US aid to Cuba unfrozen, State Dep. pledges reform

Associated Press

July 22, 2008

MIAMI (AP) - House lawmakers agreed to unfreeze $45 million in assistance to Cuba after the U.S. State Department promised it is working to improve the program, the head of the House Foreign Affairs Committee announced Tuesday.

Last month, committee chairman U.S. Rep. Howard L. Berman, D-Calif., put a hold on the money in the wake of reports of fraud by two groups receiving federal grant money from the program. Berman lifted the freeze Monday.

Congress halted the implementation of the U.S. Agency for International Development's 2008 funding for Cuba last month, The Miami Herald reported Tuesday. The move was partly in response to a $500,000 embezzlement at one of the groups, the Washington-based Center for a Free Cuba, federal officials said.

"In response to our Committee's concerns, USAID has announced an immediate review and an expanded audit of all Cuba democracy program participants, and I applaud this expanded oversight," Berman said in a statement.

Berman added that on Monday he received additional assurances the State Department understood "the gravity of the problems in these programs" and was working to correct them.

"Therefore, I have decided to release the hold placed on the $45 million in funding for Cuba democracy programs, except that funds will not be extended to those program participants that are under investigation. I look forward to working with USAID and the State Department to ensure that our Cuba democracy programs are properly administered," he said.

U.S. AID recently suspended the second organization, Grupo de Apoyo a la Democracia (Support Group for Democracy). The review found an employee at the Miami-based exile group spent thousands of dollars in grant money on personal items, according to a memo sent by U.S. AID official Stephen Driesler on Friday to various members of Congress. The money has since been reimbursed.

"When we have problems with two institutions within six months, out of 11 active grantees, you say, 'We hope this is not a pattern, but we better pause and check and make sure,'" Driesler told the Miami paper. As part of its internal review, U.S. AID is checking the legitimacy of purchases and the accuracy of invoices.

Last year, Congress' investigative arm issued a report critical of some of the aid organizations, and AID had planned to shift much of its funding to overseas groups that support Cuban dissidents from the traditional Miami-based aid organizations and academic institutions.

Center for a Free Cuba executive director Frank Calzon called the move politically motivated. The House Foreign Affairs Committee chairman who pushed for the program's audit is Democratic Rep. Howard Berman of California.

"If Mr. Berman were in agreement with the president's Cuba policy, he would not be on this fishing expedition," Calzon told the Herald. Calzon also noted that he -- not a federal audit -- discovered the $500,000 fraud at his organization.