Ex-Ambassador Left Luxembourg Embassy in 'State of Dysfunction,' Watchdog Finds

Described as "aggressive, bullying, hostile, and intimidating," President Obama's ambassador to Luxembourg left the U.S. embassy there "in a state of dysfunction" and unable to carry out its duties after her recent exit, according to report released this week by the State Department Inspector General.

Cynthia Stroum, one of President Obama’s top 25 fundraisers -- a bundler who raised more than $500,000 for the his campaign -- was chosen for ambassador in 2009. Since then, auditors say her autocratic, bossy and demanding style led to complete failure of the embassy in Luxembourg's ability to function as an arm of the U.S. government in one of the world's smallest and wealthiest nations.

"Morale among Americans and local staff is very low, and stress levels are high," said the audit. "Most employees describe the Ambassador as aggressive, bullying, hostile, and intimidating, which has resulted in an extremely difficult, unhappy and uncertain work environment."

And "the apparent nonstop requirements from the Ambassador" compromised service and cost U.S. taxpayers dearly, according to the audit. A popular website among the foreign service, Diplopundit, calls the audit "The Horror Report of the Year."

Stroum, who had no apparent qualifications for the job, quit last week, citing business and family obligations. Sources tell Fox News the White House gave her no option after reading the scathing IG report.

Among its findings:

- Stroum wrongly threatened embassy staff that "her appointment letter from the President gave
her the right to read any email messages" they wrote, and staff had "no expectation of privacy" in their e-mail or phone calls.

- For 6 weeks, multiple employees worked full-time to find Stroum a "suitable temporary residence." They screened 200 residences and visited 30-40 houses in Luxembourg. Stroum rejected them all, again costing taxpayers tens of thousands of dollars unnecessarily.

- Stroum rushed to spend $3,400 in Embassy funds on European wine and liquor before the end of the year, even though State Department rules say “in no case, is the post authorized to use excess year-end funds to purchase wine." Secondly, all wine is supposed to be American.

- After learning about a school in Switzerland that trained employees to work in places such as Buckingham Palace, Stroum and an assistant flew to Switzerland solely to hire a chef, billing taxpayers more than $1,200 for the trip and ignoring embassy rules to hire locally.

Since 1989, Stroum, an heir to a Seattle auto parts fortune, personally gave Democratic candidates more than $150,000, according to the Center for Responsive Politics, including President Obama and Washington Sens. Maria Cantwell and Patty Murray.