1. Mick West

    Mick West Administrator Staff Member

    FY1999 budget vs. supposed missing money FB.

    In 2001, Donald Rumsfeld said 'According to some estimates, we cannot track $2.3 trillion in transactions.' This has been misinterpreted by many people as $2.3 trillion actually going missing. However it's really just about the way the money was accounted for.

    Rumsfeld is asking for more money to improve the accounting systems, because the DOD is working with very outdated systems. This means transactions can't be tracked to acceptable accounting standards. As an example he says:

    From the start we can see this does not make sense as "missing" money. The DoD budget for 1999 was just $0.27 trillion ($270 billion). The entire federal budget in 2000 was $1.8 trillion, so $2.3 trillion going missing is absolutely not something that could be swept under the rug. Where would it even come from? For perspective, Fort Knox "only" holds $0.25 Trillion. So $6.5 trillion is 26 Fort Knoxs.

    What does "We cannot track" actually mean?

    "We cannot track" does not mean that money went missing. It means that their systems are so out of date and not compatible with each other that they can't track (by computer) transactions across departments. In order to do that, they would have to do it manually. The money is not missing, money went into the Pentagon, and products and services came out - it's just too complicated to follow the trail of exactly how that happened up to acceptable accounting practices.

    It's like if for a year you write down every financial transaction you made, then add them up. You add up all the numbers on:
    • Your pay slip
    • Your bank deposit statements
    • Your W2 tax statement
    • Transfer statements from checking to savings
    • ATM Withdrawals
    • A new car loan
    • Checkbook record
    • Credit card receipts
    • Actual receipts
    • Bills
    • Mortgage statements
    • Mortgage payment records
    • Mortgage tax statement
    • Credit card statements
    • Credit card payments
    • Monthly Bank statements
    • Receipt for a sale of an old car
    • Deposit slip for sale of old car
    • Title transfer for old car
    • Your 1099 tax return
    It's largely the same money going around. Your actual budget might just be $60,000, but if you add up all those numbers you probably get over $600,000. It does not mean you spent that. Nor does it mean the money all went missing if you only kept a few of the records in a shoebox under the bed, made some illegible notes on your checkbook for others, and forgot to record the rest.

    So what did he mean?

    He's basically talking about accounting. The money is not missing, just not tracked up to expected accounting standards. In 2002 the amount of improperly tracked transactions was reduced to $900 billion, as they integrated their accounting systems). But that's still not missing, it's just improperly tracked. This is explained in another defense dept publication:


    The last paragraph tells the story. The accounts are complicated, with $7.6 trillion transactions for one year. That's not saying they spent $7.6 trillion, they spent far less ($0.27 trillion) , but the transactions are between departments, so get entered multiple times. So about a third of these transactions do not have documentations "adequate for the auditing standards imposed". The transactions are also for things which are not actually expenditures, but are entries for the value of things, like "military pension actuarial liabilities" - often just estimates of the total amount of something over its lifetime.

    • "Military pension actuarial liabilities" are "The amounts calculated based on actuarial assumptions that represents the present value of the pension benefits accrued in pension plans" - i.e. it's totals that will vary from year to year, but represents an estimate of how much money is needed in the future.
    • "Contingent liabilities" are amounts that the department will probably be liable for, things like class action lawsuits or defaulted loan guarantees. These estimates vary, can last for years, and again don't represent spending.
    • "Contract accounts payable" are amounts owed to contractors. The DoD pays slowly and the account goes though various stages. Here there are estimates of the totals of these various stages in different departments.
    • "Property and equipment values" are estimates of the values of things that the DoD owns. Things like buildings, weapons, fighter jets, fuel, battleships, etc. This is not spending, as they have already spent the money to acquire the asset. It's an estimate for things like depreciation, insurance, and replacement budgeting.

    Short Explanation

    The money was not missing, just not tracked to acceptable accounting standards. Eventually the accountants sorted out how it was spent and they updates their records.

    Truth behind the quote?

