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Global charity admits €25m 'missing' in massive fraud

A €15bn development fund -- which has received significant donations from Irish Aid and a charity established by U2 singer Bono -- last night confirmed that tens of millions of euro in grants are unaccounted for.

However, the Global Fund insisted it was its own internal audits that uncovered the corruption last year.

The corruption includes millions spent on cars and motorbikes without receipts, millions more disappearing through faked invoices, and free drugs from donors being sold on the black market.

Irish Aid has allocated over €115m to the fund.

It is understood Irish Aid has no plans to follow in the footsteps of Sweden, which has suspended donations, but a spokeswoman could not confirm its next move last night.

Yesterday it emerged as much as two-thirds of some grants had been lost to corruption, and that the Global Fund -- set up to fight AIDS, tuberculosis and malaria -- had only audited a tiny fraction of the €8bn it has allocated since 2002.

The Global Fund has confirmed €25m is unaccounted for.

Sweden, the fund's 11th-biggest contributor, has suspended its €60m annual donation until the problems are eradicated.

The investigative arm of the US Congress has also issued reports criticising the fund's ability to police itself and its overreliance on those who receive the grants assessing their own performance.


Corruption problems have been identified in a number of African countries including Mali, where €3m in spending was undocumented, and Djibouti, where €3.5m was spent on cars, motorbikes and other items without receipts.

In Mauritania, over €3m -- 67pc of a anti-HIV grant -- was lost to faked documents and other fraud.

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Global Fund chief executive Prof Michel Kazatchkine last night insisted the vast majority of funds were untainted by corruption and that criminal proceedings were under way in a number of countries.

"Transparency is a guiding principle behind the work of the Global Fund and we expect to be held to the highest standards of accountability," he added.

The fund, which was hailed as an alternative to the bureaucracy of the United Nations, has also been heavily supported by Bono.

He launched a new global brand, (Product) Red, which donates a significant -- though unpublished -- share of its profits to the Global Fund.

The brand did not return calls yesterday. Bono could not be reached for comment.

The individual in charge of the Irish Aid allocation to the fund was on a long-haul flight and also uncontactable last night.

The Global Fund was set up as a response to complaints about the cumbersome UN bureaucracy, and is strictly a financing mechanism to get money to health programmes.

It claims to have saved 6.5 million lives in the past eight years by providing AIDS treatment for three million people, TB treatment for 7.7 million people and handing out 160 million insecticide-treated malaria bed nets.

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