Cashiered Over Cache in Baghdad

He took the money. Sgt. Matt Novak admits that much. He and several fellow soldiers could not resist after discovering nearly $200 million in $100 bills sealed inside a gardener’s cottage in a Baghdad palace complex last spring.

“Millions of dollars makes a lot of things go through your mind,” Novak told a military review board in Georgia in December after confessing that he and the others had stolen about $12 million.

A year after American soldiers discovered about $760 million of ousted Iraqi President Saddam Hussein’s cash hidden in several cottages, the case still raises questions. U.S. Treasury Department officials are trying to determine whether Hussein got the money from illegal oil sales and kickbacks, even as the cash is being spent on the U.S. occupation and rebuilding effort.

For Novak, one of six soldiers accused of stealing seven-inch-thick bundles of $100 bills, the affair has been a bitter lesson in military justice. He confessed, named higher-ups and led investigators to millions he and others had tried to hide. He has since been kicked out of the Army and banned from nearby Ft. Stewart, while the five others implicated received administrative punishments -- and two were promoted, Novak’s lawyer said.

“I really thought everything would work out if I just did the right thing and told the truth,” Novak said in the living room of his brick home. “I’m not asking anybody to feel sorry for me -- I did something wrong. But I tried to make it right, and the Army got me good.”

Novak, a trim, energetic man of 34, spends his days holed up in his house, the blinds drawn and the door locked. He chain-smokes, gulps coffee and cares for his young son and daughter while his wife works and attends night classes. He fears he is sinking into depression, in part because he is barred from civilian jobs at Ft. Stewart, where he feels his 12 years as a medic and supply sergeant could be put to good use.

There is one more thing troubling Novak: He says other soldiers have told him that several soldiers got away with stealing millions. According to these soldiers, Novak said, the money was buried at Baghdad University and in the desert outside the city. He said the soldiers noted the global positioning system coordinates and planned to return to recover the money.

Other soldiers scooped up cash hurriedly discarded by Novak and his confederates, he said, later spending $100 bills in stores in Hinesville. Novak said soldiers took photos of one another waving wads of cash.

While he was under investigation, Novak said, he twice took his allegations to Ft. Stewart’s inspector general’s office and was told to tell the Army’s Criminal Investigation Division. He said he opted not to say anything more to the CID, which had investigated him.

A CID spokesman in Ft. Belvoir, Va., referred questions to Ft. Stewart. A base spokesman, citing privacy issues, said he could not discuss the case.

For Novak’s old unit, the 3rd Infantry Division (Mechanized), the theft was a troubling coda to the division’s dramatic capture of Baghdad in April 2003. The first cash was discovered April 18, just nine days after the division toppled the Hussein regime. In all, soldiers found about $760 million sealed inside five bricked-up gardeners’ cottages in a neighborhood of mansions and manicured gardens.

After Novak implicated two higher-ranking soldiers, the division’s commanders offered amnesty against criminal prosecution to soldiers who confessed and cooperated. The commanders “decided that they did not want a black eye for the Army,” a division captain testified at Novak’s administrative separation hearing in December. “Instead of focusing on prosecuting the soldiers for the crime, they decided to get the money back.”

Novak’s attorney, Capt. Bernard A. Quarterman Jr., said he “argued to the [administrative separation] board that the Army went after Sgt. Novak because he named names.”

“The only person who really told the truth was Sgt. Novak,” Quarterman said, “and he is the only one who was chaptered out” -- drummed out of the Army.

Pentagon and U.S. Treasury officials said some cash probably came from Iraq’s Central Bank, which was looted of $1 billion by Hussein’s sons, Uday and Qusay, three days before the regime collapsed. (The sons were killed in July in a firefight with U.S. forces.) And the money almost certainly was raised, the officials said, through Iraqi oil sales in defiance of United Nations sanctions and through kickbacks from oil suppliers.

Officials speculate that the cash was hidden by Baath Party and Republican Guard leaders as they fled ahead of the U.S. invasion. The fact that so much was left behind suggested Iraqi officials had also hauled away staggering amounts of money, which now could be funding the anti-American insurgency.

