Arthur Brennan, who briefly served in Baghdad as head of the department's Office of Accountability and Transparency last year, and James Mattil, who worked as the chief of staff, told Senate Democrats on Monday that their office was understaffed and its warnings and recommendations ignored.
Brennan also alleges the State Department prevented a congressional aide visiting Baghdad from talking with staffers by insisting they were too busy. In reality, Brennan said, office members were watching movies at the embassy and on their computers. The staffers' workload had been cut dramatically because of Iraqi Prime Minister Nouri al-Maliki's "evisceration" of Iraq's top anti-corruption office, he said.
The State Department's policies "not only contradicted the anti-corruption mission but indirectly contributed to and has allowed corruption to fester at the highest levels of the Iraqi government," Brennan told the Senate Democratic Policy Committee.
The U.S. embassy "effort against corruption - including its new centerpiece, the now-defunct Office of Accountability and Transparency - was little more than 'window dressing,"' he added.
Deputy State Department spokesman Tom Casey said the administration takes the issue of corruption seriously and pointed to its recent appointment of Lawrence Benedict as coordinator for anti-corruption initiatives at the U.S. embassy in Baghdad.
Benedict's appointment "is another demonstration that we are working at very senior levels to help the Iraqis deal with this issue," Casey said. "Any assertion that we have not taken this issue seriously or given it the attention it deserves is simply untrue."
The Office of Accountability and Transparency, or "OAT" team, was intended to provide assistance and training to Iraq's anti-corruption agencies. It was dismantled last December, after it alleged in a draft report leaked to the media that al-Maliki's office had derailed or prevented investigations into Shiite-controlled agencies.
The draft report sparked hearings in Congress and prompted a showdown between Democrats and senior State Department officials on whether the public has a right to know the extent to which al-Maliki was involved in corruption cases.
Brennan charges the State Department never responded to his team's report, which was retroactively classified because agency officials said it could hurt bilateral relations with Iraq. Other recommendations by the group also were kept secret, including a negative assessment of Iraq's Joint Anti-Corruption Committee, Brennan said.
In July 2007, the OAT team concluded that the committee's only purpose was to provide a forum for complaints against Judge Radhi Hamza al-Radhi, a top anti-corruption official in Baghdad whom many U.S. officials have hailed as the most effective in exposing fraud and abuse.
But information later released by the embassy ignored the team's assessment and ultimately "failed to even mention what a disaster" the committee "really was," Brennan said.
Brennan said he approved the embassy report against his better judgment but later regretted it.
Mattil, who worked with Brennan, made similar allegations. Specifically, he said the U.S. "remained silent in the face of an unrelenting campaign" by senior Iraqi officials to subvert Baghdad's Commission on Public Integrity, which had been led by al-Radhi. Then, the U.S. turned its back on Iraqis who fled to the United States after being threatened for pursuing anti-corruption cases, he said.
"Since we have done so little (to undercut corruption), it's easy to see why the government of Iraq has not done more," said Mattil, who left the accountability office last October after having served for a year as its chief of staff. "We have demanded no better."
Brennan was appointed as OAT director last summer and arrived in Baghdad in July. He left only a few weeks later after his wife was diagnosed with cancer. He stepped down from his position in August.
Iraqi government officials could not be reached for comment.
Sen. Byron Dorgan, head of the Democratic Policy Committee, said the testimony was critical in light of upcoming legislation that would appropriate more than $170 billion for the wars in Iraq and Afghanistan. The Senate Appropriations Committee, of which Dorgan is a member, is expected to approve the legislation Thursday.
"It is a cruel irony if we are appropriating money next Thursday or did appropriate money last month or last year and that money ends up actually providing the resources for an insurgency in Iraq which ends up killing Americans," said Dorgan, D-N.D.