
President Joe Biden travels to Kyiv, Ukraine Monday, February 20, 2023. Photo: Official White House photo/Adam Schultz.
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President Joe Biden travels to Kyiv, Ukraine Monday, February 20, 2023. Photo: Official White House photo/Adam Schultz.
By Heather Kaiser, Anya Parampil and Max Blumenthal – Jun 27, 2023
In the absence of official scrutiny of Washingtonās spending spree on Ukraine, The Grayzone conducted an independent audit of US funding for the country. We discovered a series of wasteful, highly unusual expenditures the Biden administration has yet to explain.
During a recent discussion with New York Times columnist Nicholas Kristof, Administrator of the United States Agency for International Development (USAID), Samantha Power, touted her organizationās push to guarantee transparency for US taxpayer funds sent to Ukraine.
āWe are involved in funding efforts at ensuring judicial integrity, which is intrinsically important to building Ukraineās democracy and its integration plans to get into Europe,ā Power declared, adding USAIDās work in Ukraine was āalso really important in terms of assuring the taxpayer, the American taxpayer, that theyāre resources are well spent.ā
Even a year into the war, Ukraine continues to build out Diia ā an e-government app that gives citizens access to more than 120 gov services.
I spoke with @NickKristof about @USAIDās support of this groundbreaking app that plays such an important role in transparent government. pic.twitter.com/pZTCZYaZHN
— Samantha Power (@PowerUSAID) February 24, 2023
While innocuous on the surface, Powerās comments revealed a great deception the US government is currently waging against the American public. In the roughly 16 months since Russiaās February 2022 escalation of the Ukraine conflict, the US government has approved several multi-billion dollar spending packages to sustain the Kiev militaryās fight against Moscow.
Though many Americans likely believe that US dollars allocated for Ukraine are spent directly on supplies for the war effort, the lead author of this report, Heather Kaiser, conducted a thorough review of Washingtonās budget for the 2022 and 2023 fiscal year and discovered that is far from the case.
US taxpayers may be shocked to learn that as their families grappled with fears of Social Securityās looming insolvency, the Social Security Administration in Washington sent $4.48 million to the Kiev government in 2022 and 2023 alone. In another example of bizarre spending, USAID paid offĀ $4.5 billion worth of Ukraineās sovereign debtĀ through payments made to the World Bank ā all while Congress went to loggerheads over Americaās ballooning national debt. (Western financial interestsĀ includingĀ BlackRock Inc. are among the largest holders of Ukrainian government bonds.)
Though it is nearly impossible to calculate the total sum of US tax dollars sent to Kiev, Kaiser was able to perform an independent audit of Washingtonās proxy war in Ukraine through a careful search of open source data available on the US governmentās official spending tracker.
Kaiser reviewed all the funding allocations in which Ukraine was listed as the āPlace of Performanceā for fiscal years 2022 and 2023. Additionally, she discovered supplementary funds were sent to Kiev by listing Ukraine as the ājustificationā for spending, rather than the location where the money was physically sent.
Calculating the total dollar amount that the US has given to Ukraine is incredibly challenging for multitude of reasons: there is a lag in reporting expenditures; covert money given by the CIA (Title 50 Covert Action) wonāt be publicly disclosed; and direct military assistance in the form of military equipment is not calculated in the same manner as raw cash. The Pentagon recently admitted to an accounting error revised up toĀ 6.2 billion dollars. Despite this, Kaiser submitted a request to the Department of Treasury asking them to disclose the total dollar amount of US taxpayer support for Ukraine. Treasury has not responded at the time of publication.
Though Kaiser was able to search through pages of reported spending, the US government has yet to conduct an official audit of its funding for Ukraine. Whatās more, there is currently no limit to how much Washington can send to Kiev.
In the absence of dedicated official scrutiny of Washingtonās spending in Ukraine, The Grayzone has produced an independent audit of US tax dollar allocation in the country.
Among the many troubling contracts we discovered was a $4.25 million payment from the Pentagon to a military diving contractor that a member of the Senate Armed Services Committee has described as a āfraudulent company.ā The US government asserts the payment covered the companyās delivery of explosives equipment to Ukraine.
So how exactly was that money put to use? And why has Congress so far refused to implement any program to track these shady weapons deals?
