Gee, they don’t trust the CIA funded intelligence agency. Imagine that!

Suspicious of Iraq’s CIA-funded national intelligence agency, members of the Iraqi government have erected a “shadow” secret service that critics say is driven by a Shiite agenda and has left the country with dueling spy agencies.

The minister of state for national security, a Shiite named Sherwan al-Waili, has built a spy service boasting an estimated 1,200 agents out of a second-tier ministry with a minimal staff and meager budget, Western officials say.

“He has representatives in every province,” a Western diplomat said, speaking on condition of anonymity. “At the moment, it’s a slightly shady parallel organization.”

Shiite officials say the minister is providing information on al Qaeda and Saddam Hussein’s Baath Party that isn’t being supplied by the Iraqi National Intelligence Service, the institution meant to be Iraq’s primary spy service.

The INIS was established in the spring of 2004 by the U.S. occupation authority and since then has been under the command of Gen. Mohammed Abdullah Shahwani, a Sunni who was involved in a CIA-backed coup plot against Hussein a decade ago. Over the past three years, Shahwani’s agency has been funded by the CIA, according to the U.S. military and Iraqi officials.

The service reports directly to Shiite Prime Minister Nouri al-Maliki, but Shiite members of his government distrust the agency, which contains intelligence agents from the Hussein era. For most of 2005 and the first part of 2006, Shahwani was banned from attending Cabinet meetings.

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