Feature: New Atomic-Bomb History Offered
An author that challenges the traditional history of how the United States developed the nuclear weapons used to end World War II invites the face-to-face scrutiny of some of the nation's most respected scientists and historians.
Carter Hydrick's book has raised eyebrows since it was published nearly two years ago, arguing that enriched uranium found in a surrendered German submarine in 1945 was used in the bombs dropped on Hiroshima and Nagasaki in Japan.
The uranium found aboard submarine U-234 off the East Coast of the United States at the end of the war in Europe was used in the atomic bomb dropped on Hiroshima, and infrared fuses also from the vessel were used to develop the plutonium bomb dropped on Nagasaki, his book asserts.
Hydrick has presented his case to audiences at both the Los Alamos National Laboratory in New Mexico and the Oak Ridge Nat ional Laboratory in Tennessee, both of which were involved in the development of the atomic bomb 60 years ago. He has a return engagement scheduled Tuesday in Los Alamos.
Hydrick said he was nervous the first time he appeared before the audiences, made up mostly of scientists, because he is not a scientist or an historian. Some scientists initially refused to take his book seriously because he was butting up against long-accepted history.
"My answer to them was that's why I'm here - to get the critical review," he said in a recent interview. "If they can shoot it down, I will be sad because I put a lot of my life into it. If that's what it is, that's what it is."
Historians were some of his most severe critics in the beginning because he lacked credentials as an historian, but the climate has changed after the appearances at the laboratories and in academic settings around the nation.
Anthony Stranges, an associate professor at Texas A&M University who specializes in the history of science, knows Hydrick's work and he says the author has appeared twice on the campus to address the history honors society.
"He has some evidence there that seems worth pursuing," Stranges said.
Hydrick is challenging traditional history that has stood for decades, and that is a tough job, Stranges said.
The Texas-based writer spent 10 years researching the book, "Critical Mass: How Nazi Germany Surrendered Enriched Uranium for the United States' Atomic Bomb," which came out in a second edition last year, published by Whitehurst & Company (380 pages, $29.95).
Hydrick, a native of San Diego, began his career in film and video screenwriting and production. He eventually spent more than 20 years in the corporate world, overseeing corporate and marketing communications.
The story of the surrendered U-boat and its possible link to the Manhattan Project first came to his attention when a producer asked him to meet a retired World War II German officer with an interesting story. He thought it might be a possible script, but it turned out to be more.
Hydrick said there were "only two or three little scraps of information," but it was enough to get his attention. If they had validity, however, he wanted to do proper research and pursue critical review. It consumed 12 years of his life.
The Manhattan Project was created because the U.S. government feared Germany was ahead in development of the atomic bomb and what the consequences would be for the world if the Nazis actually acquired nuclear weapons.
The project, based at Los Alamos, was largely a U.S. project, with a large team of scientists, many of them émigrés from Nazi-occupied Europe. The project lasted for three years at a cost of $2 billion.
Hydrick's book asserts for the first time that the surrender of submarine U-234 and its cargo of enriched uranium and infrared fuses allowed the Manhattan Project to complete and drop its bombs on Japan in time to meet an important mid-August 1945 deadline for war planners.
"Without the surrender of U-234 we would not have been able to make the uranium bomb that was dropped on Hiroshima or the plutonium bomb that was dropped on Nagasaki, and would probably not have had a bomb of our own until late 1945 or early 1946," he said.
The Soviet Union announced that it was going to declare war on Japan in mid-August, which meant that if the war lasted much more than a few weeks beyond that, the allies would have to partition off the Pacific like Eastern Europe.
Hydrick cites captured cargo manifests from German submarine U-234 that list 580 kilograms - nearly 1,300 pounds - of uranium oxide, which is not conclusive proof that it was enrich ed uranium, but he found other stronger evidence.
The containers were labeled U235, according to one eyewitness, the submarine's chief radio operator. He also saw two Japanese officers, who were to travel aboard the submarine, painting the label U235 on the containers as they were being loaded for the Atlantic voyage.
The submarine's eventual destination was Japan, where the uranium and other high-tech weaponry and equipment were to be turned over to the Japanese government.
Hydrick traced the enriched uranium, which is necessary to build an atomic bomb, and other components to Los Alamos, where he argues they gave the U.S. team the help they needed to complete the bombs as soon as they did.
Hydrick also presents evidence that indicates infrared fuses found on the German submarine were used to fix problems the project scientists were having with the triggering mechanism for the plutonium bomb dropped on Nagasaki.
2005-02-16
Military Spending: Iraq, Afghanistan, Tsunami
Bush seeks 82 billion for Iraq, Afghanistan
US President George W. Bush on Monday formally asked lawmakers for 81.9 billion dollars to fund military operations in Iraq and Afghanistan as well as for Indian Ocean tsunami relief.
"This request reflects urgent and essential requirements. I ask the Congress to appropriate the funds as requested and promptly send the bill to me for signature," he said in a statement.
The request includes 150 million dollars for Pakistan; 200 million to help the Palestinians; 300 million in economic and security assistance for Jordan; and brings total US tsunami aid to 950 million dollars, the White House said.
It also includes 7.4 billion dollars to accelerate the training of local security forces in Afghanistan and Iraq. Bush has made the latter a precondition for withdrawing the roughly 140,000 US forces in Iraq.
The request calls for two billion dollars to help Afghanistan prepare for upcoming legislative elections, fund reconstruction efforts, and combat drug trafficking.
And it includes 717 million dollars for US embassy and security expenses in Iraq, including 658 million to build a permanent facility for US diplomats there.
Bush asked for 400 million dollars meant to help countries that have contributed troops to US-led military operations in Iraq and Afghanistan.
The request also includes 242.4 million dollars in food aid and refugee assistance for Sunday's trouble Darfur region, and 100 million dollars to help Sudan implement a peace agreement signed in January.
And it includes 60 million dollars earmarked to help supported newly-elected President Viktor Yushchenko of Ukraine.
US President George W. Bush on Monday formally asked lawmakers for 81.9 billion dollars to fund military operations in Iraq and Afghanistan as well as for Indian Ocean tsunami relief.
"This request reflects urgent and essential requirements. I ask the Congress to appropriate the funds as requested and promptly send the bill to me for signature," he said in a statement.
The request includes 150 million dollars for Pakistan; 200 million to help the Palestinians; 300 million in economic and security assistance for Jordan; and brings total US tsunami aid to 950 million dollars, the White House said.
It also includes 7.4 billion dollars to accelerate the training of local security forces in Afghanistan and Iraq. Bush has made the latter a precondition for withdrawing the roughly 140,000 US forces in Iraq.
The request calls for two billion dollars to help Afghanistan prepare for upcoming legislative elections, fund reconstruction efforts, and combat drug trafficking.
And it includes 717 million dollars for US embassy and security expenses in Iraq, including 658 million to build a permanent facility for US diplomats there.
Bush asked for 400 million dollars meant to help countries that have contributed troops to US-led military operations in Iraq and Afghanistan.
The request also includes 242.4 million dollars in food aid and refugee assistance for Sunday's trouble Darfur region, and 100 million dollars to help Sudan implement a peace agreement signed in January.
And it includes 60 million dollars earmarked to help supported newly-elected President Viktor Yushchenko of Ukraine.
War is Fun in 2020 - Ultimate High Ground
US Conducts Space War Game To Test Warfighting Capability
The US military has completed a week-long space war game in Nellis Air Force Base, in the western state of Nevada, to see how space-based assets can be used in a hypothetical war against terrorism in 2020, military officials said Thursday.
Despite of its name "the Schriever III" space war game, the game was not focused on a military fight in space, game officials said.
"Our focus was how best to use space assets to coordinate the joint terrestrial fight," said Brigadier General Daniel Darnell, game executive director and commander of the Space Warfare Center at Schriever Air Force Base in Colorado.