Unfortunately, the ājustificationā for contracts like these often consists of just a brief paragraph ā or worse, a single sentence. Little little information is available that documents precisely how the funds were spent down to the dollar and item.
Beneficiaries of USAIDās Ukraine aid: Polish NATO lobbyists, a private equity firm, rural Kenyans, a TV station in Toronto
USAID awardedĀ $21.8 billionĀ to UkraineĀ throughout fiscal years 2022 and 2023, roughly 41 percent of the 53.4 billion it spent during that period. Mysteriously, a portion of USAID funding earmarked for Kiev was sent to Kenya and Ethiopia via other agencies, with the award description stating projects in Africa were āpartially funded with response funds and Ukraine supplemental funds.ā
USAID sentĀ $4.5 billionĀ to Ukraine via the World BankĀ to pay off Kievās debt and fund various social programs, including government pensions. USAID made a total of $21 billion worth of direct payments to the World Bank in fiscal years 2022 and 2023 (9.1 BillionĀ andĀ 11.9 Billion, respectively), more money than all of the funding Washington sent to the bank between fiscal years 2008 and 2021Ā combined.Ā The $4.5 billion allocated for Ukraine funded programs directed by the bankās International Development Association and International Bank for Reconstruction and Development.
USAID supplied a $1 billion grant to the World Bankās International Bank for Reconstruction and DevelopmentĀ to subsidize projects āUkraine cannot fund at this time.ā
USAID has supplied $20 million to āMiscellaneous Foreign AwardeesāĀ since February 2020. Recipients include a Polish think tank called the Casimir Pulaski Foundation, a Toronto-based Ukrainian TV channel, a collection of Ukrainian āanti-corruptionā organizations, and other groups listed in the screenshot below. These awards were issued on top of $26 million worth of funds USAID sent these groups between 2016 and the February 2022 war escalation.
USAID allocated $500,000 for the Casimir Pulaski FoundationĀ in 2023 to fund a program dedicated to āadvanc[ing] U.S. foreign policy objectivesĀ by supporting economic growth, agriculture and trade; global health; and democracy, conflict prevention and humanitarian assistanceā in Ukraine. The funds were earmarked āto strengthen the International Center for Ukrainian Victory (ICUV) initiative in implementing international advocacy campaigns to keep high levels of international solidarity with Ukraine.ā
USAIDās support arrived on top of aĀ $74,788Ā subaward the State Department granted to the Casimir Pulaski FoundationĀ in June 2022 to ābuild capacity and policy formulating capabilities of the International Center for Ukrainian Victory (ICUV) and assisting Ukrainian civil society based in Poland.ā
According to their own so-called āPeace Manifesto,ā the ICUVās top priority is to admit Ukraine into NATO, a move that former US diplomats fromĀ George KennanĀ toĀ Jack MatlockĀ toĀ Henry KissingerĀ and even current CIA directorĀ William BurnsĀ have described as a major provocation against Russia.
USAID sentĀ $3 million to the World Health OrganizationĀ (WHO) in 2022Ā Ā āto improve health outcomes in drought affected areas in Ethiopia.ā The description stated, āpartially funded with response funds andĀ Ukraine Supplemental Funds.ā
USAID sentĀ 30.9 million to Chemonics International, Inc.Ā for the āUkraine confidence building initiative (UCBI).ā A private, for-profit aid contractor, Chemonics was founded by a businessman whoĀ saidĀ he launched the company to āhave my own CIA.āĀ The Grayzone has documented Chemonicsā role in deliveringĀ US government funding and supplies to the Syrian White Helmets, which served as the propaganda wing of the Al Qaeda-tied armed opposition. Chemonics previously reaped aĀ massive windfallĀ from the US occupation of Afghanistan, raking in as much as $600 million from USAID.
US Military Aid to Ukraine ‘Will Soon Be Tapped,’ Talk of More Funding ‘On Back Burner’
USAID sentĀ $20.7 million to PACT, INC.Ā for āUSAID Ukraineās public health system recovery and resilience activity and will strengthen the Government of Ukraine (GOU) capacity to address COVID-19 and other public health threats, sustain health services during a crisis, and protect the health of all Ukrainians including vulnerable and marginalized populations. According to its 2022 impact statement [PDF], āIn Ukraine, Pactās work empowers citizens to push for transparent and democratic governance, advances gender equality and human rights for women and girls, and accelerates efforts to achieve HIV epidemic control.ā The contractorās work contributed to ā172 people increas[ing] their net income,ā according to Pact.
