U.S. State Department OIG watchdog slams lack of oversight in $26 bn Ukraine aid

The US sent Ukraine $26 billion in aid without adequate oversight of how the funds would be used, a government auditor has told lawmakers.

OFFICE OF INSPECTOR GENERAL, U.S. DEPARTMENT OF STATE 4
MONTHLY UPDATE REPORT RECAP September – November 2025

Operation Atlantic Resolve, 

Including U.S. Government Activities Related to Ukraine, Special
Inspector General Report to the United States Congress, July 1–September 30, 2025, and October 1,2025–December 31, 2025
This eighth report submitted by the Special Inspector General for Operation Atlantic Resolve
summarizes U.S. government support to Ukraine and the broader response to Russia’s full-
scale invasion, including support for the Ukrainian Armed Forces, support for North Atlantic
Treaty Organization (NATO) partners, and U.S. military, diplomatic, and humanitarian activity.
This report covers two quarters due to the 2025 federal government shutdown 

The flaws in a program managed by the now-defunct US Agency for International Development (USAID) were highlighted by the office of the inspector general, which oversees it.

U.S. watchdog slams lack of oversight in $26 bn Ukraine aid

Direct USAID payments to Kiev lacked proper oversight, the inspector general’s office has told lawmakers

Published 18 Mar, 2026 09:04 | Updated 19 Mar, 2026 07:51

A USAID shipping and logistics facility in Miami, Florida, August 26, 2011. ©  HUM Images / Universal Images Group

Contractors hired by the agency to monitor the assistance “failed to provide required reports on time or at all,” Deputy Inspector General Adam Kaplan told the House Foreign Affairs Subcommittee on Oversight and Intelligence on Tuesday. “Mitigating risks requires more than announcing costly monitoring contracts.”

Kaplan was referring to funding delivered to the Ukrainian government through a World Bank trust fund, intended to compensate for social benefits to people displaced by the conflict with Russia. 

An audit released by the USAID IG office earlier this month found that in some cases, Washington reimbursed duplicate payments or payments to Ukrainian citizens living in other nations who were ineligible.

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1. International audit firms Deloitte and KPMG were contracted by the US government to provide additional oversight but both failed to deliver, the probe found. 
2. The State Department took over USAID responsibilities in July 2025 following the Trump administration’s decision to shut down the agency.

 

Since November, Kiev has been shaken by a series of corruption scandals involving senior government officials and associates of Ukrainian leader Vladimir Zelensky. Businessman Timur Mindich fled the country hours before being charged by Western-backed anti-graft agencies with running a multi-million-dollar kickback scheme in the energy sector.

 

The criminal investigation is reportedly contributing to an ongoing parliamentary crisis, with lawmakers consistently declining to vote for reforms demanded by the EU and international lenders.

 

BBC Ukraine reported this week that Zelensky has effectively lost the ability to push his agenda. Many MPs reportedly blame Zelensky for trying to scapegoat them for his failed attempt last year to strip the independence of the anti-corruption agencies – which is widely viewed as a move to shield his inner circle from prosecution.