In the game, which began Feb. 5 and ran through to Feb. 11, a 350-person team of space professionals battled in a global environment scenario set in the year 2020, the Air Force said in a statement.
Besides officials from about 20 agencies of the US Defense Department, officials from Australia, Canada and Britain were also present in the game, to investigate future space systems, the missions they support, and how to ensure their survivability, a statement said.
The war game aimed to ensure the United States maintained its ultimate high ground - space superiority, Darnell said.
Darnell noted that the game examined the capabilities required to ensure global stability and explored how to build a seamless integration of manned and unmanned space systems, supporting homeland defense and US global and theater interests.
There were very few things in conventional combat today that did not involve space systems, he said. Missile warning, battle-space awareness, precision munitions guidance, navigation and timing, and military satellite communications all critically relied on space support, he said.
"Schriever III is more than a war game - it's a valuable forum that establishes partnerships and fosters innovative thought at the strategic- and operational-levels of war," said General Lance W. Lord, commander of US Air Force Space Command.
The US military has completed a week-long space war game in Nellis Air Force Base, in the western state of Nevada, to see how space-based assets can be used in a hypothetical war against terrorism in 2020, military officials said Thursday.
Despite of its name "the Schriever III" space war game, the game was not focused on a military fight in space, game officials said.
"Our focus was how best to use space assets to coordinate the joint terrestrial fight," said Brigadier General Daniel Darnell, game executive director and commander of the Space Warfare Center at Schriever Air Force Base in Colorado.
In the game, which began Feb. 5 and ran through to Feb. 11, a 350-person team of space professionals battled in a global environment scenario set in the year 2020, the Air Force said in a statement.
Besides officials from about 20 agencies of the US Defense Department, officials from Australia, Canada and Britain were also present in the game, to investigate future space systems, the missions they support, and how to ensure their survivability, a statement said.
The war game aimed to ensure the United States maintained its ultimate high ground - space superiority, Darnell said.
Darnell noted that the game examined the capabilities required to ensure global stability and explored how to build a seamless integration of manned and unmanned space systems, supporting homeland defense and US global and theater interests.
There were very few things in conventional combat today that did not involve space systems, he said. Missile warning, battle-space awareness, precision munitions guidance, navigation and timing, and military satellite communications all critically relied on space support, he said.
"Schriever III is more than a war game - it's a valuable forum that establishes partnerships and fosters innovative thought at the strategic- and operational-levels of war," said General Lance W. Lord, commander of US Air Force Space Command.
Senator Harry Reid: President Bush Jr. is Miserable Failure
Aljazeera.Net - US senator slams Iraq reconstruction
Tuesday 15 February 2005, 1:56 Makka Time, 22:56 GMT
The ex-US occupation authority is accused of mismanagement
A senator and civilian contractors have accused the US administration of allowing Iraqi reconstruction to become as chaotic as the Wild West.
Senator Harry Reid made particular criticism of the government's former occupation administration in Iraq on Monday.
And civilian witnesses said Washington had protected an American contractor accused of fraud. They also accused the US of media censorship.
"This is a scandal," said Reid, who heads the opposition Democrats in the US Senate. "We are close to 24 months into this conflict with Iraq, and the administration still can't seem to get it right."
Reid spoke during hearings in Congress into the management of the so-called Coalition Provisional Authority's (CPA) multi-billion dollar reconstruction programme.
Bags of cash
In the hearings, civilians compared operations to the Wild West, saying bags full of cash were tossed freely about.
Franklin Willis, who supervised aviation for the CPA in late 2003, accused the organisation of "poor execution" and called it "naive".
He said millions of dollars stored in the basement of the CPA offices were casually distributed to favoured contractors with little accounting discipline.
Another witness accused the government of hampering an investigation into alleged fraud by US-based Custer Battles, which had contracts worth as much as $100 million in Iraq for airport security and other jobs.
Fraud accusation
Custer Battles was accused of repainting old airport equipment and billing the CPA for new equipment, among other schemes.
"We estimate that the government's total losses are tens of millions of dollars," said lawyer Alan Grayson, who represents former employees of the company.
"Yet for more than a year, the Bush administration has done nothing to recover these ill-gotten gains."
Censorship
Don North, a journalist hired by the CPA to create a new independent Iraqi television station, said he was scandalised by the censorship imposed on the operation.
Instead of covering stories of consequence to Iraqis, the station had to cover CPA publicity events, he said.
"It resulted in our newscasts appearing to be a laundry list of CPA activities," North, who formerly worked with leading US television networks, said, adding, "I left after four months of frustrations."
Tuesday 15 February 2005, 1:56 Makka Time, 22:56 GMT
The ex-US occupation authority is accused of mismanagement
A senator and civilian contractors have accused the US administration of allowing Iraqi reconstruction to become as chaotic as the Wild West.
Senator Harry Reid made particular criticism of the government's former occupation administration in Iraq on Monday.
And civilian witnesses said Washington had protected an American contractor accused of fraud. They also accused the US of media censorship.
"This is a scandal," said Reid, who heads the opposition Democrats in the US Senate. "We are close to 24 months into this conflict with Iraq, and the administration still can't seem to get it right."
Reid spoke during hearings in Congress into the management of the so-called Coalition Provisional Authority's (CPA) multi-billion dollar reconstruction programme.
Bags of cash
In the hearings, civilians compared operations to the Wild West, saying bags full of cash were tossed freely about.
Franklin Willis, who supervised aviation for the CPA in late 2003, accused the organisation of "poor execution" and called it "naive".
He said millions of dollars stored in the basement of the CPA offices were casually distributed to favoured contractors with little accounting discipline.
Another witness accused the government of hampering an investigation into alleged fraud by US-based Custer Battles, which had contracts worth as much as $100 million in Iraq for airport security and other jobs.
Fraud accusation
Custer Battles was accused of repainting old airport equipment and billing the CPA for new equipment, among other schemes.
"We estimate that the government's total losses are tens of millions of dollars," said lawyer Alan Grayson, who represents former employees of the company.
"Yet for more than a year, the Bush administration has done nothing to recover these ill-gotten gains."
Censorship
Don North, a journalist hired by the CPA to create a new independent Iraqi television station, said he was scandalised by the censorship imposed on the operation.
Instead of covering stories of consequence to Iraqis, the station had to cover CPA publicity events, he said.
"It resulted in our newscasts appearing to be a laundry list of CPA activities," North, who formerly worked with leading US television networks, said, adding, "I left after four months of frustrations."
US Treasury Looted in Iraq
TimesDispatch.com | U.S. payments in Iraq: 'Bring a bag'
U.S. officials in postwar Iraq paid a contractor by stuffing $2 million worth of bills into his gunnysack and routinely made cash payments around Baghdad from a pickup truck, a former official with the occupation government says.
Because the country lacked a banking system, contractors and Iraqi ministry officials were paid with bills taken from a basement vault in one of Saddam Hussein's palaces that served as headquarters for the Coalition Provisional Authority, former CPA official Frank Willis said.
Officials from the CPA, which ruled Iraq from June 2003 to June 2004, would count the money when it left the vault, but nobody kept track of the cash after that, Willis said.
"In sum: inexperienced officials, fear of decision-making, lack of communications, minimal security, no banks, and lots of money to spread around. This chaos I have referred to as a 'Wild West,'" Willis said in testimony he is prepared to give today before a panel of Democratic senators who want to spotlight the waste of U.S. funds in Iraq.
A senior official in the 1980s at the State and Transportation departments under then-President Ronald Reagan, Willis provided a copy of his testimony.
The Pentagon, which had oversight of the CPA, did not immediately respond to requests. But the administrator of the former U.S. occupation agency, L. Paul Bremer III, in response to a federal audit criticizing the CPA, strongly defended the agency's financial practices.
When the authority took over the country in 2003, Bremer said, there was no functioning Iraqi government and services were primitive or nonexistent.
Iraq's economy was "dead in the water" and the priority "was to get the economy going."
