KBR’s contracts are classified? What is the DoD hiding?

Army Secretary says KBR contract still classified

Published: Tuesday, September 01, 2010, 6:41  PM
Julie Sullivan, The Oregonian Julie Sullivan, The Oregonian

The Army’s combat mission in Iraq has ended, but details of the no-bid contract it signed with Kellogg, Brown and Root before the war started remain classified.

On Tuesday, Sec. of the Army John McHugh  said he would not release the contract’s specifics that holds taxpayers — and not — responsible for any harm to a soldier or civilian as it worked restoring Iraqi oil flows in 2003.

But in a two-page response to U. S. ’s demand for details, McHugh reveals how unusual the Army’s arrangement with the former subsidiary was.

“Apart from the Restore Iraqi Oil contract with , no other Army contracts awarded since 2001….contain indemnification provisions,” McHugh wrote. “The Army has made no payments as a result of indemnification provisions with contractors supporting contingency operations in Iraq. Afghanistan or anywhere else.”

In July, Blumenauer demanded the Army produce the contract after ’s claims of immunity emerged in a U.S. District Court case in Portland. Chris Heinrich, a attorney, said in a sworn deposition that after signed its Restore Iraqi Oil contract and as the March 2003 invasion was taking place, he went to the Pentagon himself to demand immunity for .

He told Army officials that refused to do the restoration without “broad coverage.” required that taxpayers — not the war contractor — pay for any property damage, injury or death at any site. That applies even if the harm resulted from negligence. eventually billed the government $2.5 billion for the work.

But it could cost taxpayers millions more. Dozens of National Guard soldiers from four states have sued since 2008 claiming the contractor knowingly or negligently exposed them to a cancer-causing chemical at the water treatment plant. Among them: 26 Oregon Army National Guard soldiers who arrived at the Iraq plant in late May 2003. They claim breathing, stomach and skin issues result from their exposure to hexavalent chromium.

Blumenauer expressed disbelief that the specifics would remain classified — even after combat operations ceased.

“Who is it precisely we’re keeping information from?” he asked. “It appears the only reason to invoke this classification at this point is to keep information from the American public.”

Blumenauer said he is drafting a bill requiring such an arrangement be reported to Congress in the future. “There ought to be someone looking over their shoulders.”

Meanwhile, the National Guard soldiers’ case is moving forward in Portland. Monday, U.S. District Magistrate Judge Paul Papak denied a motion to dismiss.

Spokeswoman Heather Browne said KRB disagrees with the judge and may appeal. She restated ’s stand that the Army was responsible for safety at the plant. (click HERE for original article)

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Another KBR employee Daniel Freeman pleads guilty to taking bribes (updated)

(photo courtesy of Facebook)

Updated: August 28, 2010 – The Federal Bureau of Investigation Department of Justice Press Release with more information.

Updated: August 27, 2010 – Bloomberg updated this article with ’s comments from Heather Browne verifying was in fact a former employee. Click HERE for the updated version.

Note: Apparently did in fact work for when he committed these crimes by accepting bribes from subcontractors. The below information was sent to me. It is reportedly from a employee roster generated during the time he was committing his crimes.  I redacted the date of birth. No matter what Heather Browne does or doesn’t say, which is bullshit either way, I’m convinced he worked for . ~ Ms Sparky


Afghanistan Contractor’s Former Employee Pleads Guilty to Taking Bribes

By Patricia Hurtado – Aug 26, 2010 1:36 PM PT

A former employee of a U.S. contractor in Afghanistan pleaded guilty to accepting $200,000 in bribes in return for steering work to companies doing business with the U.S. military.

, 38, of Hempstead, New York, told a U.S. magistrate judge in Manhattan that from 2007 to 2009, he accepted the gratuities while working in Afghanistan for an unnamed U.S. military contractor. He also said he laundered the money he received by sending the cash back to the U.S. in concealed transactions.

“I accepted illegal cash payments from Afghan-owned subcontractors for awarding contracts,” Freeman told U.S. Magistrate in Manhattan. “I instructed and directed other people to bring the money back into the United States. They had no knowledge of how I obtained the money. I did it to conceal the way I received the money.”

