A 42-page report by a Washington, DC-based whistle-blower organization is proving a major embarrassment for Malaysian opposition leader Anwar Ibrahim by alleging that the Foundation for the Future, which Anwar headed for a time in the middle of the last decade, was actually established and funded by the US Department of State at the behest of Elizabeth Cheney, the daughter of then-Vice President Dick Cheney, and the Bush administration's neoconservatives.

The Government Accountability Project report, titled The Foundation for the Future: What FOIA Documents Reveal, and released July 8, is based on hundreds of documents delivered to the organization under the US Freedom of Information Act. It says the Foundation for the Future was established and operated in a "highly irregular manner" by Bush administration officials and employees including Shaha Riza, the girlfriend of Paul Wolfowitz, who was forced to leave the World Bank after it became known that he had promoted Riza to triple the World Bank's salary guidelines. The full report can be found here.

Ostensibly, matching money to fund the Foundation for the Future was supposed to come from 11 countries led by Qatar at US$10 million, and Bahrain, with another US$2 million. Jordan was to put up another US$1 million, Turkey US$500,000 and the rest was to be scattered among several European Union countries including Denmark, Greece, Spain, the Netherlands and the European Union itself. But neither Qatar nor Bahrain ever came through. Of the US$22.26 million pledged, only about US$6.4 million ever materialized. The rest apparently was made up from US State Department funds.

Anwar has previously disavowed any US funding of the organization, established in 2005 as "an essential front on the global war on terror" and part of President George Bush's "freedom agenda" to promote democracy and reform in the Middle East and Africa. Anwar served as chairman and acting president of the organization's board in the period when he was out of politics following his incarceration on corruption and sexual perversion charges.

The Government Accountability Project report lends considerable ammunition to Anwar's opponents in the United Malays National Organization, who have long charged that Anwar was connected to the US Central Intelligence Agency, although neither the CIA nor the US government as a whole has ever exhibited any particular desire to bring down the Malaysian government, and in fact considers Malaysia, as a moderate Muslim democracy, to be one of its staunchest allies in the region.

In particular, UMNO Youth Chief Kairy Jamaluddin called attention to Anwar's statements disavowing US funding of the foundation and demanded that Anwar explain himself. He accused Anwar of misleading the US government in a memorandum of understanding saying the foundation had agreed to get other countries to commit funds to match those the US government was providing.

"For me, it is a serious matter that the opposition leader has tried to mislead the US government to get grants for a foundation that he was chairman of," Khairy told the Malaysian newspaper The Star.

An Anwar associate said the opposition leader would decline to comment, adding that there was little to be gained by saying anything about the matter. Nonetheless, he characterized Anwar's role as blameless.

"There is nothing wrong going on," he said. "This is part of the campaign to get Wolfowitz out of the World Bank and to do so they threw Anwar under the bus."

The report characterizes the Foundation for the Future as part of a vast and tragic misconception among the Bush administration neoconservatives, particularly Wolfowitz, that a slight push – the elimination of Iraqi strongman Saddam Hussein from power – would result in a dramatic change in the Middle East. That of course has resulted in the deaths of more than 4,000 US soldiers and hundreds of thousands of Iraqi civilians and a realignment in the Middle East that nobody in the west wanted – the growing power of Iran in the region and particularly in Iran's influence over the Iraqi government itself.

But the Foundation from the start appears to have been a mess, according to the report. It apparently was the brainchild of Shaha Riza, who was seconded from the World Bank by Wolfowitz to run it. As has been widely reported, Riza's salary increases during external service far exceeded those allowed under World Bank regulations, Wolfowitz allegedly instructed the Department of Human Resources to pay her three times the allowable increase for her grade and circumstances, so that she ended up making more money that Condoleezza Rice, her nominal superior, by about US$7,000, according to the report.

The foundation's first president, an Iraqi named Bakhtiar Amin, who had served in the new interim government set up following the invasion, quit after a short time on the job because "he was not up to the task." It appeared that the entire foundation pretty much consisted of Shaha Riza. There was no chief financial officer or chief operations officer.

The Washington Post reported at the time that "Though Shaha Riza, who has been romantically linked to Wolfowitz, is not listed as part of the staff on the organization's Web site, she is the only person working in the group's offices. ‘It is basically just her running this thing,' said Tamara Cofman Wittes, research fellow at the Brookings Institution Saban Center for Middle East Policy, who closely tracks democracy programs in the region. She said the board members had no experience in grant-making and thus had ‘started from zero,' with no bylaws or grant-making guidelines."

When Anwar was ultimately selected as board chairman, according to the report, it appeared that it was more because Anwar was a friend of Wolfowitz's rather than for any other reason. "Anwar Ibrahim…was not from the region, and the tactics used to position him as the chair were not transparent," the report continued.

Ultimately, the report says, less than half of the $60 million in initial funding for the Foundation (as envisioned by Elizabeth Cheney) ever materialized, and the major proportion of funding came from the United States, in violation of the spirit of the legislation creating the institution. The "great multilateral effort…devolved into a unilateral US initiative supported only by Jordan and a smattering of European nations. And the organization that was promoted as a "model" and "beacon of inspiration for the democratic development of the societies in which it operates" represented little more than a nest of sinecures for those people closest to the Vice President: his daughter Liz, Wolfowitz's girlfriend Shaha Riza and Wolfowitz's favored friend from Malaysia, Anwar Ibrahim."

The report ends up by questioning whether the US State Department's representation that Qatar would stump up US$10 million was deliberately perpetrated to circumvent requirements in US law regarding contributions to a Middle East Foundation, whether US law was violated by Shaha Riza's secondment to the State Department, whether future support for the Foundation is even appropriate, and whether the state Department abused freedom of information law by inappropriately classifying documents in an effort to hide them from whistle-blowers.