Iraq’s Supreme Judicial Council announced Friday that it is coordinating with the government on legal mechanisms aimed at combining accountability for corruption with the recovery of public funds. The proposal could allow reduced legal measures or lighter sentences for defendants who voluntarily return embezzled money under amendments to the General Amnesty Law. Meanwhile, the recent security operation, dubbed Dawn Assault, has exposed divisions within the ruling Coordination Framework, according to political sources and public statements. In a statement, the council said its objective is to both hold perpetrators of financial and administrative corruption accountable and recover state funds, adding that these goals could be achieved by easing legal procedures or reducing sentences “within constitutional and legal limits.” The council noted that the approach was first adopted in the Tax Deposits case, widely known as the “Heist of the Century.” The case centers on the fraudulent withdrawal of tax deposits lodged by foreign companies with the General Commission for Taxes as guarantees for project implementation. The funds were allegedly siphoned off through irregular procedures involving brokerage firms, including Al-Qant and Al-Mubdeoon Oil Services Company, owned by businessman Noor Zuhair, with the help of government employees. According to the council, the head of the Supreme Judicial Council and then-Prime Minister Mohammed Shia al-Sudani agreed, with the approval of the investigating judge, to release Zuhair on bail in exchange for repaying the money in installments and receiving a reduced sentence. The arrangement led to the recovery of 365 billion Iraqi dinars (about $252 million) out of 1.618 trillion dinars (about $1.12 billion) owed by the two companies. Overall, about 3.831 trillion dinars (roughly $2.64 billion) were withdrawn from Rafidain Bank through multiple companies. According to the council, Zuhair later left Iraq, bringing repayments to a halt. He was subsequently tried in absentia, sentenced to 10 years in prison, and became the subject of extradition proceedings through Arab and international police channels. Following amendments to the General Amnesty Law, Zuhair’s lawyer requested that his client be covered by the legislation in exchange for repaying the remaining funds. The court sought the Finance Ministry’s opinion, as the injured party, on the proposed repayment mechanism but has yet to receive a response, leaving the request pending. The council added that 12 employees of the General Commission for Taxes have been sentenced to prison for facilitating the withdrawals and may qualify under the amended amnesty law after paying compensation determined by the Finance Ministry. An photo released by the Iraqi judiciary shows cash seized inside boxes and bags marked with the Iraqi Central Bank's seal. It also noted that an investigation into former Prime Minister Mustafa al-Kadhimi, whose government was in office when the crime occurred, was closed for lack of evidence. The same approach could also be applied in the North Refineries Company case involving detained suspect Adnan al-Jumaili and several current and former lawmakers, provided the alleged offenses predated the amended amnesty law and the outstanding funds are repaid. Crimes committed after the law took effect are not eligible for amnesty. The judiciary is now coordinating with Prime Minister Ali al-Zaidi on a constitutional and legal “roadmap” aimed at recovering public funds while easing legal measures against those who voluntarily return them. Separately, the June 28 Dawn Assault operation inside Baghdad’s Green Zone, which resulted in the arrest of dozens of corruption suspects, triggered criticism within the Coordination Framework. An informed source told Asharq Al-Awsat that several alliance leaders were caught off guard by the operation and the deployment of tanks and armored vehicles, raising concerns that military force could be used more broadly in the future. The source added that al-Zaidi defended the measures during his first meeting with Coordination Framework leaders after the operation, arguing that the armored deployment was necessary to seal off the Green Zone while the arrests were carried out. The source also said several lawmakers managed to leave the Green Zone minutes before the operation began, some of them affiliated with armed factions. The absence of any response from those groups during the operation further heightened concerns among some Coordination Framework leaders. Legal expert Jamal al-Asadi told Asharq Al-Awsat that Iraqi law has no provision allowing financial settlements in corruption cases or other criminal offenses. He noted, however, that the amended General Amnesty Law includes specific provisions covering those convicted of embezzlement or squandering public funds, subject to prescribed legal conditions. In televised remarks, leading member of the Coordination Framework Amer al-Fayez said all alliance leaders except former PM al-Sudani criticized the government for failing to notify them in advance of the operation. While backing efforts to pursue corruption suspects, he objected to the use of tanks during the arrests, arguing that although the prime minister was under no obligation to disclose operational details, the Coordination Framework, as “the state’s highest governing authority,” should have been informed.
