Nils Kauffman, who served as an education officer for the U.S. Agency for International Development in Afghanistan, said he noticed irregularities at a vocational training institute the agency was funding during his visits to its campus in downtown Kabul in 2012 and 2013. He recalls being surprised not to see any students in the institute’s laboratories, where volt meters and scientific equipment remained in their original packaging.
Though Kauffman spied students elsewhere, he said he could never get a reliable account of how many were actually enrolled at the school. He also could not verify that the institute had addressed what a 2011 external audit called a host of “deviations” from sound practices, including a lack of accounting software, a cash-based payment system, and $118,000 in spending by the school over a five month period on weapons, international travel, and salary supplements.
Kauffman didn’t have the authority to demand a new, broader audit of the institute, but he reported his concerns to his superiors at USAID. They never acted, he said, and he recalls an official in the agency’s Office of Afghanistan-Pakistan Affairs expressing worry that canceling the institute’s funding would create what the official called “bad press.”
“Every time something came up, they jumped to keep this guy [the institute’s leader] happy, despite the problems, despite the lack of financial transparency,” said Kauffman, who is now a private development consultant based in the San Francisco Bay Area. In fact, USAID continued giving the institute funds, totaling at least $12.3 million through last Sunday, according to USAID spokesman Sam Ostrander.
Kauffman’s experience is only a small part of the controversy suddenly surrounding the long-running U.S. effort to promote the education and training of the largely illiterate population in Afghanistan. More than three-quarters of a billion dollars in U.S. funds have been used to finance the effort, and USAID has repeatedly depicted it as one of its signal accomplishments there.
Last month, Afghanistan’s newly-appointed education minister raised questions about the veracity of that claim when he told his country’s parliament that some aid funds had flowed to so-called “ghost schools, which are only on paper,” according to several Afghan media accounts of the May 27 session. The minister, Assadullah Hanif Balkhi, said that officials in the previous government — in power from 2004 to 2014 — lied about the number of schools to obtain more foreign funds.
“It is a fact that there are no schools in some parts of the country, but all the expenses — including teachers’ salaries — are being paid, and now we will bring reforms to this waste,” Balkhi told the parliament, according to Tolonews, a publisher and broadcaster based in Kabul.
Asked to provide more detail, a spokesman for the ministry, Kabir Haqmal, later told NBC News — the Center for Public Integrity's publication partner for this article — that the matter is still under investigation. In some cases, he said, schools may have been closed due to fighting while “permanent absentees” were kept on the books for years, following a requirement of Afghan law.
“There could be schools that do not exist, but we [are] assessing all our records and so far have not found any such instances,” Haqmal said. “That does not mean there are no ghost schools, but we just do not have that information yet. We are taking this very seriously and will share our finding with public very soon."
The new minister’s claims have provoked the top federal auditor for U.S. reconstruction efforts in Afghanistan, John F. Sopko, to express concern that “U.S. and other donors may have paid for schools that students do not attend and for the salaries of teachers who do not teach.”
In a June 11 letter to acting USAID administrator Alfonso E. Lenhardt, released by Sopko on June 18, Sopko said the allegations about “ghost schools, ghost students, and ghost teachers call for immediate attention,” and asked the agency to explain within two weeks what it is doing to investigate the reliability of its data and the potential misuse of its funds.
Accurate data, Sopko said, “is essential for gauging progress in USAID’s education programs and for making future funding decisions.”
USAID spokesman Ostrander, in an emailed response to questions, said the agency will provide a detailed reply to Sopko by the June 30 deadline. According to a written statement Ostrander provided to the Center for Public Integrity from Larry Sampler, assistant to the USAID administrator for Afghanistan and Pakistan, the agency has already asked the Afghan Education Ministry for more information. USAID currently has a full-time employee assigned to help the ministry improve the reliability of its data, according to Sampler’s statement.
Like all the agency’s projects in Afghanistan, “USAID-implemented education projects adhere to the Agency’s strict practices for monitoring their performance and success,” Sampler wrote.
USAID has repeatedly boasted about its role in raising enrollment rates in Afghanistan, citing Afghanistan Education Ministry data. More than eight million Afghan students were enrolled in 2013, compared to just 900,000 in 2002, according to data that Sopko cited in his most recent quarterly report. He said USAID had acknowledged these figures could not be independently verified, however.
At the Afghanistan Technical Vocational Institute, where Kauffman said he observed irregularities, 4,529 students have so far graduated “with the support of USAID and other sponsors,” Ostrander said. But the institute’s founder and director, Sardar Roshan, reached by cell phone in Kabul, told the Center for Public Integrity that the total number was “close to 7,000.” Ostrander told the Center for Public Integrity he could not explain the discrepancy.
