Report Exposes Irregularities of Obscure State Department-Funded Organization

For Immediate Release

Contact: 

Shelley Walden, International Reform Officer
202.457.0034, ext. 156
shelleyw@whistleblower.org

Beatrice Edwards, International Reform Director
202.457.0034 ext. 155
beatricee@whistleblower.org

Dylan Blaylock, Communications Director
202.457.0034, ext. 137
dylanb@whistleblower.org

Report Exposes Irregularities of Obscure State Department-Funded Organization

Details Questionable Roles of Liz Cheney, Shaha Riza, and Others in Multi-Million Dollar Program

WASHINGTON - A report released by the
Government Accountability Project (GAP), based on documents obtained
through
nearly three years' of U.S. Freedom of Information Act (FOIA) requests,
exposes the highly irregular manner in which the Foundation for the
Future
(FFF) - an obscure project funded by the U.S. Department of State -
was established and operated by Bush administration officials and
appointees.

Specifically, the report details
how high-level State
Department officials misled Congress as they sought millions in public
money
for the Foundation, which was a haven for people with political
connections.
The report also shows that FFF was a pet project of Elizabeth Cheney,
former
Principal Deputy Assistant Secretary of State for Near Eastern Affairs.
Cheney
worked to set up the Foundation with Shaha Riza, Paul Wolfowitz's
companion whose seconding to the State Department (and then to the FFF)
was
directly responsible for the 2007 World Bank scandal that resulted in
Wolfowitz's
departure from the Bank. 

"Liz Cheney had the
preposterous idea that the
Foundation for the Future would bring peace and democracy to the Middle
East," said GAP International Program
Officer Shelley Walden, author of the report. "This overlong project
wasted millions of taxpayer dollars."

The report,
which is based on 267
documents released by the Department of State over a period of 33
months, can
be found here: (Full
Report
) (Executive Summary) (Key FOIA documents) (Appendix I)

Background

The Foundation for the
Future first became an issue of
public interest inquiry in 2007, when GAP
published
the payroll records of Riza, girlfriend of then-World Bank
President Paul Wolfowitz. The records showed that Riza, a British
national who
worked as a World Bank communications officer, was seconded to the U.S.
State
Department after Wolfowitz was appointed, where she was responsible for
establishing the Foundation for the Future (FFF). The FFF was a
nonprofit
organization tasked with promoting democracy and reform in the Broader
Middle
East and North Africa (BMENA) region.

While seconded from the
Bank to the State Department
in 2005 and 2006, Riza received salary raises in excess of what Bank
rules
allowed, earning far more than Secretary of State Condoleezza Rice. In
October
2006, Riza's secondment was transferred to the FFF itself,
where she remained until returning to the Bank in early 2008, after
Wolfowitz
was forced to resign.

 

Liz Cheney's Failed
Pet Project

The documents released by
the Department of State
(DOS) show that Liz Cheney, as Principal Deputy Assistant Secretary of
State
for Near Eastern Affairs, envisioned Riza's highly irregular secondment
to the FFF in May 2005, well before it was established, and before Paul Wolfowitz became
President of
the Bank. In this unsupervised position, Riza promoted an overtly
political U.S. agenda in the Middle
East. Riza's activities in this role were in apparent
violation of conflict of interest regulations at the World Bank, as well
as the
national security, tax and visa regulations of the U.S. government. The
report also
shows that Cheney was instrumental in the Foundation's launch and
failure
to obtain broad international support.

"The project was doomed
from the start -
State Department officials in the region warned that restrictive laws in
the
Persian Gulf states would make the Foundation ineffective; BMENA
governments
did not support a Foundation that would give their opposition a platform
from
which to oppose them; and potential donors had misgivings about the
project's lack of indigenous imprint," stated Walden.
"Despite these warning signs, Cheney and the Bush administration moved
full steam ahead and established the Foundation anyway."

In 2005, Cheney, Shaha
Riza and Condoleezza Rice
embarked on an international crusade to obtain financial and diplomatic
support
for FFF. But their efforts at diplomacy were a failure; they raised less
than
25% of the goal (set by Cheney) of $25 million (USD) in contributions
from
other nations. The great majority of funding came from the United
States,
although the legislation creating the institution included a requirement
for
matching funding.

