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US State Department watchdog probes defunct Gaza aid group over $30 million grant

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The US State Department’s internal watchdog has launched a comprehensive investigation into how the now-defunct “Gaza Humanitarian Fund” (GHF) managed a multi-million-dollar emergency aid budget, according to reports.

The investigation, conducted by the State Department’s Office of Inspector General (OIG), is focusing on the details of a $30 million grant decision and the subsequent expenditure of those funds. The GHF was established last June specifically to distribute humanitarian aid in Gaza, the Financial Times reported, citing three sources familiar with the matter.

The foundation was created last year with the support of the Donald Trump administration and the Israeli government to serve as an alternative to United Nations (UN) humanitarian operations in Gaza. While the United States (US) was the only country to publicly declare its funding of the GHF, UN officials characterized the entity as a “front” utilized to further Israeli wartime objectives. International humanitarian organizations had largely refused to cooperate with the foundation.

One source stated that the OIG is investigating “exactly what the money was spent on and how,” as well as which budget line provided the funds and how they were distributed. Another source indicated that investigators are also scrutinizing the pricing mechanisms for aid supplies and logistical services purchased by the GHF using department funds.

The Office of Inspector General stated that it does not comment on ongoing investigations and would neither confirm nor deny the allegations. However, the office noted that it had initiated a general audit in February regarding the department’s “efforts to provide food assistance to the West Bank and Gaza.”Two sources with knowledge of GHF operations said the State Department transferred funds to the foundation, which then used contractors to purchase food and logistics. One source emphasized that the GHF paid “exorbitant” amounts for food supplies, significantly exceeding the prices previously paid by the US in the region.

A GHF spokesperson, speaking on condition of anonymity, claimed the foundation was unaware of the OIG investigation and defended the procurement, asserting that food supplies were largely sourced from the local market at reasonable prices. However, the spokesperson admitted that an internal assessment by the foundation found shipping costs to be exceptionally high due to the inherent risks of operating in an active war zone.

The spokesperson further noted that while the GHF was developing a plan to reduce transportation costs, the Israeli government requested the suspension of its activities in October following a US-brokered ceasefire. The spokesperson declined to provide further details regarding the foundation’s financial statements.

While US government internal audit mechanisms do not have the authority to impose direct criminal sanctions, they can recommend legal action to relevant agencies or refer cases directly to the US Department of Justice if they find reasonable suspicion that federal laws have been violated.

Established in May 2025, the GHF faced intense scrutiny from its first day of operations due to its opaque organizational structure, mysterious funding sources, and the reported use of mercenaries at aid distribution points. During a period of escalating international condemnation regarding Israel’s blockade of Gaza and its severe humanitarian toll, the foundation’s founding executive director and deputy resigned before operations had even fully commenced.

Health officials in the Hamas-controlled territory reported that approximately 1,000 Palestinians were killed by Israeli fire while attempting to reach GHF distribution centers. During the period when Israel restricted access for most international organizations except the GHF, UN agencies warned of an impending famine in the besieged enclave.

The GHF commenced operations during a period when the Trump administration was moving to dissolve the US Agency for International Development (USAID). State Department officials and contractors claim this move led to total chaos in aid distribution.

A US official stated that the department drew the $30 million grant from humanitarian aid funds and that the administration encouraged other nations to contribute to the structure. However, officials in Washington admitted they struggled to understand the exact mechanics of how the GHF operated.

Reports indicate the government exempted the GHF from the standard oversight and legal regulations typically applied to taxpayer-funded groups. Conversely, congressional staff overseeing the department’s budget were reportedly given no information regarding which security measures remained in place or how the funds were being spent.

In July, a group of Democratic senators wrote to Secretary of State Marco Rubio, questioning “what procurement mechanism was used in the execution of the $30 million appropriation,” which rules were bypassed, and what other funding sources supported the GHF. The senators stated in the letter that “not a single dollar of American taxpayers should be complicit in this questionable scheme.”

The GHF completely ceased its Gaza operations in October 2025. A US official who was forced to defend the project during its active period commented on its status, stating, “The funding was always in the dark. There were major question marks within the State Department’s Bureau of Near Eastern Affairs because there were no answers.” Diplomats reportedly felt significant unease being tasked with advocating for what they described as a half-baked and poorly executed project.

By late 2025, the GHF, which was initially registered in both the US and Switzerland, announced it had run out of funds. While the foundation claimed to have distributed more than 187 million free meals to Gazans during its months of operation, even some Israeli officials have viewed that figure with skepticism.

Middle East

US conducts covert ship-to-ship oil transfers in Strait of Hormuz, sources say

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The United States is conducting a covert operation in the Strait of Hormuz to ensure the uninterrupted flow of oil shipments from the Persian Gulf, according to reports.

