AP: 10 U.S. Contractors in Iraq Penalized

[mulethree]

http://story.news.yahoo.com/news?tmpl=story&u=/ap/20040426/ap_on_re_us/iraq_punished_contractors_6

By MATT KELLEY, Associated Press Writer

WASHINGTON - Ten companies with billions of dollars in U.S. contracts for Iraq (news - web sites) reconstruction have paid more than $300 million in penalties since 2000 to resolve allegations of bid rigging, fraud, delivery of faulty military parts and environmental damage.

The United States is paying more than $780 million to one British firm that was convicted of fraud on three federal construction projects and banned from U.S. government work during 2002, according to an Associated Press review of government documents.

A Virginia company convicted of rigging bids for American-funded projects in Egypt also has been awarded Iraq contracts worth hundreds of millions. And a third firm found guilty of environmental violations and bid rigging won U.S. Army approval for a subcontract to clean up an Iraqi harbor.

Seven other companies with Iraq reconstruction contracts have agreed to pay financial penalties without admitting wrongdoing. Together, the 10 companies have paid to resolve 30 alleged violations in the past four years. Six paid penalties more than once. But the companies have been awarded $7 billion in Iraq reconstruction contracts

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We've got ourselves a law-enforcement problem, crooks not going to jail and staying in business while we have millions in jail for much lesser offenses. How many of you would agree to pay a financial penalty without admitting wrongdoing?

[coda]

1. See Naomi Klein's article " Risky Business " from The Nation

The Nation

Risky Business
by Naomi Klein

Posted December 18, 2003


<snip>

At the Microsoft-sponsored cocktail reception in the Galaxy Ballroom that evening, Robert Dees urges us "to network on behalf of the people of Iraq." I follow orders and ask Lempres what happens if "the people of Iraq" decide to seize back their economy from the US firms he has so generously insured. Who bails out OPIC? "In theory," he says, "the US Treasury stands behind us." That means the US taxpayer. Yes, them again: The same people who have already paid Halliburton, Bechtel et al. to make a killing on Iraq's reconstruction would have to pay these companies again, this time in compensation for their losses. While the enormous profits being made in Iraq are strictly private, it turns out that the entire risk is being shouldered by the public.


<snip>


The reconstruction of Iraq has emerged as a vast protectionist racket, a neocon New Deal that transfers limitless public funds --in contracts, loans and insurance--to private firms, and even gets rid of the foreign competition to boot, under the guise of "national security." Ironically, these firms are being handed this corporate welfare so they can take full advantage of CPA-imposed laws that systematically strip Iraqi industry of all its protections, from import tariffs to limits on foreign ownership. Michael Fleisher, head of private-sector development for the CPA, recently explained to a group of Iraqi businesspeople why these protections had to be removed. "Protected businesses never, never become competitive," he said. Quick, somebody tell OPIC and Paul Wolfowitz.



The issue of US double standards comes up again at the conference (ReBuilding Iraq 2) when a CPA representative takes the podium. A legal adviser to Bremer, Carole Basri has a simple message: Reconstruction is being sabotaged by Iraqi corruption. "My fear is that corruption will be the downfall," she says ominously, blaming the problem on "a thirty-five-year gap in knowledge" in Iraq that has made Iraqis "not aware of current accounting standards and ideas on anticorruption." Foreign investors, she said, must engage in "education--bring people up to world-class standards."



It's hard to imagine what world-class standards she's referring to, or who, exactly, will be doing this educating. Halliburton, with its accounting scandals back home and its outrageous overbilling for gasoline in Iraq? The CPA, with its two officers under investigation for bribetaking, and nonexistent fiscal oversight? On the final day of ReBuilding Iraq 2, the cover headline in our complimentary copies of the Financial Times (a conference sponsor) is "Boeing linked to Perle investment fund." Perhaps Richard Perle--who supported Boeing's $18 billion refueling-tanker deal and extracted $20 million from Boeing for his investment fund--can teach Iraq's politicians to stop soliciting "commissions" in exchange for contracts.



For the Iraqi expats in the audience Basri's is a tough lecture to sit through. "To be honest," says Ed Kubba, a consultant and board member of the American Iraqi Chamber of Commerce, "I don't know where the line is between business and corruption." He points to US companies subcontracting huge taxpayer-funded reconstruction jobs for a fraction of what they are getting paid, then pocketing the difference. "If you take $10 million from the US government and sub the job out to Iraqi businesses for a quarter-million, is that business, or is that corruption?"




more.....

http://www.thenation.com/doc.mhtml%3Fi=20040105&s=klein

[Moderator]

2. Duplicate

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x511131