The Special Inspector General for Afghanistan Reconstruction (SIGAR) has expressed concern in a report to the US Congress about the Taliban's misuse of Afghan funds in Switzerland.
This report stated that the fund has not provided financial support to activities that benefit the people of Afghanistan.
In this report to Michael T McCaul, chairman of the House Foreign Affairs Committee, John Sapko, SIGAR inspector general, said, "Although the fund’s unanimous vote requirement could help prevent the fund from engaging in risky activity, there are currently no controls in place that specifically address the issue of Taliban diversion.”
In September 2022, United States issued a license authorising the transfer of USD 3.5 billion of the frozen assets of Afghanistan’s Central Bank to a trust fund in Switzerland for the benefit of the Afghan people, including printing money and maintaining Afghan stability.
The Taliban has persistently called for the transfer of Afghanistan's foreign exchange reserves to the group. Contrarily, Anwar Haq Ahadi, a member of this fund, clarified to Afghanistan International that the trust fund will not directly provide funds to the Taliban. Instead, it will disburse payments to relevant institutions for projects deemed to be "for the benefit of the people”.
The latest SIGAR report was commissioned in response to a request from the chairman of the foreign relations committee of the US House of Representatives, specifically concerning the oversight of the trust fund's management.
McCaul, in a letter to SIGAR in March 2023, requested a review of the management mechanism of the fund. He expressed concern about the possibility of fraud, abuse, and direct and indirect support of the trust fund to the Taliban regime.
SIGAR has raised concerns about the Taliban's involvement in appointing an official responsible for overseeing suspicious transactions. It said that Hidyatullah Badri, who is on the list of the US international terrorists, now appoints the head of "FinTRACA", Da Afghanistan Bank’s financial intelligence unit. This unit is responsible for monitoring and preventing illegal transactions such as money laundering and terrorist financing in the financial and banking system of Afghanistan.
Hidyatullah Badri was the former head of the Taliban’s financial commission, who is on the UN Security Council sanctions list for his role in financing suicide attacks in Kandahar.
The United States has rejected the Taliban's appeal for access to Afghanistan's foreign exchange reserves held in Switzerland and the United States by the Central Bank of Afghanistan. The United States says that the Central Bank of Taliban is not currently recognised as an independent institution from the group and lacks mechanisms to prevent money laundering and terrorist financing.
Nevertheless, USAID's evaluation suggests that the potential for the trust fund's involvement in activities supervised by the Taliban’s Central Bank should not be overlooked.
