The report to Congress by the inspector general's office of the Coalition Provisional Authority, the US occupation's administrative setup dissolved in June, said it had been involved in 69 criminal investigations, of which 42 had been closed or referred elsewhere. A further 27 are still open.

In one case, an unnamed senior adviser for the CPA bypassed the bidding process for a $7.2 million security contract. The deal was revoked, a $2.3 million advance taken back from the contractor and the CPA adviser removed.

CPA Inspector General Stuart Bowen said his findings were not unexpected given that the CPA and contractors were working in a volatile, dangerous environment.

"These results are not surprising: the CPA faced a variety of daunting challenges, including extremely hazardous working conditions," the former White House lawyer said in a letter accompanying the report.

Money gambled away

In another case, the Iraqi Ministry of Interior appointed a US Defence Department civilian as a coach for an Iraqi amateur sports team.

The civilian received a $40,000 cash advance, but gave the funds to his military assistant who went gambling and lost some of it. The money frittered away was then written off as a legitimate loss. That case is still pending.

The CPA-IG's office also found weaknesses in the monitoring process for oil pipeline repair and found employees were not doing work in the field specified by the contract, the report said.

In yet another instance of abuse, a Defense Department official in the CPA's contracting office committed "time card fraud" and charged for work he had not done.

He also had an unauthorized weapon. The employee was removed from his position and sent back to the United States, the report said.

Slow process

Another probe is focusing on the "illegal exchange of worthless Iraqi dinars" by a foreign national that has led to the recovery of $29,000. The investigation was continuing and the report said further funds were likely to be recovered.

The report said the CPA comptroller's policies and rules had not done enough to monitor and control more than $600 million in Iraqi funds held as cash.

Bowen's office is also looking into the "timeline" of how the $18.4 billion in US funds for Iraq is being spent. There has been criticism, particularly by Iraqis, the money was being spent too slowly.

The report says just 2.1% of the $18.4 billion Iraq Relief and Reconstruction Fund has been spent so far.

With the CPA handing over authority to a new Iraqi authority last month, the CPA-IG's office ceases to exist from the end of December.

Another CPA-IG report is set to be delivered to Congress in October, and the inspector general's office will also be continuing audits including whether companies are providing enough insurance for staff and foreign workers are being
humanely treated.