PA officials smuggled $52 million in U.S. aid

JERUSALEM – Mahmoud Dahlan, a strongman of Palestinian Authority President Mahmoud Abbas' Fatah organization, and one of Dahlan's top associates pocketed $52 million in foreign aid – mostly assistance monies from the U.S. meant to bolster Fatah against Hamas, sources in the PA Finance Ministry told WND today.

Dahlan used part of the American aid to invest in construction efforts in Dubai, the PA sources said.

The information comes as the U.S. is poised to send millions more in financial aid to bolster Abbas' militias in the West Bank against Hamas there.

Sources in Palestinian Finance Minister Salam Fayyad's office told WND upon recently checking the accounts in which about $60 million in U.S. aid was deposited, Fayyad was shocked to learn only $7 million remained.

The sources said a Finance Ministry investigation determined Dahlan smuggled $27 million and Dahlan's no. 2, Rashid Abu Shabak, former chief of the Palestinian Security Services, smuggled $25 million into their own accounts.

Fayyad already reportedly obtained and confiscated from Dahlan $7 million in smuggled aid.

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Dahlan and Shabak were two of only a handful of Fatah officials who had access to the PA accounts in which American aid was stored. Both officials fled the Gaza Strip prior to Hamas takeover of the territory and all U.S.-backed Fatah security compounds there last month.

According to the Finance Ministry sources speaking to WND, there is evidence Dahlan used some of the smuggled aid to invest in construction efforts in Dubai and also for the construction of a building there for his own personal use.

The officials said the vast majority of aid smuggled by Dahlan and Shabak came from the U.S. They said about $2 million was provided by Saudi Arabia.

The report of smuggled U.S. aid comes as Secretary of State Condoleezza Rice announced in recent weeks the U.S. will resume "full assistance to the Palestinian government," lifting an economic and political embargo against the Palestinian government enacted after Hamas came to power in March 2006.

Rice said she will ask Congress to rework a previous $86 million aid package to Abbas that was reduced following concerns by some lawmakers a portion of the money would end up financing terrorism. Congress in April only approved about $59 million of the aid package and stipulated the money cannot be used to purchase weapons. Rice intends to request Congress now grant the full $86 million.

Rice also said the U.S. would contribute an additional $40 million to the United Nations to help Palestinians, particularly in the Gaza Strip, which is now controlled by Hamas.

According to Palestinian and Israeli diplomatic sources, the bulk of the $86 million is slated to be used to fund Force 17, which serves as de facto police units in the West Bank and previously patrolled the Hamas-seized Gaza Strip. Dahlan and Shabak headed Force 17.

Many members of Force 17 are also openly members of the Al Aqsa Martyrs Brigades terror group, which took responsibility together with Islamic Jihad for every suicide bombing in Israel the last two years.

A Palestinian diplomatic source told WND the PA wants to use some of the money "to purchase equipment to help secure the Palestinian Authority against coups by other competing groups attempting to hijack our government."

The source would not specify whether the equipment the PA wants to purchase includes weapons, which would be in breach of the previous ruling from Congress that Rice has now asked to be reworked.

A number of American officials this week said the U.S. and international community must work to build up Abbas' forces in the West Bank.

Abu Abdullah, a senior leader of Hamas' so-called military wing, vowed in a recent WND interview to obtain U.S. aid slated for Fatah.

"Like the American weapons in Gaza we told you will come to Hamas, also the weapons and aid the Americans are giving to Abu Mazen (Abbas) as part of their conspiracy against us in the West Bank will finds its way to the Palestinian resistance and Hamas," said Abu Abdullah.

Abu Abdullah would not say whether Hamas was planning a coup in the West Bank similar to the complete takeover last week of all Fatah positions and U.S.-backed security compounds in the Gaza Strip, but he told WND he "hopes" the U.S. provides large quantities of weaponry to Fatah in the West Bank so Hamas can obtain them.

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