Shadowed Benefactors: Tracing the Hidden Money Trails of International Intelligence (USAID is the tip of the Iceberg)

While the USAID controversy recently highlighting dark budgets operating in plain sight, there are many other such organizations throughout the world.

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FCDO is the British Version. Let's highlight some more:

The Canadian International Development Agency (CIDA)

Agence Française de Développement (AFD) (France)

Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) (Germany)

Spanish Agency for International Development Cooperation (AECID) (Spain)

Swedish International Development Cooperation Agency (Sida) (Sweden)

Swiss Agency for Development and Cooperation (SDC) (Switzerland)

Danish International Development Agency (DANIDA) (Denmark)

Finnish International Development Agency (FINNIDA) (Finland)

Irish Aid (Ireland)

Netherlands Ministry of Foreign Affairs - Development Cooperation (Netherlands)

Norwegian Agency for Development Cooperation (NORAD) (Norway)

Austrian Development Agency (ADA) (Austria)

Belgian Development Cooperation (Enabel) (Belgium)

Italian Agency for Development Cooperation (Italy)

Japan International Cooperation Agency (JICA) (Japan)

Korea International Cooperation Agency (KOICA) (South Korea)

China International Development Cooperation Agency (CIDCA) (China)

Israel's Agency for International Development Cooperation (MASHAV) (Israel)

Australian Agency for International Development (AusAID) (Australia) - now part of the Department of Foreign Affairs and Trade (DFAT)

The Confluence of Aid and Espionage

The entanglement of aid and intelligence is epitomized by USAID’s 2009–2012 “ZunZuneo” project in Cuba, a covert social media network designed to foment dissent, orchestrated under Administrator Rajiv Shah. Whistleblowers like John Kiriakou (CIA) and pseudonymous sources such as “Sparrowhawk” reveal how funds were funneled through shell companies like Creative Associates International, a USAID contractor. Similarly, the CIA’s 2011 “Vaccination Ruse” in Pakistan, where Dr. Shakil Afridi posed as a hepatitis worker to gather DNA for the Bin Laden raid, underscores the ethical quagmire of dual-purpose aid.

Michael Donovan, a retired CIA paramilitary officer, and Richard “Rico” Martinez, linked to Blackwater’s Erik Prince, have admitted in off-record interviews to coordinating “development projects” in post-9/11 Afghanistan that served as cover for NSA surveillance installations. Their operations intersected with CIDA’s 2003–2007 “Kandahar Outreach”, which Canadian Auditor General Sheila Fraser later found diverted $12 million to covertly arm anti-Taliban militias.

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A Timeline of Intrigue

Late 1980s: The Iran-Contra scandal cast a long shadow, with USAID funds laundered through the Panama-based Udall Foundation to support Nicaraguan Contras. Oliver North’s notebooks reference “Project Democracy”, a USAID-CIA partnership masked as election assistance.

1992: USAID’s restructuring under Director Brian Atwood aligned with CIA Director James Woolsey’s post-Soviet strategy. Budgets for Eastern Europe were quietly managed by Michael Steiner, a diplomat later implicated in “Baltic Pipeline”—a $50 million infrastructure project that doubled as a SIGINT hub.

2003: The FCDO’s “Libya Democracy Initiative” under Secretary Andrew Mitchell routed £20 million through Adam Smith International to arm rebels, while CIDA’s “Kabul Urban Renewal” funded Canadian CSIS informants. Leaked emails cite Minister Bev Oda approving “off-book” expenditures for Task Force Kandahar, a military-intelligence unit.

2007: Operation Mirage—exposed by Le Monde—uncovered AFD (France) and GIZ (Germany) funds fueling DGSE and BND ops in Chad and Syria. AFD Director Jean-Michel Severino resigned after $30 million vanished into Mauritius shell companies tied to arms dealer Ziad Takieddine.

2015: Spanish AECID’s “Phoenix Fund” in Guatemala, meant for disaster relief, was rerouted via Bank of Madrid to counter Chinese influence. Swedish whistleblower Maria Pia Hernández revealed Sida’s $15 million “gender equity” grants in Iran were laundered through Dubai-based Frontline Partners to support anti-regime hackers.

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The Cast: Agencies Under Scrutiny

• USAID & FCDO: The “Development Alternatives Inc.” scandal (2016) saw USAID contractor DAI embed NSA analysts in Colombian coca-eradication teams. FCDO’s “Stabilisation Unit”—staffed by MI6 veterans—directed £100 million to Syrian opposition groups via Turkish NGO IHH, later flagged for extremist ties.
• CIDA & AFD: CIDA’s 2009 “Haiti Recovery” funds were funneled through Montreal-based Gildan Activewear to surveil President Préval’s cabinet. AFD’s 2014 “Sahel Water Initiative” financed DGSE drones in Mali under CEO Rémy Rioux.
• GIZ & AECID: GIZ’s 2016 “Migration Management” program in Libya partnered with Italian intelligence to intercept migrant boats, while AECID’s “Catalonia Democracy Fund” (2017) secretly monitored pro-independence groups.

