Iraq makes new arrests in corruption inquiry

Wife of former tax chief among three accused of money laundering

Iraq's Prime Minister Mohammed Shia Al Sudani displays piles of cash that were recovered from $2. 5 billion of snatched government funds last year. AFP

The wife of the former head of Iraq's tax authority and two other people have been arrested on corruption-related charges, the latest in a crackdown on misappropriation in a nation ranked as one of the world’s most corrupt.

The Federal Commission of Integrity, which previously arrested the former general director of the General Commission for Taxes, accused his wife and the two others of money laundering, it said on Tuesday. Their names were not disclosed.

About $1.5 million, a significant quantity of gold and 11 title deeds for prime real estate — nine of them inside Iraq and two overseas — were seized.

The commission is working to retrieve about $3.6 million deposited outside Iraq.

“All these assets came from the bribes the former general director of the General Commission for Taxes received and hid with the accused,” the commission said.

The latest arrests come as authorities investigate corruption cases involving the theft of billions of dollars.

Heist of the century

Late last year, a former minister revealed that 3.7 trillion Iraqi dinars ($2.5 billion) was embezzled from the tax office in a fraud described as “the heist of the century”.

Senior government officials and businessmen have been arrested, but less than 10 per cent of the money has been repatriated.

Also last year, the National Security Service announced the arrest of a criminal network that siphoned crude oil from pipelines in remote areas of southern Iraq and smuggled it out of the county.

Senior Interior Ministry and intelligence officers were allegedly involved.

Corruption is rife in Iraq, which ranks 157 out of 180 countries listed in Transparency International's corruption perceptions index.

That has hampered the country’s efforts to recover from decades of war and UN economic sanctions imposed during Saddam Hussein's regime.

In 2021, former president Barham Salih estimated that Iraq had lost $150 billion to embezzlement since 2003.

The UN Special Representative for Iraq Jeanine Hennis-Plasschaert has described the corruption in the country as “pervasive, structural and systemic”.

Ms Hennis-Plasschaert warned year that in “the absence of tackling corruption any attempt to push through serious reform will not succeed. This is really the cause by now of Iraq’s dysfunctionality”.

She blamed the informal power-sharing arrangement — called Muhasasa in Arabic — that was established after the overthrow of dictator Saddam Hussein in the 2003 US-led invasion.

Under the arrangement, which has been the basis for all subsequent Iraqi governments, Shiites are entitled to 12 ministries, Sunnis six, Kurds four and the rest distributed among other religious and ethnic groups, regardless of election results.

“That arrangement turned into a quite closed community, a community of collusion and a community of corruption protection,” Ms Hennis-Plasschaert said.