The front of one of two valueless Iraqi 25-dinar notes (at 70% of actual size) given to the Post by different sources
AS much as eight billion Iraqi dinar have been smuggled into Cambodia over the past
year from Thailand and are now in storage as efforts are made to convert them to
a usable currency.
The arrival of the cash, and promises of handsome commissions to anyone able to exchange
it for US dollars, initially prompted a frenzy among government officials and parliamentarians
to be the first to secure the deal.
Several government officials spoken to by the Post produced samples of the cash which
they said had been given to them by a Thai army officer who told them there were
eight billion dinar in the country.
The back of one of two valueless Iraqi 25-dinar notes (at 70% of actual size) given to the Post by different sources
They said they were told that anyone who could get $7 for 100 dinar would be given
1 percent commission and if they got a better exchange rate they could keep the surplus.
It was claimed the cash was worth about $40 million.
The Cambodian Government reacted strongly when they discovered that the Post was
investigating the matter.
Hun Sen advisor Om Yentieng issued a statement earlier this week saying the story
was an attempt to destroy goodwill at the foreign donors meeting now under way in
Paris.
However the statement did not deny that the money was in Cambodia or that members
of the Government had been involved in trying to exchange it for another currency.
When contacted by the Post, Yienteng refused to answer questions; instead he offered
to speak with Post reporters after the publication of the article.
One National Assembly member said of the dinar hoard that at one time "everyone
was trying to sell it". He said the first people to be approached were those
in the CPP; when they showed little interest they were offered to Funcinpec members
and now the offer appears open to anyone who shows any interest.
An Arab businessman in Phnom Penh said he was approached at the beginning of the
year in front of the Cambodiana Hotel by a taxi driver with a 25 dinar note.
He said he noticed that the note was dated 1986 (in Arabic under Saddam Hussein's
left shoulder) and was therefore virtually useless because the currency was changed
after the Gulf War.
The money is used by some Kurdish rebels as a local currency in the north but the
businessman's view was that the "only use for this stuff is as toilet paper".
A CPP official said that he was approached several months ago by a group of local
officials and businessmen who asked if he could assist them in the deal.
"I told them it was illegal and they would be in trouble if they went ahead
with this scheme," he said.
He added that people he knew of in the CPP who had been approached had been reluctant
to get involved, though some did make a few tentative inquiries about its convertibility.
He said the group that approached him seemed unaware of the UN sanctions against
Iraq and viewed the deal as a simple business transaction.
It was a view shared by several Funcinpec National Assembly members spoken to by
the Post. One member said he had tried very hard to find a buyer for the money, saying
it was just business and was not going to harm Cambodia.
He said he and his friends had tried Singapore, Malaysia, Thailand and had discussed
trying to ship it to Egypt, but had eventually given up after it became clear no-one
wanted it and there were possible legal issues surrounding financial dealings with
Iraq.
When the Post showed a dinar note to one senior government official, he replied "Oh
yes ... let me check ...did I leave that at home?" and then pulled another similar
25 dinar note out from his wallet.
The official, requesting anonymity, commented that he'd been given the bill about
10 months ago, and said "a lot of people know about this".
"I think they came across the border, somewhere near Pailin or in Battambang.
Many people came to approach me with this," he said.
The official said he was originally approached by a low-ranking district official
about the dinar and was told there were "only millions" available for sale.
He was not quoted a price for an exchange and said he let the matter drop as he did
not want to get involved.
As to the origin of the currency, he said he'd heard that it had something to do
with a son-in-law of Saddam Hussein who was killed trying to flee Iraq to Jordan
and that somehow the dinar had got out of the country via Amman.
He had no idea why they might have made their way to Thailand and then across the
border into Cambodia.
A Bangkok-based Asian diplomat said he heard in December last year that people on
the Thai-Burma border in the Mae Sot area, possibly Nagas, had five million Iraqi
dinar.
He said they were trying to sell at a rate of 45 cents per dinar, but had had no
luck.
Western diplomats and government officials confirmed that three shipments had been
made to Cambodia since August last year.
A western diplomat said that the most recent was two months ago and comprised of
several pallet loads of currency shipped in through Kampong Som (Sihanoukville).
He said his embassy was concerned about the shipment of Iraqi currency because it
feared it might be connected to international terrorism.
He said they made some initial investigations but had not pursued it fully. A Bangkok-based
western intelligence agent said he had been aware of a large amount of dinar in Cambodia
but he could not say where it came from.
The third shipment of money is believed to be in Pailin.
An RCAF official said that he had seen numerous pallet loads of Iraqi cash in several
denominations at an army base in the north of the country - and then produced a sample
of it by way of proof.
He said the money was commission payment from illegal oil sales facilitated by former
Thai Prime Minister General Chavalit Yongchaiyudh.
He said that in return for the CPP helping him dispose of the cash, Chavalit was
prepared to make substantial payments for the costs of their commune election campaign.
However this view was called into doubt by a Sam Rainsy Party official, who said
he believed the story about money for the CPP election campaign was prompted by spite,
because the RCAF official had not been initially offered a piece of the deal and
was also trying to make political capital.
The story of Chavalit's involvement is by no means the most extravagant to be circulating
in connection with the cash. One National Assembly member said he heard that the
money was to be used to buy the Khmer Rouge's old weapons to attack the United States.
What seems more likely is that Cambodia is at the tail end of a swindle that has
failed in Thailand and other countries. A French businessman said one of his colleagues
had been contacted by a Thai woman recently who was trying to sell a substantial
quantity of cash at a discounted rate from a country currently under UN sanctions.
Mr Kasem, a spokesman for the Iraqi Embassy in Bangkok, said that "many people
are bringing Iraqi money to us in Thailand".
He said much of the money is counterfeit but he could not say where it was coming
from.
"Nobody knows. Even the police don't know. The Thai police are investigating
this," he said.
He confirmed that the samples obtained by the Post were of little practical use after
he saw copies of them.
"I showed the fax to our Iraqi staff. This is old money, not used in Iraq. It
is used only in the north, in the Kurdish area. It is out of use in Iraq."
He said that even if someone had real Iraqi dinar they would still not be worth much.
"Dinar is very soft. One baht is 50 dinar, so one US dollar equals 2,000 dinar,"
he said.