USAID sentĀ $25 million to Horizon Capital Growth Fund IV,Ā a āleading private equity firm in emerging Europe, via the US International Development Finance Corporation (DFC), āto back high-growth tech and export-oriented [Small and Medium Sized Enterprises] succeeding globally, based on platforms in Ukraine and Moldova.ā
USAID sentĀ 7.6 million to UNICEF IDAĀ for emergency nutrition response in ASALs (Arid and Semi-Arid Lands) in Kenya. The description stated, āpartially funded with response funds andĀ Ukraine Supplemental Fundsā
USAID sentĀ $1.2 million to University of Georgia Research Foundation, Inc.Ā located in Atlanta, GA to āsupport humanitarian information management through geographic information systems, data analytics and visualizationsā. Ukraine was listed as the place of performance.
The Pentagon sponsors diving contractor with āhistory of fraudā to send mysterious explosives to Ukraine
The Department of Homeland Security sentĀ 5.48 million to Gravois Aluminum Boats LLCĀ on June 8, 2021 for the following purpose: āPROCUREMENT OF TWO 38-FOOT FULL CABIN RESPONSE BOATS, FOUR 38-FOOT CENTER CONSOLE RESPONSE BOATS, TRAILERS, SPARE PARTS, AND TRAINING AS REQUIRED UNDER FMS LOA DB-P-LCL FOR THE COUNTRY OF UKRAINE.ā
Facing Epidemic of Homelessness, US Citizens Ask Why Billions Are Being Sent to Ukraine
The Department of Defense has transferredĀ 4.75 Million to Atlantic Diving Supply, Inc.Ā as of February 3, 2023Ā for āPRO SAPPER AND EOD EQUIPMENT [CONTRACTING SQUADRON] UKRAINEā and āMarine lifesaving and Diving Equipment.ā
Explosive Ordnance Disposal (EOD) and sapper equipment is exclusively used to blow things up or clean up explosives. AndĀ Atlantic Diving SupplyĀ is a military contractor originally founded to provide tactical gear to Navy SEAL divers.
When a company like this is tasked with a highly specific delivery of explosives gear to any foreign nation, including Ukraine, it should prompt questions about the mission, particularly whenĀ US intelligence is blamingĀ Ukraineās military for attacking the Nord Stream pipelines without the knowledge of President Volodymyr Zelensky. (The payment date does not necessarily correlate with the date of delivery from the vendor; in other words, the equipment could have been delivered at a prior date.)
Luke Hillier, the founder of Atlantic Diving Supply,Ā paid a $20 million settlementĀ in 2019 to resolve charges that he defrauded the Pentagon by falsely claiming his company was a small business. Atlantic Diving is consistently listed as one of the top 25 largest military contractors in the country.
THREAD: A controversial "small business" just won a $33B DoD contact, despite what a senator calls "a known history of fraud." A new @POGOwatchdog investigation into Atlantic Diving Supply, Inc. https://t.co/kinpwb7O9l with @schwellenbach @adamzagorin
— Jason Paladino (@jason_paladino) February 18, 2021
In 2021, Hillier raked in a massive $33 billion contract under the same program, prompting fresh accusations of fraud. This pattern of malfeasance prompted a member of the Senate Armed Services Committee to bluntly denounce Atlantic Diving as aĀ āfraudulent company.ā
Hillier currently owns a $13 million mega-yacht in the Cayman Islands, $24 million worth of beachfront property in Hawaii, and two Bahamas-based companies with murky operations, according to theĀ Project on Government Oversight.
The Department of Defense has paidĀ 4.9 Million to BAE Systems GCS InternationalĀ as of September 12, 2022Ā for āUKRAINE LCS LW 155 SPARESā and āguns over 155mm through 200mmā. In Navy terminology, LCS means āLittoral Combat Ship,ā while LW refers to the lightweight gun.Ā And ā155 SPARESā refers to the gun mounted on the shipās main battery off the bow.
So what is the exact purpose of the LCS LW 155mm gun spares, why were they given to Ukraine, and where are they now? Is there a tracking mechanism in place to know where they are and how theyāre being used?
