Evelyn Pringle April 25, 2007
When President Bush announced "Mission Accomplished," and the end of the war in May 2003, he also said we would help the citizens of Iraq rebuild their country. "Now that the dictator's gone," he stated, "we and our coalition partners are helping Iraqis to lay the foundations of a free economy."
Apparently he was referring to the Coalition Provisional Authority that took up residence in Saddam's luxurious palace in May 2003, with the newly appointed King, Paul Bremer. The CPA was granted the authority to award reconstruction contracts in Iraq and it used that authority to implement what will go down in the history books as the most blatant war profiteering scheme of all time.
In large part, the masterminds of the reconstruction disaster that would occur after the CPA took over Iraq were Secretary of Defense, Donald Rumsfeld, and Undersecretary of Defense, Douglas Feith.
But to ensure control of the contracting process on the ground in Iraq, Bush filled the top slots of the CPA with the administration cronies. For instance, a friend of Cheney's, Peter McPherson, took a leave of absence as president of Michigan State University to serve as Bremer's economic deputy.
The leader of the CPA's private development sector was Thomas Foley, an old college classmate of Bush, who served as finance chairman for his Presidential campaign in Connecticut and also raised more than $100,000 for Bush.
Relatives of the administration were also given jobs, such as Ari Fleischer's brother Michael, and Simone Ledeen, the daughter of Michael Ledeen. Cheney's daughter Liz, also did a short stint. However, it should be noted that none of them lounged around for too long in what soon became a hellhole in Iraq.
On May 16, 2003, the CPA issued its first regulation and described its authority in no uncertain terms stating:
"The CPA is vested with all executive, legislative, and judicial authority necessary to achieve its objectives, to be exercised under relevant U.N. Security Council resolutions, including resolution 1483 (2003), and the laws and usages of war. This authority shall be exercised by the CPA Administrator."
With one swipe of the pen, Bremer granted himself the authority to run the government ministries, appoint Iraqi officials and award contracts for reconstruction. Next he fired 500,000 Iraqis, most of them soldiers, but pink slips also went out to many doctors, nurses, teachers and other public employees as well.
For the most part, the CPA financed its activities with billions of dollars that belonged to the Iraqis. On May 22, 2003, a UN Security Council passed a resolution that directed the proceeds from Iraqi oil to be placed in a Development Fund for Iraq, and the CPA was granted authority to control the fund and decide which profiteers would get contracts.
During the year that Bremer controlled the purse strings, the Iraqi Development Fund received $20.2 billion, including $8.1 billion from the UN's oil-for-food program, $10.8 billion from Iraqi oil, and the rest from repatriated funds, vested assets and donations.
The CPA accounting system was cash and carry and a steady stream of cash was flown into Bagdad from the US. Inspector General, Stuart Bowen later said that he knew of one $2 billion flight.
A report released by the House Government Reform Committee in February 2007, shows that in the 13 months that Bremer ruled, from May 2003 to June 2004, the Federal Reserve Bank in New York shipped nearly $12 billion in a cash to Iraq.
One can only imagine the Bank service charges associated with these shipments because to accomplish this feat, according to the Democratic chairman of the Reform Committee, Henry Waxman, the cash weighed 363 tons and the Bank had to count and pack 281 million individual bills, including more than 107 million $100 bills, and then load them onto wooden pallets to be shipped to Bagdad on C-130 cargo planes.
Inspector Bowen later said that he determined that some of this cash went to pay salaries for thousands of "ghost employees" and Iraqi civil servants who did not exist.
Within a few months of the CPA's arrival in Iraq reports of corruption in the contracting process began appearing in the media. A British adviser to the Iraqi Governing Council told the BBC that officials in the CPA were demanding bribes of up to $300,000 in return for contracts.
Reports of flat out-fraud remained steady throughout Bremer's reign in Iraq. One audit showed that the CPA Ministry of Finance could not provide documentation for about $17 million spent on employee salaries in February 2004, and a CPA Advisor to the Ministry of the Interior said the Ministry was paid for 8,602 guards but only 602 could be verified.
A CPA advisor to the Ministry of Finance was so concerned about payroll corruption that he submitted a formal complaint that stated in part: "Of the 1.6 million government employees currently on payroll, credible estimates put the number of ghost workers at somewhere between 250,000-300,000 employees."
An October 2004, audit performed for the International Advisory and Monitoring Board, created by the UN to monitor the spending of Iraqi money, found one case where a payment of $2.6 million was authorized by a CPA senior adviser to the Ministry of Oil, and auditors were unable to obtain an underlying contract or any evidence that the services had been rendered.
The auditors in this group found 37 cases where files could not be located for contracts worth $185 million all total. In another 52 cases, there was no record that goods had been received for a total of $87.9 million.
People on the ground in Iraq said that doing business with the CPA was reminiscent of the Wild West. Former CPA employees told a congressional committee that sackfuls of cash were tossed around like footballs. Franklin Willis, showed pictures of himself and others holding up bundles of $100 notes totaling $2 million, which he said was used to pay the contractor Custer Battles. "We told them to come in and bring a bag," Willis said.
He also testified that millions of dollars in $100 bills were stored in the basement of the CPA offices and distributed to favored contractors with little accounting discipline. For instance, in the year that the CPA ruled, Custer was awarded contracts worth more than $100 million.
Two former Custer employees ended up filing a lawsuit under the Federal False Claims Act, saying Custer had swindled $50 million from the CPA with scams like double-billing for salaries and repainting the forklifts found at the Baghdad airport and then leasing them back to the US government.
The employees said the CPA paid the Custer $15 million to provide security for Iraq's civilian airline, when no services were needed because the airline was grounded during the time covered by the contract.
These employees said they kept informing the CPA about Custer's fraudulent conduct for more than a year and when they asked why the firm continued to get contracts, they were told: "Battles is very active in the Republican party, and speaks to individuals he knows in the Whitehouse almost daily."
In June 2004, the Government Accounting Office estimated that more than $1 billion in had been wasted due to illegal overcharges by contractors since the war began. A later audit by the Iraqi government found that as much as $1.27 billion was lost to accounting irregularities between June 2004 and February 2005.
Inspector Bowen cited two examples of poor oversight in a November 3, 2005 interview on National Public Radio where $28 million was paid to build 5 power plants and $1.8 million was paid to rebuild a library, but the work was never performed and the money
"simply disappeared," he said.
A recent report by Bowen says DynCorp was paid $43.8 million for a residential camp for police training personnel and has been empty for months and that the company may also have billed $18 million in other unjustified costs.
About $4.2 million, he says, was improperly spent on 20 VIP trailers and an Olympic-size pool and an additional $36.4 million in spending for weapons such as armored vehicles, body armor and communications equipment that cannot be accounted for.
Not surprisingly, Cheney's Halliburton remained the top profiteer under Bremer's rule. A July 23, 2004, audit conducted by Bowen, showed the company had received 60% of all contracts paid for with Iraq money, including 5 no-bid contracts worth $222 million, $325 million, $180 million, and the last 2 together totaled $194 million for the last two. In comparison, the audit showed that the CPA awarded only 2% of the reconstruction contracts to Iraqi companies.
In one example of blatant fraud, an audit found that Halliburton was charging for more than 41,000 meals a day for soldiers when only about 14,000 were served.
By the fall of 2003, the country was realizing that the rational for war was based on lies and that the only ones drawing any benefits were the profiteers. So when Bush asked Congress for another $20 billion for the CPA, Bremer was summoned to Washington to explain where all the money was going and of course he testified in full stonewall mode.
Before the Appropriations Committee on September 22, 2003, Bremer said the CPA had detailed records of all its receipts and outlays that could be audited by Congress. But when he testified before the Armed Services Committee 3 days later he said the Office of Management and Budget was responsible for maintaining the CPA records and that Congress would have to go to the White House to access the records.
That arrogant assertion went over like a lead balloon with many members of Congress. Senator Robert Byrd said he was outraged over the inability to monitor CPA spending. "There is no reason why any arm of the executive branch charged with making such significant spending decisions," he said, "should not be working directly with Congress."
"When we're talking about handing over another $20 billion to the CPA," he said, "there is a real need for Congress to confirm that the CPA has its finances in order and that it is managing the taxpayer's money responsibly."
"We don't even know how much of the $20 billion," Byrd said, "will flow to government contractors in Iraq."
"Whatever the amount is," he noted, "we know that the size and scope of the profits being made will be enormous."
"Former Bush Administration officials," he warned fellow Senators, "are even setting up consulting firms to act as middlemen for contractors hoping to take part in the bonanza."
"Are we turning the U.S. Treasury into a grab bag for favorite campaign contributors to be financed at taxpayer expense?" he asked.
The answer was yes, and what a grab bag it was. Media reports revealed that Bush's ex-campaign manager and Feith's former law partner had set up consulting firms to profit off the war by lining up contracts for clients through their partners in crime within the CPA.
Other reports revealed that contracts worth $407 were awarded to a firm called Nour that was formed less than 2 months after the war began. The names linked to the profits from Nour, among many others, included former Secretary of Defense, William Cohen, Ahmad Chalabi via a $2 million kickback, his nephew Salam Chalabi as the attorney handling the deal, and the money trail even led to the First Brothers, Marvin and Jeb Bush.
But come to find out, Doug Feith the ringleader on the ground in Washington, had awarded a batch of no-bid contracts to a favored company the month before the war began for the purpose of controlling the media in post-war Iraq.
In October 2003, the Center for Public Integrity obtained copies of 7 contracts awarded to the San Diego-based Science Applications. The total value of the contracts was redacted but the Center was able to determine that they were all awarded in February 2003, and called for the work to be directed by Feith.
However, the Center's most stunning discovery was that when the contracts were awarded, Feith's top deputy at the time, Christopher "Ryan" Henry, had been a senior vice president at SAIC until October 2002.
In addition, one of SAIC's board members was Army General, Wayne Downing, who ran counterterrorism in the Bush administration for almost a year after 9/11, and had even went to the CIA with Cheney to discuss intelligence on Iraq. Downing had also served as an advisor to Ahmed Chalabi and the Iraqi National Congress, and was well-known advocate for a war against Saddam.
Some of the SAIC contracts required that specific persons referred to as "executive management consultants" be hired and the pay range listed went as high as $209 and $273 per hour. The Center said congressional sources estimated the value of the media contract as $38 million for the first year and as high $90 million in 2004.
The SAIC had no special expertise to justify the award of these contracts. One company executive, quoted in the media, said the firm's only credential for setting up an independent media, supposedly modeled after the BBC, was military work in "informational warfare"-signal jamming, "perception management," and the like.
Under these contracts, the Iraq Media Network (IMN) was established and journalist, Mark North, who covered the Iraq invasion for National Public Radio, was hired to train Iraqi journalists to report for the IMN.
In one of the many Congressional hearings, North testified about the control of the IMN by the CPA and said CPA officials regularly directed and censored the activities of the news station and provided "a laundry list of CPA activities" to cover in the news reports instead of stories about security or the lack of electricity and jobs
While testifying, he also described the CPA's shabby treatment of Iraqi employees and its refusal to pay their wages. "For the first two months," North said, "the local staff of about 200 journalists and technicians were not paid their salaries."
When the staffers went on strike in attempt to get paid, he said, the CPA told the Iraqis to get back to work or the US Army would remove them from the studios.
All total, the CPA had control of Iraqi money for one year between June 2003 and June 2004, but unfortunately no auditors arrived to take a look at the agency's spending until April 2004, two months before the CPA's rule was scheduled to end.
And as so often happens when it comes to giving solid advice or warnings, the senior Senator from Virginia was absolutely right. It was far too late for audits, because the CPA and its gang of profiteers had already robbed the Iraqis blind.
The favored companies enjoyed a fraud-free-all. For instance, Halliburton said it had lost over $60 million worth of government property including trucks, office furniture and computers. Inspector Bowen reported that 6,975 items valued at $61.1 million were lost, and in June 2005, the Defense Contract Audit Agency reported that the Halliburton had overcharged or presented questionable bills for close to $1.5 billion.
In the end, Bowen's audit concluded that "the CPA's internal controls for approximately $8.8 billion in DFI funds disbursed to Iraqi ministries through the national budget process failed to provide sufficient accountability for the use of those funds."
As of February 2007, according to Bowen, audits of the CPA have resulted in 300 criminal and civil investigations, 5 arrests and convictions, and another 23 cases are currently under prosecution at the DOJ, and he is working on 76 on-going investigations.
One of the convictions involved Robert Stein, a former CPA comptroller and funding officer, who recently pleaded guilty to 5 felony counts including conspiracy, money laundering, and bribery in stealing more than $2 million of reconstruction funds and taking more than $1 million in kickbacks to rig the bids on contracts that exceeded $8 million.
The whistleblower case against Custer Battle went to trial and a jury found that Custer had committed 37 acts of fraud and filed $3 million in false claims, and rendered a verdict with a $10 million penalty. However, the verdict was overturned by Republican appointed US District Court Judge TS Ellis III, who ruled that the CPA was not a US entity and therefore the false claims act does not apply to it.
In the ruling, the judge said Custer's accusers "failed to prove that the U.S. government was ever defrauded. Any fraud that occurred was perpetrated instead against the Coalition Provisional Authority, formed to run Iraq until a government was established."
Legal experts say this ruling is great news for the CPA and contractors because from now on anyone charged with any act of fraud related to the Iraqi money doled out by the CPA in Bagdad will use it in attempt to avoid civil or criminal prosecution.
Showing posts with label Halliburton. Show all posts
Showing posts with label Halliburton. Show all posts
Tuesday, August 3, 2010
Monday, August 2, 2010
Top War Profiteer Doug Feith Retires Wealthy
Evelyn Pringle September 2005
Douglas Feith, the recently resigned undersecretary of defense, who just happened to be one of the main people who for years on end advocated for a war in Iraq, and who in large part developed the disastrous policies for the war in Iraq, planned ahead for his retirement and will not be seen in the unemployment line.
On January 27, 2005, the Washington Post announced: "A principal architect of the Defense Department's postwar strategy in Iraq ... will leave his post this summer."
The announcement came after years of rumors that top administration officials had decided that Feith had to go, but were dissuaded by Donald Rumsfeld who argued that his ouster would be viewed as an admission that the war in Iraq was a mistake. But the administration had definitely reduced Feith's authority over the past 2 years.
In announcing his departure, Feith claimed he was leaving for personal reasons, citing the desire to spend more time with his children. "For the last four years, they haven't seen me a lot," he told the Post.
He used the standard administration exit line. Sort of like the noticeably absent in light of Katrina, ex-FEMA director, Joe Albaugh, who left his job to spend time with his family. Joe was Bush’s chief of staff when he was governor of Texas and his campaign manager in 2000. Once Bush took office, Joe accepted a gig as director of FEMA.
Like Feith, when he announced his resignation, Joe said, "Now I am going to take the opportunity to spend some time with my wife and children."
I sure hope Doug spends more time with his kids than Joe did, because judging from hindsight, Joe should have been a psychic. He somehow knew at the beginning of March 2003, that he should quit FEMA and go into the business of securing reconstruction contracts in Iraq for wealthy clients before the first bomb was dropped. And his family could not have enjoyed much quality time at all with Joe, being he opened up New Bridge Strategies for business within a few short weeks of leaving the White House.
At the time, Josh Marshall, who writes a column for the Washington newspaper, The Hill, said that he believed that each new piece of legislation needs a catchy title, and came up with title "The Bush Crony Full-Employment Act of 2003," for the $87 billion allocated for rebuilding Iraq.
According to Josh, New Bridge was actually an outgrowth of Haley Barbour’s lobbying firm, Barbour Griffith & Rogers. Josh says he reached that conclusion after he learned that both firms were located in the same office space. And also because Lanny Griffith was the CEO of New Bridge and Ed Rogers was the vice president. Sounds like a logical conclusion to me.
When the company began, the New Bridges official web site said, "the opportunities evolving in Iraq today are of such an unprecedented nature and scope that no other existing firm has the necessary skills and experience to be effective both in Washington, D.C., and on the ground in Iraq." That phrasing was quickly changed.
