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Arafat Funding Terror, Intelligence Shows
(Ha'aretz) Aluf Benn - Yasser Arafat acts like a "super treasurer" in allocating funds for the Fatah groups and activists dealing with terror, making it difficult for Palestinian Finance Minister Salem Fayyad to introduce reforms, according to a recent Israeli intelligence report. Recently the PA's financial situation has improved considerably, says the report. Since the beginning of the year Israel has transferred NIS 530 million to Fayyad, from the PA's tax funds collected by the Israeli treasury. These funds were added to the aid the PA received from Arab countries and Europe, and enabled the PA to pay its workers' wages earlier than expected. [However, with the renewal of revenue transfers from the Israeli treasury to the PA, the Palestinians will be informed of a reduction in the support they have received in the past as compensation for the freezing of these funds, and the Palestinians are likely to lose the generous "bridging funds" donated by the EU.] (Ha'aretz) Israel conditioned transfer of funds on having U.S. accountants supervise the PA budget, to make sure the money is not used to finance terror activities. But, the report says, Fayyad is having trouble asserting his authority over the PA's financial system and Arafat remains in control. Arafat persists in giving orders to the PA treasury to finance Fatah activities, including terror infrastructures, and is using the money to strengthen his position. Fayyad's relations with the PA security chiefs are tense, following his attempt to regulate the payment of salaries to their people. He wanted them to get their salaries via their bank accounts, but the security heads, who want to retain control of the payments, objected.