    As it stands the "cannot track" quote was true. But $2.3 trillion was never missing. The interpretation of the quote does of course have some grain of truth in it. Millions, maybe even billions of dollars "go missing" after a fashion due to accounting discrepancies - and perhaps even some illegal actions. But it certainly is not $2,300 Billion.

    See also:

    [Admin: Post update Aug 1 2017 to add graphic. Original post is from 2011]
    Last edited: Sep 11, 2018
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  2. Unregistered

    Unregistered Guest

    For Many Years other members of government have had NO PROBLEM with tracking of not just military spending, but all spending.
    It is called accountability.
    This is put into place to make sure that things of this nature do not happen.
    So that theft does not occur. This method of extortion, in which we just cannot exactly locate 2.3 trillion dollars because our accounting methods are outdated.., so we need more money to fix it is just ridiculous. This is a crook justifying the reason of why he is stealing. It's like a bank teller saying, "I don't know why my drawer is off everyday by $1000 dollars you need a better system so that you can catch me stealing." despite the fact that none of the other tellers have a problem with missing money, and none have in the past.

    So... Maybe the republican party should re-reference this event, and see why defense spending is taking place. They know exactly why, and they constantly disregard hearing about anything that might make sense, outside of what they already have their mind set to. Like a spoiled child would react.
    These CROOKS are not entitled to take our hard earned money collected via taxes and redistribute it amongst themselves and their friend or their "agenda".
    This sounds cult-ish! Giving someone all this money allowing them to do as they please , while the public struggles to survive and live within their means.
    The leaders live lavishly, wasting, living in debauchery! F-that!! I want exact account record every single penny account for!! or you are fired!! That's the only way that you can keep them from stealing, holding them accountable.

    So this "excuse" stating that "what he meant was...." is bull@#!
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  3. Mick West

    Mick West Administrator Staff Member

    But the $2.3 trillion WAS located. It was just not adequately tracked. It's just an issue of cumbersome accounting practices. No more money was lost than is usual.
  4. Cairenn

    Cairenn Senior Member

    Many, many years ago, a couple in a club were accused of mishandling the group's funds. There was no evidence that they had taken and used it, but it was 'missing'. They were removed from their position. They claimed that they had just lost track of it and those that knew them, felt that was quite reasonable.

    Some years go by and the State publishes a list of abandoned bank accounts. And there the missing money was, in an account that they had 'lost'.
  5. Alchemist

    Alchemist Banned Banned

  6. Mick West

    Mick West Administrator Staff Member

  7. Alchemist

    Alchemist Banned Banned

  8. Mick West

    Mick West Administrator Staff Member

    It does not say they lost it in the first place (nobody does), so why would they say they found it?

    It explains what the situation is.
  9. Alchemist

    Alchemist Banned Banned

    It says they couldn't account for it but you said it WAS located...
  10. Mick West

    Mick West Administrator Staff Member

    Located in the poor quality accounting. A poor choice of words perhaps. By located I mean that it was not lost in the first place. Just not properly accounted for.

    If money was actually missing then there would be a hole on the balance sheet. The accounts balanced fine, they just did not have all the precise details of all the transactions.
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  11. lee h oswald

    lee h oswald Banned Banned

    Watch out for the whistleblower

    Spot the truth teller(s)

    Spot the liar(s)
  12. Alchemist

    Alchemist Banned Banned

    Mick claims all the money is there ON THE BALANCE SHEETS... LOL. Are you SURE about that? Show me those balance sheets where you've learned this info.
  13. Alchemist

    Alchemist Banned Banned

    I'm sorry about breaking the politeness policy in the above post.

    Interesting tidbit: Dov Zakheim was the Pentagon's money manager when the $2.3 trillion couldn't be accounted for (due to their procedural inefficiencies as Mick pointed out). He was also a member of PNAC which openly stated in their document (September 2000): "Further, the process of transformation, even if it brings revolutionary change, is likely to be a long one, absent some catastrophic and catalyzing event––like a new Pearl Harbor." Furthermore, he was also an executive at a defense contractor specializing in remote controlled airplane systems, a subsidiary of which investigated 93' WTC bombing and he also worked for Booz Allen.