Also in response to that audit, Pentagon spokesman Bryan Whitman had said, "We simply disagree with the audit's conclusion that the CPA provided less than adequate controls."
Willis served as a senior adviser on aviation and communications matters for the CPA during the last half of 2003 and said he was responsible for the operation of Baghdad's airport.
Describing the transfer of $2 million to one contractor, Willis said: "We told them to come in and bring a bag."
He said the money went to Custer Battles of Middletown, R.I., for providing airport security for civilian passengers.
Sen. Byron Dorgan, D-N.D. and head of the Democratic group holding today's hearing, said he arranged for Willis' testimony because "This isn't penny ante. Millions, perhaps billions of dollars have been wasted and pilfered."
U.S. officials in postwar Iraq paid a contractor by stuffing $2 million worth of bills into his gunnysack and routinely made cash payments around Baghdad from a pickup truck, a former official with the occupation government says.
Because the country lacked a banking system, contractors and Iraqi ministry officials were paid with bills taken from a basement vault in one of Saddam Hussein's palaces that served as headquarters for the Coalition Provisional Authority, former CPA official Frank Willis said.
Officials from the CPA, which ruled Iraq from June 2003 to June 2004, would count the money when it left the vault, but nobody kept track of the cash after that, Willis said.
"In sum: inexperienced officials, fear of decision-making, lack of communications, minimal security, no banks, and lots of money to spread around. This chaos I have referred to as a 'Wild West,'" Willis said in testimony he is prepared to give today before a panel of Democratic senators who want to spotlight the waste of U.S. funds in Iraq.
A senior official in the 1980s at the State and Transportation departments under then-President Ronald Reagan, Willis provided a copy of his testimony.
The Pentagon, which had oversight of the CPA, did not immediately respond to requests. But the administrator of the former U.S. occupation agency, L. Paul Bremer III, in response to a federal audit criticizing the CPA, strongly defended the agency's financial practices.
When the authority took over the country in 2003, Bremer said, there was no functioning Iraqi government and services were primitive or nonexistent.
Iraq's economy was "dead in the water" and the priority "was to get the economy going."
Also in response to that audit, Pentagon spokesman Bryan Whitman had said, "We simply disagree with the audit's conclusion that the CPA provided less than adequate controls."
Willis served as a senior adviser on aviation and communications matters for the CPA during the last half of 2003 and said he was responsible for the operation of Baghdad's airport.
Describing the transfer of $2 million to one contractor, Willis said: "We told them to come in and bring a bag."
He said the money went to Custer Battles of Middletown, R.I., for providing airport security for civilian passengers.
Sen. Byron Dorgan, D-N.D. and head of the Democratic group holding today's hearing, said he arranged for Willis' testimony because "This isn't penny ante. Millions, perhaps billions of dollars have been wasted and pilfered."
Reconstruction Deconstruction
Chronogram - Blood Money
The Top Ten War Profiteers of 2004
By the Center for Corporate Policy
At the start of the Iraq war, Andrew Natsios of USAID proclaimed that the reconstruction of Iraq would look like a modern-day Marshall plan. The grand designs of the Bush administration, however, have made a handful of companies serious money.
This list was compiled by the Center for Corporate Policy, a non-profit, non-partisan public interest organization working to curb corporate abuses and make corporations publicly accountable. More information is available at www.corporatepolicy.org.
Aegis
In June, the Pentagon's Program Management Office in Iraq awarded a $293 million contract to coordinate security operations among thousands of private military contractors (PMCs) to Aegis, a UK firm whose founder was once investigated for illegal arms smuggling. An inquiry by the British parliament into Sandline, Aegis head Tim Spicer's former firm, determined that the company had shipped guns to Sierra Leone in 1998 in violation of a UN arms embargo. Sandline's position was that it had approval from the British government, although British ministers were cleared by the inquiry. Spicer resigned from Sandline in 2000 and incorporated Aegis in 2002.
A protest brought by rival PMC bidder Dyncorp after its bid was deemed unacceptable by the Army, was dismissed by the General Accounting Office, which concluded that Dyncorp "lacked standing to challenge the integrity of the awardee (Aegis)." Critics say that's just the problem. US and international law have failed to address the role of PMCs in Iraq, resulting in a near-total lack of accountability that epitomizes what's wrong with the corporate takeover of Iraq. PMCs fall outside the Military Code of Justice and possibly cannot be prosecuted by Iraq's own laws, due to CPA order #17, which says foreign contractors, including private security firms, are granted full immunity from Iraq's laws, even if they injure or kill an innocent party.
Bearing Point
Critics find it ironic that Bearing Point, the former consulting division of KPMG, received a $240 million contract in 2003 to help develop Iraq's "competitive private sector," since it had a hand in the development of the contract itself. According to a March 22 report by USAID's assistant inspector general Bruce Crandlemire, "Bearing Point's extensive involvement in the development of the Iraq economic reform program creates the appearance of unfair competitive advantage in the contract award process."
Bearing Point spent five months helping USAID write the job specifications and even sent some employees to Iraq to begin work before the contract was awarded, while its competitors had only a week to read the specifications and submit their own bids after final revisions were made. "No company who writes the specs for a contract should get the contract," says Keith Ashdown, the vice president of Washington, DC-based Taxpayers for Common Sense.
Neither Crandlemire nor other critics claim BearingPoint broke the law. But the company's ties to the Bush administration (according to the Center for Responsive Politics, BearingPoint employees gave $117,000 to the 2000 and 2004 Bush election campaigns, more than any other Iraq contractor) is an example of "crony contracting" that undermines the legitimacy of those who might claim to be working to establish competitive markets in the "newly liberated" country.
Bechtel
Bechtel was literally tasked with repairing much of Iraq's infrastructure—schools, hospitals, bridges, airports, water treatment plants, power plants, railroad, irrigation, electricity, etc.—a job that was critical to winning hearts and minds after the war. To accomplish this, the company hired over 90 Iraqi subcontractors for at least 100 jobs. Most of these subcontracts involved rote maintenance and repair work, however, and for sophisticated work requiring considerable hands-on knowledge of the country's infrastructure, the company bypassed Iraqi engineers and managers.
The company has yet to meet virtually any of the major deadlines in its original contract. In October, according to USAID, the CPA had restored only 4,400 MW (mega-watts) of electrical generating capacity target, falling short of its goal of 6,000 MW by end of June (USAID's goal was 9,000 MW, a level that existed in the country before the first gulf war). According to a June GAO report, "electrical service in the country as a whole has not shown a marked improvement over the immediate postwar levels of May 2003 and has worsened in some governorates."
Bechtel is not entirely to blame, as some of the delay is obviously due to the difficulties of getting employees and materials safely to project sites. [Editor's note: Not to mention the tens of thousands of new electrical appliances shipped into an import-starved post-sanction Iraq, the potential impact of which was not included in the original electrical capacity generating goals.]
BKSH & associates
Chairman Charlie Black is an old Bush family friend and prominent Republican lobbyist whose firm is affiliated with Burson Marsteller, the global public relations giant. Black was a key player in the Bush/Cheney 2000 campaign and together with his wife raised $100,000 for this year's reelection campaign.
BKSH clients with contracts in Iraq include Fluor International (whose ex-chair Phillip Carroll was tapped to head Iraq's oil ministry after the war, and whose board includes the wife of James Woolsey, the ex-CIA chief who was sent by Paul Wolfowitz before the war to convince European leaders of Saddam Hussein's ties to al-Qaeda). Fluor has won joint contracts worth up to $1.6 billion.
Another client is Cummins Engine, which has managed to sell its power generators thanks to the country's broken infrastructure.
Most prominent among BKSH's clients, however, is the Iraqi National Congress, whose leader Ahmed Chalabi was called the "George Washington of Iraq" by certain Pentagon neoconservatives before his fall from grace. BKSH's K. Riva Levinson was hired to handle the INC's U.S. public relations strategy in 1999. Hired by US taxpayers, that is: Until July 2003, the company was paid $25,000 per month by the US State Department to support the INC.
