LONDON Ñ The International Monetary Fund said Yasser Arafat has
seized $750 million from the Palestinian Authority budget, much of which is
financed by Western donors.
"There was a diversion of revenue from the budget to a special bank
account controlled by President Arafat," Karim Nashashibi, IMF
representative for the West Bank and Gaza Strip, said.
IMF officials acknowledged the investigation and its findings regarding
Arafat at the summit by the financial institute held in the United Arab
Emirates city of Dubai. The IMF and World Bank summit stressed the need for
transparency in government.
The IMF concluded that Arafat took the $750 million from the PA budget
and placed the funds in a bank account under his sole control. Arafat was
found to have embezzled the funds from 1995 until 2000.
The assertion came in wake of the first IMF investigation of PA finances
and the role of Arafat. The IMF said Arafat, chairman of the PA, invested
missing PA funds in 69 companies that he directly controls.
"In any system, you can always have a possibility of some misuse," Nashashibi said. "What we are trying to do is
raise the level of disclosure and transparency so that future or present
misuse does not happen."
The IMF report said the money seized by Arafat came from an Israeli tax
on the employers of Palestinian laborers who worked in Israel. The tax
revenues, amounting to more than $150 million a year, were then relayed to
The report also cited Arafat's stake in companies in PA-controlled
areas. The companies included virtually every major firm in the West Bank
and Gaza Strip, including casinos, telecommunications, quarries, cement
production and fuel.
In Washington, Israel and the United States discussed the prospect that
Arafat would be expelled from the Palestinian areas. The Bush administration
reiterated its opposition to the expulsion of the PA chairman and Israeli
Foreign Minister Silvan Shalom pledged to consult with Washington before
Israel decides on such a move.