Thursday, February 08, 2007

9 billion missing from Iraq

Why and where did some of that money go....
A British adviser to the Iraqi Governing Council claimed that officials in the CPA were demanding bribes of up to $300,000 in return for awarding contracts.

Contracts were paid in cash bricks - stacks of $100 bills — stuffed in gunnysacks. Why pay in cash bricks except to leave no paper or electronic trail?

$1.4 billion was flown by helicopter to a bank in the Kurdish town of Irbil — it never arrived.

8,206 guards were listed on the payroll, but they could only find 602 actual guards. Where did this money go? Who was behind this scam?

Just One individual with an excel spreadsheet was in charge of $20 billion

Cost-plus contracts gave contractors incentive to charge higher prices — the more they spent, the more they made.
Halliburton purchased of hundreds of high-end SUVs
Leased SUVs for $7,500 per month
Some employees lived in 5-star hotels
Employees were told NOT to keep electronic spreadsheets to record their purchases — ie leave no trail
Whistleblowers exposed fraudulent practices, yet for more than a year the CPA continued to give contracts to the firm Custer-Battles. When asked why, Custer said, "Battles is very active in the Republican party, and speaks to individuals he knows in the Whitehouse almost daily."
Assuming it was all $100 dollar bills it was about 20 tractor trailer loads shipped to Iraq where reports surfaced of individuals playing football with $100,000 blocks of dollars. This was one of the greatest financial scandals of all time and the GOP still does not want to investigate.
“We are in a war against terrorists, to have a blame meeting isn’t, in my opinion, constructive,” said Rep. Dan Burton, an Indiana Republican.


Anonymous said...

Looks like Custer Battles has finally been vindicated. The problem in all this fraud is who is actually right. Some whistleblowers, like the ones against Custer Battles led by this guy Grayson, appear to only be in it for the money....while other whistleblowers clearly have a legitimate beef. Our government really needs to figure out how to do this right...some companies are convicted in public opinion while actually being innocent like Custer Battles, while others get away with rampant fraud and are likely still getting away with it.

Gary said...

I disagree with anon. on that.

Custer Battles was found guilty in one trial and then in the trial just concluded a judge threw out similar charges of war profiteering. He had earlier thrown out the $10 million jury verdict from the first trial while conceding the company defrauded. His reasoning which would prevent nearly all war profiteering charges in Iraq is that the CPA is not a US government entity. Both findings will be appealed.

For what we are discussing:,_III

Anonymous said...

Both Gary and Anon bring up some good points, but they are both a little incorrect. In a previous trial, the jury found Custer Battles liable fr $3mil in damages (under the law the judge has authority to triple this, but he didn't). While this was reported significantly as getting off on a technicality, the full opinion stated that the whistleblowers failed to show that Custer Battles submitted the claims to ANYONE, not just the CPA.

Gary's point on the judge's ruling limiting corruption charges in Iraq is something both the Dems and Republicans have been erroneously reporting. Very little of the $18 billion for reconstruction was administered by the CPA...most of the funds were administered by US government officials. Custer Battles was one of those few contracts with direct CPA contracts, but almost everyone else out there (Halliburton, Parsons, Bechtel, etc) were under US government contracts and the judges ruling has no effect on them. As a lawyer, there is little chance the Custer Battles decision will be overturn - it's actually quite well written from a legal perspective. The plaintiff's lawyer, Grayson, has been using this to fuel his failed run for Congress.

Maybe now we can move on to real fraud and abuse!