The US Armed Forces are secretly escorting tankers and conducting ship-to-ship oil transfers using unmanned aerial vehicles (UAVs), unmanned surface vessels, and helicopters, Reuters reported, citing sources and satellite imagery.

At least 92 cargo vessels have participated in the process since the launch of the operation, the report said.

Sources stated that the plan is executed entirely and continuously under the control of the US military. According to the disclosed details, tankers arrive at a designated assembly point before reaching the Strait of Hormuz.

From there, they depart at staggered times, maintaining a distance of approximately 3 to 4 kilometers from one another. During the transit, the tankers switch off their transponders and extinguish their lights.

The US Armed Forces track the progress of the tankers via pre-determined routing points.

Once the tankers pass through the Strait of Hormuz and arrive just outside the zone that Iran has declared under its own control, they pull alongside receiving vessels to begin the oil transfer.

This transfer process reportedly lasts between 24 and 40 hours, after which the emptied tankers return back through the strait. Reuters noted that this method resembles the scheme used by Iran to bypass sanctions.

Oil transfers conducted in two distinct areas

Sources familiar with the process reported that the ship-to-ship oil transfers began in the early days of May and are being carried out in two distinct locations.

One of these points is located off the coast of Fujairah in the United Arab Emirates (UAE), while the other is near the Port of Sohar in Oman.

Reuters reported that satellite imagery dated June 11 detected 17 pairs of vessels simultaneously conducting oil transfers across both areas.

Sources claimed that a US Air Force Apache-type helicopter, which was shot down by Iran on the evening of June 8 and triggered retaliatory strikes by Washington, was also involved in this covert mission.

Satellite imagery captured on the day of the incident showed six pairs of tankers positioned side-by-side off the coast of Sohar. When asked for comment on the matter, the US Department of Defense (Pentagon) maintained that assets of the US Central Command (CENTCOM) are in no way involved in activities providing protection to ship-to-ship oil transfer operations on the high seas.

According to shipping documents reviewed by Reuters, a significant portion of the oil transported in the operation consists of exports originating from the UAE.

Sources added that the Kuwait Oil Tanker Company, a firm owned by the Kuwaiti state, is also actively participating in these transfers.

The UAE government, the UAE state oil company ADNOC, and the Kuwait Oil Tanker Company have not yet made any statements regarding the matter.

In a report published on June 3, Bloomberg also wrote that after Washington suspended its initiative dubbed “Project Freedom,” which envisioned escorting vessels through the Strait of Hormuz, the US Navy continued to quietly assist the transit of ships through the strait while trying not to publicize these activities.

The Iran-based Mehr news agency announced on June 10 that the Islamic Revolutionary Guard Corps had shot down a US MQ-9 Reaper-type unmanned aerial vehicle in the skies over the Iranian city of Jam.

On the evening of the same day, US President Donald Trump announced that he was preparing to resume bombardments against Iran due to insufficient progress in negotiations and the downing of the Apache helicopter off the coast of Oman on the evening of June 8.

CENTCOM announced on June 11 that the US military, acting on the instructions of President Donald Trump, had begun conducting “additional self-defense strikes” against certain targets in Iran.

Washington later desisted from launching new strikes, and Trump announced on June 15 that a peace agreement had been signed between the US and Iran.

Trump declared that the Strait of Hormuz was already partially open to maritime traffic and would be fully opened on June 19.

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Middle East

Mine clearing in Strait of Hormuz could delay shipping traffic for up to 50 days

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Clearing mines from the Strait of Hormuz to restore safe transit could delay the return of normal maritime traffic by several weeks, even after an agreement is reached to reopen the strategic waterway.

Security risks in the region persist, according to a report by the Reuters news agency, which cited shipping and maritime security sources.

Estimates from five Western sources operating in maritime security suggest that the clearance operation, which will utilize traditional minesweepers and underwater drones, could take 40 to 50 days to complete. Sources stated that this process must be concluded before insurance, shipping, and oil companies will be willing to risk transiting the strait.

The projected delay could impact global markets at a time when oil inventories in the world’s largest economies have fallen to their lowest levels since 2003. Based on pre-war shipment volumes, estimates suggest that tens of millions of additional barrels of oil could remain trapped in the strait, adding to the Persian Gulf shipments that have been blocked since February 28.

Jakob Larsen, the head of maritime safety and security at the shipping association BIMCO, called for caution regarding the situation:

“At this stage, we believe it is still too risky to begin transits. The mine hazard in the region remains a problem both now and for the future; therefore, safe, de-mined routes must be established.”

The report noted that the exact number of mines laid by Iran remains unknown in the strait, which accounted for 20% of global daily oil and natural gas shipments before the war. A June 11 briefing note from the German Navy, citing data from US and British naval forces, stated that the mines were located in four areas around the strait, though Germany noted it could not independently verify these locations.

