USAID finds no proof Hamas systematically loots aid; State Department, IDF push back

WASHINGTON — An internal US government analysis has found no evidence of systematic theft by the Hamas terror group of US-funded humanitarian supplies, challenging the main rationale that Israel and the US give for backing a new armed private aid operation.

The analysis was conducted by a bureau within the US Agency for International Development and completed in late June. It examined 156 incidents of theft or loss of US-funded supplies reported by USAID partner organizations between October 2023 and May.

It found “no reports alleging Hamas” benefited from US-funded supplies, according to a slide presentation of the findings seen by Reuters.

The analysis was unable to attribute most instances of theft to a particular actor, although it noted that because Palestinians who receive aid cannot be vetted, US-funded supplies might have been going to Hamas nonetheless.

A State Department spokesperson disputed the findings, saying there is video evidence of Hamas looting aid, but provided no such videos. The spokesperson also accused traditional humanitarian groups of covering up “aid corruption.”

The findings were shared with the USAID’s inspector general’s office and State Department officials involved in Middle East policy, said two sources familiar with the matter, as dire food shortages deepen in the devastated enclave.

The study was conducted by the Bureau of Humanitarian Assistance (BHA) of USAID, which was the largest funder of assistance to Gaza before the Trump administration froze all US foreign aid in January, terminating thousands of programs. It has also begun dismantling USAID, whose functions have been folded into the State Department.

The analysis found that at least 44 of the 156 incidents where aid supplies were reported stolen or lost were “either directly or indirectly” due to IDF actions, according to the briefing slides.

The IDF did not respond to questions about those findings.

One source familiar with the study cautioned that the absence of reports of widespread aid diversion by Hamas “does not mean that diversion has not occurred.”

The study also noted that because Palestinians who receive aid cannot be vetted, it was possible that US-funded supplies did go to Hamas, even when looters were not specifically identified as belonging to the terror group.

Israel, which controls access to Gaza, has accused Hamas of stealing food supplies from the UN and other organizations to use to control the civilian population and boost its finances, including by jacking up the prices of the goods and reselling them to civilians.

Asked about the USAID report, the IDF told Reuters that its allegations are based on intelligence reports that Hamas terrorists seized cargoes by “both covertly and overtly” embedding themselves on aid trucks.

Those intelligence reports also show that Hamas has diverted up to 25 percent of aid supplies to its fighters or sold them to civilians, the IDF said, adding that the Gaza Humanitarian Foundation (GHF), which accuses Hamas of massive aid theft, has ended the terror group’s control of aid by distributing it directly to civilians.

The UN and other groups have rejected calls by the GHF, Israel and the US to cooperate with the foundation, claiming it violates international humanitarian principles of neutrality.

Hamas denies stealing aid. A Hamas security official said that Israel has killed more than 800 Hamas-affiliated police and security guards trying to protect aid vehicles and convoy routes, asserting that their missions were coordinated with the UN.

Reuters could not independently verify the claims by Hamas or Israel.

The 156 reports of theft or loss of supplies reviewed by the BHA were filed by UN agencies and other humanitarian groups working in Gaza as a condition of receiving US aid funds.

The second source familiar with the matter said that after receiving reports of US-funded aid thefts or losses, USAID staff followed up with partner organizations to try to determine if there was Hamas involvement.

Those organizations also would “redirect or pause” aid distributions if they learned that Hamas was in the vicinity, the source said.

Aid organizations working in Gaza are also required to vet their personnel, subcontractors and suppliers for ties to extremist groups before receiving US funds, a condition that the State Department waived in approving $30 million for GHF last month.

Reporting theft as Hamas-related helps avoid loss of funding

The slide presentation noted that USAID partners tended to over-report aid diversion and theft by groups the US defines as foreign terrorist organizations, such as Hamas and the Palestinian Islamic Jihad, because they want to avoid losing US funding.

Of the 156 incidents of loss or theft reported, 63 were attributed to unknown perpetrators, 35 to armed actors, 25 to unarmed people, 11 to Israeli military action, 11 to corrupt subcontractors, five to aid group personnel “engaging in corrupt activities,” and six to “others,” a category that accounted for “commodities stolen in unknown circumstances,” according to the slide presentation.

The armed actors “included gangs and other miscellaneous individuals who may have had weapons,” said a slide. Another slide said “a review of all 156 incidents found no affiliations with” US-designated foreign terrorist organizations, of which Hamas is one.

“The majority of incidents could not be definitively attributed to a specific actor,” said another slide. “Partners often largely discovered the commodities had been stolen in transit without identifying the perpetrator.”

It is possible there were classified intelligence reports on Hamas aid thefts, but BHA staff lost access to classified systems in the dismantlement of USAID, said a slide.

However, a source familiar with US intelligence assessments told Reuters that they knew of no US intelligence reports detailing Hamas aid diversions and that Washington was relying on Israeli reports.

The BHA analysis found that the Israeli military “directly or indirectly caused” a total of 44 incidents in which US-funded aid was lost or stolen. Those included the 11 attributed to direct Israeli military actions, such as airstrikes or orders to Palestinians to evacuate areas of the war-torn enclave.

Losses indirectly attributed to the IDF included cases where they compelled aid groups to use delivery routes with high risks of theft or looting, ignoring requests for alternative routes, the analysis said.