Green plastic seals on the galvanized aluminum cash boxes were stamped “Jordan National Bank.” Each contained $4 million. Tape strips on locks on some of the bricked-up cottages were signed by a Republican Guard commander, Lt. Gen. Mohammed Ibrahim. They were dated March 20, 2003, the day the U.S. invasion began.

Whatever the source of the money, more than 99% of the $100 bills -- most of them uncirculated currency with sequential serial numbers -- were genuine.

The Pentagon comptroller’s office said the cash and other “seized assets” were being spent to rebuild Iraq. So far, $348 million has been spent on reconstruction and humanitarian assistance; $308 million on Iraqi ministry operations; $180 million on emergency response programs; and $90 million on gasoline and liquid propane.Novak said he went looking for the money only because a fellow soldier wanted to “get on TV” for his family back home. He said he and two other soldiers took a Humvee gun truck to the gardener’s cottages where two sergeants had found and turned in $320 million that day.

They spotted a similar cottage nearby. Novak said he, Spc. Jamal Mann and Pfc. Jeffrey Moyer used a tanker’s crowbar to collapse the wall. Novak smashed a locked door with a brick, cutting his hand on window glass and splattering the cottage floor with blood.

Inside, the soldiers found dozens of sealed aluminum boxes. Novak said he pried one open and pulled out bundles of $100 bills wrapped in rubber bands. The soldiers all stared at one another, he said.

“Up to this point, it was all fun and games,” Novak said. “Now it suddenly got serious.”

In his statement to investigators, Novak wrote: “Many things went through my mind -- my three children, my wife, my future not in the Army. When that first box was opened, I felt like everything was out of control.”

Mann wrote in his CID statement: “The first thing I was thinking when I saw the money was maybe I could pay for school, help my family out and pay some bills.”

In an instant, Novak said, the soldiers were grabbing stacks of cash and stuffing it into their uniforms. It was an impulse, he said -- an opportunity seized reflexively, without regard to the consequences.

“To see all that money in one place put us in awe,” Novak told his separation hearing board.

Mann wrote: “To me, it was like free money.”

At one point, Novak said, two higher-ranking men entered the cottage: 1st Lt. Charles Greenley and 1st Sgt. Eric Wilson. Novak said he shouted to Wilson, “Aren’t you retiring soon, first sergeant?” and tossed him a bundle of cash. Novak said he remarked to Greenley, “Hey, LT, you’re senior,” and tossed him a bundle.

After a second box was opened, Novak said, he panicked and decided to hide the cash. He said he, Mann and Moyer dropped two boxes into a nearby canal. They scooped up loose cash off the cottage floor and hid it in a tree, near a drain and in shrubbery along a narrow roadway.

Lt. Greenley’s driver, Spc. Darnell Emanuel, told investigators that he, Mann and Greenley took another box and buried it near where their unit was based.

Commanders summoned to the cottage realized money was missing. Just as the commanders arrived, Novak said, he realized he still had a $100 bill in his pocket and he stuffed it into the grill of a parked truck.

The commanders searched the area and found $600,000 in the tree. Another $300,000 was found later in a cooler inside the truck that transported the cash for safekeeping.

Lt. Col. Philip deCamp, commander of the armored task force to which Novak’s engineer company was attached, confronted Novak, Mann and Moyer and advised them of their rights.

Confined to barracks over the next few days, Novak said he was overcome by guilt and shame. “I was torn up, just distraught,” he said. “If it wasn’t for my wife and kids, I’d have blown my brains out.”

He decided to write a statement, confessing to the thefts and naming Greenley and Wilson, the two higher-ranking soldiers.

Novak said he led CID investigators to the canal, where agents found the two boxes containing $8 million. They recovered another $178,000 in bundles and loose cash along the roadway.

Meanwhile, Mann confessed to mailing 12 envelopes, each stuffed with $600 to $700, to his mother and four other relatives in Newark, N.J. Postal agents in New Jersey intercepted the money and notes reading “I LOVE U.”

On April 22, Emanuel led agents to a hole where he said he and Greenley earlier that day had reburied the box they had taken four days before, according to a CID report. About $3.8 million was recovered.

