Corruption eating up two-thirds of Aids fund

UP to two-thirds of a €16bn development fund into which charities such as Bono’s Product Red contribute is being eaten up through corruption, it has been claimed.

Investigators of the Global Fund to Fight Aids, Tuberculosis and Malaria say much of the money is being accounted for with forged documents or improper bookkeeping. According to the Associated Press, even donated prescriptions end up being sold on the black market.

The investigators told the fund’s board of directors that 67% of money spent on an anti-Aids programme in Mauritania was misspent as was 36% of the money spent on a programme in Mali to fight tuberculosis and malaria, and 30% of grants to Djibouti.

According to AP, in Zambia, where $3.5 million (€2.56m) in spending was undocumented and one accountant pilfered $104,130 (€76,315), the fund decided the nation’s health ministry couldn’t manage the grants and put the UN in charge of them. It said the fund is trying to recover $7 million in “unsupported and ineligible costs” from the ministry.

The fund is pulling or suspending grants from nations where corruption is found, and demanding recipients return millions of dollars of misspent money.

“The messenger is being shot to some extent,” fund spokesman Jon Liden told AP. “We would contend that we do not have any corruption problems that are significantly different in scale or nature to any other international financing institution.”

The US, the European Union and other major donors have pledged $21.7 billion (€16bn) to the fund, the dominant financier of efforts to fight the three diseases.

Apart from Bono’s charity, prominent backers include former UN secretary-general Kofi Annan, French first lady Carla Bruni-Sarkozy and Microsoft founder Bill Gates, whose Bill and Melinda Gates Foundation gives $150m a year.

The fund’s inspector general, John Parsons, said donors should be reassured that the fund is serious about uncovering corruption. “It should be viewed as a comparative advantage to anyone who’s thinking about putting funds in here.”

Sweden has suspended its $85m annual donation until the fund’s problems are fixed. It held talks with fund officials in Stockholm last week.

Fund officials blame the misspending on the lack of financial controls among the grants’ recipients, many of which are African health ministries whose budgets are heavily supported by the fund.

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