Scandals & Controversies

• “The Black Budget Files” (2013, Edward Snowden): Exposed NSA’s use of World Bank infrastructure loans to install surveillance in Kenya.
• “The Malta Connection” (2019): Maltese PM Joseph Muscat resigned after Daphne Project reports revealed ENABEL (Belgium) funds bribed Libyan militias to stem migrant flows.
• “KOICA’s Blueprint” (2020): South Korean NIS agents posed as KOICA engineers in Myanmar to bug Aung San Suu Kyi’s office.

Curious Intersections

• HSBC’s “Charitable Arm”: The bank’s 2012 laundering scandal included $2 billion in “aid transfers” to Cayman Islands accounts linked to MI6.
• Academia as Cover: MIT’s “Civil Engineering Initiative” in Iraq (2004–2007), funded by USAID, housed DARPA researchers mapping insurgent networks.

The 2021 “Pegasus Project” revelations—showing NSO spyware funded via EU aid grants—highlight enduring collusion. While the International Aid Transparency Initiative (IATI) pushes for accountability, resistance from agencies like JICA (Japan) and MASHAV (Israel) persists.

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Operation Gladio and Its European Offshoots

The Cold War’s NATO stay-behind networks, codenamed Operation Gladio, laid the groundwork for intertwining aid and espionage. Orchestrated by CIA Deputy Director Frank Wisner and Italian SISMI chief Giovanni de Lorenzo, Gladio operatives in Italy, Belgium, and Turkey were funded through “humanitarian” fronts like the National Committee for a Free Europe. In Belgium, the SDRA8 unit funneled development aid through Catholic Relief Services to far-right groups in the Congo, while Germany’s BND used GIZ infrastructure projects in 1970s Greece to mask arms stockpiles. The 1990 Pentapoli scandal exposed Gladio-linked slush funds in Italy’s Ministry of Foreign Affairs, with millions of lire diverted to destabilize post-Soviet states under the guise of “democracy promotion.”

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Operation Cyclone in Afghanistan

The CIA’s Operation Cyclone (1979–1992), overseen by Congressman Charlie Wilson and CIA officer Gust Avrakotos, laundered $3 billion through USAID’s Pakistan mission to arm the Mujahideen. Funds flowed via Bank of Credit and Commerce International (BCCI) and NGOs like Sayed Jamaluddin Afghani Foundation, which distributed textbooks laced with jihadist propaganda. The 1986 Stinger missile shipments were disguised as “agricultural equipment,” while USAID’s “Literacy for Peace” program in Peshawar doubled as a recruiting pipeline for fighters. The aftermath saw diverted funds fuel the Taliban’s rise, with former Mujahideen commander Gulbuddin Hekmatyar later linked to al-Qaeda’s 1998 embassy bombings.

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Operation Timber Sycamore (Syria)

The CIA’s Timber Sycamore (2012–2017), authorized by President Obama and coordinated with Saudi Arabia’s GID, weaponized aid to Syrian rebels. USAID’s “Syria Recovery Trust Fund” and the UK’s “Conflict, Stability, and Security Fund” funneled $1 billion annually through Turkish NGOs like IHH Humanitarian Relief Foundation to groups like Ahrar al-Sham, while FCDO contractors embedded with rebels to identify targets for airstrikes. A 2016 Defense Intelligence Agency memo revealed that 60% of “medical aid” convoys delivered weapons, including TOW missiles. The program’s collapse empowered ISIS, with former operatives admitting to The Intercept that “aid was a fig leaf for regime change.”

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The Expanded Fallout from the Panama Papers

The 2016 Panama Papers exposed how intelligence agencies laundered funds via offshore networks. Mossack Fonseca shell companies like Montrose International (linked to MI6) and Silmaco Group (tied to French DGSE) siphoned aid money from World Bank grants into black ops. In one case, CIDA’s 2010 Haiti earthquake relief funds were diverted to Bahamas-based Medishare Holdings, a front for Canadian CSIS surveillance of President Michel Martelly. Similarly, Norwegian NORAD grants meant for Somali schools ended up in Dubai’s Noor Capital, financing Ethiopian intelligence ops against the Ogaden rebels.

