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Anham LLC accused of outrageous overbilling in Iraq (Updated 7/31/2011)

Dubai Firm Overbilled Pentagon $900 for $7 Switch, Bowen Says

By David Lerman and Tony Capaccio – Jul 29, 2011 9:01 PM PT

A U.S. contractor in Iraq overbilled the Pentagon by at least $4.4 million for spare parts and equipment, including $900 for an electronic control switch valued at $7.05, according to a new audit.

Based on the questionable costs identified in a $300 million contract with Dubai-based Anham LLC, the U.S. should review all its contracts with the company in Iraq and Afghanistan, which total about $3.9 billion, said Special Inspector General For Iraq Reconstruction Stuart Bowen.

“The audit found weak oversight in multiple areas that left the government vulnerable to improper overcharges,” Bowen wrote in the forward to his 30th quarterly report, released today. The contract in question was funded with a combination of money earmarked for Iraqi Security Forces and Army operations and maintenance funds.

Among the “egregious examples of overbilling” by Anham were $4,500 for a circuit breaker valued at $183.30, $3,000 for a $94.47 circuit breaker and $80 for a small segment of drain pipe valued at $1.41. Read the remainder of this entry »

Inspections mandatory for all DoD facilities

WASHINGTON (CN) – March 21, 2011 – Defense Department facilities, infrastructure and equipment provided by private military contractors such as KBR, DynCorp, and Fluor Corporation, overseas, are to be inspected for safety and habitability, under rules adopted under the National Defense Authorization Act.

According to the rules, prior to use, the facilities should be “brought into compliance with generally accepted standards for the safety and health of personnel to the maximum extent practicable consistent with the requirements of military operations and the best interests of the agency.”

Contracts will require compliance with the Unified Facilities Criteria 1-200-01 to meet generally accepted standards for fire protection, structural integrity, electrical systems, plumbing, water treatment, waste disposal, and telecommunications networks.

The rules apply to each contract, including task or delivery orders, entered into for the construction, installation, repair, maintenance, or operation of facilities, infrastructure, and equipment for use by Defense Department military or civilian personnel.

The rules were effective in 2010, in temporary form, and have now been adopted permanently.

Click HERE for original article and click HERE to read this regulation.

Will it be the big house for bubba in the end?

Anyone who has worked in Afghanistan, Iraq or for one of the many government contractors supporting the Department of Defense (DoD) understands the look of  jaw dropping astonishment and horror when some Neanderthal, sporting a single digit IQ, is promoted to a position of power, as well as  the equally perplexing look of dismay when an honest, hardworking individual is sacked and blackballed (aka not eligible for rehire) for some minor infraction, such as a cracked tail light on their vehicle etc..  Is bubba hitting the big time because corporate executives are calculating and conniving for a bigger piece of the taxpayer pie?  Is it possible that these over inflated egos are merely pawns, pigeons or puppets, for the corporate robber barons known as government contractors?

What will happen to poor bubba when the shit hits the fan and the DoJ comes knocking on doors?  Absolute total denial from the company and the leadership that condoned or promoted bubba’s evil ways and felonious heart that’s what:

“KBR does not in any way condone or tolerate illegal or unethical behavior,” says Heather Browne, KBR spokesperson. “The company stands firm in its unwavering commitment to conduct business with the utmost integrity.”

I don’t know if puffing up your chest and shouting “DO YOU KNOW WHO I AM” will have much of an effect with bubba’s new cellmate.  Here’s hoping that his new celly responds with – “My New Girlfriend, that’s who!”  I am sure bubba’s former employees and the taxpayers he has been sticking it to for years will not offer him much compassion or sympathy, if or when this occurs.

The following article about the whistleblower who helped bring Louis Berger Group’s misdeeds to light brings up some interesting points about the companies that vie for USG contracts.  This article could be about any one of the many companies we have blogged about, or will blog about in the future.  Kudos to Harold Salomon for his honesty and integrity!  Let’s hope there are more people just like him.

~ Ms Sparky

Whistleblower details bribes, fraud in Afghanistan

Warren P. Strobel – McClatchy Newspapers – November 21, 2010 – KABUL, Afghanistan — A corporate whistleblower, whose evidence of fraud led to one of the largest fines ever against a war-zone contractor, said that he was ordered to facilitate bribes, keep information from government auditors and inflate overhead rates.
Former Louis Berger Group employee Harold Salomon, in his first interview since the case was settled earlier this month, said he came to believe the New Jersey firm hired him because executives calculated the Haitian immigrant would not uncover their defrauding of U.S. taxpayers.

“Me being an immigrant would be easy prey,” he said. They thought, “I would not understand anything.”

