And Halliburton Hold Title - Top Earners In Iraq
By Evelyn Pringle
31 March, 2006
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
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
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
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
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
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
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"
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
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.
(Evelyn Pringle is a columnist for Independent Media TV and an investigative
journalist focused on exposing corruption in government. He can be reached