CACI and Titan
Although members of the military police face certain prosecution for the horrific treatment of prisoners at the Abu Ghraib prison, so far the corporate contractors have avoided any charges. Maj. Gen. Antonio Taguba reported in an internal Army report that two CACI employees "were either directly or indirectly responsible" for abuses at the prison, including the use of dogs to threaten detainees and forced sexual abuse and other threats of violence. Another internal Army report suggested that Steven Stefanowicz, one of 27 CACI interrogators working for the Army in Iraq, "clearly knew [that] his instructions" to soldiers interrogating Iraqi prisoners "equated to physical abuse."
"Titan's role in Iraq is to serve as translators and interpreters for the US Army," company CEO Gene Ray said, implying that news reports had inaccurately implied the employees' involvement in torture. "The company's contract is for linguists, not interrogators." But according to Joseph A. Neurauter, a GSA suspension and debarment official, CACI's role in designing its own Abu Ghraib contract "continues to be an open issue and a potential conflict of interest."
Nevertheless, the GSA and other agencies conducting their own investigations have yet to find a reason to suspend the company from any new contracts. As a result, in August the Army gave CACI another $15 million no-bid contract to continue providing interrogation services for intelligence gathering in Iraq; In September, the Army awarded Titan a contract worth up to $400 million for additional translators.
Custer Battles
At the end of September, the Defense Department suspended Custer Battles (the name comes from the company's two principle founders—Michael Battles and Scott Custer) and 13 associated individuals and affiliated corporations from all federal contracts for fraudulent billing practices involving the use of sham corporations set up in Lebanon and the Cayman Islands. The CPA caught the company after it left a spreadsheet behind at a meeting with CPA employees. The spreadsheet revealed that the company had marked up certain expenses associated with a currency exchange contract by 162 percent.
Robert Isakson, a company employee, drew attention to the problem by filing a false claims action against the company. Isakson also alleged that Custer's "war profiteering...contributed to the deaths of at least four Custer Battles employees."
In a prepared statement, company attorneys suggested that the government's decision to not participate in Isakson's case is evidence that the charges are baseless, and that "the individuals [involved] filed this claim solely as a last ditch effort to achieve a competitive edge over CB."
The suspension was the first for any company in association with its work in Iraq. The FBI and the Pentagon inspector general's Defense Criminal Investigative Services are both conducting ongoing investigations.
Halliburton
In December Congressman Waxman (D-CA), an-nounced that "a growing list of concern's about Halliburton's performance" on contracts that total $10.8 billion have led to multiple criminal investigations into overcharging and kickbacks. In nine different reports, government auditors have found "widespread, systemic problems with almost every aspect of Halliburton's work in Iraq, from cost estimation and billing systems to cost control and subcontract management." Six former employees have come forward, corroborating the auditors' concerns.
Another "H-bomb" dropped just before the election, when a top contracting official responsible for ensuring that the Army Corps of Engineers follows competitive contracting rules accused top Pentagon officials of improperly favoring Halliburton in an early-contract before the occupation. Bunnatine Greenhouse says that when the Pentagon awarded the company a five-year oil-related contract worth up to $7 billion, it pressured her to withdraw her objections, actions that she said were unprecedented in her experience.
Halliburton spokesperson Beverly Scippa says that while she cannot comment on the allegations until specific charges are filed, any suggestion that the company's involvement made it difficult for other companies to fairly compete are "absolutely untrue," pointing to a earlier GAO report that found that Halliburton/KBR was "the only contractor DOD had determined was in a position to provide the services within the required time frame given prewar planning requirements."
But others, including Waxman, believe that Greenhouse's version of events corroborates existing evidence that the contracting process was biased toward Vice President Dick Cheney's old company. Pentagon officials referred the matter to the Pentagon's inspector general, a move that critics say effectively buried the issue.
(For more information about Halliburton, visit www.HalliburtonWatch.org)
Lockheed Martin
Lockheed Martin remains the king among war profiteers, raking in $21.9 billion in Pentagon contracts in 2003 alone. With satellites and planes, missiles and IT systems, the company has profited from just about every phase of the war except for the reconstruction. The company's stock has tripled since 2000 to just over $60.
Lockheed is also helping Donald Rumsfeld develop a new tech-heavy integrated global warfare system that the company promises will transform the nature of war. In fact, the large defense conglomerate's sophistication in areas as diverse as space systems, aeronautics, and IT will allow it to play a leading role in the development of new weapons systems for decades to come, including a planned highly-secure military Internet, a spaced-based missile defense system, and next-generation warplanes such as the F-22 (currently in production) and the Joint Strike Fighter F-35.
When it comes to defense policy, Lockheed's network of influence is virtually unmatched. E.C. Aldridge Jr., the former undersecretary of defense for acquisitions and procurement, gave final approval to begin building the F-35 in 2001, a decision potentially worth $200 billion to the company. Although he soon left the Pentagon to join Lockheed's board, Aldridge continues to straddle the public-private divide: Rumsfeld appointed him to a blue-ribbon panel to study advanced weapons systems.
Former Lockheed lobbyists and employees include the current secretary of the Navy, Gordon England, secretary of transportation Norm Mineta (a former Lockheed vice president) and Stephen J. Hadley, Bush's proposed successor to Condoleeza Rice as his next national security advisor.
Lockheed is not only represented on various Pentagon advisory boards, but is also tied to various influential think tanks. For example, Lockheed VP Bruce Jackson (who helped draft the Republican foreign policy platform in 2000) is a key player at the neo-conservative planning bastion known as the Project for a New American Century.
Loral Satellite
In the buildup to the war the Pentagon bought up access to numerous commercial satellites to bolster its own orbiting space fleet. US armed forces needed the extra spaced-based capacity to be able to transmit huge amounts of data to planes (including unmanned Predator drones flown remotely by pilots who may be halfway around the world), and guided missiles and troops on the ground.
Industry experts say the war on terror literally saved some satellite operators from bankruptcy. The Pentagon "is hoovering up all the available capacity" to supplement its three orbiting satellite fleets, Richard DalBello, president of the Satellite Industry Association explained to the Washington Post in 2003. The industry's other customers—broadcast networks competing for satellite time—were left to scramble for the remaining bandwidth.
Loral Space & Communications Chairman Bernard L. Schwartz is very tight with the neoconservative hawks in the Bush administration's foreign policy ranks, and is the principal funder of Blueprint, the newsletter of the Democratic Leadership Council.
In the end, the profits from the war in Iraq didn't end up being as huge for the industry as expected, and certainly weren't enough to compensate for a sharp downturn in the commercial market. But more help may be on its way. The Pentagon announced in November that it would create a new global Intranet for the military that would take two decades and hundreds of billions of dollars to build. Satellites, of course, will play a key part in that integrated global weapons system.
Qualcomm
Two CPA officials resigned this year after claiming they were pressured by John Shaw, the deputy undersecretary of defense for technology security to change an Iraqi police radio contract to favor Qualcomm's patented cellular technology, a move that critics say was intended to lock the technology in as the standard for the entire country.
Iraq's cellular market is potentially worth hundreds of millions of dollars in annual revenues for the company, and potentially much more should it establish a standard for the region. Shaw's efforts to override contracting officials delayed an emergency radio contract, depriving Iraqi police officers, firefighters, ambulance drivers and border guards of a joint communications system for months.
Shaw says he was urged to push Qualcomm's technology by Rep. Darrell E. Issa, a Republican whose San Diego County constituency includes numerous Qualcomm employees. Issa, who received $5,000 in campaign contributions from Qualcomm employees from 2003 to 2004, sits on the House Small Business Committee, and previously tried to help the company by sponsoring a bill that would have required the military to use its CDMA (code division multiple access) technology.
