$600 million Iraqi Dinar Ghost Travelers Scandal Involves the CBI
Documents obtained from Iraq's Federal Board of Supreme Audit reveal a staggering corruption scheme involving the illicit acquisition of US currency by over 151,000 citizens.
The individuals obtained dollars at the official state rate for travel purposes, but never left the country, hence being referred to as ghost travelers by locals. As a result of the corruption, Iraq's Central Bank employees, private banks, currency exchange companies, and tourism firms were involved.
Increasingly evident is the extent of complicity among key players in Iraq's financial landscape, driving calls for accountability and comprehensive reforms to protect the nation's economy.
According to exclusive documents published by Al-Alam Al-Jadeed ("The New World"), an Iraqi outlet, the total amount involved in this fraudulent operation exceeds $600 million. Although ostensibly intended for travel expenditures, these funds were diverted to the black market, exploiting the price difference between the official and black market.
As a result of the sale of dollars at the official rate to customers who never actually embarked on their purported travels, the total expenditure increased by approximately US$607.76 million. Rather than taking advantage of the price differential in the parallel market, unscrupulous individuals benefited from the price differential, resulting in substantial profits.
Moreover, a damning document from the Integrity Commission, obtained by the outlet, sheds light on another corruption scandal involving the Central Bank of Iraq (CBI). In the document, it is revealed how private bank owners diverted funds from their intended use by utilizing large loans intended for investment projects to buy dollars from the Central Bank of Iraq's currency auctions.
By the time this report was published, The New Arab had not received a response from CBI.
This revelation comes midst growing concerns over rampant corruption within Iraqi financial institutions, underscoring the urgent need for comprehensive reforms to restore transparency and accountability. In light of these scandals, the Iraqi public demands swift and decisive action to ensure that perpetrators are held accountable and economic integrity is safeguarded.
The US officials stressed that Iraq should take further measures to prevent US dollar smuggling to Iran and Syria during Mohammed Shia Al-Sudani's recent rare visit to the United States.
In this import-driven economy, traders play a crucial role in conducting transactions that require the use of the US dollar. According to the World Bank, Iraq's economy is one of the most oil-dependent in the world.
US authorities banned transactions with 14 Iraqi banks last July, citing alleged violations of regulations designed to prevent dollar smuggling to Iran.
Iraq formed a committee with the US Treasury and Federal Reserve to address violations by commercial banks previously sanctioned by the US during Sudani's visit.