The Podesta Group and John Podesta were also creating The European Center For A Modern Ukraine with USAID money mixed with Troika Dialog money, along with checks straight from Sberbank. Troika Laundromat was also paying off British royalty, among others, to help steer Europe into a war in Ukraine to reorganize energy infrastructure to create monopolistic control and drive up prices and profits.

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Further Revelations from Black Budget Leaks

Beyond Edward Snowden’s 2013 disclosures, the Shadow Brokers’ 2016 leak revealed NSA’s “IRATEMONK” program, which embedded spyware in USAID-funded power grids in Kenya and Nigeria. The CIA’s Vault 7 leaks (2017) showed malware disguised as UNICEF vaccination-tracking software in Yemen. Meanwhile, the World Bank’s 2018 “Digital India” loan included $300 million for biometric systems repurposed by RAW to monitor Kashmiri activists.

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UN and NGO Fronts for Intelligence Collection

The World Health Organization’s (WHO) 2011 polio campaign in Pakistan was exploited by the CIA to confirm Osama bin Laden’s location, using Dr. Shakil Afridi as an asset. The backlash led to Taliban attacks on legitimate health workers. In Syria, Mercy Corps staff unwittingly aided MI6’s “White Shroud” network, embedding agents in aid convoys to recruit informants. The UN’s OCHA (Office for the Coordination of Humanitarian Affairs) faced scrutiny in 2020 when its Venezuela aid program was linked to USAID’s Juan Guaidó-recognition campaign, using relief maps to identify Maduro loyalists.

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Private Security Firms and the “Revolving Door”

Erik Prince’s Frontier Services Group (FSG), staffed by ex-Blackwater and CIA operatives, secured a $10 million USAID contract in 2017 to “protect aid workers” in South Sudan—while covertly arming opposition forces. Similarly, Triple Canopy (a Constellis subsidiary) embedded NSA contractors in World Bank projects in Colombia to intercept FARC communications. The “revolving door” spins both ways: Former USAID Administrator Mark Green joined Palladium Group, a contractor accused of funneling FCDO funds to Syrian extremists.

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Digital Dual-Use Funding in the Cyber Age

The 2021 Pegasus Project revealed that EU aid grants to Morocco and Rwanda financed NSO Group spyware targeting dissidents. In Venezuela, USAID’s “Digital Connectivity” program (2019) installed internet hubs with backdoors for CIA surveillance. Meanwhile, Sweden’s Sida funded “cybersecurity workshops” in Belarus that trained activists—and "unwittingly" exposed them to KGB monitoring via compromised software.

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Aid-Funded Infrastructure as SIGINT Covers

The Baltic Pipeline (2005–2015), financed by EU development funds, concealed GCHQ listening posts to monitor Russian naval traffic. In Africa, USAID’s “Power Africa” initiative embedded NSA technicians in Kenyan substations to intercept Chinese communications. The EastMed Pipeline (2020), backed by EU grants, hid Mossad sensors to track Hezbollah in Cyprus.

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Controversies in Multilateral Development Bank Projects

The World Bank’s $2.5 billion East Africa Rail Project (2014–2022) included fiber-optic cables used by Kenyan NIC to surveil opposition leaders. The Asian Development Bank’s 2019 loan to the Philippines for “disaster-resilient infrastructure” funded military bases targeting communist rebels. Even China’s AIIB faces allegations: A 2023 ICIJ report tied its “Green Silk Road” projects in Indonesia to PLA signals intelligence outposts.

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Additional Revelations

• Wagner Group’s “Humanitarian” Fronts: Russian PMCs in the Central African Republic used UNICEF school grants to smuggle arms, per a 2022 Crisis Group report.
• Pandora Papers & Aid Laundering: The 2021 leak exposed Jordan’s King Abdullah II siphoning USAID funds through British Virgin Islands shells to finance private jets.
• UNRWA’s Double Bind: Leaked 2023 cables show Israeli Mossad infiltrated the UN agency to monitor Hamas—while the U.S. cut funding over alleged terror ties.

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The Unending Web of Slime

From Gladio’s ghosts to Pegasus’s pixels, the marriage of aid and intelligence thrives in the shadows. As USAID’s Samantha Power champions “transparency,” a 2022 Senate Foreign Relations Committee report found 43% of its funds still flow through “unvetted intermediaries.” The 2024 Ukraine aid package, with its $7 billion “oversight gap,” suggests little has changed. Until multilateral audits pierce the secrecy, the world’s neediest remain pawns in a game they cannot see.

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Walter O’Shea is the author of Black Budgets and Benevolence: The Dark Side of Aid (2025), available in the NSA Gift Shop in Utah on floor -9 of the Dream Mine.