Cott said Freeman could have faced as long as 25 years in prison if convicted after trial of two charges of money laundering and accepting an illegal gratuity. The magistrate said that according to a plea agreement between the defendant and the government, Freeman faces 51 to 63 months in prison when he is sentenced by U.S. District Judge Colleen McMahon, who is presiding over the case.

“He’s accepted responsibility and he plans to live a law- abiding life,” , Freeman’s lawyer, said after today’s hearing. “He’s very sorry for what he’s done.”

Free on Bond

Freeman was allowed to remain free on a $150,000 personal- recognizance bond. Cott told him to return to court Nov. 18. No sentencing date was set.

While the contractor which Freeman worked for wasn’t named in court or in court papers, two people with knowledge of the case who weren’t authorized to speak on the record said Freeman worked for Inc., the U.S. military contractor.

The company, the U.S. Army’s largest contractor in Iraq, provides services such as housing, meals, laundry, showers, water purification and bathroom cleaning.

Heather Browne, a spokeswoman for Houston-based , didn’t immediately reply to a voice-mail message left at her office seeking comment. Another person at , who wouldn’t give her name, said the company was preparing a statement.

The case is U.S. v. Freeman, 10-CR-00766, U.S. District Court, Southern District of New York (Manhattan). Click HERE for the original article)


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Did KBR get what Halliburton wanted…Iraq’s oil!

wins two Iraq contracts
Wednesday, August 25, 2010
Houston Business Journal

has won two contracts by the Republic of Iraq Ministry of Oil through the South Refineries Co.

will provide licensing and basic engineering services for the construction of fluid catalytic cracking and solvent deasphalting units at the planned grassroots in Maissan, Iraq. Financial terms were not disclosed.

Houston-based (NSYE: ) plans to license its FCC Technology for an anticipated 47,500 barrels per day FCC unit and its “Rose” technology for a 45,000 barrels per day SDA unit.

and ExxonMobil Research and Engineering Co. have formed a joint marketing alliance to work on the FCC unit.

“These awards mark the first wins for ’s technology business in Iraq and provide the opportunity to introduce two of its leading refining technologies into an important, emerging market,” , president of Technology, said in a statement. (click HERE for the original article)

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Defense Cover-up Management Agency (DCMA) – Part 1

Former employee and US Air Force MSgt at the original US Embassy in Baghdad, Iraq

This is Part 1 in a series of original articles to be published on MsSparky.com by former QAR discussing his personal experiences with the oversight of ’s LOGCAP III contract.

We all know Dick Cheney’s agenda when he directed the LOGCAP III contract be sole sourced and awarded to . ’s LOGCAP III contract has been tainted with accusations of fraud, waste, abuse and rape. They are accused of overcharging the US Government and contract violations. Most disturbingly is accused of exposing hundreds of US National Guard troops to deadly toxins at . They are accused of negligence in exposing hundreds if not thousands of troops and civilians to deadly burn pit smoke and they are accused of shoddy electrical work that has killed soldiers and more than likely civilians as well. We are just now realizing who their accomplices to these allegations are. The corruption, ineptness, and cover-up by both the U.S. Army and the () have contributed to ’s ability to commit these acts of fraud, waste and abuse over and over again.

I was in my 21st year with the U.S. Air Force.  I had worked for the Defense Contract Management Agency (DCMA) while deployed and put on Active Duty with the U.S. Air Force Reserves IMA  (Individual Mobilization Augmentee) program. I had served previously in the Active Duty Air Force, the California Air National Guard, and finally in the U.S. Air Force Reserves. I discovered DCMA had only 3 Master Sergeant (MSgt) slots for the entire United States. As a MSgt myself, I felt the odds of landing a DCMA position was slim. The DCMA had a program called the Contingency Contracting Administration Services (CCAS) and it would allow me to deploy to Iraq. I volunteered for this program. I wanted to be in the heart of it in the Green Zone in Baghdad, Iraq and I wanted to be there for Christmas 2004.

