UPDATE, JAN 27:
Human Rights Watch and the Syrian Legal Development Programme have published a report documenting how Syria’s Assad regime seizes UN aid meant for civilians in need.
The report assesses that “UN agencies do not sufficiently incorporate human rights principles in their assessment of UN suppliers and partners in Syria, and this exposes them to significant reputational and actual risk of financing abusive actors and/or actors that operate in high-risk sectors without sufficient safeguards”.
The authors set our recommendations for better procurement practices by the UN country team and UN agencies in Syria, with an assessment tool to help them identify Syrian suppliers who may be involved in human rights abuses.
The report is based on correspondence and interviews with UN officers, former employees, and economic experts and a review of project documents.
In one case, the UN gave more than $4 million between 2015 and 2020 to Shourouk for Security Services, reportedly linked to Maher al-Assad, brother of Bashar Al-Assad and one of the regime’s most important military commanders.
In 2019, the UN Development Programme gave a contract to the Aleppo Defenders Legion for the repair of water supply pipes and removal of rubble in parts of Aleppo city. The ADL was formed from militia groups involved in the forcible displacement of tens of thousands of civilians from east Aleppo, as the regime reoccupied the area in December 2016.
The HRW’s Sara Kayyali summarizes:
The Syrian government has committed atrocities against its own people, including mass torture, chemical weapons attacks, and sexual violence. Despite this horrific track record, UN agencies have often failed to do the necessary human rights due diligence to ensure that the way they acquire supplies and services locally does not enable human rights violations and corruption.
ORIGINAL ENTRY, OCT 24: Using a basic tactic with exchange rates, the Assad regime pocketed at least $100 million from UN aid in 2019-2020.
The diversion was enabled through the difference between the official and unofficial exchange rates of the Syrian pound v. the US dollar.
UN agencies must put their operational funds in Syrian private banks or in “correspondent banks” in other countries. The banks swap the dollars for Syrian pounds at the official rate, set by the Assad regime’s Central Bank. Private banks must then sell half of their hard currency directly to the Central Bank.
In March 2021, the official rate of the Syrian pound was 1,500:1, while the unofficial rate was 4,700:1. So the private banks and the Assad regime effectively confiscated 2/3rds of the aid.
The official rate is now 2,500:1, but with an unofficial rate above 3,300:1, the banks and regime are still profiting by about 32% on each transaction.
Natasha Hall, Karam Shaar, and Munqeth Othman Agha of the Center for Strategic and International Studies reviewed all 779 UN procurement entries for 2019 and 2020. They found that in 2020, UN agencies converted at least $113 million for commodities and services at the official rate. With the gap between the unofficial rate, $60 million — 51% of the funds — was diverted
Adding the contracts for 2019 brings the total to $100 million.
And that is only the start of the regime’s profiteering. The procurement figures do not include NGOs operating in regime-held areas. They do not cover the funds, for both the UN and NGOs, to pay staff salaries, provide cash assistance, and carry out ancillary activities. Some UN contractors could not be identified in the review of the 2019-2020 procurements.