The leaflet, a sign that Palestinians as a whole may be turning against Mr Arafat and signed by an anonymous group calling itself Free Officers, accuses Mr Arafat of "giving authority to 3,000 thieves".
They are able to travel freely outside the Palestinian enclaves in Gaza and the West Bank through a special agreement with Israel.
The leaflet names senior lieutenants of Mr Arafat, saying they take bribes, get medical treatment abroad, are given free apartments and drive luxury cars, while ordinary Palestinian "soldiers do not receive their legal salaries".
The leaflet says labourers have to pay pounds 80 to pounds 160 each to Palestinian officials to get a work permit for Israel. The spread of the leaflet underlines the deep and growing rift between the Palestinian elite, who returned from exile with Mr Arafat in 1994, and the 2.5 million Palestinians who live in the West Bank and Gaza.
"Nobody would dare publish it in the papers, but it is being talked about in every home in the West Bank because they think its accusations are true," said one Palestinian, who lives in Ramallah, a town north of Jerusalem. He wished to remain anonymous.
Palestinians have often criticised men around Mr Arafat for corruption, but have usually seen the Palestinian leader as misled or misadvised.
At the heart of discontent is a sense that Mr Arafat, and the small group of men he brought back from exile in Tunis, have done well out of the Oslo Accords negotiated with Israel in 1993.
But nearly all Palestinians have seen their living standards plunge and their freedom of movement decrease over the past six years.
The leaflet attacks by name almost all of Mr Arafat's senior aides, particularly Musa Arafat, the head of military intelligence, and Khalid Salam, his business adviser. It also says: "The financial department headed by Fou'ad al-Shobaki includes a list of 80 names of people on the payroll, of whom only a few come to work."
The leaflet adds that friends of the elite and collaborators with Israel receive promotion in the security services, while those veterans long active in the Palestinian struggle are ignored.
A further sign of Palestinian discontent with Mr Arafat's leadership was the dismal turn-out for the so-called Palestinian "Day of Rage" on 3 June, called to protest against the expansion of Jewish settlements in the West Bank.
Only 3,000 Palestinians demonstrated, compared with the hundreds of thousands who took to the streets during the Palestinian intifada (uprising) against Israel between 1987 and 1992. Palestinian observers said the small turnout was closely linked to popular disillusionment with Mr Arafat and his regime.
Palestinian businessmen and foreign diplomats say corruption in the Gaza security forces has reached saturation point. Bribes are said to be required to carry out almost any business activity. One diplomat told The Independent: "Some businessmen won't leave home without a bodyguard because they are frightened of being kidnapped by the security forces and held for ransom."
The leaders of the 11 security services established by Mr Arafat have made money since he returned to Gaza from, Tunis.
But men from elements of the old Palestinian regular forces known as the Palestine Liberation Army are still poorly paid. The authors of the leaflet are likely to come from their ranks.Reuse content