After I arrived in the Green Zone I learned my assignment was to oversee the LOGCAP III contract. They sent me as a Contracts Administrator. But, because an unlimited warrant was needed (the authorization to approve contract actions needed an unlimited dollar authority – which I did not have) I ended up working with U.S. Air Force Major Jimmy Hammonds in Operations and assisted Contracting Officer, Navy Lt., Russell Baum.

wrote Letters Of Technical Direction (LOTD) which were nothing more than open checkbooks to . LOTD’s were written for any item that was floated and approved by the State Department Liaison Officer, Harold Price. I must have heard the speech a hundred times. supported 1700 organizations in the Green Zone and 60 cents on the dollar was going for life-support services that was contracted to do. This included living accommodations, trailers, water,  5 DFACs (Dining Facilities), soft cars, hard cars (armored) with maintenance and fuel, offices, office supplies and equipment, and so on. 40 cents on the dollar was spent in the Green Zone on the military.  As a part of their support contracts supported the as well. This conflict if interest is established.

Aftermath of Iraq car bomb (Courtesy of )

Car bombs went off at a rate of  2 or 3 times each morning and rockets and mortars rained in daily. We had a new Quality Assurance Representative (QAR), named John Golden. He had just arrived in the Green Zone in early January. I advised him if needed to have something signed off at one of the 6 Green Zone checkpoints, it would be wise not to go in the mornings because the car bombs went off daily in the morning. “Maybe go in the afternoon” I recommended. 45 minutes later at approximately 3:30pm  a huge car bomb went off at a nearby checkpoint. He gave me an odd look and I said, “Maybe that isn’t such a good time either.”  The “insurgents” were targeting the Green Zone checkpoints trying to kill Iraqi workers who were working for American companies in the Green Zone and they were succeeding.

At first people would dive under desks at every car bomb, mortar and rocket. But and after a couple of weeks, we didn’t even miss a keystroke. We would turn our air conditioning up and pull our body armor over for a blanket. The only time we might get running was if giant footsteps were approaching which were mortars getting “walked in” – then it was time to get moving.

The morning of the January 29, 2005, was the day of Iraq’s first elections and I had to hand it to them – they kept voting despite vest bombers going off in the lines. By 10 AM I heard 80 vest bombers blow up within earshot of the Republican Palace in the Green Zone and it continued all day. Early that evening I heard what I thought was an F-15 fly across the top of my trailer.  This was no F-15, it was a rocket, but unlike other rockets I had seen there was no flash as it disappeared into the side of the South wing of the U.S. Embassy. This rocket flew in from over 9 miles away and killed civilian Barbara Heald and Navy Lt CDR Keith Taylor . That rocket came in at a high angle and ricocheted off the floor and killing Ms. Heald. It ricocheted again hitting the Lt Commander killing him and injuring several others.

The () worked out of the room adjacent to Ms. Heald. Commander Colonel Miles ordered anything with blood on it was to be burned in the KBR Burn Pit located in the Green Zone and QAR John Golden was to oversee it. John Golden was left unprotected wearing only his body armor, in the open and exposed to the “other” side of the Tigris River. Known to all of us as “The Red Zone”.  It took 3 long days to dispose of the the bloody refuse. At this point Mr. John Golden chose to resign.

It was then I was appointed the lone Quality Assurance Representative (QAR) for the entire Green Zone. I didn’t think could be too serious about oversight if I was being appointed to take over the duty. I receive no training and no instructions. I was just the token QAR. There were 42 Statement of Procedures (SOP) I was apparently required to inspect. Unsure of what I was required to do to perform these task, I contacted two QAR’s from Camp Victory.  They gave me the checklists they used and said just inspect to those standards.

When I initially tried to inspect ’s compliance with the 42 SOP’s, ’s own Contract Administrator Taryk Ferris tried to inform me “ really didn’t agree to that. Those SOP’s were just sort of advisory.” Evidently that tactic had worked in the past. When I discussed this response with my QAR counterparts from Camp Victory, they pointedly informed Mr. Ferris and the Project Manager there would be inspections and they needed to get ready. As I listened to this conversation (actually it was more of a scolding) I was thinking “Get ready?”.  Being inspected to the SOP’s was apparently a new and disturbing concept to . I wondered just how long the had NOT been inspecting to the SOPs? What had the previous QARs been doing? Apparently nothing if somehow thought that 42 Statement of Procedures (SOP’s) were only “suggestions”? I experienced first hand how wanted me to sign off on inspections over a cup of coffee.  I was asked to sign off on 9 smoke detectors in US Ambassador Negroponte’s villa – that were never installed. How hard was that to get done? Two screws or self-adhesive and they simply were not there and yet I was expected to sign it off as complete. I saw project after project not completed.

