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Palestinians disclose finances

©Associated Press

March 1, 2003

JERUSALEM -- In a bid to dispel charges of widespread corruption, the top Palestinian financial official Friday said the Palestinian Authority had no secret accounts and had not funneled money to groups accused of terrorism.

Finance Minister Salam Fayad said the Palestinian Authority had about $600-million in liquid assets. The public accounting was the first since the governing body's creation about a decade ago.

"The object is to have a system judged to be good and right by our own people," Fayad told the Associated Press. "If we succeed on that front, it should be good for the rest of the world."

International donors, led by the United States and the European Union, have for years demanded the Palestinian government divulge its financial dealings, including the alleged diversion of millions of dollars in tax revenues to secret bank accounts to which only Palestinian leader Yasser Arafat and a few close advisers had access.

In a special annual issue of Forbes Magazine, Arafat was reported to have $300-million, making him among the richest in its category of "Kings, Queens and Despots."

"This is not his money," Fayad said. "This is the Palestinian Authority money, and it is being managed as such." Fayad's report was partially prepared by analysts from Standard & Poors and did not mention accounts held by Arafat.

An internationally respected former World Bank official, Fayad was appointed finance minister by Arafat in a Cabinet reshuffle forced on the Palestinian leader in June. Arafat made the changes after widespread complaints about corruption in his administration and Israeli charges that government funds were being funneled to terror groups. Fayad said no money had gone to fund terrorist activity.

"It is really not too hard to do the accounting and to show that whatever limited resources we had . . . we were funding basic government functions," he said, dodging questions about reports that Arafat had signed off on payments to suspected terrorists.

An aide to Israeli Prime Minister Ariel Sharon, Rannan Gissin, refused to comment on the financial disclosure, saying it would be counterproductive.

Last year, the Israelis issued a report linking Arafat to terror attacks against Israel and released documents that it said outlined payments to Palestinian militants, allegedly signed by Arafat. The Palestinians have questioned the authenticity of the documents.

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