How could it get any sweeter than this? Joe quits FEMA, moves into the office space of one of the most successful and powerful GOP lobbying firms in the country and starts advertising for clients who want to win reconstruction contracts in Iraq.
First Brother, Neil Bush, also jumped on this money train and landed a $60,000 a year consultant contract with a principal in New Bridge. According to Neil's testimony in his divorce deposition in March 2004, in return for his salary, he took phone messages for about 3 hours a week.
However, 3 people contacted by the Financial Times of London reported seeing letters written by Neil that recommend business ventures promoted by New Bridges in the Middle East. So we had Neil being paid an annual fee to "help companies secure contracts in Iraq," the Times reported.
I'm not too worried about Doug Feith ending up in the unemployment lines because following in Joe's footsteps, Feith and his law partner stayed very busy behind the scenes planning for Feith's retirement when it came time to leave the White House.
The Iraqi International Law Group
Before Feith was inducted into the Bush administration, he was the Feith half of the Feith & Zell, law firm in Washington. His partner, Marc Zell, simply renamed the firm, Zell, Goldberg & Co, when they decided to set up shop to start cashing in on the Iraq contracting business.
According to The Hill, Zell, was helping with international marketing for a concern called the Iraqi International Law Group. Billing itself as a group of lawyers and businessmen interested in helping investors in Iraq, the venture was run by Ahmed Chalabi's nephew Salem, who doubled as a legal adviser to Iraq's governing council, of which his uncle was a member.
How powerful was Feith in awarding contracts? Extremely. According to a June, 2004, by an article in Time Magazine entitled, "The Paper Trail: Did Cheney Okay a Deal? Feith is the person who approved the controversial no-bid contract for Halliburton in Iraq.
Time Magazine quoted an email sent by Stephen Browning of the Army Corps of Engineers, that said the contract for construction of oil pipelines was approved by Under Secretary of Defense Douglas Feith "contingent on informing WH tomorrow. We anticipate no issues since action has been coordinated w VP,s [Vice President,s] office.
Browning, later said in an interview that he wrote the memo after he and retired Lt Gen. Jay Garner met with Feith. According to Browning, Feith told him that he had already informed Cheney's office. The email was dated March 5, 2003, and Halliburton was awarded the contract three days later with no bids tendered by any other companies.
If he could pull this off for Halliburton, what he could do for the IILG, goes without saying. According to its web site, the IILG was made up of lawyers and businessmen who claimed to have, "dared to take the lead in bringing private sector investment and experience" to the war-torn country and offered to "be your Professional Gateway to the New Iraq."
The way it was set up, nephew Salem was charge of the IILG and Feith's partner, Zell, was in charge of international marketing. The IILG's website claimed that it was the only firm worth consulting. "At IILG, our task is to provide foreign enterprise with the information and tools it needs to enter the emerging Iraq and to succeed," it said.
"Our clients number among the largest corporations and institutions on the planet" it said, "They have chosen IILG to provide them with real-time, on the ground intelligence they cannot get from inexperienced local firms or from overburdened coalition and local government officials."
Imagine that, the top firms on the planet.
"Many firms outside the country purport to counsel companies about doing business in Iraq," the web site read. "The simple fact is: you cannot adequately advise about Iraq unless you are here day in and day out, working closely with officials at the CPA, the newly constituted governing council and the few functioning civilian ministries [oil, labor and social welfare, etc]."
The truth is, the IILG was nothing more than another one of many front companies, in a web-like profiteering network, that was specifically set up to funnel tax dollars through Iraq and back into the pockets of the Bush gang.
And talk about blatant. When the company was set up, its website was not registered to Salem Chalabi; it was registered under the name of Marc Zell, located at the very same address as Zell, Goldberg & Co.
According to Salem, quoted in the National Journal, Zell was IILG's "marketing consultant" and had been contacting law firms in Washington and New York to ask if they had clients interested in doing business in Iraq.
This tied in with an announcement by Zell, Goldberg & Co, that it had set up a "task force" dealing with issues and opportunities relating to the "recently ended" war in Iraq, and to assist companies "in their relations with the United States government in connection with Iraqi reconstruction projects as prime contractors and consultants."
Of course Zell made no mention of the firm's ties to the infamous nephew Salem or the IILG. Zell said it was working with the Federal Market Group, an organization which specialized in helping companies win government contracts, which boasted of having a 90% success rate.
Considering all of its boasting about high level connections, IILG was also rather modest about the family ties of its founder. The website did not mention that he was the nephew of Ahmed Chalabi even once. Geez, I wonder why.
Implementing The Iraq Profiteering Scheme
Feith had been pushing for the ouster of Saddam for years. In 1998, him and Richard Perle sent a letter to President Bill Clinton proposing that the US team up with Ahmed Chalabi's Iraqi National Congress to get rid of Saddam. Clinton refused.
As we all know, Ahmed had strong support within the Pentagon. In fact, two of his staunchest supporters were Feith, and Perle, chairman of the Defense Policy Board.
Perle, an assistant defense secretary during the Reagan administration, was appointed by his old crony, Donald Rumsfeld, to lead the board in 2001. Its a well-known fact that the board exerts tremendous influence when it comes to war policies.
As soon as Bush took office, Perle, Feith and Ahmed Chalabi all started working diligently together to get the war in Iraq off the ground, with Ahmed providing bogus intelligence about WMDs and bragging about a secret network within Iraq which could take over running the country after the invasion.
"There was a close personal bond, too, between Chalabi and Wolfowitz and Perle, dating back many years," according to Seymour Hersh in the May 5, 2003 the New Yorker.
"Their relationship deepened after the Bush Administration took office, and Chalabi’s ties extended to others in the Administration, including Rumsfeld; Douglas Feith, the Under-Secretary of Defense for Policy; and I. Lewis Libby, Vice-President Dick Cheney’s chief of staff," Hersh wrote.
"With the Pentagon’s support, Chalabi’s group worked to put defectors with compelling stories in touch with reporters in the United States and Europe," Hersh said, "The resulting articles had dramatic accounts of advances in weapons of mass destruction or told of ties to terrorist groups. In some cases, these stories were disputed in analyses by the C.I.A." he noted.
Almost immediately after September 11th, "the I.N.C. began to publicize the stories of defectors who claimed that they had information connecting Iraq to the attacks, Hersh said.
For example, in a October 14, 2001, interview on PBS "Frontline," Sabah Khodada, an Iraqi Army captain, said that the 9/11 attack "was conducted by people who were trained by Saddam," and that Iraq had a program to instruct terrorists in the art of hijacking. Another defector, who was identified as a retired lieutenant general in the Iraqi intelligence service, said that in 2000 he witnessed Arab students being given lessons in hijacking on a Boeing 707 parked at an Iraqi training camp near the town of Salman Pak, south of Baghdad.
Feith then fed this type of INC data into a fabrication mill operating at top speed known as the Office of Special Plans and some of the information processed through the OSP was not even shared with official intelligence agencies. In many instances it was passed on to the National Security Council, Cheney, and Bush without having been vetted by anyone besides this group of nitwits.
And they had to know that much of the information was false. A former high-level intelligence official told Hersh that American Special Forces units had been sent into Iraq in mid-March 2003, before the start of the war, to investigate sites suspected of being missile or chemical- and biological-weapon storage depots. "They came up with nothing," the official told Hersh. "Never found a single Scud."
A 46 page report, based on a 15-month investigation, titled, Report of an Inquiry into the Alternative Analysis of the Issue of an Iraq-al Qaeda Relationship, was released on October 21, 2004, which said, "There is ample evidence that the Bush Administration had a predisposition to overthrow Saddam Hussein before the 9/11 attacks."
The report accused Feith's office of compiling "selective reinterpretations of intelligence" that went beyond the views of American spy agencies in order to help make the case for an invasion of Iraq.
The report concluded that Feith and his staff were convinced that a relationship existed between Saddam and Al Qaeda, and that the office had advanced that perspective by trying to change the intelligence community's views and "by taking its interpretation straight to policymakers."
"That alleged relationship," the report said, "coupled with the assertion that Iraq possessed stockpiles of weapons of mass destruction (WMD), was the major argument presented by the Administration for invading Iraq."
Relying on selective reporting, irrespective of credibility and reliability, Feith’s briefing concluded the following:
• Iraq had "more than a decade of numerous contacts" with al Qaeda;
• there were "multiple areas of cooperation" between Iraq and al Qaeda;
• Iraq and al Qaeda had a "shared interest and pursuit of WMD;" and
• there was "[o]ne indication of Iraq coordination with al Qaeda specifically related to 9/11," presumably a reference to the alleged (but doubted by the IC) Atta meeting in Prague.
The report states that there are no known intelligence reports, other than those provided by Feith's office, that could explain where this view originated. "A pattern emerges of senior administration officials exaggerating the extent of the relationship in public statements which more closely reflect the Feith analysis" than those of the intelligence community, it said.
As an obvious example, the report said Feith's office repeatedly asserted in the months leading up to the war that lead hijacker Mohammed Atta had met with an Iraqi intelligence agent in Prague in the spring before the September 11 attacks, an account that the CIA dismissed because evidence existed that Atta was elsewhere at the time.
And in at least one case, according to the report, the Pentagon office included the purported meeting in a report sent to the White House, but omitted it from the version of the same report sent to the CIA.
The meeting was then constantly referred to by senior administration officials, and especially Cheney, as evidence of a possible Saddam link to 9/11. In fact, Cheney said the Feith analysis was the "best source of information," according to the report.
However, not only had the alleged meeting never been "known," at the time of the briefing to the White House, the Intelligence Community was skeptical in late spring 2002 that such a meeting ever took place. Yet in September of 2002, Feith called the meeting a "known contact" in a crucial misstatement about the intelligence, since it indicated a link which did not exist.
"The professional objectivity and independence required in the assessment of the Iraq-Al Qaeda relationship, a major reason given for going to war, were compromised to support a predetermined policy -- to present the government of Saddam Hussein as a serious threat to the security of the United States" the report wrote.
Finally, relative to the attacks, the final 911 Commission Report itself said that the "Intelligence Community has no credible information that Baghdad had foreknowledge of the 11 September attacks or any other al-Qaida strike."
Inventing bogus intelligence was bad enough but during the pre-war planning, the military experts were systematically excluded from participating in that process as well. In the end, Feith and the OSP had so grossly underestimated the Iraqi resistance that it caused General Tommy Franks, who led the invasion in Iraq, to call Feith "the fucking stupidest guy on the face of the earth," according Bob Woodward's book Plan of Attack.
Feith and the Defense Policy Board
The DPB is a group of 30 people, who for the most part were chosen by Rumsfeld and Feith, that advises officials on whether to go to war or not. Many of its members are literally making a fortune off a war which they had been promoting for years. At least 9 members have ties to companies that won more than $76 billion in defense contracts during 2001 and 2002.
Feith excluded many top Middle East experts from the State Department from playing any meaningful role in the Coalition Provisional Authority (CPA). Feith's office and the CPA were tasked with awarding reconstruction contracts in Iraq.
So this was another sweet setup. Feith was deciding who would get contracts, at the same time that his middleman law partner, Zel, was hustling up business deals in Iraq for rich clients. Of course, for members of the Bush war profiteering club, this was merely business as usual.
Among the firms that have profited the most, are those with consultants serving on the DPB, many of which were hand-picked by Feith.
Some of the construction and defense companies with direct ties to DPB members include Boeing, Bechtel, TRW, Northrop Grumman, Lockheed Martin and Booz Allen Hamilton, along with smaller players like Symantec Corp, Technology Strategies and Alliance Corp, and Polycom Inc.
How much money was up for grabs when it came to doling out defense contracts? For starters, during the major combat phase of the war, the US military launched over 800 Tomahawk cruise missiles at Iraqi forces, according to figures released by the US Navy.
At a price of about $569,000 each, replacing those missiles no doubt generated a lofty amount for Raytheon Systems, the Pentagon contractor for Tomahawks. Close to a 100 more missiles were fired during Operation Enduring Freedom in Afghanistan.
Occupation forces later launched over 19,000 guided munitions in Iraq, most of which came from the US, according to a report on Operation Iraqi Freedom published by the US Central Command Air Forces on 30 April 2003.
There was a $10.3 billion proposal for the development of a missile defense program in Bush’s 2005 defense spending budget, of which Lockheed Martin would be heavily involved in, according to a report from the World Policy Institute.
Northrop Grumman, the country's third largest defense contractor, secured contracts to build new weapons systems such as the unmanned predator drones. The firm is the prime contractor for the Global Hawk Unmanned Aerial Vehicle (UAV). Bush proposed $12 billion for UAV development for the years between 2004 - 2009. Northrop earned a company record of $11.1 billion in defense contracts in 2003.
And Bush is funneling our tax dollars to known crooks. Northrop's Vinnell subsidiary was awarded a $48 million contract to train the new Iraqi Army, even though Northrop was forced to pay $191.7 million in penalties over the previous 4 years.
In less than a year after he took office, Bush got rid of regulations implemented by President Clinton that barred contracts for companies convicted or penalized for crimes during the previous 3 years. Clinton strengthened the rules before leaving office, and said that repeated violations would make a company ineligible for new contracts. Bush suspended the regulations within his first 3 months in office. By December 2001, he had revoked them entirely.
Who Else Is Raking In War Profits?
Lets look at a couple members of the Defense Policy Board. Former CIA Director, James Woolsey, is a prime example of how the revolving door never stops spinning for this gang of war profiteers. After he left the CIA, Woolsey remained a senior advisor on intelligence and national security issues, and specifically the war in Iraq. When the war began, he worked for two private companies that did business in Iraq, and was a partner in a company that invested in firms that provide security and anti-terrorism services.
At the time, Woolsey was a vice president at Booz Allen Hamilton. In that role, less than 2 months after the war began, he was a featured speaker at a May 2003 conference titled "Companies on the Ground: The Challenge for Business in Rebuilding Iraq," at which 80 corporate executives paid $1,100 to attend. He spoke about the many potential business opportunities in Iraq and about Bush's decision to steer reconstruction contracts to US firms.
With Woolsey in a Vice President position, Booz Allen became a subcontractor for a $75-million telecommunications contract in Iraq. Of course in true Dick Cheney style, Woolsey denies any involvement in that work. But then, it really does not matter whether he was directly involved or not because as VP of the company he would get a cut of the profits resulting from any contracts the firm enters into.
Soon after 9/11, Woolsey wrote an op ed piece in the Wall Street Journal saying a foreign state had aided Al Qaeda in preparing the attacks and named Iraq as the leading culprit. In October 2001, Deputy Secretary of Defense Wolfowitz sent Woolsey to the UK to hunt for evidence to link Saddam to the attacks.
Before the war, Woolsey was up to his neck in war planning. In addition to sitting on the DPB and giving direct advice to Rumsfeld, he was a founding member of the Committee for the Liberation of Iraq (CLI), an organization set up by the WH in 2002 to help garner public support for going to war in Iraq.
They actually put together a promotion team to rally support for the war funded with our tax dollars no less. Tell me this scheme wasn't well planned and directed.
Before the war, another DPB member, Margaret Bartel, managed the funds channeled to Amhed Chalabi's exile group, the INC, including funds for its bogus prewar intelligence program on WMDs. Once it began, Bartel went on to head a consulting firm which helped investors find Iraqi partners.
Bartel established Global Positioning and told the LA Times that the firm's primary purpose was to "introduce clients to the Iraqi market, help them find potential Iraqi partners, set up meetings with government officials … and provide on-the-ground support for their business interests." So here was another sweet set up.
As for the chairman of the DPB, Richard Perle was a "special government employee," subject to federal ethics rules, including the rule that bars the chairman from using his public office for private gain.
Perle decided to resign as chairman after a little ethical problem came under scrutiny in March 2003. It was discovered that at the same time that he was advising the Pentagon on war policies, Perle had been retained by the telecommunications company Global Crossing to help overcome opposition by the Department of Defense and the FBI to the firms proposed sale to a Chinese company.
The agencies objected to the sale citing national security and law enforcement problems, because it would put Global's fiber-optic network, used by the US government, under Chinese ownership.
