DOD forms task force to study Iraq fraud
June 4, 2007
RAF MILDENHALL, England — Allegations of staggering levels of fraud and corruption in Iraq have prompted the Pentagon to form a task force comprised of military and federal law enforcement agencies.
The announcement of the new International Contract Corruption Task Force was part of the latest Department of Defense Inspector General’s report to Congress.
“As a result of the magnitude of alleged criminal activity within the Iraqi theater, a group of federal agencies has formalized their partnership to investigate contract fraud and public corruption related to Iraq reconstruction,” the report states.
The task force will be made up of agents from the FBI, the Defense Criminal Investigative Service, the Army Criminal Investigative Division, the Special Inspector General for Iraq Reconstruction, as well as officials from the Inspector General’s office at the Agency for International Development and the State Department.
The Congressional report was released on May 24 and covers the Inspector General’s activities from Oct. 1, 2006, through March 31.
The office’s accomplishments in the six-month period include 77 audits that identified $589.8 million in achieved monetary benefits and $65.9 million worth of recommendations on how to use funds better, according to Inspector General Claude M. Kicklighter.
Investigations resulted in 190 indictments and 155 convictions and led to the return of $303.9 million to the government.
The report cited as accomplishments:
General Electric Company Aircraft Engines paid $11.5 million in restitution after it manufactured and delivered defective T700 jet engines and components for use on Black Hawk, Apache and Cobra helicopters.KBR agreed to pay $8 million as a result of a civil settlement to resolve allegations of false claims, conspiracy, false statements, falsely making, altering and forging documents, theft of funds, violations of the anti-Kickback Act, bid-rigging and product substitution.Medco Health Solutions agreed to pay $155 million plus interest to settle allegations that the company submitted false claims, solicited and accepted kickbacks from pharmaceutical manufacturers to favor their drugs and paid kickbacks to health plans to obtain business.Two Indonesian nationals pleaded guilty after a federal investigation revealed they acquired sensitive military technology from an undercover business run by federal agents. They had obtained a night vision device and holographic weapons sights for the Liberation Tamil Tigers Elam, a Sri Lankan rebel/terrorist group.The report also covered the IG’s role in investigating the government’s recovery effort from Hurricanes Katrina and Rita. As of Feb. 21, the DCIS has received 27 allegations of criminal activity related to the hurricanes, and agents have opened 10 investigations concerning bribery, kickbacks, false claims and possible product substitution.
While the IG has been successful in combating some fraud, a senior fellow at the Center for Strategic and Budgetary Assessments said the problem will continue.
“In any business model, there is going to be some corruption,” said Dakota Wood, a retired Marine Corps lieutenant colonel who served during the 2003 Iraqi invasion and now works for the Washington, D.C.-based independent policy research institute.
“To go into a war zone and expect everyone to be on the up-and-up is probably unrealistic.”
Wood said there is no quick fix.
“When you look at the size of Iraq and the number of people involved, you simply don’t have the manpower to apply against the problem,” he said. “It’s like anything to do with Iraq, there’s no single, simple answer.”