After the commanders’ amnesty offer, a plastic Meal Ready To Eat spaghetti bag containing about $275,000 in $100 bills was found on the desk of the task force executive officer. With the cash was a note that read: “Rest went down sewer.”

A CID report said Wilson told investigators: “That money was turned in during the amnesty period. Nobody was supposed to get in trouble.” An analysis of Wilson’s handwriting compared to the note was inconclusive.

Authorities at Ft. Stewart declined to specify punishments given to the five soldiers besides Novak, citing privacy issues. Because of the amnesty offer, none of the six was criminally prosecuted.

Quarterman said that except for Novak, the soldiers received nothing more serious than letters of reprimand and/or poor fitness reports. Moyer testified that he was promoted despite what he called “the incident.” Novak and Mann said Emanuel also was promoted.

DeCamp said Greenley was stripped of his command and given a poor fitness report. He said Wilson was given a poor fitness report and assigned to lesser duties with no chance of promotion. “Justice was served” in the case, deCamp said.

He noted that all other soldiers who found cash turned it in, along with $6.1 million his soldiers recovered when they foiled a bank robbery in Baghdad the same week.

At the separation hearing, Novak -- a Gulf War veteran -- was praised as an outstanding supply sergeant.

One officer said of Novak: “I would personally like him to be my supply sergeant because he knows all the answers.... I would go to war with him without a doubt.” A month before the money was found, Novak’s battalion commander had awarded him the Army Achievement Medal, citing his “exceptional performance” during the war.

James C. Mead, a CID agent, testified that while Greenley and Wilson gave him false statements, “Sgt. Novak came and said the truth.... His confession was accurate. The information that he gave us did identify additional subjects.”

The board -- two commissioned officers and one noncommissioned officer -- found Novak’s actions warranted separation from the Army. However, the board recommended he be given a six-month probationary period to “show successful rehabilitation.” They called him “a deserving soldier whose service should not be ended.”

But a month later, Maj. Gen. William G. Webster, the division commander, ordered Novak discharged. “Conduct such as yours is prejudicial to good order and discipline.... It demonstrates a lack of respect for law and order,” Webster wrote.

Mann, who said he was allowed to leave the Army with an honorable discharge when his enlistment was up, said: “They treated Matt unfairly.... He couldn’t tell the first sergeant and the lieutenant what to do. We all did what we did on our own.”

He added: “Any soldier -- any human being -- who came across that much money would have done the same thing. It was just too tempting, trust me.”

Authorities at Ft. Stewart responded to a request for an interview with Webster by providing written responses from Maj. Robert F. Resnick of the base legal office. Resnick said Webster decided that “Sgt. Novak’s actions were far too serious” for him to remain in the Army. He said Novak “was very much the ringleader of this theft and he duped subordinates into joining him.”

To Novak, the ultimate irony lies in what he says his commanders asked him to do before and after the money was found.

He said he was ordered or encouraged to grab computers, printers, office supplies and electrical equipment from abandoned Iraqi offices and homes. An Iraqi truck used to deliver the found millions for safekeeping had been taken by Novak off the streets of Baghdad for use by his unit, he said.

Even after he was accused of trying to steal the $12 million, Novak said, his commanders asked him to tear out electrical supplies and toilet fixtures from Hussein’s palaces to supply his unit after it was transferred from Baghdad to Fallouja.

“Nobody had any problem with telling me to take stuff. They all said I was their go-to guy,” Novak said.

All he asks now, Novak said, is that the same treatment be given other soldiers who took money. “I lost my pride,” he said. “I have nothing else to lose.”

A few days before Hussein’s cash was discovered, several Americans in the elite neighborhood noticed that a cinderblock wall around a cottage had been smashed and the door broken. No one thought much of it until the $760 million was discovered. Only then did people speculate about the significance of several broken green Jordan National Bank seals on the cottage floor.

Had millions in cash been stored there? If so, was it taken by Iraqis or by the first Americans to arrive?

For Novak, a man who tried to get away with a fortune and now regrets his actions, it only suggests that millions of dollars are still missing.

“I guess you could call this a real life ‘Who Wants to Be a Millionaire’ story,” he said.