According to a legal notice that Global was preparing to file in bankruptcy court at the time, Perle was set to make $725,000, including $600,000 if the government approved the sale of the firm to the joint venture of Hutchison Whampoa Ltd, and Singapore Technologies Telemedia Pte, a company controlled by the Singapore government.
Perle was quick to pipe up to reporters and make the distinction that he was not involved in the lobbying of Defense Department officials, that his job was merely to advise Global on the process of gaining approval. That sure put my mind at ease.
In the end, I don't think its likely that Feith will end up in the welfare lines. Due to careful post-White House planning, I think its safe to say that Feith and his band of cronies will enjoy financial benefits for life, just so long as their never-ending war policies are carried on by their successor.
Douglas Feith, the recently resigned undersecretary of defense, who just happened to be one of the main people who for years on end advocated for a war in Iraq, and who in large part developed the disastrous policies for the war in Iraq, planned ahead for his retirement and will not be seen in the unemployment line.
On January 27, 2005, the Washington Post announced: "A principal architect of the Defense Department's postwar strategy in Iraq ... will leave his post this summer."
The announcement came after years of rumors that top administration officials had decided that Feith had to go, but were dissuaded by Donald Rumsfeld who argued that his ouster would be viewed as an admission that the war in Iraq was a mistake. But the administration had definitely reduced Feith's authority over the past 2 years.
In announcing his departure, Feith claimed he was leaving for personal reasons, citing the desire to spend more time with his children. "For the last four years, they haven't seen me a lot," he told the Post.
He used the standard administration exit line. Sort of like the noticeably absent in light of Katrina, ex-FEMA director, Joe Albaugh, who left his job to spend time with his family. Joe was Bush’s chief of staff when he was governor of Texas and his campaign manager in 2000. Once Bush took office, Joe accepted a gig as director of FEMA.
Like Feith, when he announced his resignation, Joe said, "Now I am going to take the opportunity to spend some time with my wife and children."
I sure hope Doug spends more time with his kids than Joe did, because judging from hindsight, Joe should have been a psychic. He somehow knew at the beginning of March 2003, that he should quit FEMA and go into the business of securing reconstruction contracts in Iraq for wealthy clients before the first bomb was dropped. And his family could not have enjoyed much quality time at all with Joe, being he opened up New Bridge Strategies for business within a few short weeks of leaving the White House.
At the time, Josh Marshall, who writes a column for the Washington newspaper, The Hill, said that he believed that each new piece of legislation needs a catchy title, and came up with title "The Bush Crony Full-Employment Act of 2003," for the $87 billion allocated for rebuilding Iraq.
According to Josh, New Bridge was actually an outgrowth of Haley Barbour’s lobbying firm, Barbour Griffith & Rogers. Josh says he reached that conclusion after he learned that both firms were located in the same office space. And also because Lanny Griffith was the CEO of New Bridge and Ed Rogers was the vice president. Sounds like a logical conclusion to me.
When the company began, the New Bridges official web site said, "the opportunities evolving in Iraq today are of such an unprecedented nature and scope that no other existing firm has the necessary skills and experience to be effective both in Washington, D.C., and on the ground in Iraq." That phrasing was quickly changed.
How could it get any sweeter than this? Joe quits FEMA, moves into the office space of one of the most successful and powerful GOP lobbying firms in the country and starts advertising for clients who want to win reconstruction contracts in Iraq.
First Brother, Neil Bush, also jumped on this money train and landed a $60,000 a year consultant contract with a principal in New Bridge. According to Neil's testimony in his divorce deposition in March 2004, in return for his salary, he took phone messages for about 3 hours a week.
However, 3 people contacted by the Financial Times of London reported seeing letters written by Neil that recommend business ventures promoted by New Bridges in the Middle East. So we had Neil being paid an annual fee to "help companies secure contracts in Iraq," the Times reported.
I'm not too worried about Doug Feith ending up in the unemployment lines because following in Joe's footsteps, Feith and his law partner stayed very busy behind the scenes planning for Feith's retirement when it came time to leave the White House.
The Iraqi International Law Group
Before Feith was inducted into the Bush administration, he was the Feith half of the Feith & Zell, law firm in Washington. His partner, Marc Zell, simply renamed the firm, Zell, Goldberg & Co, when they decided to set up shop to start cashing in on the Iraq contracting business.
According to The Hill, Zell, was helping with international marketing for a concern called the Iraqi International Law Group. Billing itself as a group of lawyers and businessmen interested in helping investors in Iraq, the venture was run by Ahmed Chalabi's nephew Salem, who doubled as a legal adviser to Iraq's governing council, of which his uncle was a member.
How powerful was Feith in awarding contracts? Extremely. According to a June, 2004, by an article in Time Magazine entitled, "The Paper Trail: Did Cheney Okay a Deal? Feith is the person who approved the controversial no-bid contract for Halliburton in Iraq.
Time Magazine quoted an email sent by Stephen Browning of the Army Corps of Engineers, that said the contract for construction of oil pipelines was approved by Under Secretary of Defense Douglas Feith "contingent on informing WH tomorrow. We anticipate no issues since action has been coordinated w VP,s [Vice President,s] office.
Browning, later said in an interview that he wrote the memo after he and retired Lt Gen. Jay Garner met with Feith. According to Browning, Feith told him that he had already informed Cheney's office. The email was dated March 5, 2003, and Halliburton was awarded the contract three days later with no bids tendered by any other companies.
If he could pull this off for Halliburton, what he could do for the IILG, goes without saying. According to its web site, the IILG was made up of lawyers and businessmen who claimed to have, "dared to take the lead in bringing private sector investment and experience" to the war-torn country and offered to "be your Professional Gateway to the New Iraq."
The way it was set up, nephew Salem was charge of the IILG and Feith's partner, Zell, was in charge of international marketing. The IILG's website claimed that it was the only firm worth consulting. "At IILG, our task is to provide foreign enterprise with the information and tools it needs to enter the emerging Iraq and to succeed," it said.
"Our clients number among the largest corporations and institutions on the planet" it said, "They have chosen IILG to provide them with real-time, on the ground intelligence they cannot get from inexperienced local firms or from overburdened coalition and local government officials."
Imagine that, the top firms on the planet.
"Many firms outside the country purport to counsel companies about doing business in Iraq," the web site read. "The simple fact is: you cannot adequately advise about Iraq unless you are here day in and day out, working closely with officials at the CPA, the newly constituted governing council and the few functioning civilian ministries [oil, labor and social welfare, etc]."
The truth is, the IILG was nothing more than another one of many front companies, in a web-like profiteering network, that was specifically set up to funnel tax dollars through Iraq and back into the pockets of the Bush gang.
And talk about blatant. When the company was set up, its website was not registered to Salem Chalabi; it was registered under the name of Marc Zell, located at the very same address as Zell, Goldberg & Co.
According to Salem, quoted in the National Journal, Zell was IILG's "marketing consultant" and had been contacting law firms in Washington and New York to ask if they had clients interested in doing business in Iraq.
This tied in with an announcement by Zell, Goldberg & Co, that it had set up a "task force" dealing with issues and opportunities relating to the "recently ended" war in Iraq, and to assist companies "in their relations with the United States government in connection with Iraqi reconstruction projects as prime contractors and consultants."
Of course Zell made no mention of the firm's ties to the infamous nephew Salem or the IILG. Zell said it was working with the Federal Market Group, an organization which specialized in helping companies win government contracts, which boasted of having a 90% success rate.
Considering all of its boasting about high level connections, IILG was also rather modest about the family ties of its founder. The website did not mention that he was the nephew of Ahmed Chalabi even once. Geez, I wonder why.
Implementing The Iraq Profiteering Scheme
Feith had been pushing for the ouster of Saddam for years. In 1998, him and Richard Perle sent a letter to President Bill Clinton proposing that the US team up with Ahmed Chalabi's Iraqi National Congress to get rid of Saddam. Clinton refused.
As we all know, Ahmed had strong support within the Pentagon. In fact, two of his staunchest supporters were Feith, and Perle, chairman of the Defense Policy Board.
Perle, an assistant defense secretary during the Reagan administration, was appointed by his old crony, Donald Rumsfeld, to lead the board in 2001. Its a well-known fact that the board exerts tremendous influence when it comes to war policies.
As soon as Bush took office, Perle, Feith and Ahmed Chalabi all started working diligently together to get the war in Iraq off the ground, with Ahmed providing bogus intelligence about WMDs and bragging about a secret network within Iraq which could take over running the country after the invasion.
"There was a close personal bond, too, between Chalabi and Wolfowitz and Perle, dating back many years," according to Seymour Hersh in the May 5, 2003 the New Yorker.
"Their relationship deepened after the Bush Administration took office, and Chalabi’s ties extended to others in the Administration, including Rumsfeld; Douglas Feith, the Under-Secretary of Defense for Policy; and I. Lewis Libby, Vice-President Dick Cheney’s chief of staff," Hersh wrote.
"With the Pentagon’s support, Chalabi’s group worked to put defectors with compelling stories in touch with reporters in the United States and Europe," Hersh said, "The resulting articles had dramatic accounts of advances in weapons of mass destruction or told of ties to terrorist groups. In some cases, these stories were disputed in analyses by the C.I.A." he noted.
Almost immediately after September 11th, "the I.N.C. began to publicize the stories of defectors who claimed that they had information connecting Iraq to the attacks, Hersh said.
For example, in a October 14, 2001, interview on PBS "Frontline," Sabah Khodada, an Iraqi Army captain, said that the 9/11 attack "was conducted by people who were trained by Saddam," and that Iraq had a program to instruct terrorists in the art of hijacking. Another defector, who was identified as a retired lieutenant general in the Iraqi intelligence service, said that in 2000 he witnessed Arab students being given lessons in hijacking on a Boeing 707 parked at an Iraqi training camp near the town of Salman Pak, south of Baghdad.
Feith then fed this type of INC data into a fabrication mill operating at top speed known as the Office of Special Plans and some of the information processed through the OSP was not even shared with official intelligence agencies. In many instances it was passed on to the National Security Council, Cheney, and Bush without having been vetted by anyone besides this group of nitwits.
And they had to know that much of the information was false. A former high-level intelligence official told Hersh that American Special Forces units had been sent into Iraq in mid-March 2003, before the start of the war, to investigate sites suspected of being missile or chemical- and biological-weapon storage depots. "They came up with nothing," the official told Hersh. "Never found a single Scud."
A 46 page report, based on a 15-month investigation, titled, Report of an Inquiry into the Alternative Analysis of the Issue of an Iraq-al Qaeda Relationship, was released on October 21, 2004, which said, "There is ample evidence that the Bush Administration had a predisposition to overthrow Saddam Hussein before the 9/11 attacks."
The report accused Feith's office of compiling "selective reinterpretations of intelligence" that went beyond the views of American spy agencies in order to help make the case for an invasion of Iraq.
The report concluded that Feith and his staff were convinced that a relationship existed between Saddam and Al Qaeda, and that the office had advanced that perspective by trying to change the intelligence community's views and "by taking its interpretation straight to policymakers."
"That alleged relationship," the report said, "coupled with the assertion that Iraq possessed stockpiles of weapons of mass destruction (WMD), was the major argument presented by the Administration for invading Iraq."
Relying on selective reporting, irrespective of credibility and reliability, Feith’s briefing concluded the following:
• Iraq had "more than a decade of numerous contacts" with al Qaeda;
• there were "multiple areas of cooperation" between Iraq and al Qaeda;
• Iraq and al Qaeda had a "shared interest and pursuit of WMD;" and
• there was "[o]ne indication of Iraq coordination with al Qaeda specifically related to 9/11," presumably a reference to the alleged (but doubted by the IC) Atta meeting in Prague.
The report states that there are no known intelligence reports, other than those provided by Feith's office, that could explain where this view originated. "A pattern emerges of senior administration officials exaggerating the extent of the relationship in public statements which more closely reflect the Feith analysis" than those of the intelligence community, it said.
As an obvious example, the report said Feith's office repeatedly asserted in the months leading up to the war that lead hijacker Mohammed Atta had met with an Iraqi intelligence agent in Prague in the spring before the September 11 attacks, an account that the CIA dismissed because evidence existed that Atta was elsewhere at the time.
And in at least one case, according to the report, the Pentagon office included the purported meeting in a report sent to the White House, but omitted it from the version of the same report sent to the CIA.
The meeting was then constantly referred to by senior administration officials, and especially Cheney, as evidence of a possible Saddam link to 9/11. In fact, Cheney said the Feith analysis was the "best source of information," according to the report.
However, not only had the alleged meeting never been "known," at the time of the briefing to the White House, the Intelligence Community was skeptical in late spring 2002 that such a meeting ever took place. Yet in September of 2002, Feith called the meeting a "known contact" in a crucial misstatement about the intelligence, since it indicated a link which did not exist.
"The professional objectivity and independence required in the assessment of the Iraq-Al Qaeda relationship, a major reason given for going to war, were compromised to support a predetermined policy -- to present the government of Saddam Hussein as a serious threat to the security of the United States" the report wrote.
Finally, relative to the attacks, the final 911 Commission Report itself said that the "Intelligence Community has no credible information that Baghdad had foreknowledge of the 11 September attacks or any other al-Qaida strike."
Inventing bogus intelligence was bad enough but during the pre-war planning, the military experts were systematically excluded from participating in that process as well. In the end, Feith and the OSP had so grossly underestimated the Iraqi resistance that it caused General Tommy Franks, who led the invasion in Iraq, to call Feith "the fucking stupidest guy on the face of the earth," according Bob Woodward's book Plan of Attack.
Feith and the Defense Policy Board
The DPB is a group of 30 people, who for the most part were chosen by Rumsfeld and Feith, that advises officials on whether to go to war or not. Many of its members are literally making a fortune off a war which they had been promoting for years. At least 9 members have ties to companies that won more than $76 billion in defense contracts during 2001 and 2002.
Feith excluded many top Middle East experts from the State Department from playing any meaningful role in the Coalition Provisional Authority (CPA). Feith's office and the CPA were tasked with awarding reconstruction contracts in Iraq.
So this was another sweet setup. Feith was deciding who would get contracts, at the same time that his middleman law partner, Zel, was hustling up business deals in Iraq for rich clients. Of course, for members of the Bush war profiteering club, this was merely business as usual.
Among the firms that have profited the most, are those with consultants serving on the DPB, many of which were hand-picked by Feith.
Some of the construction and defense companies with direct ties to DPB members include Boeing, Bechtel, TRW, Northrop Grumman, Lockheed Martin and Booz Allen Hamilton, along with smaller players like Symantec Corp, Technology Strategies and Alliance Corp, and Polycom Inc.
How much money was up for grabs when it came to doling out defense contracts? For starters, during the major combat phase of the war, the US military launched over 800 Tomahawk cruise missiles at Iraqi forces, according to figures released by the US Navy.
At a price of about $569,000 each, replacing those missiles no doubt generated a lofty amount for Raytheon Systems, the Pentagon contractor for Tomahawks. Close to a 100 more missiles were fired during Operation Enduring Freedom in Afghanistan.
Occupation forces later launched over 19,000 guided munitions in Iraq, most of which came from the US, according to a report on Operation Iraqi Freedom published by the US Central Command Air Forces on 30 April 2003.
There was a $10.3 billion proposal for the development of a missile defense program in Bush’s 2005 defense spending budget, of which Lockheed Martin would be heavily involved in, according to a report from the World Policy Institute.
Northrop Grumman, the country's third largest defense contractor, secured contracts to build new weapons systems such as the unmanned predator drones. The firm is the prime contractor for the Global Hawk Unmanned Aerial Vehicle (UAV). Bush proposed $12 billion for UAV development for the years between 2004 - 2009. Northrop earned a company record of $11.1 billion in defense contracts in 2003.
And Bush is funneling our tax dollars to known crooks. Northrop's Vinnell subsidiary was awarded a $48 million contract to train the new Iraqi Army, even though Northrop was forced to pay $191.7 million in penalties over the previous 4 years.
In less than a year after he took office, Bush got rid of regulations implemented by President Clinton that barred contracts for companies convicted or penalized for crimes during the previous 3 years. Clinton strengthened the rules before leaving office, and said that repeated violations would make a company ineligible for new contracts. Bush suspended the regulations within his first 3 months in office. By December 2001, he had revoked them entirely.
