By Greg Miller and Joshua Partlow
Washington Post Staff Writer
Friday, August 20, 2010; 10:56 PM
Alarmed by an exodus of money from Afghanistan, U.S. and Afghan authorities are trying to constrict a flow of cash through the country's main airport, believed to be a major conduit for drug proceeds and diverted foreign aid.
The plan, part of an effort to monitor an outflow of money thought to exceed $1 billion a year, centers on the installation of U.S.-developed currency counters at the Kabul airport. The devices would be used to record serial numbers on bills to determine whether money being carried out of the country has been siphoned from aid funds flowing in, U.S. and Afghan officials said.
Authorities also said they intend to eliminate an arrangement that has allowed top government officials and other well-connected Afghans to board planes -- even while carrying suitcases packed with cash -- without declaring the transfers or being searched.
The measures represent the latest effort to combat rampant corruption in Afghanistan with a combination of sophisticated U.S. technology and expanded enforcement. U.S. government agencies have also provided Afghan units with wiretap equipment that has been used to build corruption cases against senior government officials in Afghanistan, including a top national security adviser to President Hamid Karzai.
It is legal to carry large sums of cash out of Afghanistan, as long as the transfers are declared. But authorities have grown increasingly convinced that much of the money is being siphoned from U.S.-backed aid projects and is swelling secret accounts being set up by Afghan elite in other countries, including the Persian Gulf emirate of Dubai.Source of contention
Concern over corruption in Afghanistan -- where the United States is spending tens of billions of dollars as part of the war effort -- has become a major source of contention between Washington and Kabul.
Karzai has lashed out against investigations that have implicated members of his inner circle and has moved to limit the powers of U.S.-backed anti-corruption teams. On Friday, Karzai pledged to support the units, but he also said in a statement that the teams should be free of "foreign interference or political influence."
Obama administration officials describe the issue as an emerging crisis, with a key congressional panel threatening to withhold $4 billion in aid until it is clear that the money won't be squandered in a country regarded as among the most corrupt in the world.
"Hundreds of millions of dollars leave the country every month in cash," said a senior U.S. official involved in anti-corruption probes. Much of that money "was meant to be spent in Afghanistan. When it's being siphoned off or diverted, then there's no benefit to the Afghan economy or public."
A spokeswoman for the U.S. Department of Homeland Security, which oversees Immigration and Customs Enforcement, declined to comment on the plan to install currency counters in Kabul. "The U.S. government is working very closely with our Afghan partners to detect and end bulk cash smuggling," said the spokeswoman, Amy Kudwa. "We are not in a position to discuss specific new tools or methods we may be developing to track finances."
Afghan and U.S. officials, speaking about the plan on the condition of anonymity, said it calls for the installation of three or four counting machines at the airport in the next several months.
"Everybody has to be screened" under new rules being drawn up, said a senior Afghan official. "Everybody has to be checked. Everybody has to make a declaration."Staggering flow
Declarations filed over the past year, which almost certainly understate the amount of money being transferred, nevertheless indicate a staggering flow. Documents reviewed by The Washington Post this year showed that passengers took more than $180 million to Dubai during a two-month period in 2009. At that rate, the amount of money being carried out over the course of the year would have exceeded the country's annual tax revenue of $875 million.
On a single day this year, seven couriers declared $8 million in U.S. dollars, according to a second U.S. official familiar with efforts to track the money. In April, officials encountered a courier for a financial transfer firm who reported that he was carrying $700,000 on a flight to Dubai, but when customs officials inspected the courier's luggage, they found an additional $600,000.
The volume of money, much of which is legitimate, was temporarily tracked by Global Strategies Group, a British company that compiled reports on the transfers at the request of Afghanistan's domestic spy service, the National Directorate of Security. But the effort did not include recording serial numbers, and, after objections from Afghanistan's police force, Global Strategies ceased compiling the reports altogether in September.
The senior Afghan official said the new devices would allow for a more accurate tally of how much money is being carried out and help uncover whether donor funding is being diverted from reconstruction projects or other foreign aid.
Tracking serial numbers would enable authorities to trace money to where it had been issued, deposited and withdrawn.
A senior U.S. official said that serial numbers on U.S. currency were used to develop the corruption case against Afghanistan's former minister of Islamic affairs this year. The minister, Mohammad Siddiq Chakari, has been accused of extorting millions of dollars from companies seeking contracts to take pilgrims to the Muslim holy land in Saudi Arabia, a trip known as the hajj.
Chakari, who left Kabul for London, has repeatedly denied the allegations. But the U.S. official said associates of Chakari were caught bringing stacks of cash into Afghanistan and claimed that they were simply returning with money they had carried with them to Saudi Arabia to pay for travel and hotels. Using serial numbers, the official said, investigators were able to show that the bank notes were new and had gone from a U.S. printing facility to Saudi Arabia.
"In fact, it was money that had never been in Afghanistan," the official said. Installing currency counters in Kabul, the official said, "will let you tell a history of where the money came from."
U.S. officials declined to provide details on the machines. The Department of Homeland Security has a directorate of science and technology that conducts and funds research into devices that have security applications, such as sensors that can be deployed to detect explosive liquids at airports or airborne toxins in subways. But Kudwa, the department spokeswoman, would not acknowledge that the currency counters existed, let alone whether the department's research directorate had played a role in their development.
Partlow reported from Kabul.