"Hundreds of thousands of American jobs depend on the success of US-developed wireless technologies like CDMA," Issa claimed in a letter to Donald Rumsfeld. But the Pentagon doesn't seem to be buying the argument. The DoD's inspector general has asked the FBI to investigate Shaw's activities.
(For an excellent, in-depth investigation of Qualcomm see Michael Scherer, "Crossing the Lines," Mother Jones, Sept./Oct. 2004)
The Top Ten War Profiteers of 2004
By the Center for Corporate Policy
At the start of the Iraq war, Andrew Natsios of USAID proclaimed that the reconstruction of Iraq would look like a modern-day Marshall plan. The grand designs of the Bush administration, however, have made a handful of companies serious money.
This list was compiled by the Center for Corporate Policy, a non-profit, non-partisan public interest organization working to curb corporate abuses and make corporations publicly accountable. More information is available at www.corporatepolicy.org.
Aegis
In June, the Pentagon's Program Management Office in Iraq awarded a $293 million contract to coordinate security operations among thousands of private military contractors (PMCs) to Aegis, a UK firm whose founder was once investigated for illegal arms smuggling. An inquiry by the British parliament into Sandline, Aegis head Tim Spicer's former firm, determined that the company had shipped guns to Sierra Leone in 1998 in violation of a UN arms embargo. Sandline's position was that it had approval from the British government, although British ministers were cleared by the inquiry. Spicer resigned from Sandline in 2000 and incorporated Aegis in 2002.
A protest brought by rival PMC bidder Dyncorp after its bid was deemed unacceptable by the Army, was dismissed by the General Accounting Office, which concluded that Dyncorp "lacked standing to challenge the integrity of the awardee (Aegis)." Critics say that's just the problem. US and international law have failed to address the role of PMCs in Iraq, resulting in a near-total lack of accountability that epitomizes what's wrong with the corporate takeover of Iraq. PMCs fall outside the Military Code of Justice and possibly cannot be prosecuted by Iraq's own laws, due to CPA order #17, which says foreign contractors, including private security firms, are granted full immunity from Iraq's laws, even if they injure or kill an innocent party.
Bearing Point
Critics find it ironic that Bearing Point, the former consulting division of KPMG, received a $240 million contract in 2003 to help develop Iraq's "competitive private sector," since it had a hand in the development of the contract itself. According to a March 22 report by USAID's assistant inspector general Bruce Crandlemire, "Bearing Point's extensive involvement in the development of the Iraq economic reform program creates the appearance of unfair competitive advantage in the contract award process."
Bearing Point spent five months helping USAID write the job specifications and even sent some employees to Iraq to begin work before the contract was awarded, while its competitors had only a week to read the specifications and submit their own bids after final revisions were made. "No company who writes the specs for a contract should get the contract," says Keith Ashdown, the vice president of Washington, DC-based Taxpayers for Common Sense.
Neither Crandlemire nor other critics claim BearingPoint broke the law. But the company's ties to the Bush administration (according to the Center for Responsive Politics, BearingPoint employees gave $117,000 to the 2000 and 2004 Bush election campaigns, more than any other Iraq contractor) is an example of "crony contracting" that undermines the legitimacy of those who might claim to be working to establish competitive markets in the "newly liberated" country.
Bechtel
Bechtel was literally tasked with repairing much of Iraq's infrastructure—schools, hospitals, bridges, airports, water treatment plants, power plants, railroad, irrigation, electricity, etc.—a job that was critical to winning hearts and minds after the war. To accomplish this, the company hired over 90 Iraqi subcontractors for at least 100 jobs. Most of these subcontracts involved rote maintenance and repair work, however, and for sophisticated work requiring considerable hands-on knowledge of the country's infrastructure, the company bypassed Iraqi engineers and managers.
The company has yet to meet virtually any of the major deadlines in its original contract. In October, according to USAID, the CPA had restored only 4,400 MW (mega-watts) of electrical generating capacity target, falling short of its goal of 6,000 MW by end of June (USAID's goal was 9,000 MW, a level that existed in the country before the first gulf war). According to a June GAO report, "electrical service in the country as a whole has not shown a marked improvement over the immediate postwar levels of May 2003 and has worsened in some governorates."
Bechtel is not entirely to blame, as some of the delay is obviously due to the difficulties of getting employees and materials safely to project sites. [Editor's note: Not to mention the tens of thousands of new electrical appliances shipped into an import-starved post-sanction Iraq, the potential impact of which was not included in the original electrical capacity generating goals.]
BKSH & associates
Chairman Charlie Black is an old Bush family friend and prominent Republican lobbyist whose firm is affiliated with Burson Marsteller, the global public relations giant. Black was a key player in the Bush/Cheney 2000 campaign and together with his wife raised $100,000 for this year's reelection campaign.
BKSH clients with contracts in Iraq include Fluor International (whose ex-chair Phillip Carroll was tapped to head Iraq's oil ministry after the war, and whose board includes the wife of James Woolsey, the ex-CIA chief who was sent by Paul Wolfowitz before the war to convince European leaders of Saddam Hussein's ties to al-Qaeda). Fluor has won joint contracts worth up to $1.6 billion.
Another client is Cummins Engine, which has managed to sell its power generators thanks to the country's broken infrastructure.
Most prominent among BKSH's clients, however, is the Iraqi National Congress, whose leader Ahmed Chalabi was called the "George Washington of Iraq" by certain Pentagon neoconservatives before his fall from grace. BKSH's K. Riva Levinson was hired to handle the INC's U.S. public relations strategy in 1999. Hired by US taxpayers, that is: Until July 2003, the company was paid $25,000 per month by the US State Department to support the INC.
CACI and Titan
Although members of the military police face certain prosecution for the horrific treatment of prisoners at the Abu Ghraib prison, so far the corporate contractors have avoided any charges. Maj. Gen. Antonio Taguba reported in an internal Army report that two CACI employees "were either directly or indirectly responsible" for abuses at the prison, including the use of dogs to threaten detainees and forced sexual abuse and other threats of violence. Another internal Army report suggested that Steven Stefanowicz, one of 27 CACI interrogators working for the Army in Iraq, "clearly knew [that] his instructions" to soldiers interrogating Iraqi prisoners "equated to physical abuse."
"Titan's role in Iraq is to serve as translators and interpreters for the US Army," company CEO Gene Ray said, implying that news reports had inaccurately implied the employees' involvement in torture. "The company's contract is for linguists, not interrogators." But according to Joseph A. Neurauter, a GSA suspension and debarment official, CACI's role in designing its own Abu Ghraib contract "continues to be an open issue and a potential conflict of interest."
Nevertheless, the GSA and other agencies conducting their own investigations have yet to find a reason to suspend the company from any new contracts. As a result, in August the Army gave CACI another $15 million no-bid contract to continue providing interrogation services for intelligence gathering in Iraq; In September, the Army awarded Titan a contract worth up to $400 million for additional translators.
Custer Battles
At the end of September, the Defense Department suspended Custer Battles (the name comes from the company's two principle founders—Michael Battles and Scott Custer) and 13 associated individuals and affiliated corporations from all federal contracts for fraudulent billing practices involving the use of sham corporations set up in Lebanon and the Cayman Islands. The CPA caught the company after it left a spreadsheet behind at a meeting with CPA employees. The spreadsheet revealed that the company had marked up certain expenses associated with a currency exchange contract by 162 percent.
Robert Isakson, a company employee, drew attention to the problem by filing a false claims action against the company. Isakson also alleged that Custer's "war profiteering...contributed to the deaths of at least four Custer Battles employees."
In a prepared statement, company attorneys suggested that the government's decision to not participate in Isakson's case is evidence that the charges are baseless, and that "the individuals [involved] filed this claim solely as a last ditch effort to achieve a competitive edge over CB."
The suspension was the first for any company in association with its work in Iraq. The FBI and the Pentagon inspector general's Defense Criminal Investigative Services are both conducting ongoing investigations.