Who Else Is Raking In War Profits?
Lets look at a couple members of the Defense Policy Board. Former CIA Director, James Woolsey, is a prime example of how the revolving door never stops spinning for this gang of war profiteers. After he left the CIA, Woolsey remained a senior advisor on intelligence and national security issues, and specifically the war in Iraq. When the war began, he worked for two private companies that did business in Iraq, and was a partner in a company that invested in firms that provide security and anti-terrorism services.
At the time, Woolsey was a vice president at Booz Allen Hamilton. In that role, less than 2 months after the war began, he was a featured speaker at a May 2003 conference titled "Companies on the Ground: The Challenge for Business in Rebuilding Iraq," at which 80 corporate executives paid $1,100 to attend. He spoke about the many potential business opportunities in Iraq and about Bush's decision to steer reconstruction contracts to US firms.
With Woolsey in a Vice President position, Booz Allen became a subcontractor for a $75-million telecommunications contract in Iraq. Of course in true Dick Cheney style, Woolsey denies any involvement in that work. But then, it really does not matter whether he was directly involved or not because as VP of the company he would get a cut of the profits resulting from any contracts the firm enters into.
Soon after 9/11, Woolsey wrote an op ed piece in the Wall Street Journal saying a foreign state had aided Al Qaeda in preparing the attacks and named Iraq as the leading culprit. In October 2001, Deputy Secretary of Defense Wolfowitz sent Woolsey to the UK to hunt for evidence to link Saddam to the attacks.
Before the war, Woolsey was up to his neck in war planning. In addition to sitting on the DPB and giving direct advice to Rumsfeld, he was a founding member of the Committee for the Liberation of Iraq (CLI), an organization set up by the WH in 2002 to help garner public support for going to war in Iraq.
They actually put together a promotion team to rally support for the war funded with our tax dollars no less. Tell me this scheme wasn't well planned and directed.
Before the war, another DPB member, Margaret Bartel, managed the funds channeled to Amhed Chalabi's exile group, the INC, including funds for its bogus prewar intelligence program on WMDs. Once it began, Bartel went on to head a consulting firm which helped investors find Iraqi partners.
Bartel established Global Positioning and told the LA Times that the firm's primary purpose was to "introduce clients to the Iraqi market, help them find potential Iraqi partners, set up meetings with government officials … and provide on-the-ground support for their business interests." So here was another sweet set up.
As for the chairman of the DPB, Richard Perle was a "special government employee," subject to federal ethics rules, including the rule that bars the chairman from using his public office for private gain.
Perle decided to resign as chairman after a little ethical problem came under scrutiny in March 2003. It was discovered that at the same time that he was advising the Pentagon on war policies, Perle had been retained by the telecommunications company Global Crossing to help overcome opposition by the Department of Defense and the FBI to the firms proposed sale to a Chinese company.
The agencies objected to the sale citing national security and law enforcement problems, because it would put Global's fiber-optic network, used by the US government, under Chinese ownership.
According to a legal notice that Global was preparing to file in bankruptcy court at the time, Perle was set to make $725,000, including $600,000 if the government approved the sale of the firm to the joint venture of Hutchison Whampoa Ltd, and Singapore Technologies Telemedia Pte, a company controlled by the Singapore government.
Perle was quick to pipe up to reporters and make the distinction that he was not involved in the lobbying of Defense Department officials, that his job was merely to advise Global on the process of gaining approval. That sure put my mind at ease.
In the end, I don't think its likely that Feith will end up in the welfare lines. Due to careful post-White House planning, I think its safe to say that Feith and his band of cronies will enjoy financial benefits for life, just so long as their never-ending war policies are carried on by their successor.
Halliburton - Poster Child For War Profiteering
January 24, 2005
Evelyn Pringle
Of course, by now, everybody has at least heard of Halliburton, the all-time poster child for war profiteering. But I'll bet most people don't understand exactly how this company has gone the full financial circle in Iraq. Some background info may be helpful.
First of all it helps to know that between 1999 and 2002, Halliburton gave more than $700,000 in political contributions, almost always to Republicans. In 2000, it donated $17,677 to Bush. In fact, the 70 or so companies that were awarded contracts in Iraq, have contributed more money to Bush than they have to any other candidate over the past 12 years.
But overall, Halliburton owes most of its good fortune to Cheney. While he was Bush Sr's secretary of defense, Cheney directed millions of tax dollars in government business to Halliburton.
Toward the end of his tenure, Cheney decided to turn over the business of planning and providing support for military operations abroad, such as preparing food, doing the laundry, and cleaning the latrines, to one company, Halliburton. He commissioned Halliburton to do a study of how this plan might work. In effect, you might say that Cheney paid Halliburton to create its own market.
It was paid $3.9 million for its initial report, which offered a strategy for providing support for 20,000 troops. The Pentagon then paid Halliburton $5 million to do a follow-up study. In August, 1992, Halliburton was selected to do all the work needed to support the military during the next 5 years. For its services in Somalia, Halliburton was paid $109 million and over the next 5 years, it was paid $2.2 billion for work in the Balkans.
When Bush Senior lost the election to Clinton, and Cheney lost his government job, he called in the markers and cashed in big time by becoming Halliburton's CEO.
Five years later Cheney waltzed back through the revolving door right into the Vice President’s office, with a retirement package from Halliburton said to be worth more than $34 million. Not bad for a guy who never so much as ran a lemonade stand prior to being hired by one of the world's largest companies.
But it didn't end there. Cheney still draws over $150,000 a year in deferred compensation from Halliburton, and he still holds over 400,000 stock options, at an estimated worth of $18 million (and rising).
Cheney Does Good By Halliburton
I have to admit, in the second half of the 1990s, as CEO, Cheney did rack up a number of notable accomplishments. He increased Halliburton’s offshore tax havens nearly 5-fold, from 9 to 44. And that sure paid off. The company went from paying $302 million in federal taxes in 1998, to getting an $85 million refund in 1999. All of which comes as no surprise considering the fact that Halliburton is one of the worlds most notorious corporate crooks.
Cheney and Halliburton were a match made in heaven. Together they found ways to make money off of just about every known terrorist county on God's green earth, regardless of the strict US laws against it.
While he was CEO, American companies were barred from doing business with Iran. So Cheney set up an address in the Cayman Islands. 60 Minutes did an investigation of the offshore subsidiary called Halliburton Products and Services, and discovered that the company had no known office or employees. The only sign of the fathom company was a forwarding address to Houston, Texas. So this bogus company was used to avoid US sanctions while doing business with Iran.
Halliburton’s bad habits don’t set so well with some of its shareholders these days. New York City's controller, William Thompson, who watches over the City workers' $80 million pension fund, said that city workers affected by 9/11, were "outraged that their retirement portfolios included stock in US firms getting fat off contracts with rogue nations like Iran, which funds the terror groups Hezbollah and Hamas and is suspected of giving sanctuary to Al Qaeda leaders."
But this conduct is nothing new. While Cheney was CEO, Halliburton even used a subsidiary in the Cayman Islands to make tens of millions of dollars off Iraq. According to UN records and oil industry executives, quoted in the June 23, 2004, Washington Post, Halliburton held stakes in 2 firms that sold over $73 million in oil production equipment and spare parts to Iraq.
And yet, listen to what Cheney (the pathological liar that he is), said when he running for VP in 2000, and was interviewed on ABC's "This Week" on July 30 2000, "I had a firm policy that we wouldn't do anything in Iraq, even arrangements that were supposedly legal. We've not done any business in Iraq since U.N. sanction were imposed . . ." Cheney really needs to get some help for that out-of-control compulsive lying disorder.
Anything To Make A Buck
Halliburton has been doing business with terrorists for years. In 1995, it was fined $3.8 million for doing business with Libya. The company sold Libya oil drilling tools that critics say could also be used to trigger nuclear bombs. So, keep in mind, whenever Bush starts bragging about dismantling Libya's WMD program, that it was Halliburton that helped create the program in the first place.
Under Cheney's watch, Halliburton was caught time and time again, over-billing the Pentagon. In 1997, the GAO found that it had inflated expenses in the Balkans, charging $85.98 for a sheet of plywood that only cost $14.06. A follow-up report in the year 2000, found more inflated costs, including charges for cleaning the same offices up to 4 times a day. In February 2002, Halliburton paid a $2 million fine for defrauding tax payers on its work in the Balkins.
However, don’t think for one minute that Halliburton has turned over a new leaf just because it was forced to pay a few million in fines. That is never going to happen. By now, I’m convinced that Halliburton estimates the cost of potential fines and lists them under "war profiteering expenses" when it submits the bid. Of course, that's if the company is even required to submit bid.
In the fall of 2002, Halliburton geared up to make big bucks while Bush was preparing to destroy Iraq. On the very day that Congress voted on the resolution, someone within the Bush administration, got on the phone and told Halliburton it had 9 weeks to build a base to house 7,000 soldiers. It was awarded several no-bid contracts, and its been driving a gravy train through Iraq ever since.
Who Cares About The Troops
As part of the LOGCAP contract, Halliburton serves meals to troops in Iraq and Kuwait. In December 2003, the Pentagon inspected the military kitchens and found dirty pans, dirty grills, dirty salad bars, blood all over the floor, and rotting meats and vegetables in kitchens operated by Halliburton.
In May 2004, the Defense Contract Audit Agency (DCAA) determined that the company had charged for thousands of meals that were never served. Auditors then decided to look into food contracts at 50 other locations.
In June 2004, the DCAA completed its review and found that Halliburton had billed for 36% more meals than were actually served. The Pentagon has refused to reimburse the company for overcharges that amount to about $186 million. In addition, the DCAA has ordered Halliburton to send all future bills to their agency for prior approval, before submitting them for reimbursement.
If Halliburton had not been handed the no-bid food contract, tax payers could have saved a fortune. According to the LA times, "the Army recently renegotiated a contract that Halliburton had with a Kuwaiti company to provide meals. By contracting directly with the Kuwaiti company, instead of going through a middle man like Halliburton, the Army knocked 40% off the cost of the contract."
According to GAO Controller David Walker, since the Pentagon started dealing directly with the Kuwaiti company, the price fell from about $5 a meal to about $3.
On another front, in line with its usual and customary behavior, Halliburton has also been caught with its hand in yet another till. The Pentagon began another investigation after an audit revealed that the company had overcharged the Army by $61 million for gasoline it delivered to Iraq.
And this $61 million is over and above the $6.3 million it already had to pay back when employees got caught taking kickbacks, in return for awarding a Kuwaiti-based company a contract.
While continuing to rip off tax payers, and making a fortune off an endless war, Halliburton went full circle when it was awarded billions of dollars worth of no-bid reconstruction contracts (guaranteed payment by tax payers), to rebuild the same country it helped destroy. Only in America (with a corrupt Vice President in your pocket) could something like this ever happen.
Evelyn Pringle
Of course, by now, everybody has at least heard of Halliburton, the all-time poster child for war profiteering. But I'll bet most people don't understand exactly how this company has gone the full financial circle in Iraq. Some background info may be helpful.
First of all it helps to know that between 1999 and 2002, Halliburton gave more than $700,000 in political contributions, almost always to Republicans. In 2000, it donated $17,677 to Bush. In fact, the 70 or so companies that were awarded contracts in Iraq, have contributed more money to Bush than they have to any other candidate over the past 12 years.
But overall, Halliburton owes most of its good fortune to Cheney. While he was Bush Sr's secretary of defense, Cheney directed millions of tax dollars in government business to Halliburton.
Toward the end of his tenure, Cheney decided to turn over the business of planning and providing support for military operations abroad, such as preparing food, doing the laundry, and cleaning the latrines, to one company, Halliburton. He commissioned Halliburton to do a study of how this plan might work. In effect, you might say that Cheney paid Halliburton to create its own market.
It was paid $3.9 million for its initial report, which offered a strategy for providing support for 20,000 troops. The Pentagon then paid Halliburton $5 million to do a follow-up study. In August, 1992, Halliburton was selected to do all the work needed to support the military during the next 5 years. For its services in Somalia, Halliburton was paid $109 million and over the next 5 years, it was paid $2.2 billion for work in the Balkans.
When Bush Senior lost the election to Clinton, and Cheney lost his government job, he called in the markers and cashed in big time by becoming Halliburton's CEO.
Five years later Cheney waltzed back through the revolving door right into the Vice President’s office, with a retirement package from Halliburton said to be worth more than $34 million. Not bad for a guy who never so much as ran a lemonade stand prior to being hired by one of the world's largest companies.
But it didn't end there. Cheney still draws over $150,000 a year in deferred compensation from Halliburton, and he still holds over 400,000 stock options, at an estimated worth of $18 million (and rising).
Cheney Does Good By Halliburton
I have to admit, in the second half of the 1990s, as CEO, Cheney did rack up a number of notable accomplishments. He increased Halliburton’s offshore tax havens nearly 5-fold, from 9 to 44. And that sure paid off. The company went from paying $302 million in federal taxes in 1998, to getting an $85 million refund in 1999. All of which comes as no surprise considering the fact that Halliburton is one of the worlds most notorious corporate crooks.
Cheney and Halliburton were a match made in heaven. Together they found ways to make money off of just about every known terrorist county on God's green earth, regardless of the strict US laws against it.
While he was CEO, American companies were barred from doing business with Iran. So Cheney set up an address in the Cayman Islands. 60 Minutes did an investigation of the offshore subsidiary called Halliburton Products and Services, and discovered that the company had no known office or employees. The only sign of the fathom company was a forwarding address to Houston, Texas. So this bogus company was used to avoid US sanctions while doing business with Iran.
Halliburton’s bad habits don’t set so well with some of its shareholders these days. New York City's controller, William Thompson, who watches over the City workers' $80 million pension fund, said that city workers affected by 9/11, were "outraged that their retirement portfolios included stock in US firms getting fat off contracts with rogue nations like Iran, which funds the terror groups Hezbollah and Hamas and is suspected of giving sanctuary to Al Qaeda leaders."
But this conduct is nothing new. While Cheney was CEO, Halliburton even used a subsidiary in the Cayman Islands to make tens of millions of dollars off Iraq. According to UN records and oil industry executives, quoted in the June 23, 2004, Washington Post, Halliburton held stakes in 2 firms that sold over $73 million in oil production equipment and spare parts to Iraq.
And yet, listen to what Cheney (the pathological liar that he is), said when he running for VP in 2000, and was interviewed on ABC's "This Week" on July 30 2000, "I had a firm policy that we wouldn't do anything in Iraq, even arrangements that were supposedly legal. We've not done any business in Iraq since U.N. sanction were imposed . . ." Cheney really needs to get some help for that out-of-control compulsive lying disorder.
Anything To Make A Buck
Halliburton has been doing business with terrorists for years. In 1995, it was fined $3.8 million for doing business with Libya. The company sold Libya oil drilling tools that critics say could also be used to trigger nuclear bombs. So, keep in mind, whenever Bush starts bragging about dismantling Libya's WMD program, that it was Halliburton that helped create the program in the first place.
Under Cheney's watch, Halliburton was caught time and time again, over-billing the Pentagon. In 1997, the GAO found that it had inflated expenses in the Balkans, charging $85.98 for a sheet of plywood that only cost $14.06. A follow-up report in the year 2000, found more inflated costs, including charges for cleaning the same offices up to 4 times a day. In February 2002, Halliburton paid a $2 million fine for defrauding tax payers on its work in the Balkins.
However, don’t think for one minute that Halliburton has turned over a new leaf just because it was forced to pay a few million in fines. That is never going to happen. By now, I’m convinced that Halliburton estimates the cost of potential fines and lists them under "war profiteering expenses" when it submits the bid. Of course, that's if the company is even required to submit bid.
In the fall of 2002, Halliburton geared up to make big bucks while Bush was preparing to destroy Iraq. On the very day that Congress voted on the resolution, someone within the Bush administration, got on the phone and told Halliburton it had 9 weeks to build a base to house 7,000 soldiers. It was awarded several no-bid contracts, and its been driving a gravy train through Iraq ever since.
