Contract Award: $18M to Procure 6 Additional Months of Contractor Logistics in Iraq

January 7, 2014 | CONTRACTS

Bell Helicopter Textron, Inc, Hurst, Texas, was awarded an $18,556,810 modification to contract W58RGZ-12-C-0030 to procure six additional months of contractor logistics support for Bell 407, Huey, Jet Ranger, and OH-58A&C helicopters. Fiscal 2014 funds in the amount of $18,556,810 were obligated at the time of the award. The estimated completion date is Aug. 8, 2014. Work will be performed in Al Taji, Iraq, and Piney Flats, Tenn.

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Reducing Waste in Wartime Contracting

January 1, 2014 | Justice Abroad

Reducing Waste in Wartime Contracting At least one in every six dollars of U.S. spending for contracts and grants in Iraq and Afghanistan over the past decade, or more than $30 billion, has been wasted. And at least that much could again turn into waste if the host governments are unable or unwilling to sustain U.S.-funded projects after our involvement ends.

Those sobering but conservative numbers are a key finding of the bipartisan Commission on Wartime Contracting in Iraq and Afghanistan, which will submit its report to Congress on Wednesday. All eight commissioners agree that major changes in law and policy are needed to avoid confusion and waste in the next contingency, whether it involves armed struggle overseas or response to disasters at home.

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Tens of billions of taxpayer dollars have been wasted through poor planning, vague and shifting requirements, inadequate competition, substandard contract management and oversight, lax accountability, weak interagency coordination, and subpar performance or outright misconduct by some contractors and federal employees. Both government and contractors need to do better.Our final report shows that the costs of contracting waste and fraud extend beyond the disservice to taxpayers. The costs include diminishing for U.S. military, diplomatic and development efforts; fostering corruption in host countries; and undermining U.S. standing and influence overseas.

The contractor workforce in Iraq and Afghanistan has at times exceeded 260,000 people and has sometimes outnumbered U.S. military forces in theater. The roughly 1-to-1 ratio sustained over the years reflects a basic operating truth that Defense Department officials expressed in testimony to the commission: The United States cannot conduct large or prolonged military operations without contractor support.

Defense doctrine has for more than 20 years held that contractors are part of the “total force” to be deployed in contingency operations. Nonetheless, the United States embarked on operations in Afghanistan in 2001 and in Iraq in 2003 without adequate planning or contract-management personnel to handle the enormous scale and numbers of contracts. In that sense and in others, America is over-relying on contractors.

Poor planning, federal understaffing and over-reliance led to billions of dollars of contracts awarded without effective competition, legions of foreign subcontractors not subject to U.S. laws, private security guards performing tasks that can easily escalate into combat, unprosecuted instances of apparent fraud, and projects that are unlikely to be sustained by the governments of Iraq and Afghanistan.

Projects that are or may be unsustainable are a serious problem. For instance, U.S. taxpayers spent $40 million on a prison that Iraq did not want and that was never finished. U.S. taxpayers poured $300 million into a Kabul power plant that requires funding and technical expertise beyond the Afghan government’s capabilities. Meanwhile, a federal official testified to the commission that an $11.4 billion program of facilities for the Afghan National Security Forces is “at risk” of unsustainability.

Iraqi Based Construction Company Pays $2.7 Million to US for Alleged False Claims in Bribery Scheme

November 11, 2013 | Justice Abroad

Iraqi Consultants and Construction Bureau (ICCB) has paid the U.S. $2.7 million to resolve allegations that it violated the False Claims Act by bribing a U.S. government official to obtain U.S. government contracts in Iraq, the Department of Justice announced. ICCB is a privately owned construction company headquartered in Baghdad, Iraq.

“Bribery will not be tolerated in government contracting,” said Assistant Attorney General for the Justice Department’s Civil Division Stuart F. Delery. “We will ensure that government contracts are awarded based on merit and pursue allegations of fraudulently procured contracts wherever they occur.”

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The government alleged that, from 2007 to 2008, ICCB paid bribes to Army Corps of Engineers procurement official John Salama Markus, 41, of Nazareth, Pa., to obtain information that gave it an advantage in bidding on several construction contracts with the Department of Defense in Iraq. The contracts supported reconstruction efforts involving the Iraq war, including infrastructure and security projects and the building of medical facilities and schools. ICCB then knowingly overcharged the U.S. for services provided under the contracts, according to the government’s allegation.

“It is offensive that anyone would see projects to promote stability, health and education in a rebuilding country as a way to make illegal cash on the side,” said U.S. Attorney for the District of New Jersey Paul J. Fishman. “We will not abide companies paying to play in such a system.”

“The Defense Criminal Investigative Service (DCIS) is committed to protecting the integrity of the Defense acquisition process from personal and corporate avarice,” said Special Agent in Charge, DCIS Northeast Field Office Craig Rupert. “Ensuring the proper use of U.S. taxpayers’ dollars and preventing contract fraud is in our nation’s interest and remains a priority.”

The settlement is part of a larger investigation initiated by the U.S. Attorney’s Office for the District of New Jersey. As part of that investigation, Markus pleaded guilty on Sept. 7, 2012, to wire fraud, money laundering and failure to report a foreign bank account in connection with more than $50 million in contracts awarded to foreign companies in Gulf Region North, Iraq. Markus was sentenced to 13 years in prison on March 12, 2013, in Newark, N.J., federal court.

The investigation is being handled by the U.S. Attorney’s Office for the District of New Jersey and the Civil Division’s Commercial Litigation Branch, in cooperation with the Defense Criminal Investigative Service, the Major Procurement Fraud Unit of the Army’s Criminal Investigation Command, the Criminal Investigative Division of the Internal Revenue Service and the Department of Homeland Security. The claims resolved by the settlement are allegations only; there has been no determination of liability.