A top U.S. Army procurement official said on Monday Halliburton's deals in Iraq were the worst example of contract abuse she had seen as Pentagon auditors flagged over $1 billion of potential overcharges by the Texas-based firm.
Bunny Greenhouse, the Army Corps of Engineers' top contracting official-turned whistle-blower, said in testimony at a hearing by Democrats on Capitol Hill that “every aspect” of Halliburton's oil contract in Iraq had been under the control of the Office of the Secretary of Defense.
“I can unequivocally state that the abuse related to contracts awarded to KBR (Kellogg Brown and Root) represents the most blatant and improper contract abuse I have witnessed during the course of my professional career,” said Greenhouse, a procurement veteran of more than 20 years.
$1 billion in (alleged) fraud? How could that possibly happen?
Pressed by lawmakers whether she thought the defense secretary's office was involved in the handout and running of contracts to KBR, Greenhouse replied: “That is true.”
“I observed, first hand, that essentially every aspect of the RIO (Restore Iraqi Oil) contract remained under the control of the Office of the Secretary of Defense. This troubled me and was wrong,” said Greenhouse.
Oh. Motive, opportunity, method…. For the record, all is denied and pooh-poohed by Kellog, Brown & Root (now part of the Halliburton group, and itself one of the great influence-peddling companies of all time).
If, however, this is true, it means Halliburton is in the same league as Saddam Hussein's family, also thought to have ripped off about $1 billion, although it would leave Halliburton still well behind the multiple billions siphoned off by the US's own CPA and its Iraqi henchmen:
A report by Democratic Rep. Henry Waxman of California, said in the week before the hand-over on June 28, 2004, the U.S.-led Coalition Provisional Authority ordered the urgent delivery of more than $4 billion in Iraqi funds from the U.S. Federal Reserve in New York.
One single shipment amounted to $2.4 billion — the largest movement of cash in the bank's history, said Waxman.
Most of these funds came from frozen and seized assets and from the Development Fund for Iraq, which succeeded the U.N.'s oil-for-food program. After the U.S. invasion, the U.N. directed this money should be used by the CPA for the benefit of the Iraqi people.
Cash was loaded onto giant pallets for shipment by plane to Iraq, and paid out to contractors who carried it away in duffel bags.
The report, released at a House of Representatives committee hearing, said despite the huge amount of money, there was little U.S. scrutiny in how these assets were managed.
“The disbursement of these funds was characterized by significant waste, fraud and abuse,” said Waxman.
An audit by the U.S. Special Inspector General for Iraq Reconstruction said U.S. auditors could not account for nearly $8.8 billion in Iraqi funds and the United States had not provided adequate controls for this money..
As a famous Senator once said, “A billion here, a billion there, pretty soon you are talking about real money.”