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Vanity Fair Exclusive: Billions Over Baghdad: How $9B Disappeared Into A Frenzy Of Mismanagement And Greed

Illustration by John Blackford

Update - Is it $9 billion or possibly as much as $18 billion?

The NY Fed will not say...


Vanity Fair

Between April 2003 and June 2004, $12 billion in U.S. currency - much of it belonging to the Iraqi people - was shipped from the Federal Reserve to Baghdad, where it was dispensed by the Coalition Provisional Authority. Some of the cash went to pay for projects and keep ministries afloat, but, incredibly, at least $9 billion has gone missing, unaccounted for, in a frenzy of mismanagement and greed.  Following a trail that leads from a safe in one of Saddam's palaces to a house near San Diego, to a P.O. box in the Bahamas, the authors discover just how little anyone cared about how the money was handled.

Hidden in plain sight, 10 miles west of Manhattan, amid a suburban community of middle-class homes and small businesses, stands a fortress-like building shielded by big trees and lush plantings behind an iron fence. The steel-gray structure, in East Rutherford, New Jersey, is all but invisible to the thousands of commuters who whiz by every day on Route 17. Even if they noticed it, they would scarcely guess that it is the largest repository of American currency in the world.

Officially, 100 Orchard Street is referred to by the acronym eroc, for the East Rutherford Operations Center of the Federal Reserve Bank of New York. The brains of the New York Fed may lie in Manhattan, but xeroc is the beating heart of its operations—a secretive, heavily guarded compound where the bank processes checks, makes wire transfers, and receives and ships out its most precious commodity: new and used paper money.

On Tuesday, June 22, 2004, a tractor-trailer truck turned off Route 17 onto Orchard Street, stopped at a guard station for clearance, and then entered the eroc compound. What happened next would have been the stuff of routine—procedures followed countless times. Inside an immense three-story cavern known as the currency vault, the truck's next cargo was made ready for shipment. With storage space to rival a Wal-Mart's, the currency vault can reportedly hold upwards of $60 billion in cash. Human beings don't perform many functions inside the vault, and few are allowed in; a robotic system, immune to human temptation, handles everything. On that Tuesday in June the machines were especially busy. Though accustomed to receiving and shipping large quantities of cash, the vault had never before processed a single order of this magnitude: $2.4 billion in $100 bills.

Under the watchful eye of bank employees in a glass-enclosed control room, and under the even steadier gaze of a video surveillance system, pallets of shrink-wrapped bills were lifted out of currency bays by unmanned "storage and retrieval vehicles" and loaded onto conveyors that transported the 24 million bills, sorted into "bricks," to the waiting trailer. No human being would have touched this cargo, which is how the Fed wants it: the bank aims to "minimize the handling of currency by eroc employees and create an audit trail of all currency movement from initial receipt through final disposition."

Forty pallets of cash, weighing 30 tons, were loaded that day. The tractor-trailer turned back onto Route 17 and after three miles merged onto a southbound lane of the New Jersey Turnpike, looking like any other big rig on a busy highway. Hours later the truck arrived at Andrews Air Force Base, near Washington, D.C. There the seals on the truck were broken, and the cash was off-loaded and counted by Treasury Department personnel. The money was transferred to a C-130 transport plane. The next day, it arrived in Baghdad.

That transfer of cash to Iraq was the largest one-day shipment of currency in the history of the New York Fed. It was not, however, the first such shipment of cash to Iraq. Beginning soon after the invasion and continuing for more than a year, $12 billion in U.S. currency was airlifted to Baghdad, ostensibly as a stopgap measure to help run the Iraqi government and pay for basic services until a new Iraqi currency could be put into people's hands. In effect, the entire nation of Iraq needed walking-around money, and Washington mobilized to provide it.

Continue reading at Vanity Fair...


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Reader Comments (13)

Apr 5, 2011 at 2:54 PM | Registered CommenterDailyBail
Wall Street executive dies after falling from New York apartment 'as he celebrated birth of baby'

Apr 5, 2011 at 2:55 PM | Registered CommenterDailyBail
Just in his mid-20s, Brian Deschane has no college degree, very little management experience and two drunken-driving convictions.

Yet he has landed an $81,500-per-year job in Gov. Scott Walker's administration overseeing environmental and regulatory matters and dozens of employees at the Department of Commerce. Even though Walker says the state is broke and public employees are overpaid, Deschane already has earned a promotion and a 26% pay raise in just two months with the state.

Apr 5, 2011 at 3:39 PM | Registered CommenterDailyBail
This Walker-Deschane thing sounds like your typical bondage trip. And when I read of the total disdain wanker Walker has for state constitutional law, I see someone with an apocholyptic desire to get rammed in prison. I see no positive ambition in the fellow, though he aspired to a higher office to become governor. He's a spoiler, not a real man of the people. He wants to get his head stuffed in the toilet. An immediate recall is indicated, the same as with the congressional mewlers who led us here swathed in images of themselves as superior beings. I see no talent in those who would ride a lame horse into the ground or murder our representative form of government through disuse.
Apr 5, 2011 at 8:00 PM | Unregistered CommenterHoward T. Lewis III
Al Gore branches out into population control theory


Very rare and unauthorized video of him speaking. He never allows video recording at these events.
Jun 22, 2011 at 11:27 AM | Unregistered Commenterjohn
Great find john...thanks....
Jun 22, 2011 at 11:57 AM | Registered CommenterDailyBail
Not the first time in our history we have coughed up tons of cash only to have it vanish.

Whats on tv tonight?
Jun 22, 2011 at 11:58 AM | Unregistered CommenterS. Gompers
Al Gore Blasts Obama On Climate Change For Failing To Take 'Bold Action'


You are welcome!
Jun 22, 2011 at 12:01 PM | Unregistered Commenterjohn
Not the first time in our history we have coughed up tons of cash only to have it vanish.


You are right gomp, but in this case, the cash wasn't ours...the NY Fed was holding the cash for the Iraqis...it was their money in the first place...
Jun 22, 2011 at 12:17 PM | Registered CommenterDailyBail
Climate of Denial: Can Science and the Truth Withstand the Merchants of Poison?


Merchants of poison? Something didn't quite go his way recently.
Jun 22, 2011 at 12:20 PM | Unregistered Commenterjohn
Trust me, we will replace it at the U.S. taxpayers expense.

I hear a rumor that the American taxpayer has bottomless pockets...
Jun 22, 2011 at 12:22 PM | Unregistered CommenterS. Gompers
Al Gore Says President Obama Has ‘Failed’



We haven't heard much from Al Gore in the year since his marriage broke down and he was accused of doing inappropriate things with a hotel masseuse.
Jun 22, 2011 at 12:53 PM | Unregistered Commenterjohn
The cash out the window in Iraq was an effective P.R. campaign. So successful that hundreds of family feud participants were turned in for further cash rewards. These and other innocent people sit in Guantanamo being tortured, some to death, while the majority of dumshi_ America spends their time admiring their toaster cozy that took hours to choose from a huge selection.
Check out Dimona Dozen v. Fukushima 50 and dutchsinse.com. The first reference is about the nuke attack on Japan in retaliation for their offer to enrich nuclear fuel for Iran. Dutchsinse.com follows half a dozen chemtrail> HAARP circle> radical weather event sequences and I followed and witnessed three sequences and correct predictions. America is under attack. Congress mewls and Pres. Obama actively aids and abets the enemy. Hillary is psycho enough to do it and wait for her reward from the CFR/Fed/NWO crowd. Treason all the way.
Jun 23, 2011 at 2:39 AM | Unregistered CommenterHoward T. Lewis III

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