 "The
Foundation
for the Future was to promote democracy, transparency and popular
political participation on a multilateral basis in the Middle
East," said GAP International Program Director Bea Edwards.
"So when Liz Cheney - who, in the view of many Middle Eastern
leaders, occupied her position largely because she was the Vice
President's daughter - asked other nations for contributions, they
balked. Add to this the fact that the Foundation's board member
selection
process was directed by the former Deputy Secretary of Defense's
girlfriend and that the Foundation was managed by a personal friend of
Wolfowitz's with little expertise in the region, and it's no wonder
that many potential donors refused to fund it."  

 

Astroturfing

GAP's report shows that
the FFF was almost entirely
financed and monitored by the U.S.
government, even though the Bush administration repeatedly portrayed it
to
Congress as a multilateral, non-governmental organization created in
response
to democratic demands from grassroots organizations. Documents also show
that
the Bush administration intended to use the Foundation as a vehicle
through
which to demonstrate its purported commitment to democratic processes
and human
rights abroad, at a time when President Bush was subjected to increasing
criticism for human rights violations in Iraq,
Afghanistan, "black
sites" around the world and Guantánamo
Bay.

 

Dubious Lobbying and
Funding Efforts

From 2005-2007, officials
at the State Department executed a number of questionable legislative
maneuvers
in the US Congress that were favorable to the FFF. In the end, the
Bush-Cheney
administration successfully obtained the passage of three laws related
to the
Foundation and a disbursement of $21.3 million in public funds. They
also
secured $921,064 for the Eurasia Foundation - a non-profit organization
set up by the State Department in the 1990s to promote democracy in the
former Soviet Union - to help establish the FFF.

It appears that in
order
to obtain the disbursement to the FFF, State Department officials
deliberately
misled the US Congress about the funding pledged to the Foundation by
other
governments. Evidence strongly suggests that section 534(k) of US Public
Law
109-102, which at that time stipulated that funds could only be made
available
to the Foundation to the extent that they had been matched by
contributions
from other governments, was violated; the Foundation's own reports show
that less than $6.4 million of the $22.26 million in "matching
funds" listed by the State Department in its communications with
Congress
as pledged ever materialized.

Especially suspicious
was
the State Department's representation of a murky $10 million pledge from
Qatar, the largest "pledge" of any
country other than the United
States. Documents indicate that the State
Department knew that this pledge would never materialize when it asked
Congress
to disburse matching funds.

GAP's report also
suggests that FFF management - including former FFF Chairman (and close
friend of Paul Wolfowitz) Anwar Ibrahim, who is currently a Malaysian
parliamentarian - misled the US Internal Revenue Service. The FFF's
financial statements for 2006 and 2007 state that the Foundation did not
attempt to influence national legislation, an assertion contradicted by
the
cables and reports released by the Department of State. These documents
suggest
that several Foundation representatives actively lobbied the US Congress
in
2006-07 for legislative changes favorable to the FFF.


Shaha
Riza

State Department
documents show generous travel
allowances and salaries for the office of Shaha Riza, whose nebulous
duties did
not seem to require such lavish financial support. Riza was paid a net
salary
of $180,000 to perform such tasks as reviewing a translated draft of the
FFF
bylaws, a PowerPoint presentation of a business plan and a translated
policies
and procedures manual.

The
Foundation for the
Future continues to operate, although the departure of both Cheneys from
public
office appears to have weakened its financial support from Congress.
Because
the vast majority of its funding comes from the U.S. government,
budgetary figures
indicate that the FFF will be unsustainable after 2014.

###

The Government Accountability Project (GAP) is a 30-year-old nonprofit public interest group that promotes government and corporate accountability by advancing occupational free speech, defending whistleblowers, and empowering citizen activists. We pursue this mission through our Nuclear Safety, International Reform, Corporate Accountability, Food & Drug Safety, and Federal Employee/National Security programs. GAP is the nation's leading whistleblower protection organization.

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