    System Planning Corporation: remote controlled airplane systems.

    Their subsidiary Tridata Corp investigated the '93 bombing, and had access to the blueprints.


    Above link has biographical info, and information about SPC's remote control technology.

    To give Mick a break... though Pentagon's auditors admit they can't account for 25% of what they spend (source), 25% of Pentagon expenditure, even over the entire 1990's, is still less than 2.3 trillion. In 2000 the official Department of Defense budget was approx 300 billion.
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  14. Hoooser

    Hoooser New Member

    I understand what this article is saying but I am still stuck considering... that within a system that is so inefficient, there will always be people who take advantage of that system. That within that sea of legitimately misplaced/misrepresented money that there are amounts going, if even a fraction of that money had been spent in ways that go against the interest of the public. That, to me, still has the potential to be motivation of a cover-up. Is it entirely implausible to consider that documents located in the impact may have been physical evidence to the whereabouts to some money used for acts of, say, treason? I mean, if records were in fact destroyed, then it is possible that they were then replaced with different information? Were there copies? Is it even true that this section of the pentagon had documents related to this money?
  15. Landru

    Landru Moderator Staff Member

    Do you have any evidence to back up your assertions? This is not a discussion site for people who do/don't like the government.
  16. Hoooser

    Hoooser New Member

    Not the government, human nature. I intended the post to be more a question than a statement. I'm asking that IF there were records, is that the only place they were stored? Were there copies? If there were copies in existence somewhere else, then that would completely disprove the theory. I'm asking if anybody knows these details? Thank you.
  17. Svartbjørn

    Svartbjørn Senior Member

    What @Landru is saying @Hoooser is that, the way the website works... you take a look at what's presented, and if you have any evidence that supports a counter theory or opinion than by all means, post it. What you've seen thus far from Mick and the others is what they themselves have been able to discover and come up with on their own, and then explain the evidence as they see it. Please dont take anything that's being said as being blown off or ignored, its not. Mick has a very specific way of running the site so that things dont devolve into total anarchy etc with ppl yelling and screaming at one another. If you're asking for clarification of evidence, thats totally different and people would be more than happy to explain it to you.
  18. Guest

    Guest New Member

    First, thanks for posting the link to the SecDef report. As someone with a decade of professional auditing experience, I disagree with how you characterize some of the information in the report, on page 3, Sen Grassly is quoted, "
    "...these reports show that DoD has lost control of the money at the transaction level. With no control at the transaction level, it is physically impossible to roll up the numbers into a top-line financial statement that can stand up to scrutiny and, most importantly, audit." the next paragraph states "For the FY 1999 financial statements, the auditors concluded that $2.3 trillion transactions of the $7.6 trillion entries to the financial statements were "unsupported"." The paragraph then lists several non-cash items which were unsupported but estimated such as unfunded pension liabilities etc.
    It's an over statement to say no money was "missing". Missing and "unable to track at the transaction level" are very similar concepts. For example, if you have $50,000 transaction and you don't know how the money was spent because the transaction controls are inadequate, you don't really know if it was spent at all. If the invoices are missing so a payment can't be matched to a specific transaction that is a red flag. That is why basic auditing practices include contacting vendors and verifying invoices -if you don't have a transaction record, there is no verification to be done. Accounting fraud can involve sending a check to a conspirator at an approved vendor, or removing cash from an account and covering it up by making a journal entry which indicates payment to a vendor that was never made. Vendor fraud includes overcharging, double charging etc. So not having control at the transaction level raises questions.
    The report doesn't actually discuss transactions in detail. It is focused on streamlining and fixing systems so proper auditing and accounting can be done in the future.
    We don't know from this report how many transactions failed the initial audit, or the specific missing information for each of those transactions. We don't know the size of the transactions either. Without that information, it's impossible to conclude exactly what the situation was. Although, the DOD later said all the money had been accounted for, as far as I know, no detailed accounting was ever presented to the public. Accounting is about numbers which track the actual movement of money. Press releases and reports that don't provide those numbers don't meet accounting standards.
    The report doesn't refute Grassly's statement that the DOD had lost control of the money at the transaction level. The point is, if that control was not in place at the time of the transaction, it can't be put in place after the fact. The best an auditor could do is try to find evidence after the fact of what happened to the money - it would be highly unusual to be able to do that perfectly, but that's what the DOD claimed they did.
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  19. To update the thread with new information.