Roshan's tight connections to Washington
Roshan served as Afghanistan’s ambassador to Pakistan from 1992 to 1994, as the country’s minister of education from 1990 to 1992, and as a “rebel commander” liaising between “anticommunist forces and the U.S. government” in the National Islamic Front of Afghanistan during the 1980’s, according to his Linkedin profile.
Roshan denies that the institute has ever misreported its student population, saying the “ghost schools” are in rural provinces, but that his institute in downtown Kabul “could not fake students even if we wanted to.” He says he is highly proud of the institute. “When I’m in the international airport, when I walk into a bank in Kabul, when I look at the provincial governments, I see my graduates in every corner,” he said.
Rajiv Shah, the administrator of USAID from 2010 until February, singled the vocational institute out for special praise in a July 2013 speech at the U.S. Institute of Peace in Washington. “Today, we have more than 8 million children in schools with over 30 percent of who are girls. These investments have resulted in over 30,000 young women finishing secondary school and more than 40,000 young women seeking to earn university degrees today,” Shah said. “I’ve had the chance to meet some of these young women on visits to places like the Afghan Vocational Training Institute, watching them come in from around the country to develop marketable skills so they can triple or quadruple their earning potential upon graduation.”
But Kauffman, the former USAID education officer, was not alone in in voicing concerns about the institute’s achievements. In early 2012 – more than a year before Shah’s speech — USAID’s inspector general had reported there was “little evidence” that the agency’s support of the school, known as the Afghanistan Technical Vocational Institute, had strengthened its “overall technical capacity” or empowered Afghan youth. It said the project that included the institute “lacked clearly defined goals, objectives, and priorities.”
The institute began receiving USAID funds in 2007, according to Roshan and Ostrander. The funds were initially for scholarships, and were paid under USAID’s Afghanistan capacity-building program, Roshan said. But the financing was switched to the agency’s education department in 2010, under a subcontract with Education Development Center, Inc., a Massachusetts-based non-profit organization. Students were supposed to be trained in business management, construction, horticulture, information and communication technology, and automotive repair, according to the USAID webpage about the institute.
After the 2011 audit by accounting firm Grant Thornton’s Afghanistan office, USAID staff twice came to inspect the institute. But Kauffman said the institute obstructed efforts by USAID teams to dig deeper into its records, a claim supported by a copy he provided of USAID’s internal report about its site visits in July and August 2011.
The report states that the inspectors were “unable to meet all technical staff, check the systems, or gather sample documentation,” partly because the staff “were instructed by their headquarters not to disclose any documents” to them. It complained that Roshan and his ex-finance officer only met with them for 50 minutes, and said that as a result they were unable to learn whether the Institute had addressed key concerns the audit raised, including many involving its handling and disbursement of donor funds.
One person was, inappropriately, still responsible for handling petty cash, writing checks, and entering financial data into the computer, the report said. And the “most important gap” identified by the auditors — the fact that the institute paid its employees’ salaries in cash rather than traceable bank transfers — was still a problem, the inspectors wrote. Multiple reports by Sopko have described this as a frequent practice in Afghanistan.
Roshan denied making any attempt to obstruct the inspection. He told the Center for Public Integrity that many of these problems were resolved by the institute directly after the audit appeared, though he acknowledged that the institute had continued to use a cash-based payment system until 2013. Ostrander similarly said the institute had made progress since undergoing a separate assessment of its business model.
Roshan sent the Center for Public Integrity a lengthy rebuttal to the Grant Thornton audit, accompanied by documents including templates for payment vouchers, time sheets, a 19-page accounting manual, and its personnel policy. He defended the spending on weapons, saying the institute needed shotguns for the protection of its staff and students. The international travel was for his own visits to the U.S., he said. And the salary supplements were “necessary,” he said, to keep American teachers at the institute.
“I admit shortfalls in the finance/procurement systems,” Roshan told the Center for Public Integrity in an emailed statement, but some were “nothing but symptoms of failure of the counterpart/donor to deliver technical and financial assistance” in a timely and consistent manner.
Roshan said further that the issues raised in the audit stemmed from friction between Education Development Center, Inc. and USAID. Indeed, the agency’s 2012 inspector general report said the two entities had disagreed about “key elements of the design” of the larger educational project that Washington was financing, and said that this had hampered progress. “We were just caught in the tug of war,” Roshan said.
Alison Cohen, a spokeswoman for Education Development Center, Inc., said in an emailed statement that her firm “did as it was required,” and USAID found no mismanagement of its funds “on the part of EDC.” She said the firm is “fully committed to achieving the highest level of compliance” with its contracts, a quality recognized by “dozens of federal agencies, state and local governments, and private organizations” that have given it funds.