$1bn Bosnia aid is lost to fraud

AS MUCH as pounds 1bn has disappeared from public funds, or been lost to aid projects, because of fraud carried out by the Muslim, Croat and Serb nationalist leaders in the three enclaves of Bosnia.

The anti-fraud unit set up by the Office of the High Representative - the agency responsible for implementing civilian aspects of the Dayton peace accord - has exposed so much corruption that relief agencies and embassies are reluctant to publicise the thefts for fear of frightening away international donors, according to a report in yesterday's New York Times.

The report names several officials linked to the governing nationalist parties that it says profited from the fraud. Although the Office of the High Representative has dismissed 15 officials or prevented them from holding office, most retain authority.

In one incident, 10 embassies and aid agencies lost more than $20m deposited in a Bosnian bank. Only the Swiss embassy has acknowledged its losses.