    This article claims that "The Pentagon alone has never been audited, leaving roughly $8.5 trillion in taxpayer dollars unaccounted for since 1996, the first year it was supposed to be audited."

    Source: http://www.reuters.com/investigates/pentagon/#article/part3

    Thus the $2,3 trillion number seems outdated if one takes Reuters as a reliable source.
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  20. SmokeHillFarm

    SmokeHillFarm New Member

    Though it will never convince the wide-eyed conspiracy [people], I must point out that the fairy tales about the Pentagon plane attack (or missile, as the really confused ones claim) being done to destroy records of "missing money" are completely absurd. Not only are DoD financial transactions filed in many different computer (and paper file) systems, the main agency for controlling and auditing these transactions has NEVER been located inside the Pentagon building. Back when I worked there it was located in the Navy Annex (then known as the Defense Audit Service), several miles away, and now it is located in Texas. I spent 7 years in the Pentagon, and well know that the massive duplication of EVERTHING connected with spending makes it difficult to even embezzle except in small amounts -- and those are usually caught eventually. Every year each agency gets X amount of spending authority, to basically write checks upon, and usually spends almost all of it. Same thing next year, and the next. You can't just write massive checks to some shell company your brother-in-law owns, and hope it'll never get caught. Some subordinate unit is going to howl like hell that their funds for (pick something) are gone & they didn't get whatever it was (carpeting, new jets, tank shells, belt buckles).

    The basic explanation of this "missing money" is just as described by Mick West, above, and the amount was never really 2.3 trillion anyhow. As someone else mentioned, amounts often get counted several times, since DoD gets money for a Joint Fighter (for example), which goes to both the Air Force, Navy & Marines, each of which then pays their share to the contractor(s). Since most of the computers back then couldn't track among themselves (over 600 different systems), you knew that the right amount of Defense Department money got paid out compared to what came in, but until the hand-auditing was done (often much, much later), you couldn't track each dollar all the way through multiple computer systems. Five or six months after Rumsfeld's announcement of the audit-tracking mess (and resulting request for massive computer upgrades, the real point of his speech), that 2.3 trillion was down to 700 billion, and continued to drop.

    Anyone who knows anything about the government understood all this quite well, but when you inject a pack of [conspiracy theorists] into the discussion, it's hardly surprising they are confused, and foster [misconceptions] about huge amounts "going missing." They apparently think that several years' worth of the entire Defense Department budget can get magically "stolen," yet everything goes on as usual and nobody notices.
    Last edited by a moderator: Mar 18, 2016
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  21. MikeG

    MikeG Senior Member

    Well stated.
  22. Engineer

    Engineer Active Member

    Regardless of whether the money was partially misspent, or perfectly spent, the fact that an organization responsible for such a huge amount of taxpayer dollars is not able to reconcile their balance sheets and comply with the auditing standards is reprehensible. Auditing standards are nothing new and while cumbersome in some cases are not rocket science. Yes of course the computer systems are different and not integrated and government is inefficient, etc etc. But when you are talking about that kind of money, I think it's safe to say they can afford upgrades. Exactly what Rumsfeld was probably asking for by bringing it to our attention. Based on some of the Pentagon links (above) now on different servers perhaps these upgrades are already being done .

    The statement that the money was "missing" may be debunked in a simple semantics discussion.