I think that is enough for my introductory post at MsSparky.com. I have volumes to share and I have the documents and photos to support my claims. Nothing classified of course. If anyone thinks has had adequate oversight on their LOGCAP III contract they are sorely mistaken.

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KBR’s Utt tells the DoD to back off!

I just love the relentless tenacity of the dedicated  staff at the Project On Government Oversight (POGO). In a recent POGO post entitled KBR Puts the Squeeze on Its Pentagon ‘Partner’ it’s clear that ’s idea of partner and mine are quite different.

Below is a letter ’s Chairman, President and CEO sent Dr. Ashton B. Carter Under Secretary of Defense in March 2010. I read the letter. It basically says……back off, give us our award fee and current and future contracts won’t be affected. You read it and you decide.  (click HERE for a copy of the original)

My personal thanks to the tipster who informed me this letter even existed and to POGO for their FOIA writing expertise that got it released!

~~~~~~~~~

March 5, 2010

Dr. Ashton B. Carter
Under Secretary of Defense
for Acquisition, Technology and Logistics
3010 Defense Pentagon
Washington, DC 20301-3010

Dear Secretary Carter:

I write to follow up on our meeting last year and to convey several concerns about the course of events since our discussion.  Developments on several fronts cause me to ask for your assistance as contemplates future business decisions involving our Department of Defense contracts.  Since our meeting, developments have evolved on various fronts that potentially impact ’s ability to continue to provide expeditionary, stability and reconstruction contract support.

Please recall that when we met I questioned the extent to which the Department values ’s contributions to the US Military efforts in Iraq and Afghanistan. My impression, based upon your response to the issues I raised at that meeting, was that you and the Department not only value ’s contributions to the war effort but see the company as an essential partner going forward.

First, with respect to the LOGCAP IV contract, while had unsuccessfully bid on eight prior task orders; we are pleased that our bid for the LOGCAP IV Corp Logistics Support Services, Theater Transportation, and Postal Services (CTP) Task Order in Iraq was evaluated as providing best value to the US Army. This award was significant to as it confirmed to us that our lack of success in bidding previous task orders was not the result of being constructively debarred for reasons of political expediency.  Further, we understand the prudency and fully support the actions by the Department to have multiple options for mission support as opposed to relying on a single source supplier.

Second, as a result of the recent actions by the LOGCAP Award Fee Determining Official to deny any award fees for the period of January 1, 2008 through April 30, 2008, I feel there no longer exists any transparency or predictability in the way will be treated by the LOGCAP Award Fee Determining Official with respect to the payment of any prospective award fees.   In the overwhelming majority of task orders on which has worked, the quality of the work has been exceptional and our customers on the ground, soldiers, sailors, airmen and Marines, have been more than satisfied with the product provided or service rendered. This has been reflected in our consistent ratings of “very good” to “excellent” award fee scores.   Moreover, I believe that ’s contributions in Iraq in providing continuing logistics support to our troops as well as “ramping up” our services to accommodate the influx of forces associated with the surge in Iraq contributed greatly to the success of that endeavor. While we disagree with the actions on the part of the LOGCAP Award Fee Determining Official to award zero award fees for the period from January 1, 2008 through April 30, 2008, we nonetheless recognize the discretion the LOGCAP Award Fee Determining Official has in determining award fees. This action by the LOGCAP Award Fee Determining Official has caused to write off $133 million of accrued awards fees as of 31 December 2009. This action, without clear delineation as to 1) how future award fee boards will be managed, and 2) if our performance warrants, as in the past, the payment of award fees how payments of these award fees will be made to , raises significant questions in my mind as to the predictable and objective basis to receive award fees.

To address this concern, I request your assistance in facilitating a meeting with and colleagues in the Army to openly discuss the timing and content of future evaluations for services on upcoming award fee boards.

Third, the spate of lawsuits against resulting from activities the company undertook at the specific direction and control of the Army and other military officials continues to grow. Specifically, we are facing suits literally from across the country in connection with deaths and injuries associated with supply convoys, electrical safety, chemical exposures, down wind exposure to toxins from burn pits, and other issues resulting from our work on behalf of the military.  The financial and administrative burden to in defending these suits is enormous, and support from our customer is critical to adequately describe the Army’s position in its use and direction of its contingency contractors.