Washington funnels cash to a private equity firm, Georgian finance corporation, a āprivate entrepreneurā via Ukraine aid
US International Development Finance Corporation (DFC)Ā Ā sentĀ $25 million to Horizon Capital Growth Fund IV,Ā a āleading private equity firm in emerging Europe, āto back high-growth tech and export-oriented [Small and Medium Sized Enterprises] succeeding globally, based on platforms in Ukraine and Moldova.ā
US International Development Finance Corporation (DFC)Ā Ā sentĀ $1.5 million to the Gazelle Fund LP,Ā another private equity firm, to relocate Ukrainian businesses to Georgia. Georgia does not border Ukraine, nor is it aĀ primary locationĀ for Ukrainian refugee resettlement.
The Federal Trade Commission (FTC) sentĀ $882,291 to a single individualĀ described as an āprivate entrepreneurā in exchange for āoverseas technical assistance program support services.āĀ The private entrepreneur listed, Igor Lavreniuk, serves as the Program Coordinator for USAIDās Competitive Markets Program according to his LinkedIn.
The National Science FoundationĀ sentĀ 1.3 million to University of IllinoisĀ for faculty and curricular development in remote sensing. The place of performance is listed as Ukraine.
The Department of State has paidĀ 8.3 million to Catholic Relief Services (CRS)Ā to help ārefugees from Ukraine meet their essential needs during initial displacement.ā According to SpendingUS.gov, Catholic Relief Services is listed as having received a total ofĀ 657 million from the State Department in 2021,Ā 5.7 billion since 2008Ā andĀ 670 million during the last 12 months.
Sponsoring ādemocracyā at Americansā expense
Along with the blowback from their governmentās gratuitous sanctions policy against Russia and other official enemies, Americans are feeling the impact of this overseas spending spree at grocery stores, gas stations, and everywhere in between. Meanwhile, rising generations are not only struggling with historic inflation, but concerns that Medicare and Social Security will be insolvent in the near future.
Washington and Europe have insisted that the flood of aid to Ukraine is essential to defending democracy against the existential threat of an authoritarian Russia. This framing is designed to shut down all debate by casting anyone who questions the ballooning price tag as fundamentally anti-American ā if you are against funding the Westās proxy war with a nuclear power, you oppose the very ideals that define our nation.
Yet our inspection of US government spending in Ukraine demonstrates that Washington has prioritized its supposed fight for ādemocracyā abroad over the well-being of the American people.
As the war drags on, lawmakersĀ like Sen. Lindsey Graham have marketed military aid to Ukraine in increasingly grim terms. As the senatorĀ boastedĀ during a recent trip to Kiev, āThe Russians are dyingā¦itās the best money weāve ever spent.ā Meanwhile, Congress has rejected any mechanism that would guarantee transparency on the billions sent to Kiev, and shunned a war powers debate over the US militaryās presence on the Ukrainian battlefield.
President Joseph Biden, for his part, hasĀ pledgedĀ that official Washington will support Kiev āas long as it takes.ā As the potential for blowback grows from Western pressure to push Ukraine into NATO, and a nuclear-armed Moscow is backed into an existential fight for its survival, while economic powers including China gradually decouple from the Western financial system, Americans can only wonder how much will this war cost them when it is finally over.
Heather Kaiser is a former military intelligence officer and veteran of the wars in Iraq and Afghanistan. She is an independent researcher and analyst for defense, intelligence, and political matters. Heather earned a bachelor’s in geopolitics from the United States Military Academy at West Point and earned a degree in sculpture from Indiana University of Pennsylvania. Since the 2020 riots, she has returned to research and analysis of current events for organizations such as American Contingency and Grayzone.
Anya Parampil is a journalist based in Washington, DC. She previously hosted a daily progressive afternoon news program called In Question on RT America. She has produced and reported several documentaries, including on-the-ground reports from the Korean peninsula and Palestine.
Max Blumenthal is an award-winning journalist and the author of several books, including best-sellingĀ Republican Gomorrah,Ā Goliath,The Fifty One Day War, andĀ The Management of Savagery. He has produced print articles for an array of publications, many video reports, and several documentaries, includingĀ Killing Gaza. Blumenthal founded The Grayzone in 2015 to shine a journalistic light on Americaās state of perpetual war and its dangerous domestic repercussions.
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