Cheney and Halliburton Hold Title - Top Earners In Iraq
There has never been an investigation into Cheney's involvement in awarding Halliburton no-bid contracts making the
company the number one war profiteerer in Iraq. Apparently people have forgotten about the March 5, 2003 e-mail between
the Army Corps of Engineers and a Pentagon employee that stated the contract "has been coordinated w VP's office."
People also seem to have forgotten that Cheney continues to own stock in Halliburton. Stock that has risen in leaps and
bounds since its former CEO moved into the White House and developed the most prolific war profiteering scheme of all
time.
A study released in June 2005, originating from the Defense Contract Audit Agency (DCAA), revealed that overall,
Halliburton had received roughly 52% of the $25.4 billion that has been paid out to private contractors since the war in
Iraq began.
Halliburton was the top profiteer when it came to funds belonging to the citizens of Iraq as well. A March 18, 2004
audit report by the Department of Defense Office of the Inspector General, titled, “Acquisition: Contracts Awarded by
the Coalition Provisional Authority by the Defense Contracting Command-Washington," determined that the CPA and its
predecessor, the Office for Reconstruction and Humanitarian Assistance, had circumvented federal contracting procedures
since the early days of the occupation.
The audit found that federal procurement rules were not followed in 22 of 24 contracts awarded by the Defense
Contracting Command and that defense department personnel conducted “inadequate surveillance” on more than half of the
contracts; did not “perform or support price reasonableness determinations;” and allowed activity that was
“out-of-scope” of the original contracts.
An analysis of the data released in August 2004, showed the CPA had awarded 85% of the contracts to US and UK firms and
that Iraqi companies received a mere 2% of the contracts paid for with Iraqi funds. Halliburton received 60% of all
contracts paid for with Iraqi money.
Halliburton's contracts are "cost-plus" deals and according to Peter Singer, author of "Corporate Warrior," when the
government gives out cost-plus contracts, "essentially it rewards firms when they add to costs rather than rewarding
them for cost savings," he said.
Halliburton employees told Knight Ridder about a scam where the company ran up costs by having employees drive empty
trucks back and forth across Iraq.
"There was one time we ran 28 trucks, one trailer had one pallet (a trailer can hold as many as 26 four-foot square
pallets) and the rest of them were empty," said David Wilson, who was the convoy commander on more than 100 runs. Four
other drivers who were with Wilson confirmed his account for Knight Ridder.
Halliburton's contract allows the company to pass on the cost of the truck runs and add between 1% and 3% for profit.
"Trucking experts estimate that each round trip costs taxpayers thousands of dollars," according to Knight Ridder.
But if you listen to Cheney, people are just picking on Halliburton because they don't like him. Not so. I would be mad
at any company that billed me for driving empty trucks across the desert, but it just so happens that Halliburton is the
company at the wheel.
Other whistleblowers described how employees were instructed to abandon or torch new trucks, worth $80,000, if they got
a flat tire or had some other minor problems, so that Halliburton could purchase new trucks with taxpayer dollars.
People must have been picking on Halliburton long before Iraq because under Cheney's watch, the company was caught
ripping of the government time and time again. In 1997, the GAO caught the company charging $85.98 for a sheet of
plywood that only cost $14.06. In a 2000 follow-up investigation, Halliburton was caught billing tax payers for cleaning
the exact same office space 4 times a day.
So what happened as a result of these expensive drawn-out investigations? In 2002 Halliburton paid a $2 million fine for
defrauding the government. The investigation probably cost more than $2 mill.
In January 2004, two Halliburton employees were caught red-handed taking $6.3 million in kickbacks from a subcontractor
in Iraq. The company gave the $6.3 million back, claimed it fired the employees, and went on like nothing ever happened.
I guess Cheney would have us believe that 2 guys stuffed $6.3 million in their back pockets without Halliburton's
knowledge. Well call me cynical or whatever, but I don't buy it.
This time around, the Bush team not only ignored the blatant misconduct, it gave Halliburton another $1.2 billion
contract, a move that even upset republicans. Rep Tom Davis, Chairman of the House Committee on Government Reform
stated: "It's incomprehensible that the [Bush] Administration could give Halliburton another billion-dollar contract
without fully investigating such serious criminal wrongdoing."
And that ain't all. In June 2004, the Pentagon's Defense Contract Audit Agency completed a review that found Halliburton
had billed for 36% more meals in Iraq than it had served to the troops, resulting in an overcharge estimated to be as
high as $186 million.
In July 2004, the GAO reported that when Halliburton acted as a middleman for the operation of dining halls, costs were
over 40% higher.
So what kind of punishment did this misdeed bring? The DCAA told Halliburton to send all bills to their agency for
approval before submitting them for reimbursement.
In an August 16, 2004, memorandum, the DCAA "identified significant unsupported costs" submitted by Halliburton and said
"while contingency issues may have had an impact during the earlier stages of the procurements, clearly, the contractor
should have adequate supporting data by now."
When DCAA examined 7 task orders with a combined proposed value of $4.33 billion, its auditors identified unsupported
costs totaling $1.82 billion.
On September 16, 2004, the Pentagon found that $34.2 million of the costs associated with KBR's task order of the Iraqi
oil infrastructure contract were unreasonable, including $14.9 million in overcharges and $17.7 million in "unsupported"
costs.
On March 14, 2005, a Pentagon audit discovered $108 million in overcharges by KBR for delivering gasoline to Iraq. The
minority staff of the House Government Reform Committee later determined that the total overpayment through April 1,
2004 was $167 million
And that still ain't all. In another case of fraud, government auditors found Halliburton claimed to have lost over $60
million worth of government property in Iraq, including trucks, office furniture and computers.
Stuart Bowen, auditor of the now-disbanded Coalition Provisional Authority, said that 6,975 of 20,531 items on
Halliburton's ledgers were unaccounted for.
"This occurred because KBR did not effectively manage government property," his report said. "As a result," Bowen said,
"we projected that KBR could not account for 6,975 property items from an inventory of 20,531 valued at $61.1 million."
The June 2005 DCAA study revealed new evidence of Halliburton fraud to include the company: (1) overcharged or presented
questionable bills for close to $1.5 billion;
(2) lost 12 pre-fabricated bases worth over $75;
(3) billed $152,000 to provide a movie library for 2,500 soldiers; and
(4) submitted inconsistent billings, eg: video cassette players $300 in some instances, and $1000 in others; $2.31 for
towels one day and $5 on another.
If Cheney is to be believed, the conspiracy to pick on Halliburton is a global effort because as of July 2004, the
French, British, Nigerian and US governments were all investigating Halliburton's activities while Cheney was CEO, for
paying over $180 million in bribes to Nigerian officials in exchange for a $6 billion contract to build a natural gas
plant in Nigeria.
In this investigation, former Halliburton employees are ratting out Cheney himself. Ex-Halliburton consultant, Attorney
Jeffrey Tesler, testified under oath in May, 2004 that he made bribery payments to Jack Stanley, while Stanley was
president of Halliburton subsidiary KBR, and also made payments to Halliburton executive William Chaudran. His testimony
was backed up by banking records and Tesler said CEO Cheney approved the payments.
Cheney had better not get too comfortable because his criminal empire may soon come crashing down around him. If
democrats take back the house and the senate next November, I think its safe to say that investigations will follow.
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Evelyn Pringle
evelyn.pringle@sbcglobal.net
(Evelyn Pringle is a columnist for Independent Media TV and an investigative journalist focused on exposing corruption
in government)