...the contract would be "cost-plus": KBR would just submit bills for whatever it spent, and the government would reimburse it, adding fees of between 2 and 7 percent as KBR's profit....the more money KBR spent, the more profit it would make.... the G.A.O. has concluded that KBR let costs spiral out of control....
...the whistle-blowers' testimony squared with reports from three government organizations: the Defense Contract Audit Agency (D.C.A.A.), the Iraq Coalition Provisional Authority's Office of the Inspector General, and the U.S. G.A.O. ....
Last year, a Pentagon audit found that KBR could not document more than $l.8 billion worth of work done under its LOGCAP contract in Iraq. At first the army considered withholding payments, but the prospect of bitter court battles led it to try to negotiate a settlement. Ordinarily, a contractor would be asked to come up with documentation for its claim—to date, Halliburton has charged the government $9.5 billion for LOGCAP work in Iraq. The government would then respond with its own documentation, and the two parties would reach a compromise figure. Not here: strangely, an outside auditor was hired to help decide what Halliburton would be owed if it could come up with the paperwork—and the government would then pay that amount. Whatever the final number, hundreds of millions of dollars will simply go unaccounted for...
Back in 1998, Cheney decided to merge Halliburton with Dresser Industries, a Texas-based energy company. Unfortunately, he failed to do his homework on Dresser: a mountain of lawsuits over asbestos-contamination claims were about to be filed against it. KBR, formed from the merger, bore the brunt of those. By late 2003, Dresser was forced into bankruptcy and began organizing a court-ordered settlement plan. KBR incurred huge liabilities—handily offset by those contracts in Iraq.
I was wondering what the hell Bush meant when he complained about frivelous asbesto claims: now I can pretend I know.
The U.S. contractor working on the project repeatedly warned the task force headed by Army Lt. Gen. David H. Petraeus that a Lebanese middleman involved in the deal might be routing kickbacks to Iraqi Defense Ministry officials. But senior U.S. military officials did not act on the contractor's pleas for tighter financial controls, according to documents and interviews.
"If we proceed down the road we are currently on, there will be serious legal issues that will land us all in jail," the contractor, Dale Stoffel, wrote in a Nov. 30 e-mail to a senior assistant to Petraeus.
Eight days later, Stoffel was shot dead in an ambush near Baghdad. The killing is being investigated by the FBI, according to people who have been interviewed by the bureau.
The latest figures $108 million Hallibitchton alone has illegally profiteered, outside the legal profiteering that is the basis of it's entire existence.