Who Cares About The Troops
As part of the LOGCAP contract, Halliburton serves meals to troops in Iraq and Kuwait. In December 2003, the Pentagon inspected the military kitchens and found dirty pans, dirty grills, dirty salad bars, blood all over the floor, and rotting meats and vegetables in kitchens operated by Halliburton.
In May 2004, the Defense Contract Audit Agency (DCAA) determined that the company had charged for thousands of meals that were never served. Auditors then decided to look into food contracts at 50 other locations.
In June 2004, the DCAA completed its review and found that Halliburton had billed for 36% more meals than were actually served. The Pentagon has refused to reimburse the company for overcharges that amount to about $186 million. In addition, the DCAA has ordered Halliburton to send all future bills to their agency for prior approval, before submitting them for reimbursement.
If Halliburton had not been handed the no-bid food contract, tax payers could have saved a fortune. According to the LA times, "the Army recently renegotiated a contract that Halliburton had with a Kuwaiti company to provide meals. By contracting directly with the Kuwaiti company, instead of going through a middle man like Halliburton, the Army knocked 40% off the cost of the contract."
According to GAO Controller David Walker, since the Pentagon started dealing directly with the Kuwaiti company, the price fell from about $5 a meal to about $3.
On another front, in line with its usual and customary behavior, Halliburton has also been caught with its hand in yet another till. The Pentagon began another investigation after an audit revealed that the company had overcharged the Army by $61 million for gasoline it delivered to Iraq.
And this $61 million is over and above the $6.3 million it already had to pay back when employees got caught taking kickbacks, in return for awarding a Kuwaiti-based company a contract.
While continuing to rip off tax payers, and making a fortune off an endless war, Halliburton went full circle when it was awarded billions of dollars worth of no-bid reconstruction contracts (guaranteed payment by tax payers), to rebuild the same country it helped destroy. Only in America (with a corrupt Vice President in your pocket) could something like this ever happen.
Sunday, August 1, 2010
Resume of Dick Cheney to be Posted on Monster.Com
August 6, 2004
Evelyn Pringle
Dick Cheney is too modest to list his past accomplishments as CEO of Halliburton on the White House Website, so I decided to give him a few pointers on writing a resume to submit to future employers when he leaves the White House in January 2005.
I would definitely keep the focus on three areas of expertise: (1) Setting up fraudulent tax havens to avoid paying US taxes; (2) Doing business with terrorist countries; and (3) Stonewalling criminal investigations without going to prison.
(1) How To Set Up Fraudulent Corporate Tax Havens
As CEO of Halliburton, Cheney did rack up a number of accomplishments. He increased Halliburton's offshore tax haven subsidiaries nearly 5-fold. The company currently has 143 subsidiaries, but only 36 are incorporated in the US. The other 107 are located in other countries. According to CitizenWorks.org, Halliburton is 8th on the Fortune 500 list of companies with the most offshore tax havens.
For tax purposes, a subsidiary is defined as a controlled foreign corporation if US shareholders own more than 50% of its voting stock, or more than 50% of the value of all its outstanding stock (directly, indirectly, or constructively) on any day of the year.
Here's how they work. Under the US tax code, American corporations must pay taxes on income earned in foreign countries. But if a company incorporates a subsidiary under the laws of a foreign nation, the subsidiary is not considered a US resident, it is considered a foreign citizen. This allows the US parent company to avoid paying US taxes on the subsidiary's income as long as the income is retained and reinvested outside the US.
So by filing a few incorporation papers and paying a small fee to a foreign government Halliburton can turn a subsidiary into a foreign corporation that can avoid paying any US income tax. Its that easy.
Overall, the tax saving generated by Halliburton's tax havens, and the correlative tax loss to American taxpayers, is enormous. For example, in 2002, Halliburton only paid $15 million of its $80 million tax bill (or 19%) to the US government. The remaining 81% went to foreign governments.
Bob McIntyre, the director of Citizens for Tax Justice, talks about tax havens engaging in complex deals to shelter their profits, "The more these companies can bounce things around offshore, the more profit that can be kept offshore and tax free," McIntyre says. "They shouldn't get away with it, but it is really hard to police."
This may be true, but I think Bob would agree that with Cheney in the VP office, Halliburton gets away with a lot more than other corporations do.
(2) How To Do Business With Terrorists
Cheney and Halliburton were a match made in heaven. Together they found ways to make money off of just about every known terrorist country on God's green earth, regardless of the strict US laws against it.
While Cheney was CEO, American companies were barred from doing business with Iran. So the company set up an address in the Cayman Islands. The TV news program 60 Minutes did an investigation of a subsidiary called Halliburton Products and Services, and discovered that the company had no office or employees. The only sign of the phantom company was a forwarding address to Houston, Texas.
The 60 Minutes reporter traveled to the Cayman Islands, went to the address listed for Halliburton Products, and found a building owned by a local bank and a bank employee who told him that when mail arrived for Halliburton Products, it was forwarded directly to Houston, Texas.
The company's luck might be running out because this particular subsidiary has recently come under new scrutiny. A grand jury is said to be examining whether it is truly independent and whether Halliburton violated federal sanctions by operating in Iran.
The LA Times explains that US companies are allowed to operate in Iran, but under strict guidelines requiring that their subsidiaries have a foreign registry, and no US employees, and that they act independently of the parent company. So in a nutshell, it boils down to whether Halliburton Products met those criteria.
The Treasury Department website details US sanctions that bar almost all trade with Iran, and says that, "No US person may approve or facilitate the entry into or performance of transactions or contracts with Iran by a foreign subsidiary of a US firm that the US person is precluded from performing directly. Similarly, no US person may facilitate such transactions by unaffiliated foreign persons," it says.
According to media reports, investigators are examining Halliburton documents dating back to 1997 - 1998 that relate to a Dubai based subsidiary that received several tender offers from Kala Ltd, which is a subsidiary of the National Iranian Oil Company. Investigators want to know whether the deals were completed and whether they were in violation of US sanctions against Iran.
So, is Halliburton worried? Apparently not. It has known since 2001, that the Office of Foreign Assets Control (OFAC) was conducting an investigation to determine whether the company violated the ban, and it still went right on doing business with Iran. In fact in 2003, Halliburton's subsidiary was used to sell $63 million worth of oil products to Iran.
Something must have turned up because the OFAC recently referred the matter over to the Justice Department for investigation, which in turn prompted the Justice Department to issue a subpoena that calls on Halliburton to provide documents relating to its business relationships with Iran. It will be interesting to see what information Halliburton turns over (if anything).
But this trading with the enemy is nothing new. While Cheney was CEO, Halliburton even used subsidiaries to make tens of millions of dollars off Iraq. According to UN records and industry executives quoted in the Washington Post, Halliburton held stakes in 2 firms that sold over $73 million in oil production equipment and spare parts to Iraq.
And yet, listen to what that pathological liar said when he running for VP and was interviewed on ABC's "This Week" on July 30 2000. "I had a firm policy that we wouldn't do anything in Iraq, even arrangements that were supposedly legal. We've not done any business in Iraq since U.N. sanction were imposed...," Cheney claimed. He really needs to get some help for that compulsive lying disorder. Its obviously out of control.
Halliburton has been doing business with known terrorists for years. Back in 1995, it was fined $3.8 million for doing business with Libya. The company sold tools to Libya that critics said could be used to trigger nuclear bombs. So be sure to keep in mind whenever Bush starts bragging about dismantling Libya's WMD program, that it was Halliburton that helped create it in the first place.
(3) How To Stonewall Investigations and Stay Out Of Prison
Halliburton is the all-time pro at fraudulent scams and war profiteering. And its top level executives are pros at stonewalling investigations and finding ways to stay out of prison.
Under Cheney's watch, the company was caught over-billing the government time and time again. In 1997, the GAO caught Halliburton charging $85.98 for a sheet of plywood that only cost $14.06. A 2000 follow-up investigation caught it charging tax payers for cleaning the exact same office space 4 times a day. So what happened to Halliburton as a result of these lengthily and expensive investigations? Nothing until 2002. Then it was fined $2 million for defrauding the government and that's it.
And nobody better think for one minute that the company has turned over a new leaf just because it was forced to pay a few million in fines. That is never going to happen. By now, I'm convinced that Halliburton estimates the cost of potential fines and lists them under "war profiteering expenses" when it submits the bid. Of course, that's if its even required to submit bid.
For example, as recently as January 2004, Halliburton employees were caught accepting $6.3 million in kickbacks from a Kuwaiti subcontractor. The company paid back the $6.3 million, said it fired the employees, and went right on as if nothing had ever happened.
In fact, the administration not only ignored the kickbacks, it gave Halliburton another $1.2 billion contract. Republican Congressman Tom Davis, Chairman of the House Committee on Government Reform, even said, "It's incomprehensible that the [Bush] Administration could give Halliburton another billion-dollar contract without fully investigating such serious criminal wrongdoing." Well incomprehensible or not, it did.
Here's another good example of Halliburton officials stonewalling and avoiding prison. In May of 2003, Halliburton was forced to admit to the SEC that it had paid $2.4 million in bribes to officials of Nigeria's Federal Inland Revenue Service in 2001 and 2002 "to obtain favorable tax treatment."
Halliburton put all the blame on a couple of lowly employees and claimed that none of its senior officers were involved in the bribe. But as the Houston Chronicle pointed out, "left unanswered is how a 'low-level employee' could channel that much money from the company to the pockets of a corrupt official."
So what are they asking us to believe? That 2 employees took a brown paper bag to an ATM machine and made withdrawals of $2.4 million? Oh Please!
We are talking here about ripping off hundreds of millions of dollars from the US government (aka the taxpayers), and yet no matter how bad it gets, there are never any arrests.
In fact, the SEC might even end up letting the $2.4 million bribery case slide, because it has far bigger fish to fry. As of July 2004, the French, British, Nigerian and US governments are all investigating allegations that Halliburton and three other companies paid $180 million in bribes to Nigerian officials in exchange for a $6 billion contract to build a natural gas plant in Nigeria, while Cheney was CEO.
French police started the initial investigation into the matter way back in October, 2002. In June 2003, the chief prosecutor on the case believed that there was enough evidence to appoint anti-corruption judge, Renaud van Ruymbeke, to expand the investigation.
This second case is far more complicated because it involves an international consortium between Halliburton and three other companies from France, Italy, and Japan. Together, they formed the joint venture TSKJ, a company registered in Medeira, Portugal.
TSKJ was then awarded the $6 billion contract. But here's where it gets tricky for Halliburton because the alleged bribery payments were made through TSKJ, and Halliburton owns 25% of the company.
According to the Washington Post, "at the heart of the investigation is the question of whether those payments amounted to illegal commissions, or bribes, to Nigerian public officials." The payments were made during Cheney's tenure, and according to the Boson Globe, "If such payments were made and Cheney approved them, he could be guilty of violating the U.S. Foreign Corrupt Practices Act."
Ex-Halliburton consultant, Attorney Jeffrey Tesler, says that Cheney knew all about the bribes. Tesler testified under oath in May, 2004 that he made payments to Jack Stanley, while Stanley was president of Halliburton subsidiary KBR, and Tesler specifically said that Cheney approved the payments.
His testimony is backed up by banking records that show that at least $5 million in payments were wired to Stanley through a secret bank account in Zurich. Tesler also testified that he paid $350,000 to another Halliburton executive, William Chaudran, through a secret bank account on the isle of Jersey.
On June 18, 2004, Halliburton announced that it was cutting its ties with Jack Stanley. But there's good news for Stanley in France. Judge Ruymbeke is said to be offering him a deal if he implicates Cheney, and sources within the French legal system say that there is more than enough evidence to indict Cheney on charges of bribery, money laundering and misuse of corporate assets.
It's Definitely Time To Lawyer Up
Halliburton knows it's in big trouble with this case. Cheney might have pull in the US but not France. In February 2004, Halliburton hired Attorney James Doty, from (where else but) the Baker-Botts law firm.
Doty just happens to be the same attorney that Bush hired when he bought the Texas Rangers, and he was also general counsel to the SEC when it investigated Bush for insider trading while he was a director on the board of Harken Energy. What a tight-knit little group. I guess birds of a feather definitely do flock together.
Something I heard recently suddenly makes sense. Halliburton apparently purchased some kind of insurance policy to cover legal expenses that Cheney might incur as a direct result of problems arising from his employment with Halliburton. Now it becomes clear.
Well lets hope that's true and that they get Cheney a good attorney too, because the way things stand right now, he may very well be looking at criminal indictments for the some of the illegal activities he engaged in while CEO of Halliburton. With such a long history of corrupt business deals hanging over his head, its no wonder that he has heart trouble.
I bet Cheney longs for the good old days of Campaign 2000, when his only legal problems consisted of trying to hide drunk driving arrests, and worrying about whether, if elected Vice President, he could get into Canada since he was a two-time convicted criminal.
Evelyn Pringle
Dick Cheney is too modest to list his past accomplishments as CEO of Halliburton on the White House Website, so I decided to give him a few pointers on writing a resume to submit to future employers when he leaves the White House in January 2005.
I would definitely keep the focus on three areas of expertise: (1) Setting up fraudulent tax havens to avoid paying US taxes; (2) Doing business with terrorist countries; and (3) Stonewalling criminal investigations without going to prison.
(1) How To Set Up Fraudulent Corporate Tax Havens
As CEO of Halliburton, Cheney did rack up a number of accomplishments. He increased Halliburton's offshore tax haven subsidiaries nearly 5-fold. The company currently has 143 subsidiaries, but only 36 are incorporated in the US. The other 107 are located in other countries. According to CitizenWorks.org, Halliburton is 8th on the Fortune 500 list of companies with the most offshore tax havens.
For tax purposes, a subsidiary is defined as a controlled foreign corporation if US shareholders own more than 50% of its voting stock, or more than 50% of the value of all its outstanding stock (directly, indirectly, or constructively) on any day of the year.
Here's how they work. Under the US tax code, American corporations must pay taxes on income earned in foreign countries. But if a company incorporates a subsidiary under the laws of a foreign nation, the subsidiary is not considered a US resident, it is considered a foreign citizen. This allows the US parent company to avoid paying US taxes on the subsidiary's income as long as the income is retained and reinvested outside the US.
So by filing a few incorporation papers and paying a small fee to a foreign government Halliburton can turn a subsidiary into a foreign corporation that can avoid paying any US income tax. Its that easy.
Overall, the tax saving generated by Halliburton's tax havens, and the correlative tax loss to American taxpayers, is enormous. For example, in 2002, Halliburton only paid $15 million of its $80 million tax bill (or 19%) to the US government. The remaining 81% went to foreign governments.
Bob McIntyre, the director of Citizens for Tax Justice, talks about tax havens engaging in complex deals to shelter their profits, "The more these companies can bounce things around offshore, the more profit that can be kept offshore and tax free," McIntyre says. "They shouldn't get away with it, but it is really hard to police."
This may be true, but I think Bob would agree that with Cheney in the VP office, Halliburton gets away with a lot more than other corporations do.
(2) How To Do Business With Terrorists
Cheney and Halliburton were a match made in heaven. Together they found ways to make money off of just about every known terrorist country on God's green earth, regardless of the strict US laws against it.
While Cheney was CEO, American companies were barred from doing business with Iran. So the company set up an address in the Cayman Islands. The TV news program 60 Minutes did an investigation of a subsidiary called Halliburton Products and Services, and discovered that the company had no office or employees. The only sign of the phantom company was a forwarding address to Houston, Texas.
The 60 Minutes reporter traveled to the Cayman Islands, went to the address listed for Halliburton Products, and found a building owned by a local bank and a bank employee who told him that when mail arrived for Halliburton Products, it was forwarded directly to Houston, Texas.
The company's luck might be running out because this particular subsidiary has recently come under new scrutiny. A grand jury is said to be examining whether it is truly independent and whether Halliburton violated federal sanctions by operating in Iran.
The LA Times explains that US companies are allowed to operate in Iran, but under strict guidelines requiring that their subsidiaries have a foreign registry, and no US employees, and that they act independently of the parent company. So in a nutshell, it boils down to whether Halliburton Products met those criteria.