Halliburton
In December Congressman Waxman (D-CA), an-nounced that "a growing list of concern's about Halliburton's performance" on contracts that total $10.8 billion have led to multiple criminal investigations into overcharging and kickbacks. In nine different reports, government auditors have found "widespread, systemic problems with almost every aspect of Halliburton's work in Iraq, from cost estimation and billing systems to cost control and subcontract management." Six former employees have come forward, corroborating the auditors' concerns.
Another "H-bomb" dropped just before the election, when a top contracting official responsible for ensuring that the Army Corps of Engineers follows competitive contracting rules accused top Pentagon officials of improperly favoring Halliburton in an early-contract before the occupation. Bunnatine Greenhouse says that when the Pentagon awarded the company a five-year oil-related contract worth up to $7 billion, it pressured her to withdraw her objections, actions that she said were unprecedented in her experience.
Halliburton spokesperson Beverly Scippa says that while she cannot comment on the allegations until specific charges are filed, any suggestion that the company's involvement made it difficult for other companies to fairly compete are "absolutely untrue," pointing to a earlier GAO report that found that Halliburton/KBR was "the only contractor DOD had determined was in a position to provide the services within the required time frame given prewar planning requirements."
But others, including Waxman, believe that Greenhouse's version of events corroborates existing evidence that the contracting process was biased toward Vice President Dick Cheney's old company. Pentagon officials referred the matter to the Pentagon's inspector general, a move that critics say effectively buried the issue.
(For more information about Halliburton, visit www.HalliburtonWatch.org)
Lockheed Martin
Lockheed Martin remains the king among war profiteers, raking in $21.9 billion in Pentagon contracts in 2003 alone. With satellites and planes, missiles and IT systems, the company has profited from just about every phase of the war except for the reconstruction. The company's stock has tripled since 2000 to just over $60.
Lockheed is also helping Donald Rumsfeld develop a new tech-heavy integrated global warfare system that the company promises will transform the nature of war. In fact, the large defense conglomerate's sophistication in areas as diverse as space systems, aeronautics, and IT will allow it to play a leading role in the development of new weapons systems for decades to come, including a planned highly-secure military Internet, a spaced-based missile defense system, and next-generation warplanes such as the F-22 (currently in production) and the Joint Strike Fighter F-35.
When it comes to defense policy, Lockheed's network of influence is virtually unmatched. E.C. Aldridge Jr., the former undersecretary of defense for acquisitions and procurement, gave final approval to begin building the F-35 in 2001, a decision potentially worth $200 billion to the company. Although he soon left the Pentagon to join Lockheed's board, Aldridge continues to straddle the public-private divide: Rumsfeld appointed him to a blue-ribbon panel to study advanced weapons systems.
Former Lockheed lobbyists and employees include the current secretary of the Navy, Gordon England, secretary of transportation Norm Mineta (a former Lockheed vice president) and Stephen J. Hadley, Bush's proposed successor to Condoleeza Rice as his next national security advisor.
Lockheed is not only represented on various Pentagon advisory boards, but is also tied to various influential think tanks. For example, Lockheed VP Bruce Jackson (who helped draft the Republican foreign policy platform in 2000) is a key player at the neo-conservative planning bastion known as the Project for a New American Century.
Loral Satellite
In the buildup to the war the Pentagon bought up access to numerous commercial satellites to bolster its own orbiting space fleet. US armed forces needed the extra spaced-based capacity to be able to transmit huge amounts of data to planes (including unmanned Predator drones flown remotely by pilots who may be halfway around the world), and guided missiles and troops on the ground.
Industry experts say the war on terror literally saved some satellite operators from bankruptcy. The Pentagon "is hoovering up all the available capacity" to supplement its three orbiting satellite fleets, Richard DalBello, president of the Satellite Industry Association explained to the Washington Post in 2003. The industry's other customers—broadcast networks competing for satellite time—were left to scramble for the remaining bandwidth.
Loral Space & Communications Chairman Bernard L. Schwartz is very tight with the neoconservative hawks in the Bush administration's foreign policy ranks, and is the principal funder of Blueprint, the newsletter of the Democratic Leadership Council.
In the end, the profits from the war in Iraq didn't end up being as huge for the industry as expected, and certainly weren't enough to compensate for a sharp downturn in the commercial market. But more help may be on its way. The Pentagon announced in November that it would create a new global Intranet for the military that would take two decades and hundreds of billions of dollars to build. Satellites, of course, will play a key part in that integrated global weapons system.
Qualcomm
Two CPA officials resigned this year after claiming they were pressured by John Shaw, the deputy undersecretary of defense for technology security to change an Iraqi police radio contract to favor Qualcomm's patented cellular technology, a move that critics say was intended to lock the technology in as the standard for the entire country.
Iraq's cellular market is potentially worth hundreds of millions of dollars in annual revenues for the company, and potentially much more should it establish a standard for the region. Shaw's efforts to override contracting officials delayed an emergency radio contract, depriving Iraqi police officers, firefighters, ambulance drivers and border guards of a joint communications system for months.
Shaw says he was urged to push Qualcomm's technology by Rep. Darrell E. Issa, a Republican whose San Diego County constituency includes numerous Qualcomm employees. Issa, who received $5,000 in campaign contributions from Qualcomm employees from 2003 to 2004, sits on the House Small Business Committee, and previously tried to help the company by sponsoring a bill that would have required the military to use its CDMA (code division multiple access) technology.
"Hundreds of thousands of American jobs depend on the success of US-developed wireless technologies like CDMA," Issa claimed in a letter to Donald Rumsfeld. But the Pentagon doesn't seem to be buying the argument. The DoD's inspector general has asked the FBI to investigate Shaw's activities.
(For an excellent, in-depth investigation of Qualcomm see Michael Scherer, "Crossing the Lines," Mother Jones, Sept./Oct. 2004)
Coalition Provisional Authority - Wild West Iraq
International Relations and Security Network ISN - Security Watch
At a Senate hearing on Monday, Democratic senators accused the Coalition Provisional Authority (CPA), which ran Iraq from June 2003 to June 2004, of having wasted millions of dollars. Former CPA official Franklin Willis testified to widespread abuse and waste of money at the authority, and presented photographs of himself and other US officials holding bundles of US$100 bank notes - totaling US$2 million - wrapped in plastic. He said the bundles of cash had been used to pay a security contractor. “A combination of inexperienced officials, fear of decision-making, lack of communications, minimal security, no banks, and lots of money to spend" led to Wild West-style chaos, Willis said. Allegations of overcharging and fraud were also made at the hearing. At the end of January, an inspector-general's report concluded that the CPA had transferred nearly US$9 billion to the interim Iraqi government without any accounting controls.
At a Senate hearing on Monday, Democratic senators accused the Coalition Provisional Authority (CPA), which ran Iraq from June 2003 to June 2004, of having wasted millions of dollars. Former CPA official Franklin Willis testified to widespread abuse and waste of money at the authority, and presented photographs of himself and other US officials holding bundles of US$100 bank notes - totaling US$2 million - wrapped in plastic. He said the bundles of cash had been used to pay a security contractor. “A combination of inexperienced officials, fear of decision-making, lack of communications, minimal security, no banks, and lots of money to spend" led to Wild West-style chaos, Willis said. Allegations of overcharging and fraud were also made at the hearing. At the end of January, an inspector-general's report concluded that the CPA had transferred nearly US$9 billion to the interim Iraqi government without any accounting controls.
"Custer" and "Battles" Terrorize Iraq
U.S. contractors in Iraq allege abuses
Four men say they witnessed shooting of unarmed civilians :: from www.uruknet.info :: news from occupied Iraq
This is not the firm’s first brush with controversy. Custer Battles is a relatively new company in the booming field of so-called "private military companies" in Iraq providing veteran soldiers from around the world for various security jobs. Named for founders Michael Battles and Scott Custer, who are military veterans, the company quickly nabbed lucrative contracts in Iraq, where U.S. authorities needed firms who were willing to accept high-risk assignments.