Read the remainder of this entry »

Pentagon adopts “don’t ask don’t tell” policy on contractor oversight

Pictured above is our Pentagon leadership, Speak No Evil, See No Evil and Hear No Evil. On the right is a corrupt Defense contractor!

In a recent article from the Project On Government Oversight (POGO) it show cases the Pentagon’s attitude towards the Defense Contract Audit Agency and those pesky little $100 million dollar contracts.  Where’s Congress in all this? Who is overseeing the Pentagon? The Pentagon is giving corrupt Defense contractors the keys to the Kingdom! ~Ms Sparky

Pentagon Radically Reducing Oversight of Contracts Worth Tens of Billions

October 29, 2010

The Pentagon has radically decreased the Defense Contract Audit Agency’s (DCAA) review of contracts, according to an October 18 DCAA memo obtained by POGO. DCAA’s job is to protect taxpayers from contractor overbilling.

“POGO has long feared contractors and their government allies would block DCAA from exposing contractor ripoffs,” said Nick Schwellenbach, POGO’s director of investigations.  “Why are billions of dollars being put at risk when Secretary Gates is demanding cost savings?”

According to the memo, contracting guidance “now limits contracting officer requests for audit services to Fixed-price proposals over $10 million and Cost-Type proposals over $100 million, unless there are exceptional circumstances.”

These audit services are reviews of cost data (referred to as “reviews”) and they entail an examination of a contractor’s cost proposal to the government.  In these proposals, contractors estimate how much it will cost them to accomplish work on a contract.

Previously, there was no dollar threshold for reviews on fixed-price contract proposals, but contracting officers would limit requests for DCAA reviews of proposals over a threshold tied to the submission of cost or pricing data, which is currently $700,000. The old threshold for reviews of cost-type proposals was $10 million, but could be lower if the contractor has systemic problems estimating costs.

In FY 2009, a total of at least $92 billion in Defense Department contracts fell between the old thresholds and the new ones, according to USAspending.gov.  The $92 billion figure is a conservative estimate – it reflects awarded and funded contracts, rather than contract proposals, which are often higher than the funded contract award amounts.

The guidance states that cost proposals below the new dollar thresholds for review may be sent instead to the Defense Contract Management Agency (DCMA). DCMA is typically less thorough than DCAA, according to a 2009 Wartime Contracting Commission report.  The DCMA also does not specialize in examining and verifying cost and pricing data.

The reason for this new restriction is DCAA’s attempt to perfectly comply with Generally Accepted Government Auditing Standards (GAGAS). With this standard, which requires meticulous documentation of findings, DCAA is unable to cover as much ground as they used to, thus the need to restrict “audits” as defined by GAGAS.  The number of DCAA reports produced annually has plunged: 33,801 in FY 2007 to 30,352 in FY 2008 to 21,276 reports in FY 2009.

Rather than subjecting reviews of cost or pricing data to GAGAS, DCAA should consider these reviews as financial advisory services, which are not subject to all GAGAS requirements.  This would better protect taxpayers and warfighters by allowing DCAA to review cost data and deliver advice to contracting officers in a timely fashion.
Founded in 1981, the Project On Government Oversight (POGO) is a nonpartisan independent watchdog that champions good government reforms. POGO’s investigations into corruption, misconduct, and conflicts of interest achieve a more effective, accountable, open, and ethical federal government. (click HERE for original article)

Defense Cover-Up Management Agency (DCMA) – Part 2

US Air Force MSgt Keven L. Barnes

This is Part 2 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. Defense Cover-Up Management Agency (DCMA) – Part 1 can be read HERE.

The next Statement of Procedure (SOP) I was to turn my attention to was the Water. The concern about the water in the Green Zone was elevated after laundry operations went down for 17 days because the laundry machines became contaminated with diesel fuel. In addition, I had several complaints from military personnel that their showers “smelled like diesel fuel”. I heard that same complaint nearly every week. I told our DCMA commanders about these concerns and they laughed it off. No action was taken to locate the cause of the fuel smell by either Col Miles or his replacement, U.S. Army Col McQuain.

The State Department and US Embassy personnel became very upset about the laundry being shut down (no dry cleaning services) and I was told to find out the cause. Now I have have clients of the LOGCAP contract informing me their shower smells like diesel fuel and the laundry goes down for 17 days because of fuel contamination. I felt the next logical step was to perform an inspection of the KBR Water Operations to assess their compliance with the Statement of Procedure. I informed KBR of the impending Water Operations inspection and gave them a week to prepare. To that date, KBR’s Water Operations in the Green Zone had never been inspected by DCMA. I questioned on a daily basis what the previous DCMA Quality Assurance Representative (QAR) were doing? The Statement of Procedure for Water Operations stated the requirements for super chlorinating, daily inspections and logbooks. I was to find that none of these requirements were being adequately performed, if at all. Read the remainder of this entry »