Recently, met with attorneys from the office of the Department of Defense General Counsel to discuss the need for more and better support to bring the perspective of the Army into the discussion in several of these law suits. The position of the Department to properly characterize the broad and far reaching role of the Army in its use and direction of its contingency contractors needs to be heard, if only to serve to protect the interests of the taxpayer from inappropriate and misinformed rulings from the Judicial Branch of the Government. Further, if the Army does not provide the necessary support to enable those companies who perform work at the government’s direction and control to respond to lawsuits resulting from that work, inappropriate outcomes on these lawsuits could give rise to long term adverse consequences to the Department’s ability to continue to attract and retain highly qualified battlefield contractors.   Clearly, does not feel like a true partner of the Department in supporting critical military missions if we are left alone to defend these suits without the appropriate involvement of the Department in these litigations.   Moreover, the actual costs and any possible judgments against may ultimately be visited on the U.S. Government.

To address this concern, I urge your support to assist to cause our Army customer to provide a greater level of cooperation and better access to information and witnesses going forward as we seek to prevent inappropriate legal outcomes based, in part, on the failure of the court to appropriately understand the Army’s position in its use and direction of its contingency contractors.

Finally, I hope you appreciate that has been subjected to an incredible amount of oversight and scrutiny in connection with its work on the Department’s behalf.  This oversight and scrutiny is far more than anyone could possibly imagine.  In recent years, in our Houston offices alone, we have had up to 30 auditors in resident, with more on the way.  By mid-March, 61 auditors will occupy our Houston facilities.  When one factors in the additional scrutiny, voluminous information requests, briefings, meetings, hearings and other administrative burdens the company faces from Congressional Committees, the Government Accountability Office, inspectors general, , , and the Commission on Wartime Contracting.   I hope you can understand both the strain on the company as well as the extraordinary lengths to which has gone in order to both be a good corporate citizen and to comply within the increasingly onerous requirements that go along with being a wartime contractor.  While much of this oversight may have been the result of policies, actions or inactions on the part of our prior parent, ; I can assure you that ’s new management, as well as its new Board of Directors, does not tolerate, for one moment, any of the issues that may have given rise to such a high degree of oversight as has received.  Please understand that we are working to correct any deficiencies that come to light with due urgency and commitment; however, the degree of oversight and investigation is potentially crushing for a company even as large as .

To address this concern, I request your assistance to cause to continue to take a more active role in managing the interface between and the contractor with an objective to reduce, and hopefully eliminate, any emotion on the part of in issuing a steady and seemingly endless string of Form 1 withhold requests.  has taken steps to change its personnel interfacing with and and we continue to examine ways to improve both our professional relationships and working dialog with the and ; and as a consequence, I hope that a renewed effort on the part of can be a positive contributor towards getting this situation back on a more appropriate footing.

All of the foregoing circumstances, taken cumulatively, are making a significant impact on whether can continue to support the Department’s battlefield logistics requirements now and in the future.  Indeed, the aforementioned issues did cause to decline to bid on the recent LOGCAP IV task order issued for the rebuilding of Haiti.  It is extremely difficult, if not financially burdensome for to continue in the present environment that exist today.  I feel we may be rapidly approaching a tipping point at which the expense of defending lawsuits, increased administrative burdens and, in our view, potential financial penalties and continued uncertainties related to our ability to continue to receive award fees under the LOGCAP III contract will overwhelm our patriotic and business interests in serving our troops.

I would appreciate the opportunity to discuss in greater detail the present situation and the way forward at your earliest convenience and urge you to reconsider my request to meet in person.  I want to continue to believe that is a valued partner for the Department as it undertakes difficult operational challenges.  We support your efforts and are honored to serve with on behalf of the troops of the United States Military.  Candidly, I hope that you and the Department are willing to make the kind of commitment to a partnership that we believe will be required for to continue to provide the valuable on-going and lasting support to military operational activities that it has to this point.

Sincerely,

William P. Utt
Chairman, President and CEO

My only response to this is…..who’s really running the war? or the DoD.It sounds to me like is trying to hold the DoD hostage and the ransom is the Award Fee!

Ms Sparky

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