I hadn't heard this before, but I just read on Juan Cole's blog that former Defense Minister Hazem Shaalan embezzled $1-$2 billion from the Iraqi Ministry of Defense, delaying the equipping of the Iraqi military as well as costing Iraq (and presumably therefore the US) money.
I will try to find out a little more about this and report my thoughts, but for the time being, I agree with most of what Mr. Cole said, and I recommend that you check out the many links he provides to articles et al. discussing the scandal (I'm particularly intrigued by the story of the two contractors who may have been killed over it).
In any case, I will give credit where credit is due: it appears that Ahmad Chalabi was "the good guy" in this, warning about Shaalan's perfidy back in January, which started a bit of a political scuffle.
That is all.