Taliban have no legal right to multibillion-dollar Afghan fund, says U.S. watchdog

SIGAR report questions Taliban's legal right to billions in U.S. funding for Afghanistan, suggesting return to U.S. control.

The watchdog for U.S. assistance to Afghanistan said the Taliban have no legal right to billions of dollars in funding set aside for the country because they are not recognised as its government and are under sanctions.

In its latest report issued on Friday (January 31, 2025), the office of the Special Inspector General for Afghanistan Reconstruction, or SIGAR, also said President Donald Trump’s administration and Congress may want to examine returning nearly $4 billion earmarked for Afghanistan to the “custody and control” of the U.S. government.

In 2022, the U.S. transferred $3.5 billion in Afghan central bank assets previously frozen in America to the Swiss-based Fund for the Afghan People. The fund has grown to nearly $4 billion since then, according to the inspector general.

Although no payments benefiting Afghans have been made, the fund is aimed at protecting and stabilising the economy on their behalf.

“The Taliban want these funds even though they have no legal right to them since they are not recognised by the United States as the government of Afghanistan, are on the U.S. Specially Designated Global Terrorist list, and are under U.S. and U.N. sanctions,” the report said.

Responding to the report on Saturday, the Afghan Economy Ministry said more than $9 billion of Afghanistan’s foreign exchange reserves had been frozen and warned that any U.S. action regarding the allocation, use or transfer of these reserves was unacceptable.

It urged the international community to return the money to the central bank to ensure the country’s stability.