"Michael Battles" and "Scott Custer"? Is this for real?
Four men say they witnessed shooting of unarmed civilians :: from www.uruknet.info :: news from occupied Iraq
This is not the firm’s first brush with controversy. Custer Battles is a relatively new company in the booming field of so-called "private military companies" in Iraq providing veteran soldiers from around the world for various security jobs. Named for founders Michael Battles and Scott Custer, who are military veterans, the company quickly nabbed lucrative contracts in Iraq, where U.S. authorities needed firms who were willing to accept high-risk assignments.
"Michael Battles" and "Scott Custer"? Is this for real?
Corrupt Iraqi Occupation
Iraq Occupation Ran On Policy of Corruption, Witnesses Say
Witnesses testifying at a special Congressional hearing yesterday told Democratic lawmakers about severe and rampant mishandling of American and Iraqi funds managed by the former US-run occupation government, as well as censorship and manipulation of Iraqi media in the service of pro-American propaganda.
One former senior advisor to the Coalition Provisional Authority (CPA), the organization established to administer the US occupation of Iraq during the first year following the March 2003 invasion, testified that massive amounts of freshly minted American cash were distributed regularly to Iraqi ministries and American companies.
On at least one known occasion, cash was handed to a private US mercenary firm, ostensibly to be spent on its operations in Iraq, though the cash was not properly accounted for once it was paid. Former CPA employee Frank Willis said that company, Custer Battles, was handed $2 million in shrink-wrapped $100 bills in his presence, and he displayed a photograph taken just moments before the handing over to prove it.
A lawyer attended the hearings to represent two former associates of Custer Battles who declined at the last minute to testify in person for fear of retribution from both the mercenary firm and the Bush administration. Alan Grayson said his clients have filed a sealed claim against Custer Battles alleging, in part, that the company accepted $15 million from the CPA to provide security for Iraq’s civilian airline, which was in fact grounded for the duration of the contract and in no need of the company’s services.
The hearing was called by Senator Byron Dorgan (D-North Dakota), chairperson of the Democratic Policy Committee, in lieu of oversight activities that should have been held by Congressional committees with actual jurisdiction over US policy toward Iraq, in Dorgan’s view.
Senator Harry Reid (D-Nevada) and Representative Henry Waxman (D-California) joined Dorgan on the committee, which heard testimony from four witnesses, including two who worked in Iraq and personally witnessed what they termed the misuse of Iraqi and American monies intended for reconstruction-related projects. The committee members said the hearing was inspired by a recent report by the inspector general for Iraqi reconstruction, which found nearly $9 billion in mismanaged or missing funds that were supposedly under CPA control.
Theft By Any Other Name
Grayson read from an internal memo compiled by a Custer Battles field manager, which drew damning conclusions about Custer Battles’ top executives, apparently regarding the company’s fulfillment of a $21 million contract to guard the exchange of Iraq’s Saddam Hussein-era currency for US-minted bills in late 2003 and early 2004. Based on information provided by one of Grayson’s clients, the memo stated:
Indicated in this report are enormous areas of discrepancies and irregularities that lend themselves to criminal fraud. A broader issue of criminal intent has become evident. The documents are prima facia evidence of a course of conduct consistent with criminal activity and intent. The concerns and issues raised by [whistleblower Pete Baldwin], in his response to my email, significantly reinforces my concern that criminal activity transpired here on the money exchange project.
The memo goes on to cite "a clear and definite pattern of deception and misrepresentation" and recommends, "Further discussions and decisions concerning the [money exchange] project should be coordinated through the corporate criminal defense attorney."
In his testimony, Grayson mistakenly referred to the author of that memorandum as Custer Battles’ "corporate integrity officer." But according to a New York Times article published last October, it was only after that memo was written that the man who penned it, Peter Miskovich, found himself promoted from a field manager to the position of corporate integrity officer. At that point, Miskovich recanted the findings reported in his memo and revised attribution of blame to individual lower-level employees, insisting that neither Scott Custer nor Mike Battles, the company’s founders, "was involved in the questionable conduct." Prior to his change in title, Miskovich oversaw the money exchange project, reported the Times.
Assistant US Attorney Richard Sponseller, according to Grayson, has suggested that any fraud committed against the CPA should not be equated with theft from the United States, since the CPA was an international organization. But when President George Bush signed the CPA’s original funding mandate, it clearly referred to the organization as "an entity of the United States."
Custer Battles has reached the same conclusion about its own lack of culpability, but for different reasons. The company’s lawyers told CorpWatch, a website that monitors the activity of war profiteers, that the claim against them should be dismissed because the money allegedly stolen was rightfully that of Iraqis, not Americans.
Grayson told the committee that the Bush administration has so far declined to respond to the claim he filed on behalf of the two men previously affiliated with Custer Battles.
Grayson pointed out that for a full year after the federal government had conclusive evidence that Custer Battles was committing crimes against the United States, the CPA continued to award hefty contracts to the firm. Finally, on September 30, 2004, the US Air Force placed Custer Battles on a government blacklist under a code that excludes contracting with organizations involved in "fraud, antitrust violations, embezzlement, theft, forgery, bribery, false statements or any other offenses indicating a lack of business integrity."
In an October 2004 press release, Custer Battles denied all claims of misconduct and speculated that the two ex-associates, identified as former employee Pete Baldwin and contractor Bob Isakson, filed their claim as "a last ditch effort to achieve a competitive edge over [Custer Battles]." Isakson runs a disaster relief firm that Custer Battles said competes with it for contracts.
A ‘Public Diplomacy Operation’
Journalist Mark North, who covered the invasion for National Public Radio and was employed by the CPA to train Iraqi journalists to report for the US-founded Iraq Media Network (IMN), told the hearing that CPA officials regularly directed and censored the activities of the TV news station. He said "a laundry list of CPA activities" was handed down to dictate subject matter with which to replace stories Iraqi journalists preferred to report, such as those pertaining to the problems of post-war life in the embattled country.
"The original plan for IMN seems to have been jettisoned by CPA officials who were more interested in managing news for Iraqis and Americans," North told the committee. He said the CPA made the Iraqi media operation into "another Voice of America," referring to the US government-run propaganda outlet that broadcasts to millions of people in foreign countries. He said CPA officials told him IMN was to be "a public diplomacy operation" for the occupation authorities.
North testified that on occasion, CPA officials specifically ordered stories critical of the occupation and its effects to be cut and insisted that IMN run stories about positive work undertaken by occupation forces.
News content was not the only problem North reported. A labor conflict also arose during his four-month involvement at IMN. "For the first two months, the local staff of about 200 journalists and technicians were not paid their salaries," North said. "Finally, they went on strike. CPA would not negotiate. Striking staffers were told to go back to work, or the US Army would remove them from the studios."
North also told the committee that of the ten American journalists and engineers hired to train Iraqis, all quit within six months. Additionally, the Iraqi hired as news director "was forced to resign," North testified. Ahmed Al-Rikaby had dismissed five employees North described as "troublemakers and Baathists," but the American corporation that oversaw IMN hired them back and reprimanded Al-Rikaby. IMN was established by a Pentagon contractor called Scientific Applications International Corp, which specializes in military gear and programs.
Furthermore, while private American contractors were lavishly wasting CPA funds on five-star hotels in Kuwait and unnecessary supplies in Baghdad, the Iraq Media Network lacked even basic equipment. According to North, a request for just $200 with which to print a journalism training manual in Arabic was never fulfilled. North said he had to use his only day off to teach a journalism course.
While the committee members and witnesses repeatedly affirmed their support for the US mission in Iraq and did not suggest the activities in questions were necessarily systemic, each witness testified that the corrupt activities were carried out as a matter of policy, and no one suggested questionable transactions were contrary to CPA regulations.