The Treasury Department website details US sanctions that bar almost all trade with Iran, and says that, "No US person may approve or facilitate the entry into or performance of transactions or contracts with Iran by a foreign subsidiary of a US firm that the US person is precluded from performing directly. Similarly, no US person may facilitate such transactions by unaffiliated foreign persons," it says.
According to media reports, investigators are examining Halliburton documents dating back to 1997 - 1998 that relate to a Dubai based subsidiary that received several tender offers from Kala Ltd, which is a subsidiary of the National Iranian Oil Company. Investigators want to know whether the deals were completed and whether they were in violation of US sanctions against Iran.
So, is Halliburton worried? Apparently not. It has known since 2001, that the Office of Foreign Assets Control (OFAC) was conducting an investigation to determine whether the company violated the ban, and it still went right on doing business with Iran. In fact in 2003, Halliburton's subsidiary was used to sell $63 million worth of oil products to Iran.
Something must have turned up because the OFAC recently referred the matter over to the Justice Department for investigation, which in turn prompted the Justice Department to issue a subpoena that calls on Halliburton to provide documents relating to its business relationships with Iran. It will be interesting to see what information Halliburton turns over (if anything).
But this trading with the enemy is nothing new. While Cheney was CEO, Halliburton even used subsidiaries to make tens of millions of dollars off Iraq. According to UN records and industry executives quoted in the Washington Post, Halliburton held stakes in 2 firms that sold over $73 million in oil production equipment and spare parts to Iraq.
And yet, listen to what that pathological liar said when he running for VP and was interviewed on ABC's "This Week" on July 30 2000. "I had a firm policy that we wouldn't do anything in Iraq, even arrangements that were supposedly legal. We've not done any business in Iraq since U.N. sanction were imposed...," Cheney claimed. He really needs to get some help for that compulsive lying disorder. Its obviously out of control.
Halliburton has been doing business with known terrorists for years. Back in 1995, it was fined $3.8 million for doing business with Libya. The company sold tools to Libya that critics said could be used to trigger nuclear bombs. So be sure to keep in mind whenever Bush starts bragging about dismantling Libya's WMD program, that it was Halliburton that helped create it in the first place.
(3) How To Stonewall Investigations and Stay Out Of Prison
Halliburton is the all-time pro at fraudulent scams and war profiteering. And its top level executives are pros at stonewalling investigations and finding ways to stay out of prison.
Under Cheney's watch, the company was caught over-billing the government time and time again. In 1997, the GAO caught Halliburton charging $85.98 for a sheet of plywood that only cost $14.06. A 2000 follow-up investigation caught it charging tax payers for cleaning the exact same office space 4 times a day. So what happened to Halliburton as a result of these lengthily and expensive investigations? Nothing until 2002. Then it was fined $2 million for defrauding the government and that's it.
And nobody better think for one minute that the company has turned over a new leaf just because it was forced to pay a few million in fines. That is never going to happen. By now, I'm convinced that Halliburton estimates the cost of potential fines and lists them under "war profiteering expenses" when it submits the bid. Of course, that's if its even required to submit bid.
For example, as recently as January 2004, Halliburton employees were caught accepting $6.3 million in kickbacks from a Kuwaiti subcontractor. The company paid back the $6.3 million, said it fired the employees, and went right on as if nothing had ever happened.
In fact, the administration not only ignored the kickbacks, it gave Halliburton another $1.2 billion contract. Republican Congressman Tom Davis, Chairman of the House Committee on Government Reform, even said, "It's incomprehensible that the [Bush] Administration could give Halliburton another billion-dollar contract without fully investigating such serious criminal wrongdoing." Well incomprehensible or not, it did.
Here's another good example of Halliburton officials stonewalling and avoiding prison. In May of 2003, Halliburton was forced to admit to the SEC that it had paid $2.4 million in bribes to officials of Nigeria's Federal Inland Revenue Service in 2001 and 2002 "to obtain favorable tax treatment."
Halliburton put all the blame on a couple of lowly employees and claimed that none of its senior officers were involved in the bribe. But as the Houston Chronicle pointed out, "left unanswered is how a 'low-level employee' could channel that much money from the company to the pockets of a corrupt official."
So what are they asking us to believe? That 2 employees took a brown paper bag to an ATM machine and made withdrawals of $2.4 million? Oh Please!
We are talking here about ripping off hundreds of millions of dollars from the US government (aka the taxpayers), and yet no matter how bad it gets, there are never any arrests.
In fact, the SEC might even end up letting the $2.4 million bribery case slide, because it has far bigger fish to fry. As of July 2004, the French, British, Nigerian and US governments are all investigating allegations that Halliburton and three other companies paid $180 million in bribes to Nigerian officials in exchange for a $6 billion contract to build a natural gas plant in Nigeria, while Cheney was CEO.
French police started the initial investigation into the matter way back in October, 2002. In June 2003, the chief prosecutor on the case believed that there was enough evidence to appoint anti-corruption judge, Renaud van Ruymbeke, to expand the investigation.
This second case is far more complicated because it involves an international consortium between Halliburton and three other companies from France, Italy, and Japan. Together, they formed the joint venture TSKJ, a company registered in Medeira, Portugal.
TSKJ was then awarded the $6 billion contract. But here's where it gets tricky for Halliburton because the alleged bribery payments were made through TSKJ, and Halliburton owns 25% of the company.
According to the Washington Post, "at the heart of the investigation is the question of whether those payments amounted to illegal commissions, or bribes, to Nigerian public officials." The payments were made during Cheney's tenure, and according to the Boson Globe, "If such payments were made and Cheney approved them, he could be guilty of violating the U.S. Foreign Corrupt Practices Act."
Ex-Halliburton consultant, Attorney Jeffrey Tesler, says that Cheney knew all about the bribes. Tesler testified under oath in May, 2004 that he made payments to Jack Stanley, while Stanley was president of Halliburton subsidiary KBR, and Tesler specifically said that Cheney approved the payments.
His testimony is backed up by banking records that show that at least $5 million in payments were wired to Stanley through a secret bank account in Zurich. Tesler also testified that he paid $350,000 to another Halliburton executive, William Chaudran, through a secret bank account on the isle of Jersey.
On June 18, 2004, Halliburton announced that it was cutting its ties with Jack Stanley. But there's good news for Stanley in France. Judge Ruymbeke is said to be offering him a deal if he implicates Cheney, and sources within the French legal system say that there is more than enough evidence to indict Cheney on charges of bribery, money laundering and misuse of corporate assets.
It's Definitely Time To Lawyer Up
Halliburton knows it's in big trouble with this case. Cheney might have pull in the US but not France. In February 2004, Halliburton hired Attorney James Doty, from (where else but) the Baker-Botts law firm.
Doty just happens to be the same attorney that Bush hired when he bought the Texas Rangers, and he was also general counsel to the SEC when it investigated Bush for insider trading while he was a director on the board of Harken Energy. What a tight-knit little group. I guess birds of a feather definitely do flock together.
Something I heard recently suddenly makes sense. Halliburton apparently purchased some kind of insurance policy to cover legal expenses that Cheney might incur as a direct result of problems arising from his employment with Halliburton. Now it becomes clear.
Well lets hope that's true and that they get Cheney a good attorney too, because the way things stand right now, he may very well be looking at criminal indictments for the some of the illegal activities he engaged in while CEO of Halliburton. With such a long history of corrupt business deals hanging over his head, its no wonder that he has heart trouble.
I bet Cheney longs for the good old days of Campaign 2000, when his only legal problems consisted of trying to hide drunk driving arrests, and worrying about whether, if elected Vice President, he could get into Canada since he was a two-time convicted criminal.
Cheney and Halliburton Hold Title of Top Earners In Iraq
March 31, 2006
Evelyn Pringle
There 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 time.
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 began.
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 Ridder.
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 a day.
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 buy it.
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 criminal wrongdoing."
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" costs.
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 $167 million
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
There 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 time.
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 began.
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 Ridder.
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 a day.
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 buy it.
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 criminal wrongdoing."
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" costs.
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 $167 million
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.
Cheney Fitted for New Halliburton Uniform - Striped Jumpsuit
Evelyn Pringle November 2006
The US Securities and Exchange Commission is conducting a formal investigation into whether Halliburton made improper payments to government officials in Nigeria in connection with the construction and expansion by TSKJ of a natural gas liquefaction complex and facilities at Bonny Island in Rivers State, Nigeria.
TSKJ is a company registered in Portugal whose members include Technip SA of France, Snamprogetti Netherlands BV, a subsidiary of Saipem SpA of Italy, JGC Corporation of Japan, and Kellogg Brown & Root, a successor to the MW Kellogg Company, each of which has a 25% interest in the venture.
TSKJ entered into various contracts to build and expand the liquefied natural gas project for Nigeria LNG Limited, which is owned by the Nigerian National Petroleum Corp, Shell Gas BV, Cleag Limited, and Agip International BV, an affiliate of ENI SpA of Italy.
MW Kellogg Limited is a joint venture in which Halliburton has a 55% interest; and MW Kellogg Limited and the MW Kellogg Company were subsidiaries of Dresser Industries before Halliburton's 1998 acquisition of Dresser Industries. The MW Kellogg Company was later merged with a Halliburton subsidiary to form Kellogg Brown & Root.
The US Department of Justice is also conducting a related criminal investigation of the Nigerian bribery matter pursuant to the US Foreign Corrupt Practices Act (FCPA).
In addition to the SEC and the DOJ investigations, other investigations are being conducted in France, Nigeria and Switzerland and in Nigeria, a legislative committee of the National Assembly and the Economic and Financial Crimes Commission are also investigating the matter.
And last but not least, on August 7, 2006, the Financial Times of London reported that KBR, a subsidiary of Halliburton, is being investigated by Britain's Serious Fraud Office over the company's role in an alleged plot to pay more than $170 million in bribes to win $7 billion worth of contracts at a Nigerian oil plant.
For part of the period under investigation, the newspaper reported, Halliburton was headed by Vice President Dick Cheney.
The SFO said it had conducted searches at business and residential premises as part of its investigation into KBR, which it said was opened in March 2006. The probe comes after criticism that the SFO was doing too little on the case even though a British-based company and a British lawyer were at the centre of a plot, the Times noted.
During the investigations, information has surfaced suggesting that at least 10 years ago, members of TSKJ planned to make bribery payments to Nigerian officials.
According the Times article, documents from the French investigation show the payments relate to four separate contracts under which the consortium agreed to pay a total of just over $170 million to an offshore company controlled by London-based attorney, Jeffrey Tesler.
Investigators in the US, France and Nigeria, the Times said, have looked with particular interest at handwritten meeting minutes surrendered by Halliburton, in which the consortium partners use highly suggestive language about how they plan to do business.
"One note," the Times reports, "from December 1994 says that “all services” will cost the consortium $180m, with a further $60m allocated to “culture”.
"Elsewhere in the notes," the article says, "KBR and its consortium partners – Technip of France, Italy’s Snamprogetti and JGC of Japan – discuss the pros and cons of a series of possible “secret” and “open” payments to agents."
The payments were made during Cheney's tenure, and according to the Boson Globe, "If such payments were made and Cheney approved them, he could be guilty of violating the U.S. Foreign Corrupt Practices Act."
Mr Tesler swears that Cheney knew about the bribes. He testified under oath in May, 2004 that he made payments to Jack Stanley, while Stanley was president of KBR, and specifically testified that Cheney approved the payments.
His testimony is backed up by banking records that show that at least $5 million in payments were wired to Stanley through a secret bank account in Zurich. Mr Tesler also testified that he paid $350,000 to another Halliburton executive, William Chaudran, through a secret bank account on the isle of Jersey.
A French magistrate has officially placed Mr Tesler under investigation for corruption of a foreign public official and is said to be offering him a deal if he implicates Dick Cheney.
Sources within the French legal system contend that there is more than enough evidence to indict Cheney on charges of bribery, money laundering and misuse of corporate assets.
In connection with the Bonny Island project, TSKJ entered into a series of agreements, including with Tri-Star Investments, of which Mr Tesler is a principal, beginning in 1995, and a series of subcontracts with a Japanese trading company beginning in 1996.
The SEC and DOJ are seeking to determine whether TSKJ’s engaged Tri-Star as an agent, and the Japanese company as a subcontractor, to make improper payments to Nigerian officials.
According to Halliburton's SEC filing, company representatives have met with the French magistrate and Nigerian officials and in October 2004, representatives of TSKJ testified before the Nigerian legislative committee.
If violations of the FCPA are found in these investigations, a guilty person or entity could be subject to fines, and civil penalties of up to $500,000 for each violation, as well as equitable remedies, including disgorgement, and injunctive relief.
Under the statute, criminal penalties could range from up to the greater of $2 million per violation or twice the gross pecuniary gain or loss. The SEC and the DOJ could also decide that continuing conduct constitutes multiple violations for purposes of assessing the penalty amounts for each violation.
Potential consequences of a criminal indictment to Halliburton could include suspension by the US Department of Defense, or other federal, state, or local government agencies, of KBR and its affiliates from their ability to contract with government agencies.
If a criminal or civil violation is found, KBR and its affiliates could be debarred from receiving future contracts and also from receiving new orders under existing contracts to provide services to any such entities, which would naturally include current KBR contracts in Iraq and Afghanistan.
And this would be no small penalty for Halliburton. According to the company's SEC filing for the quarter ending June 30, 2006, during 2005, "KBR and its affiliates had revenue of approximately $6.6 billion from its government contracts work with agencies of the United States or state or local governments."
"Suspension or debarment from the government contracts business," the filing states, "would have a material adverse effect on the business, results of operations, and cash flows of KBR and Halliburton."
The investigations could also result in third-party claims against the company, "which may include claims for special, indirect, derivative or consequential damages, damage to our business or reputation, loss of, or adverse effect on, cash flow, assets, goodwill, results of operations, business, prospects, profits or business value, adverse consequences on our ability to obtain or continue financing for current or future projects or claims by directors, officers, employees, affiliates, advisors, attorneys, agents, debt holders or other interest holders or constituents of us or our subsidiaries," the SEC filing says.
In addition, Halliburton "could incur costs and expenses for any monitor required by or agreed to with governmental authority to review our continued compliance with FCPA law," it notes.
On another front, during the investigation into the Bonny Island project, the SEC filing states, "information has been uncovered suggesting that Mr. Stanley and other former employees may have engaged in coordinated bidding with one or more competitors on certain foreign construction projects, and that such coordination possibly began as early as the mid-1980s."
On the basis of this information, the DOJ is reportedly seeking to determine the nature of any improper bidding practices, whether antitrust laws were violated, and whether Halliburton employees have received payments as a result of such bidding practices on foreign projects.
If violations of antitrust laws are found to have occurred, according to Halliburton's SEC filing, "the range of possible penalties includes criminal fines, which could range up to the greater of $10 million in fines per count for a corporation, or twice the gross pecuniary gain or loss, and treble civil damages in favor of any persons financially injured by such violations."
"Criminal prosecutions," the filing states, "under applicable laws of relevant foreign jurisdictions and civil claims by, or relationship issues with customers, are also possible."
As part of the investigation, the SEC has issued subpoenas seeking information regarding current and former agents used in connection with projects over the past 20 years located in and outside of Nigeria in which MW Kellogg Company, MW Kellogg, Ltd, KBR or their joint ventures, as well as the Halliburton energy services business, were participants.
Halliburton says it has "produced documents to the SEC and the DOJ both voluntarily and pursuant to company subpoenas from the files of numerous officers of Halliburton and KBR, including current and former executives of Halliburton and KBR, and we are making our employees available to the SEC and the DOJ for interviews."
In addition, the SEC has issued a subpoena to Jack Stanley, and to other current and former KBR employees, former executive officers of KBR, and at least one subcontractor of KBR.
The DOJ has invoked its authority under a sitting grand jury to issue subpoenas for the purpose of obtaining information abroad, and other partners in TSKJ have provided information to the DOJ and the SEC related to the investigations.
Back in May of 2003, Halliburton was forced to admit to the SEC that it had paid $2.4 million in bribes to officials of Nigeria's Federal Inland Revenue Service in 2001 and 2002 "to obtain favorable tax treatment."