    In any case I think it is easier to debunk any correlation between the statement and events of 9/11. The information was clearly and publicly being discussed prior to 9/10/2001 and certainly the accounting records were backed up and not entirely located at the Pentagon.
  23. trevor

    trevor Active Member

    in other words, CT's purposely worded it wrongly by saying "The pentagon lost 2.3 trillion dollars and cannot find it". I agree with what you said, but "We can't track 2.3 trillion in transactions" over the last 20 something years, is alot different then "We lost 2.3 trillion dollars, we dont' know where it went".
  24. Engineer

    Engineer Active Member

    Yes I'm not sure how the CT's spun it, I was referring to the OP's sentence, which in and of itself is true and may or may not have been debunked. The links were broken so I couldn't see the statements saying "we found and reconciled the transactions". I think the Pentagon should probably be audited more frequently in any case and develop the ability to conform to standard auditing and accounting practices which aren't anything new. In fact the more money that is involved the more cognizant and conformant they should be of proper accounting practices.

    If even 25% of that 2.3 Trillion was not able to be tracked that's still inexcusable, imo.
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  25. trevor

    trevor Active Member

    True...especially for the Pentagon. That's like saying Area 51 lost their aliens.
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  26. Mick West

    Mick West Administrator Staff Member

    The broken link is fixed:

    But I'm not sure where you are getting "we found and reconciled the transactions" from? Are you paraphrasing something?
  27. Engineer

    Engineer Active Member

    Thank you. No I wasn't paraphrasing anything just suggesting what kind of statement or conclusion would be required to debunk the original statement as listed in the title here.

    I see that this report basically addresses the problems in the system and makes recommendations for improvements without actually addressing the specific entries and showing that they were indeed accounted for. We have a few statements like below and a few others. It sounds to me like the auditors were unable to account for quite a lot of transactions. I may have missed something but I'd say the statement is not debunked, that would required audit trails for 2.3 Trillion dollars or at least a statement that it had all been accounted for, no? Inadequate audit trail basically means we can't account for it.

    "One of the reasons that the department-level accounting entries were unsupported is that they were made to force general ledger data to agree with data from other sources without adequate research and reconciliation."
    "Of the $4.5 trillion, proper research, reconciliations, and adequate audit trails supported $2.8 trillion of the department level accounting entries for FY 2000."
    "The DoD Components and DFAS did not resolve financial and accounting disparities of $28.4 billion, and the disparities continue to affect the accuracy of the FBWT account. Auditors were unable to assess the reliability of the $177.5 billion reported for FBWT on the DoD Agency-Wide financial statements for FY 2000 ($1.2 billion)."
  28. Mick West

    Mick West Administrator Staff Member

    Yeah, I wrote it 4.5 years, and I'd probably phrase it differently now. The thing I mean that was debunked was that $2.3 Trillion was MISSING. Clearly the quote itself is correct.

    I'll update the title and start of the post to reflect this.
    Last edited: Nov 22, 2015
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  29. Engineer

    Engineer Active Member

    Thank you. That actually supports my belief in your integrity and attention to accuracy and the truth. Not that I had any doubts really. In this case "missing" is truly the operative word which as I pointed out could have been debunked by a simple semantics discussion. When digging into this it is still pretty discouraging that large sums were still not accounted for actually.

    I'm obviously new here and don't know the policy for commenting on old threads, my apologies if that was considered bad form.
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  30. Mick West

    Mick West Administrator Staff Member

    Not if there's something new to add. In this case the OP clear needed some clarification. I had this at the end of the post:

    But the title and opening of the post were not clear. And the the by-the-numbers debunking format does not really work in terms of clear communication.
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  31. tadaaa

    tadaaa Active Member

    this "missing money / accounting" trope is used in the UK (and probably other countries in Europe) as a rod to beat the European Union with, by people who basically don't agree with the European Union and want to leave (I suspect an under current of anti big government / NWO etc)

    two opposing views on it


    and the below saying the above is bunk


    imo there are plenty of good reason to bash the EU and leave it (it is far from perfect) - but creating a faux controversy over "accounting" is prob not one of them
  32. The claim is fundamentally false, because it refers to unaccounted-for transactions.

    This means there was $2.3 Trillion in assets they don't have any record of paying for.

