September 16, 2011 | Quote

U.S. Congress Mulls Cutting PA Funding, Closing PLO Mission in Light of UN Bid

Dr. Jonathan Schanzer, vice president of research at the Foundation for Defense of Democracies and the former terrorism finance analyst at the U.S. Department of Treasury, argued that despite the fact that the Palestinian government lead by Fayyad was lauded for its transparency, Abbas was still managing to abuse his power.

Schanzer said Fayyad has been “sidelined” by Abbas. “Abbas has consolidated power, and he is now abusing it.”

Schanzer explained that Abbas is at the center of corruption within the Palestine Investment Fund (PIF).

“The PIF was created in 2002 to function as a transparent sovereign wealth fund to benefit the Palestinian people. In recent years, however, Abbas has changed the charter, installed his own choices for board members, placed the PIF under his full control and neglected to have it audited.”

“The PA also borrows from this fund, currently worth at least $1 billion, when it cannot pay salaries. In return for the money borrowed, Abbas has been repaying the PIF with land slated for businesses that enrich his own inner circle.”

“One former official charges that $1.3 billion has gone missing from the fund. Another claims that exposing the PIF would reveal corruption at the highest levels of the PA. And the fact that Hamas recently took full control over the PIF's assets in Gaza now adds to the concern,” Schanzer continued.

Schanzer also called for an investigation on the Palestinian Authority's “troubling financial relationship with Hamas” and the reports that Abbas' sons, Yaser and Tareq, have accumulated wealth since their father took office in 2005.

“Congress should challenge the corrupt system created by Mahmoud Abbas. This includes, one, stricter oversight of the presidential waiver process that releases Palestinian funds each year, two, oversight of the PIF including a full audit, three, conducting an inquiry into the wealth of Mahmoud Abbas and his sons, Yaser and Tareq, to determine whether U.S. funds have contributed to their holdings, [and] four, demanding an immediate resolution to the matter of the electric power plant in Gaza – U.S. taxpayers should not be indirectly financing Hamas.”

Schanzer recommended the United States takes two additional steps: scrutinizing Abbas' presidential budget, and finding ways to increase the role of Fayyad, “who has been marginalized by Abbas in recent years,” he said. …

Dr. Jonathan Schanzer agreed the administration handled the current situation poorly.


International Organizations Palestinian Politics