Of course Halliburton pointed the finger of blame at a couple of lowly employees for bribing the Nigerian IRS, and claimed that none of its senior officers were involved in the bribery plot. But as the Houston Chronicle pointed out at the time, "left unanswered is how a 'low-level employee' could channel that much money from the company to the pockets of a corrupt official."
The current investigation into the payment of $170 million in bribes could be near to a conclusion because Halliburton seems to be ready to throw in the towel.
"We have reason to believe," Halliburton said in its SEC filing, "based on the ongoing investigations, that payments may have been made to Nigerian officials."
So if Dick Cheney goes missing again, it probably just means that he's off being fitted for a new Halliburton uniform - a striped jumpsuit.
The US Securities and Exchange Commission is conducting a formal investigation into whether Halliburton made improper payments to government officials in Nigeria in connection with the construction and expansion by TSKJ of a natural gas liquefaction complex and facilities at Bonny Island in Rivers State, Nigeria.
TSKJ is a company registered in Portugal whose members include Technip SA of France, Snamprogetti Netherlands BV, a subsidiary of Saipem SpA of Italy, JGC Corporation of Japan, and Kellogg Brown & Root, a successor to the MW Kellogg Company, each of which has a 25% interest in the venture.
TSKJ entered into various contracts to build and expand the liquefied natural gas project for Nigeria LNG Limited, which is owned by the Nigerian National Petroleum Corp, Shell Gas BV, Cleag Limited, and Agip International BV, an affiliate of ENI SpA of Italy.
MW Kellogg Limited is a joint venture in which Halliburton has a 55% interest; and MW Kellogg Limited and the MW Kellogg Company were subsidiaries of Dresser Industries before Halliburton's 1998 acquisition of Dresser Industries. The MW Kellogg Company was later merged with a Halliburton subsidiary to form Kellogg Brown & Root.
The US Department of Justice is also conducting a related criminal investigation of the Nigerian bribery matter pursuant to the US Foreign Corrupt Practices Act (FCPA).
In addition to the SEC and the DOJ investigations, other investigations are being conducted in France, Nigeria and Switzerland and in Nigeria, a legislative committee of the National Assembly and the Economic and Financial Crimes Commission are also investigating the matter.
And last but not least, on August 7, 2006, the Financial Times of London reported that KBR, a subsidiary of Halliburton, is being investigated by Britain's Serious Fraud Office over the company's role in an alleged plot to pay more than $170 million in bribes to win $7 billion worth of contracts at a Nigerian oil plant.
For part of the period under investigation, the newspaper reported, Halliburton was headed by Vice President Dick Cheney.
The SFO said it had conducted searches at business and residential premises as part of its investigation into KBR, which it said was opened in March 2006. The probe comes after criticism that the SFO was doing too little on the case even though a British-based company and a British lawyer were at the centre of a plot, the Times noted.
During the investigations, information has surfaced suggesting that at least 10 years ago, members of TSKJ planned to make bribery payments to Nigerian officials.
According the Times article, documents from the French investigation show the payments relate to four separate contracts under which the consortium agreed to pay a total of just over $170 million to an offshore company controlled by London-based attorney, Jeffrey Tesler.
Investigators in the US, France and Nigeria, the Times said, have looked with particular interest at handwritten meeting minutes surrendered by Halliburton, in which the consortium partners use highly suggestive language about how they plan to do business.
"One note," the Times reports, "from December 1994 says that “all services” will cost the consortium $180m, with a further $60m allocated to “culture”.
"Elsewhere in the notes," the article says, "KBR and its consortium partners – Technip of France, Italy’s Snamprogetti and JGC of Japan – discuss the pros and cons of a series of possible “secret” and “open” payments to agents."
The payments were made during Cheney's tenure, and according to the Boson Globe, "If such payments were made and Cheney approved them, he could be guilty of violating the U.S. Foreign Corrupt Practices Act."
Mr Tesler swears that Cheney knew about the bribes. He testified under oath in May, 2004 that he made payments to Jack Stanley, while Stanley was president of KBR, and specifically testified that Cheney approved the payments.
His testimony is backed up by banking records that show that at least $5 million in payments were wired to Stanley through a secret bank account in Zurich. Mr Tesler also testified that he paid $350,000 to another Halliburton executive, William Chaudran, through a secret bank account on the isle of Jersey.
A French magistrate has officially placed Mr Tesler under investigation for corruption of a foreign public official and is said to be offering him a deal if he implicates Dick Cheney.
Sources within the French legal system contend that there is more than enough evidence to indict Cheney on charges of bribery, money laundering and misuse of corporate assets.
In connection with the Bonny Island project, TSKJ entered into a series of agreements, including with Tri-Star Investments, of which Mr Tesler is a principal, beginning in 1995, and a series of subcontracts with a Japanese trading company beginning in 1996.
The SEC and DOJ are seeking to determine whether TSKJ’s engaged Tri-Star as an agent, and the Japanese company as a subcontractor, to make improper payments to Nigerian officials.
According to Halliburton's SEC filing, company representatives have met with the French magistrate and Nigerian officials and in October 2004, representatives of TSKJ testified before the Nigerian legislative committee.
If violations of the FCPA are found in these investigations, a guilty person or entity could be subject to fines, and civil penalties of up to $500,000 for each violation, as well as equitable remedies, including disgorgement, and injunctive relief.
Under the statute, criminal penalties could range from up to the greater of $2 million per violation or twice the gross pecuniary gain or loss. The SEC and the DOJ could also decide that continuing conduct constitutes multiple violations for purposes of assessing the penalty amounts for each violation.
Potential consequences of a criminal indictment to Halliburton could include suspension by the US Department of Defense, or other federal, state, or local government agencies, of KBR and its affiliates from their ability to contract with government agencies.
If a criminal or civil violation is found, KBR and its affiliates could be debarred from receiving future contracts and also from receiving new orders under existing contracts to provide services to any such entities, which would naturally include current KBR contracts in Iraq and Afghanistan.
And this would be no small penalty for Halliburton. According to the company's SEC filing for the quarter ending June 30, 2006, during 2005, "KBR and its affiliates had revenue of approximately $6.6 billion from its government contracts work with agencies of the United States or state or local governments."
"Suspension or debarment from the government contracts business," the filing states, "would have a material adverse effect on the business, results of operations, and cash flows of KBR and Halliburton."
The investigations could also result in third-party claims against the company, "which may include claims for special, indirect, derivative or consequential damages, damage to our business or reputation, loss of, or adverse effect on, cash flow, assets, goodwill, results of operations, business, prospects, profits or business value, adverse consequences on our ability to obtain or continue financing for current or future projects or claims by directors, officers, employees, affiliates, advisors, attorneys, agents, debt holders or other interest holders or constituents of us or our subsidiaries," the SEC filing says.
In addition, Halliburton "could incur costs and expenses for any monitor required by or agreed to with governmental authority to review our continued compliance with FCPA law," it notes.
On another front, during the investigation into the Bonny Island project, the SEC filing states, "information has been uncovered suggesting that Mr. Stanley and other former employees may have engaged in coordinated bidding with one or more competitors on certain foreign construction projects, and that such coordination possibly began as early as the mid-1980s."
On the basis of this information, the DOJ is reportedly seeking to determine the nature of any improper bidding practices, whether antitrust laws were violated, and whether Halliburton employees have received payments as a result of such bidding practices on foreign projects.
If violations of antitrust laws are found to have occurred, according to Halliburton's SEC filing, "the range of possible penalties includes criminal fines, which could range up to the greater of $10 million in fines per count for a corporation, or twice the gross pecuniary gain or loss, and treble civil damages in favor of any persons financially injured by such violations."
"Criminal prosecutions," the filing states, "under applicable laws of relevant foreign jurisdictions and civil claims by, or relationship issues with customers, are also possible."
As part of the investigation, the SEC has issued subpoenas seeking information regarding current and former agents used in connection with projects over the past 20 years located in and outside of Nigeria in which MW Kellogg Company, MW Kellogg, Ltd, KBR or their joint ventures, as well as the Halliburton energy services business, were participants.
Halliburton says it has "produced documents to the SEC and the DOJ both voluntarily and pursuant to company subpoenas from the files of numerous officers of Halliburton and KBR, including current and former executives of Halliburton and KBR, and we are making our employees available to the SEC and the DOJ for interviews."
In addition, the SEC has issued a subpoena to Jack Stanley, and to other current and former KBR employees, former executive officers of KBR, and at least one subcontractor of KBR.
The DOJ has invoked its authority under a sitting grand jury to issue subpoenas for the purpose of obtaining information abroad, and other partners in TSKJ have provided information to the DOJ and the SEC related to the investigations.
Back in May of 2003, Halliburton was forced to admit to the SEC that it had paid $2.4 million in bribes to officials of Nigeria's Federal Inland Revenue Service in 2001 and 2002 "to obtain favorable tax treatment."
Of course Halliburton pointed the finger of blame at a couple of lowly employees for bribing the Nigerian IRS, and claimed that none of its senior officers were involved in the bribery plot. But as the Houston Chronicle pointed out at the time, "left unanswered is how a 'low-level employee' could channel that much money from the company to the pockets of a corrupt official."
The current investigation into the payment of $170 million in bribes could be near to a conclusion because Halliburton seems to be ready to throw in the towel.
"We have reason to believe," Halliburton said in its SEC filing, "based on the ongoing investigations, that payments may have been made to Nigerian officials."
So if Dick Cheney goes missing again, it probably just means that he's off being fitted for a new Halliburton uniform - a striped jumpsuit.
Halliburton Contracts Illegal - But Bush Busts The Whistleblower
Evelyn Pringle August 31, 2005
In October, 2004, Bunnatine Greenhouse, a top military official responsible for making sure the Army Corps of Engineers complies with contracting rules, came forward and revealed that top Pentagon officials showed improper favoritism to Halliburton when awarding military contracts.
The allegations made by this official were first reported by Time Magazine.
Greenhouse said that when the Pentagon awarded Halliburton a five-year $7 billion contract, it pressured her to withdraw her objections, actions which she claimed were unprecedented in her experience.
In a letter from her attorney's office, Greenhouse told members of Congress that the Army gave the no-bid contracts to Halliburton's subsidiary KBR for political reasons.
Greenhouse charged that contracts were approved over her reservations, some of which were handwritten on the original contracts, and extensions of contracts were awarded because underlings signed them in collusion with senior officials without her knowledge.
A five-year Iraq contract was awarded less than a month before the invasion, under a clause which allowed for no-bid contracts in the case of a "compelling emergency." Greenhouse contends that she objected to the 5-year terms of the contract, questioning the probability of an emergency lasting for five years.
When her superiors signed off on the contract and sent it back for her approval, she wrote the following message next to her signature: "I caution that extending this sole-source effort beyond a one year period could convey an invalid perception that there is not strong intent for a limited competition."
Federal contracting rules say contracts must be awarded by career civil servants, not political appointees. Greenhouse claimed the Army ignored this requirement when giving contracts to Halliburton and violated "the integrity of the federal contracting program as it relates to a major defense contractor."
"Employees of the U.S. government have taken improper action that favored KBR's interests," Greenhouse wrote. "This conduct has violated specific regulations and calls into question the independence" of the contracting process, she said.
She also said the Army altered documents in order to justify the Halliburton's contract work in the Balkans. In a letter from Michael Kohn, Greenhouse's attorney, to then acting Army Secretary Les Brownlee, Greenhouse charged that on a Balkan's contract, a deputy assistant secretary of the Army had ordered changes in documents to legitimize the contract "for political reasons."
According to Kohn's letter, in January 2002, Greenhouse sent an investigative team to review the Halliburton operation in the Balkans. After which she reported: "The general feeling in the theater is that the contractor (KBR) is 'out of control'" and was able to manipulate Corps of Engineer officials.
The Balkan's contract was scheduled to expire no later than May 27, 2004. However, it was extended without Greenhouse's knowledge, after a search for other contractors was stopped. Although the contract was originally awarded a "compelling emergency" exception, the extended contract was awarded under another exception, that KBR was the "one and only source."
Nothing was ever done about the illegal contracts awarded to Halliburton. Instead, less than a year after she reported these blatant violations of procurement law, Bush decided to bust the Whistleblower, Ms Greenhouse.
The August 29, 2005 New York Times reports: "A top Army contracting official who criticized a large, noncompetitive contract with the Halliburton Company for work in Iraq was demoted Saturday for what the Army called poor job performance.
"The official, Bunnatine H. Greenhouse," the Times wrote, "has worked in military procurement for 20 years and for the past several years had been the chief overseer of contracts at the Army Corps of Engineers, the agency that has managed much of the reconstruction work in Iraq."
Ms Greenhouse's lawyer, Michael Kohn, "called the action an "obvious reprisal" for the strong objections she raised in 2003 to a series of corps decisions involving the Halliburton subsidiary Kellogg Brown & Root, which has garnered more than $10 billion for work in Iraq," according to the Times.
Whistleblower Told The Truth
When Cheney appeared on NBC's Meet the Press on Sept 14, 2003, he arrogantly stated: "And as vice president, I have absolutely no influence of, involvement of, knowledge of in any way, shape or form of contracts led by the Corps of Engineers or anybody else in the federal government."
And when Cheney was specifically asked whether he had known about Halliburton's no-bid contract, he said, "I don't know any of the details of the contract because I deliberately stayed away from any information on that."
Those statements were proven false on June, 2004, by an article in Time Magazine entitled, “The Paper Trail: Did Cheney Okay a Deal?”
The truth is, Bush and Cheney both were informed that Halliburton would get the contract before it was ever awarded. Time Magazine quoted an email sent by the Army Corps of Engineers, that said the contract for construction of oil pipelines was approved by Under Secretary of Defense Douglas Feith “contingent on informing WH tomorrow. We anticipate no issues since action has been coordinated w VP’s [Vice President’s] office.”
The author of the email, Stephen Browning, said in an interview that he wrote the memo after he and retired Lt Gen Jay Garner met with Douglas Feith about plans to declassify the earlier $1.8 million contract with the Halliburton.
According to Browning, Feith told him that he had already informed Cheney's office.
The email was dated March 5, 2003, and Halliburton was awarded the contract three days later without allowing for any bids from other companies.
The email totally contradicts Cheney's televised claims that he had no involvement in Halliburton's contracts whatsoever and proves that Cheney and the White House played a key role in boosting Halliburton into the number one war profiteering position in Iraq.
When confronted with the email, Bush dismissed it by saying the Corp of Engineers was just trying to give the Vice President's office a heads-up on the process. Now I suppose people's opinions could vary as to what the email actually meant, depending on what the definition of co-or-di-na-ted is.
No Political Appointees Were Involved - None
In the heat of the debate over Halliburton contracts, some readers may recall a news conference, where Richard Boucher, spokesman for State Department at the time, explained how decisions are made on military contracts. "The decisions are made by career procurement officials. There's a separation, a wall, between them and political-level questions when they're doing the contracts," he said.
Then the chief counsel of the Army Corp of Engineers appeared on "60 Minutes" where he denied that there was any involvement by political appointees in the Halliburton contract. He specifically said: "The procurement of this particular contract was done by career civil servants."
We also heard from a spokesman from the Department of Defense, Major Joseph Yoswa, who claimed safeguards existed to insure that the process was free of favoritism. "Most important,” he said, “career civil servants, not political appointees, make final decisions on contracts," according to The New Yorker.
Next Halliburton spokeswoman, Wendy Hall, stepped up to the mike in August, 2003, and said Halliburton's military contracts were awarded "not by politicians but by government civil servants, under strict guidelines."
Finally, during a hearing on March 11, 2004, before the Government Reform Committee, six senior government officials from the CPA and DOD testified under oath, and were each asked the following question by Republican Committee Chairman, Tom Davis:
"I want to get this on the record, and everybody is under oath. Have you or anyone in your office ever discussed with the Vice President or with his office the award of a contract for Iraqi reconstruction prior to any contract being awarded?"
Every single one of those six officials said "no sir," which means every single one of them lied under oath. I may not know how Cheney got this number of people to lie under oath, but the fact is he did it and nothing was ever done about it.
Three months after the hearing, the June 14, 2004, LA Times reported: "The Pentagon admitted that a $7 billion no-bid contract to extinguish oil fires in Iraq was awarded to Halliburton after a political appointee from the Bush administration recommended the company for the job."