The mere possibility of mines is highlighted as enough to keep shipping companies away from the region. Because a supertanker carrying crude oil can be valued at approximately $300 million, war-risk insurers, oil companies, and tanker operators are expected to demand guarantees of safe passage.

Rene Kofod-Olsen, CEO of V.Group—one of the world’s largest technical ship and crew management companies, which has 13 vessels stranded in the Persian Gulf—evaluated the situation:

“Even a single naval mine is enough to cause loss of life. This is clearly a massive problem for the global shipping industry.”

Arsenio Dominguez, Secretary-General of the UN’s International Maritime Organization, welcomed the agreement to reopen the Strait of Hormuz, calling it “an important step toward restoring security in this vital corridor for seafarers and ships.” However, Dominguez added that “implementation will take time to ensure all necessary security and safety guarantees are met.”

Earlier, US President Donald Trump announced that an agreement had been signed with Iran, that the Strait of Hormuz was partially opened to maritime traffic, and that it would be fully opened as of June 19.

Trump claimed that, at the current stage, “a search is being conducted for a few mines.”

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Iran discloses 14-point draft US agreement featuring sanctions relief and troop withdrawals

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Iran has disclosed the details of a 14-point draft memorandum of understanding (MoU) prepared as part of ongoing negotiations with the United States.

According to the draft text published by the Mehr news agency, citing sources, the document includes critical provisions such as an immediate end to the war, the withdrawal of US forces from the region, and the provision of financial assistance to Tehran.

Iranian Ministry of Foreign Affairs officials stated that the text has not yet taken its final shape and must be reviewed and processed by relevant domestic institutions.

The draft memorandum of understanding published by the Mehr agency consists of the following points:

  • An immediate and complete cessation of war on all fronts, including Lebanon;
  • US non-interference in the internal affairs of Iran and respect for its sovereignty;
  • The complete lifting of the maritime blockade within 30 days;
  • The withdrawal of American military personnel from areas close to Iran;
  • The restoration of normal maritime traffic in the Strait of Hormuz within 30 days;
  • The suspension of sanctions and the provision of full access to Iran’s frozen assets;
  • The provision of $300 billion in financial assistance to Tehran by the US and its allies;
  • The initiation of a 60-day negotiation period for a final agreement regarding nuclear issues, the complete lifting of US sanctions, and the revocation of UN Security Council and International Atomic Energy Agency (IAEA) resolutions;
  • Iran’s reaffirmation of its commitment to the Treaty on the Non-Proliferation of Nuclear Weapons (NPT);
  • A US commitment not to increase its troop levels in the region and to refrain from imposing new sanctions;
  • The release of $24 billion of Iran’s frozen financial assets by the US during the 60-day negotiation process, with half of this amount transferred to Tehran before negotiations begin;
  • The establishment of a monitoring mechanism to oversee the implementation of the agreement;
  • The endorsement of the final agreement via a UN Security Council resolution;
  • The requirement that half of the Iranian funds be released, oil sanctions suspended, and the maritime blockade lifted for second-phase negotiations to begin; with the final agreement strictly limited to the status of enriched uranium, the lifting of sanctions, and the economic recovery program, while explicitly excluding the missile program and support for resistance groups from the agenda.

Meanwhile, the news outlet Axios, citing its own sources, reported that Washington and Tehran have agreed on the text of the memorandum of understanding, though the document still awaits final approval.

The report noted that the document in question contains all the details regarding nuclear issues and satisfies US demands.

Bloomberg reported that instead of establishing direct contact, the parties have been exchanging messages through indirect diplomatic channels, utilizing Pakistani mediators and private couriers.

US President Donald Trump announced on June 11 that the parties had reached an agreement to end the war, stating that only the signatures remained to be finalized.

Trump indicated that the preparation of the documents had reached the final stage, adding that the signing ceremony could take place as early as this weekend.

According to information reported by Axios correspondent Barak Ravid, US Air Force aircraft and necessary equipment departed for Geneva, Switzerland, on the evening of June 11 to prepare for the signing ceremony.

Iranian Ministry of Foreign Affairs Spokesperson Esmaeil Baghaei also announced that work on the main articles of the peace agreement text with the US is nearly complete.

Despite these positive statements pointing toward an agreement, military tensions between the two sides had continued until very recently.

A few days ago, the parties carried out reciprocal military strikes, after which Trump stated that Washington was prepared to launch new attacks against Iran, seize Kharg Island, and take control of the country’s oil and gas markets, drawing a parallel to Venezuela.

Trump later announced that he had canceled these attack plans, while the Iranian Ministry of Foreign Affairs argued that the American attacks had rendered the ceasefire process dysfunctional.

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