Update: weapons for Iraqi army...

http://www.timesonline.co.uk/newspaper/0,,174-2554802,00.html

So, turns out I was right. I didn't really have any "proof" yesterday of the corruption. I knew that it existed but did not know where I heard it. Thankfully the next day an article comes out.

Widespread corruption has robbed the Iraqi Armed Forces of arms, money and troops, a Times investigation has discovered.

Army numbers are swelled with “ghost soldiers” who appear on rosters but do not exist. A brigade commander was removed this month for selling weapons and fuel on the black market and officials in the Ministry of Defence support terrorism, according to one lieutenant-colonel

And

Cost of corruption

325,000 Iraqi security personnel have been trained and are operational, 137,000 are soldiers, the rest police

More than 14,000 guns paid for by the US are unaccounted for

An Iraqi Government report into police corruption concluded that officers made money through kidnappings and forgery, and passed information to insurgents

$4 billion a year is lost to corruption in Iraq, according to auditors — including $100m of oil smuggling that helps to fund the insurgency

One former police chief is said to have run a personal militia of 1,400 troops

Source: Brookings Institution, agencies