The political appointee referred to was Michael Mobbs, a special assistant to Undersecretary of Defense Douglas Feith.
During the Summer of 2002, the Times wrote, "Mobbs was in charge of the Pentagon's Energy Infrastructure Planning Group (EIPG) to develop a plan for reconstructing Iraq's oil industry."
This is how the Halliburton contract got set up. In November 2002, a Pentagon group led by Mobbs (under Cheney's instruction), came up with the idea to pay Halliburton $1.9 million to develop a secret contingency plan for handling the Iraqi oil industry. Its important to understand that it was this order to develop a contingency plan, that ultimately led to the firm being awarded the $7 billion oil infrastructure contract.
To ensure that Halliburton would get the contract, Cheney used the exact same strategy that he developed back when he was secretary of defense during the first Bush Presidency. The way it works is actually quite simple. Halliburton gets funding to create a market for its services and then it becomes the logical company to carry out the plan when the time for awarding contracts rolls around.
I'm sure no one needs reminding of how well this plan paid off for Cheney when he left office in 1992 and soon thereafter became very gainfully employed with Halliburton. Ten years later, his method of contract manipulation worked like a charm again.
According to testimony at a House oversight hearing, by GAO investigator, William Woods, it was discovered that Michael Mobbs even acknowledged in a memo that the $1.9 million task order would uniquely position Halliburton to win the far larger sole-source contract to actually do the restoration work to Iraqi oil fields.
In fact, Mobbs himself later admitted that he had described the contingency plan in a meeting of the Deputies' Committee to an audience that including Cheney's chief of staff, Scooter Libby, Rice's deputy national security adviser, Steven Hadley (guy who took the fall for the 16 words about uranium in Africa in Bush's state of the union address), the deputy secretaries of state and defense, and the deputy director of the CIA.
On March 8, 2003, Halliburton was awarded the $7 billion contract and the war began on March 20, 2003.
When the topic of the no-bid contract came up in the media, Bush claimed that it was merely a deal to put out oil well fires. However, Pentagon officials were soon forced to admit that it was a very big deal and would in fact amount to billions of dollars for Halliburton. But even then, the story of the day was that the contract was only temporary and would be replaced by competitive bidding shortly.
After months of senseless delays, new contracts were finally awarded on January 16, 2004 but once again, Halliburton netted the top prize. The Parsons Corporation was awarded an $800 million contract, but the $1.2 billion contract went to Halliburton.
During a June 8, 2004, briefing to staff members of the House Committee on Government Reform, Mobbs and Pentagon officials were asked about the specific details of the contracting procedure that was employed with Halliburton.
Before making a final decision, Mobbs admitted that he briefed top officials from several executive agencies, in the Deputies Committee, to make sure they had no objections. According to Mobbs, White House Staff members were also at the meeting. After that meeting, Mobb's said that a White House official told Douglas Feith that the group did not object.
These disclosures prove that Cheney and Bush were informed about the Halliburton contracts on at least two key occasions during the procurement process.
So we've got all these high level officials plotting together for 6 months to set up a plan to hand Halliburton billions of dollars, and Bush and Cheney expect us to believe that not one of these guys uttered a word about contracts to either one of them.
And the media is no help.
During the Clinton administration, it chased after a stupid story about a 20-year-old land deal involving $100,000 (hardly the crime of the century) for 8 years and to this day, I still have never figured out what they were expecting to find exactly. I do know one thing, it wasn't that the Clintons and their cronies were accused of funneling billions of tax dollars through the bodies of our slain and injured young soldiers like what is going on right now in the Bush administration.
The media in fact spends very little effort and time investigating and reporting on the real crimes within the current administration, even when they involve fraud and corruption by officials at every level of government who are openly handing our tax dollars to war profiteers to the tune of a billion dollars a month.
I often find myself wondering whether the mainstream media has been bought off entirely.
Who's Next In Line For Retaliation?
The question is, who's next? Greenhouse wasn't the only official to report on the illegal procurement practices of the Bush administration. According to a report on an investigation of Halliburton by the Government Accounting Office titled, Rebuilding Iraq: Fiscal Year 2003 Contract Award Procedures and Management Challenges, contracts worth billions of dollars were awarded to Halliburton without full and open competition, including Iraq's oil infrastructure contract.
The GAO determined that the administration had violated procurement law when it issued various task orders under already existing contracts and that out of 11 task orders examined, more than half were awarded outside the scope of their contracts.
As an example of the inept procurement process, the GAO report described how "a military review board approved a six-month renewal contract with Halliburton worth $587 million in just ten minutes and based on only six pages of documentation."
After wasting millions of tax dollars conducting the investigation, the GAO concluded that the contracts should have never been awarded to the company in the first place and yet Halliburton remains the number one contractor in Iraq. Go figure.
In October, 2004, Bunnatine Greenhouse, a top military official responsible for making sure the Army Corps of Engineers complies with contracting rules, came forward and revealed that top Pentagon officials showed improper favoritism to Halliburton when awarding military contracts.
The allegations made by this official were first reported by Time Magazine.
Greenhouse said that when the Pentagon awarded Halliburton a five-year $7 billion contract, it pressured her to withdraw her objections, actions which she claimed were unprecedented in her experience.
In a letter from her attorney's office, Greenhouse told members of Congress that the Army gave the no-bid contracts to Halliburton's subsidiary KBR for political reasons.
Greenhouse charged that contracts were approved over her reservations, some of which were handwritten on the original contracts, and extensions of contracts were awarded because underlings signed them in collusion with senior officials without her knowledge.
A five-year Iraq contract was awarded less than a month before the invasion, under a clause which allowed for no-bid contracts in the case of a "compelling emergency." Greenhouse contends that she objected to the 5-year terms of the contract, questioning the probability of an emergency lasting for five years.
When her superiors signed off on the contract and sent it back for her approval, she wrote the following message next to her signature: "I caution that extending this sole-source effort beyond a one year period could convey an invalid perception that there is not strong intent for a limited competition."
Federal contracting rules say contracts must be awarded by career civil servants, not political appointees. Greenhouse claimed the Army ignored this requirement when giving contracts to Halliburton and violated "the integrity of the federal contracting program as it relates to a major defense contractor."
"Employees of the U.S. government have taken improper action that favored KBR's interests," Greenhouse wrote. "This conduct has violated specific regulations and calls into question the independence" of the contracting process, she said.
She also said the Army altered documents in order to justify the Halliburton's contract work in the Balkans. In a letter from Michael Kohn, Greenhouse's attorney, to then acting Army Secretary Les Brownlee, Greenhouse charged that on a Balkan's contract, a deputy assistant secretary of the Army had ordered changes in documents to legitimize the contract "for political reasons."
According to Kohn's letter, in January 2002, Greenhouse sent an investigative team to review the Halliburton operation in the Balkans. After which she reported: "The general feeling in the theater is that the contractor (KBR) is 'out of control'" and was able to manipulate Corps of Engineer officials.
The Balkan's contract was scheduled to expire no later than May 27, 2004. However, it was extended without Greenhouse's knowledge, after a search for other contractors was stopped. Although the contract was originally awarded a "compelling emergency" exception, the extended contract was awarded under another exception, that KBR was the "one and only source."
Nothing was ever done about the illegal contracts awarded to Halliburton. Instead, less than a year after she reported these blatant violations of procurement law, Bush decided to bust the Whistleblower, Ms Greenhouse.
The August 29, 2005 New York Times reports: "A top Army contracting official who criticized a large, noncompetitive contract with the Halliburton Company for work in Iraq was demoted Saturday for what the Army called poor job performance.
"The official, Bunnatine H. Greenhouse," the Times wrote, "has worked in military procurement for 20 years and for the past several years had been the chief overseer of contracts at the Army Corps of Engineers, the agency that has managed much of the reconstruction work in Iraq."
Ms Greenhouse's lawyer, Michael Kohn, "called the action an "obvious reprisal" for the strong objections she raised in 2003 to a series of corps decisions involving the Halliburton subsidiary Kellogg Brown & Root, which has garnered more than $10 billion for work in Iraq," according to the Times.
Whistleblower Told The Truth
When Cheney appeared on NBC's Meet the Press on Sept 14, 2003, he arrogantly stated: "And as vice president, I have absolutely no influence of, involvement of, knowledge of in any way, shape or form of contracts led by the Corps of Engineers or anybody else in the federal government."
And when Cheney was specifically asked whether he had known about Halliburton's no-bid contract, he said, "I don't know any of the details of the contract because I deliberately stayed away from any information on that."
Those statements were proven false on June, 2004, by an article in Time Magazine entitled, “The Paper Trail: Did Cheney Okay a Deal?”
The truth is, Bush and Cheney both were informed that Halliburton would get the contract before it was ever awarded. Time Magazine quoted an email sent by the Army Corps of Engineers, that said the contract for construction of oil pipelines was approved by Under Secretary of Defense Douglas Feith “contingent on informing WH tomorrow. We anticipate no issues since action has been coordinated w VP’s [Vice President’s] office.”
The author of the email, Stephen Browning, said in an interview that he wrote the memo after he and retired Lt Gen Jay Garner met with Douglas Feith about plans to declassify the earlier $1.8 million contract with the Halliburton.
According to Browning, Feith told him that he had already informed Cheney's office.
The email was dated March 5, 2003, and Halliburton was awarded the contract three days later without allowing for any bids from other companies.
The email totally contradicts Cheney's televised claims that he had no involvement in Halliburton's contracts whatsoever and proves that Cheney and the White House played a key role in boosting Halliburton into the number one war profiteering position in Iraq.
When confronted with the email, Bush dismissed it by saying the Corp of Engineers was just trying to give the Vice President's office a heads-up on the process. Now I suppose people's opinions could vary as to what the email actually meant, depending on what the definition of co-or-di-na-ted is.
No Political Appointees Were Involved - None
In the heat of the debate over Halliburton contracts, some readers may recall a news conference, where Richard Boucher, spokesman for State Department at the time, explained how decisions are made on military contracts. "The decisions are made by career procurement officials. There's a separation, a wall, between them and political-level questions when they're doing the contracts," he said.
Then the chief counsel of the Army Corp of Engineers appeared on "60 Minutes" where he denied that there was any involvement by political appointees in the Halliburton contract. He specifically said: "The procurement of this particular contract was done by career civil servants."
We also heard from a spokesman from the Department of Defense, Major Joseph Yoswa, who claimed safeguards existed to insure that the process was free of favoritism. "Most important,” he said, “career civil servants, not political appointees, make final decisions on contracts," according to The New Yorker.
Next Halliburton spokeswoman, Wendy Hall, stepped up to the mike in August, 2003, and said Halliburton's military contracts were awarded "not by politicians but by government civil servants, under strict guidelines."
Finally, during a hearing on March 11, 2004, before the Government Reform Committee, six senior government officials from the CPA and DOD testified under oath, and were each asked the following question by Republican Committee Chairman, Tom Davis:
"I want to get this on the record, and everybody is under oath. Have you or anyone in your office ever discussed with the Vice President or with his office the award of a contract for Iraqi reconstruction prior to any contract being awarded?"
Every single one of those six officials said "no sir," which means every single one of them lied under oath. I may not know how Cheney got this number of people to lie under oath, but the fact is he did it and nothing was ever done about it.
Three months after the hearing, the June 14, 2004, LA Times reported: "The Pentagon admitted that a $7 billion no-bid contract to extinguish oil fires in Iraq was awarded to Halliburton after a political appointee from the Bush administration recommended the company for the job."
The political appointee referred to was Michael Mobbs, a special assistant to Undersecretary of Defense Douglas Feith.
During the Summer of 2002, the Times wrote, "Mobbs was in charge of the Pentagon's Energy Infrastructure Planning Group (EIPG) to develop a plan for reconstructing Iraq's oil industry."
This is how the Halliburton contract got set up. In November 2002, a Pentagon group led by Mobbs (under Cheney's instruction), came up with the idea to pay Halliburton $1.9 million to develop a secret contingency plan for handling the Iraqi oil industry. Its important to understand that it was this order to develop a contingency plan, that ultimately led to the firm being awarded the $7 billion oil infrastructure contract.
To ensure that Halliburton would get the contract, Cheney used the exact same strategy that he developed back when he was secretary of defense during the first Bush Presidency. The way it works is actually quite simple. Halliburton gets funding to create a market for its services and then it becomes the logical company to carry out the plan when the time for awarding contracts rolls around.
I'm sure no one needs reminding of how well this plan paid off for Cheney when he left office in 1992 and soon thereafter became very gainfully employed with Halliburton. Ten years later, his method of contract manipulation worked like a charm again.
According to testimony at a House oversight hearing, by GAO investigator, William Woods, it was discovered that Michael Mobbs even acknowledged in a memo that the $1.9 million task order would uniquely position Halliburton to win the far larger sole-source contract to actually do the restoration work to Iraqi oil fields.
In fact, Mobbs himself later admitted that he had described the contingency plan in a meeting of the Deputies' Committee to an audience that including Cheney's chief of staff, Scooter Libby, Rice's deputy national security adviser, Steven Hadley (guy who took the fall for the 16 words about uranium in Africa in Bush's state of the union address), the deputy secretaries of state and defense, and the deputy director of the CIA.
On March 8, 2003, Halliburton was awarded the $7 billion contract and the war began on March 20, 2003.
When the topic of the no-bid contract came up in the media, Bush claimed that it was merely a deal to put out oil well fires. However, Pentagon officials were soon forced to admit that it was a very big deal and would in fact amount to billions of dollars for Halliburton. But even then, the story of the day was that the contract was only temporary and would be replaced by competitive bidding shortly.
After months of senseless delays, new contracts were finally awarded on January 16, 2004 but once again, Halliburton netted the top prize. The Parsons Corporation was awarded an $800 million contract, but the $1.2 billion contract went to Halliburton.
During a June 8, 2004, briefing to staff members of the House Committee on Government Reform, Mobbs and Pentagon officials were asked about the specific details of the contracting procedure that was employed with Halliburton.
Before making a final decision, Mobbs admitted that he briefed top officials from several executive agencies, in the Deputies Committee, to make sure they had no objections. According to Mobbs, White House Staff members were also at the meeting. After that meeting, Mobb's said that a White House official told Douglas Feith that the group did not object.
These disclosures prove that Cheney and Bush were informed about the Halliburton contracts on at least two key occasions during the procurement process.
So we've got all these high level officials plotting together for 6 months to set up a plan to hand Halliburton billions of dollars, and Bush and Cheney expect us to believe that not one of these guys uttered a word about contracts to either one of them.
And the media is no help.
During the Clinton administration, it chased after a stupid story about a 20-year-old land deal involving $100,000 (hardly the crime of the century) for 8 years and to this day, I still have never figured out what they were expecting to find exactly. I do know one thing, it wasn't that the Clintons and their cronies were accused of funneling billions of tax dollars through the bodies of our slain and injured young soldiers like what is going on right now in the Bush administration.
The media in fact spends very little effort and time investigating and reporting on the real crimes within the current administration, even when they involve fraud and corruption by officials at every level of government who are openly handing our tax dollars to war profiteers to the tune of a billion dollars a month.
I often find myself wondering whether the mainstream media has been bought off entirely.
Who's Next In Line For Retaliation?
The question is, who's next? Greenhouse wasn't the only official to report on the illegal procurement practices of the Bush administration. According to a report on an investigation of Halliburton by the Government Accounting Office titled, Rebuilding Iraq: Fiscal Year 2003 Contract Award Procedures and Management Challenges, contracts worth billions of dollars were awarded to Halliburton without full and open competition, including Iraq's oil infrastructure contract.
The GAO determined that the administration had violated procurement law when it issued various task orders under already existing contracts and that out of 11 task orders examined, more than half were awarded outside the scope of their contracts.
As an example of the inept procurement process, the GAO report described how "a military review board approved a six-month renewal contract with Halliburton worth $587 million in just ten minutes and based on only six pages of documentation."
After wasting millions of tax dollars conducting the investigation, the GAO concluded that the contracts should have never been awarded to the company in the first place and yet Halliburton remains the number one contractor in Iraq. Go figure.
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