    Further, this was not a new story. The pentagons inability to track transactions was known years earlier

    People who make this claim dont realize how much $2.3T really is. At the time of the 911 attacks, the DOD budget was approx 294 Billion. Working backwards TOTAL Pentagon spending from 1993 to include 2000 is $2.2T.

    So to say the Penty lost $2.3T is similar to saying "from 1993 through 2000 the Penty took every dollar from congress, and for 8 straight years didn't spend a single penny of it on anything at all. They just set it off to the side somewhere and then lost it."

    Pentagon is pay as you go. They don't have a savings account where they squirrel a few bucks away for a rainy day. Every dollar allocated is spent. So the only way for the Penty to have $2.3T suddenly disappear is if it was siphoned off a small % a year. So, lets say for example that the Penty only spent 95% of its budget as normal, and hid 5% away somewhere each year. If you started skimming 5% off the top in 1940, you are only going to have $395 billion by the year 2000.

    Conversely, if you started in 1940, and wanted to skim enough each year to have $2.3T by 2001, you would need to skim off 30% of each budget, each year, for those 60 years.

    It is not reasonable to believe a 60 year long conspiracy existed, because they knew 60 years in advance that Bush and co would be in the WH in 2001 and wanted to swindle $2.3T off the pentagon. Nor is it reasonable to believe one can hide a "disappearing act" of 30% of the Pentagon budget for 60 years with no one noticing.
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  33. Zee_Avenger

    Zee_Avenger New Member

    Mr. West,
    Would you explain something to me. I believe that the 9/11 strike at the Pentagon exactly hit the office where the special audit group that was tasked with explaining the missing $2.3 Trillion was housed - killing most of the group. Apparently the group was all present that day, since Mr. Rumsfeld's news conference to explain the missing funds was scheduled for that day or the following day. Do you not find it a just a little suspicious that in the largest office building in the world, an alleged commercial aircraft should exactly attack and eradicate this very special group of auditors at this exact moment in time? Seems to me that the stink of this situation remains, even after your debunking argument.
    Last edited by a moderator: Dec 1, 2017
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  34. deirdre

    deirdre Moderator Staff Member

    Mr. Rumsfeld spoke of it sept 10th. BEFORE the shooting. As Micks OP post shows.
    and it was known long before then: source 911 myths.com

    Can you please provide evidence of this statement.. in a new thread. metabunk examines specific claims of EVIDENCE, one topic per thread. Thank you.
    How to post a new thread:


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  35. An "untracked" transaction is NOT missing money. its assets that don't have payments attached to them.
  36. 1) it wasn't a press conference to explain anything. it was a speech TO the pentagons accountants

    2) Please explain how it makes sense to (if the conspiracy theory is correct) to publically announce $2.3 trillion missing when you never had to, and then publically kill everyone you just told.
    Last edited by a moderator: Jun 27, 2016
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  37. Mike Henderson

    Mike Henderson New Member

    More is here than meets the eye....
    Last edited by a moderator: Dec 1, 2017
  38. Keith Beachy

    Keith Beachy Active Member

    More like confirmation accounting problems continue, what Rumsfeld was upset with 15 years ago.
  39. Napata

    Napata New Member

    You write: in respect of the statement '
    I am a qualified auditor - your statement is simply UNTRUE. If it is unaccounted it means we do NOT know if there has been theft!!!! While it does not affirm theft it highlights the possibility and likelihood. It simply does not support the statement 'was never missing'. If this were a public listed company there would be all hell to pay and SEC would be down everyone throats with external investigators. 'Unsupported' is VERY strong in auditor language. If it was merely lacking proper allocation between dept or accounting heads there are other words for this and definitely not 'UNSUPPORTED'. You seem to be in such a hurry to debunk you have misled yourself.
    Last edited by a moderator: May 28, 2018
  40. Keith Beachy

    Keith Beachy Active Member

    What is there to debunk? The money is not missing, and in no way is related to the acts of 19 terrorists on 9/11. Rumsfeld was upset with accounting practices at the Pentagon, there was no conspiracy, nothing to debunk, the quote debunks the missing claim. Self-debunking quotes.