WASHINGTON - U.S. investigators this year opened more than 100 cases involving alleged abuse of some of the billions of dollars in U.S. and Iraqi funds to rebuild Iraq, an auditors' report said on Monday.

The report said most allegations involved fraud, waste and abuse of funds while 40 percent were linked to reprisals, theft and other issues. It said 75 cases had been either closed or referred to other U.S. agencies and 38 remained open.

The report was prepared for the U.S. Congress by the inspector general's office of the Coalition Provisional Authority, the U.S. occupying power dissolved in June and now renamed the Special Inspector General for Iraq Reconstruction.

In addition to the CPA investigations, the FBI had at least five open and pending cases involving Iraq, with two recent ones focusing on public corruption and government fraud, the report said. It gave no details.

Last week, the Army Corps of Engineers top contracting official said she was being interviewed by the FBI after she complained about deals given to Halliburton, the Texas company run by Vice President Dick Cheney before he joined the race for the White House in 2000.

The report said the military's Defense Criminal Investigative Service also had 16 open cases involving Iraq and 22 had been closed. No details were given of those cases.

FRAUD AND FAVORITISM

The Iraq process of reconstructing Iraq begun after last year's U.S.-led invasion and now hampered by a bloody insurgency, has long been dogged by widespread allegations ranging from favoritism to fraud.

The CPA inspector general's office said it expected to release an audit in November on the CPA's handling of money from the Development Fund for Iraq. The fund is made up from proceeds from Iraqi oil sales, frozen assets from foreign governments and surplus from the U.N. Oil for Food Program.

A leaked draft of that audit said at least $8.8 billion in Iraqi funds given to Iraqi ministries by the CPA could not be accounted for.

The latest report cited a case in which Iraqi construction companies were suspected of illegally removing equipment belonging to the Iraqi interim government with the help of U.S. troops who were allegedly paid for their services.

In another case, five Iraqi citizens, including two police officers, were arrested and charged by the Central Criminal Court of Iraq in connection with criminal activity involving a U.S. contract.

Contractors have become an increasing focus of attacks and kidnappings in recent months by insurgents and the report said these grave risks hindered and slowed down rebuilding work, resulting in unknown additional costs.

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