USAID after stealing more than $250,000. The employee was a member of the USAIDcontractor’s local staff and was part of a team responsible for providing logistical support toseveral USAID projects. The employee altered a check written for approximately $200 andredeemed it at a local bank for more than $250,000 in cash. The USAID contractor detected thetheft and did not pass the cost on to USAID, instead reporting the matter to OIG for furtherUSAID OIG Afghanistan and Pakistan Oversight Report 13