Senator Reid speculated that the problems raised by witnesses at the hearing represented "just the tip of the iceberg."
The White House had no comment on Monday, but a Pentagon spokesperson told the LA Times that the occupation authority tried its best to run on the level. "The CPA was operating under extraordinary conditions from its inception to mission completement," Army Lt. Col. Joseph Yoswa said. "Throughout, the CPA strived earnestly for sound management, transparency and oversight."
© 2005 The NewStandard
Witnesses testifying at a special Congressional hearing yesterday told Democratic lawmakers about severe and rampant mishandling of American and Iraqi funds managed by the former US-run occupation government, as well as censorship and manipulation of Iraqi media in the service of pro-American propaganda.
One former senior advisor to the Coalition Provisional Authority (CPA), the organization established to administer the US occupation of Iraq during the first year following the March 2003 invasion, testified that massive amounts of freshly minted American cash were distributed regularly to Iraqi ministries and American companies.
On at least one known occasion, cash was handed to a private US mercenary firm, ostensibly to be spent on its operations in Iraq, though the cash was not properly accounted for once it was paid. Former CPA employee Frank Willis said that company, Custer Battles, was handed $2 million in shrink-wrapped $100 bills in his presence, and he displayed a photograph taken just moments before the handing over to prove it.
A lawyer attended the hearings to represent two former associates of Custer Battles who declined at the last minute to testify in person for fear of retribution from both the mercenary firm and the Bush administration. Alan Grayson said his clients have filed a sealed claim against Custer Battles alleging, in part, that the company accepted $15 million from the CPA to provide security for Iraq’s civilian airline, which was in fact grounded for the duration of the contract and in no need of the company’s services.
The hearing was called by Senator Byron Dorgan (D-North Dakota), chairperson of the Democratic Policy Committee, in lieu of oversight activities that should have been held by Congressional committees with actual jurisdiction over US policy toward Iraq, in Dorgan’s view.
Senator Harry Reid (D-Nevada) and Representative Henry Waxman (D-California) joined Dorgan on the committee, which heard testimony from four witnesses, including two who worked in Iraq and personally witnessed what they termed the misuse of Iraqi and American monies intended for reconstruction-related projects. The committee members said the hearing was inspired by a recent report by the inspector general for Iraqi reconstruction, which found nearly $9 billion in mismanaged or missing funds that were supposedly under CPA control.
Theft By Any Other Name
Grayson read from an internal memo compiled by a Custer Battles field manager, which drew damning conclusions about Custer Battles’ top executives, apparently regarding the company’s fulfillment of a $21 million contract to guard the exchange of Iraq’s Saddam Hussein-era currency for US-minted bills in late 2003 and early 2004. Based on information provided by one of Grayson’s clients, the memo stated:
Indicated in this report are enormous areas of discrepancies and irregularities that lend themselves to criminal fraud. A broader issue of criminal intent has become evident. The documents are prima facia evidence of a course of conduct consistent with criminal activity and intent. The concerns and issues raised by [whistleblower Pete Baldwin], in his response to my email, significantly reinforces my concern that criminal activity transpired here on the money exchange project.
The memo goes on to cite "a clear and definite pattern of deception and misrepresentation" and recommends, "Further discussions and decisions concerning the [money exchange] project should be coordinated through the corporate criminal defense attorney."
In his testimony, Grayson mistakenly referred to the author of that memorandum as Custer Battles’ "corporate integrity officer." But according to a New York Times article published last October, it was only after that memo was written that the man who penned it, Peter Miskovich, found himself promoted from a field manager to the position of corporate integrity officer. At that point, Miskovich recanted the findings reported in his memo and revised attribution of blame to individual lower-level employees, insisting that neither Scott Custer nor Mike Battles, the company’s founders, "was involved in the questionable conduct." Prior to his change in title, Miskovich oversaw the money exchange project, reported the Times.
Assistant US Attorney Richard Sponseller, according to Grayson, has suggested that any fraud committed against the CPA should not be equated with theft from the United States, since the CPA was an international organization. But when President George Bush signed the CPA’s original funding mandate, it clearly referred to the organization as "an entity of the United States."
Custer Battles has reached the same conclusion about its own lack of culpability, but for different reasons. The company’s lawyers told CorpWatch, a website that monitors the activity of war profiteers, that the claim against them should be dismissed because the money allegedly stolen was rightfully that of Iraqis, not Americans.
Grayson told the committee that the Bush administration has so far declined to respond to the claim he filed on behalf of the two men previously affiliated with Custer Battles.
Grayson pointed out that for a full year after the federal government had conclusive evidence that Custer Battles was committing crimes against the United States, the CPA continued to award hefty contracts to the firm. Finally, on September 30, 2004, the US Air Force placed Custer Battles on a government blacklist under a code that excludes contracting with organizations involved in "fraud, antitrust violations, embezzlement, theft, forgery, bribery, false statements or any other offenses indicating a lack of business integrity."
In an October 2004 press release, Custer Battles denied all claims of misconduct and speculated that the two ex-associates, identified as former employee Pete Baldwin and contractor Bob Isakson, filed their claim as "a last ditch effort to achieve a competitive edge over [Custer Battles]." Isakson runs a disaster relief firm that Custer Battles said competes with it for contracts.
A ‘Public Diplomacy Operation’
Journalist Mark North, who covered the invasion for National Public Radio and was employed by the CPA to train Iraqi journalists to report for the US-founded Iraq Media Network (IMN), told the hearing that CPA officials regularly directed and censored the activities of the TV news station. He said "a laundry list of CPA activities" was handed down to dictate subject matter with which to replace stories Iraqi journalists preferred to report, such as those pertaining to the problems of post-war life in the embattled country.
"The original plan for IMN seems to have been jettisoned by CPA officials who were more interested in managing news for Iraqis and Americans," North told the committee. He said the CPA made the Iraqi media operation into "another Voice of America," referring to the US government-run propaganda outlet that broadcasts to millions of people in foreign countries. He said CPA officials told him IMN was to be "a public diplomacy operation" for the occupation authorities.
North testified that on occasion, CPA officials specifically ordered stories critical of the occupation and its effects to be cut and insisted that IMN run stories about positive work undertaken by occupation forces.
News content was not the only problem North reported. A labor conflict also arose during his four-month involvement at IMN. "For the first two months, the local staff of about 200 journalists and technicians were not paid their salaries," North said. "Finally, they went on strike. CPA would not negotiate. Striking staffers were told to go back to work, or the US Army would remove them from the studios."
North also told the committee that of the ten American journalists and engineers hired to train Iraqis, all quit within six months. Additionally, the Iraqi hired as news director "was forced to resign," North testified. Ahmed Al-Rikaby had dismissed five employees North described as "troublemakers and Baathists," but the American corporation that oversaw IMN hired them back and reprimanded Al-Rikaby. IMN was established by a Pentagon contractor called Scientific Applications International Corp, which specializes in military gear and programs.
Furthermore, while private American contractors were lavishly wasting CPA funds on five-star hotels in Kuwait and unnecessary supplies in Baghdad, the Iraq Media Network lacked even basic equipment. According to North, a request for just $200 with which to print a journalism training manual in Arabic was never fulfilled. North said he had to use his only day off to teach a journalism course.
While the committee members and witnesses repeatedly affirmed their support for the US mission in Iraq and did not suggest the activities in questions were necessarily systemic, each witness testified that the corrupt activities were carried out as a matter of policy, and no one suggested questionable transactions were contrary to CPA regulations.
Senator Reid speculated that the problems raised by witnesses at the hearing represented "just the tip of the iceberg."
The White House had no comment on Monday, but a Pentagon spokesperson told the LA Times that the occupation authority tried its best to run on the level. "The CPA was operating under extraordinary conditions from its inception to mission completement," Army Lt. Col. Joseph Yoswa said. "Throughout, the CPA strived earnestly for sound management, transparency and oversight."
© 2005 The NewStandard
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