The International Monetary Fund announced yesterday an audit of Palestinian Authority funds revealed President Yasser Arafat had diverted some $900 million to a special bank account he controlled.

Most of the cash, which came from revenues in the budget, went into some 69 commercial activities located in Palestinian areas and abroad, said Karim Nashashibi, IMF resident representative in the West Bank and Gaza.

Nashashibi disclosed the Arafat account and figures to reporters at a news conference on the economic situation in the West Bank and Gaza. He said the information provided by the Palestinians was an example of the openness and transparency in Palestinian finances under Finance Minister Salam Fayad.

However, Nashashibi did not rule out the possibility that a portion of the funds was misused. He said he believes an accounting of the rest of the money will be conducted “at some point, but we’re taking it all a step at a time.”

“What we’re trying to do is have a level of disclosure and transparency so that future or present misuse does not happen … At least there is a followup, there is disclosure,” Nashashibi said

There have been charges of corruption in the Palestinian Authority, including some complaints from ordinary Palestinians.

Forbes Magazine earlier this year reported Arafat controlled $300 million.
U.S. and European governments have complained for years that the Palestinian financial structure is not transparent and does not allow donors to follow their money to projects for the benefit of the people.

Note: Read our discussion guidelines before commenting.