Posted on 06/15/2004 6:12:34 AM PDT by jmc813
Halliburton Inc. paid high-priced bills for common items, such as soda, laundry, and hotels, in Iraq and Kuwait and then passed the inflated costs along to taxpayers, according to several former Halliburton employees and a Pentagon internal audit.
Democrats in the House of Representatives, who are feuding with House Republicans over whether the spending should be publicly aired at a hearing Tuesday, released signed statements Monday by five ex-Halliburton employees recounting the lavish spending.
Those former employees contend that the firm:
# Lodged 100 workers at a five-star hotel in Kuwait for a total of $10,000 a day while the Pentagon wanted them to stay in tents, like soldiers, at $139 a night.
# Abandoned $85,000 trucks because of flat tires and minor problems.
# Paid $100 to have a 15-pound bag of laundry cleaned as part of a million-dollar laundry contract in peaceful Kuwait. The price for cleaning the same amount of laundry in war-torn Iraq was $28.
# Spent $1.50 a can to buy 37,200 cans of soda in Kuwait, about 24 times higher than the contract price.
# Knowingly paid subcontractors twice for the same bill.
Halliburton, which was formerly headed by Vice President Dick Chaney, is already under fire for allegations of overcharging the Pentagon for fuel and soldiers' meals. The latest accusations center on whether Halliburton properly keeps track of its bills from subcontractors, Pentagon auditors said in a month-old report released Monday by Rep. Henry Waxman, D-Calif.
The 36-page report by the Defense Contract Audit Agency said Halliburton subsidiary Kellogg, Brown and Root had a billing system that was "inadequate," had numerous deficiencies and billing misstatements, and that KBR didn't follow laws and regulations relating to spending and record keeping.
Its contracting practices are so bad, the auditors said, that KBR shouldn't be allowed to bill the Pentagon directly without the government poring over every detail in advance.
Statements by the whistle-blowers - five of whom were identified - and the government's audit report "portray a company and a contracting environment that has run amok," Waxman wrote in a letter to Government Reform Committee Chairman Tom Davis, R-Va., on Monday.
Halliburton disputed the auditor's report and said Waxman was politically motivated.
Wendy Hall, a company spokeswoman, said Waxman's allegations do nothing "to feed a single member of our military, create a single unit of housing, repair a single oil well, or supply a single piece of material for reconstruction."
But one former Halliburton subcontracting manager, Marie deYoung, said in her signed statement that she had seen "significant waste and overpricing."
"Halliburton rarely collected adequate information from subcontractors to justify payment of invoices. When I attempted to properly verify invoice terms before setting up payment authorization, I was chastised," said DeYoung, a former Army captain and chaplain who resigned from the company last month.
DeYoung said Halliburton's financial staff lives at the five-star Kempinski Julai'a Hotel and Resort in Kuwait. "For a three-month period, the Kempinski hotel charged almost $1 million to house 100 Halliburton employees.
"By comparison, it costs less than $200,000 a year to lease tents that could house 400 soldiers. ... The military requested that Halliburton move into tents, but Halliburton refused."
Hall didn't respond to the specific charges made by DeYoung and other employees, but said, "There are clear inaccuracies in these assertions. We take any charges of improper conduct seriously."
I wouldn't be surprised if all this is true. Govt contractors can be awfully greedy.
If I'm a contractor working for Halliburton/KBR and they tell me I'm going to live in a tent? No way...
Not without lots of money and accrued vacation time.
......hey, it's not just ANY tent....it's a $139.00 a night tent!
WTF? $139.00 a night?
The tents have a lighted "Marriott" logo on the outside, so it's worth it to go with a trusted brand. ;)
Is this $139/night per worker or for all of them?
Based on this paragraph further down in the "story," I think the $139/night was a per worker cost. If it were for the 100 of them, the total annual cost would be $50,735.00
The per night cost must be $13,900. Therefore, it costs more to put them in tents.
One of the complaints you hear these days is that Halliburton (or any other contractor, for that matter) is being paid to do a lot of the functions that U.S. military personnel once did themselves. My guess is that the difference in cost between the two is not all that great. Having a private contractor do these things costs more on the spot, but a contractor doesn't have to be kept on active duty for years waiting for the time that he becomes useful.
""By comparison, it costs less than $200,000 a year to lease tents that could house 400 soldiers."
Based on this paragraph further down in the "story," I think the $139/night was a per worker cost. If it were for the 100 of them, the total annual cost would be $50,735.00
The per night cost must be $13,900. Therefore, it costs more to put them in tents.
Using their numbers, to house 400 costs $200,000/yr; 100 costs 50,000/yr, or the $139 per night per 100.
I don't see how this sentence was supported by the rest of your post. The $139 a night seems to be for the entire group (100).
Oops. Sorry - by bad.
"The per night cost must be $13,900. Therefore, it costs more to put them in tents." was a quote of Sauropod's, not mine. I forgot to quote properly...
Ah, OK. I agree, then. :)
Govt per diem rates for civilian contractors in Kuwait City is $344/day...lodging, meals, and incidentals.
Waxman wants them to supply soda at 6.25 cents per can?
The Democratic Party of course.
As for housing, as a civillian, would you go into an area where vehicle bombs are a possibility, and stay in a tent which will let in dust (messes up the computers), without air conditioning in the desert?
I did something not so different in Nevada on a wellsite years ago, (no terrorist threat) but I was a lot hungrier then. Now? No way.
Look at the Gubmint perdiem rate for DC. Then let them go ahead and carp about it. Nevada was $26 per day.
Bullshit. Giving Halliburton the contract without a bidding war led to this kind of waste.
Here's another article on this mess:
http://www.realcities.com/mld/krwashington/8922543.htm?template=contentModules/printstory.jsp
The key points:
-Abandoned $85,000 trucks because of flat tires and minor problems.
-Paid $100 to have a 15-pound bag of laundry cleaned as part of a million-dollar laundry contract in peaceful Kuwait. The price for cleaning the same amount of laundry in war-torn Iraq was $28.
But one former Halliburton subcontracting manager, Marie deYoung, said in her signed statement that she had seen "significant waste and overpricing."
"Halliburton rarely collected adequate information from subcontractors to justify payment of invoices. When I attempted to properly verify invoice terms before setting up payment authorization, I was chastised," said deYoung, a former Army captain and chaplain who resigned from the company last month.
Last week, Halliburton revealed that it's being investigated by the Securities and Exchange Commission over allegations of bribery in Nigeria for the late 1990s, when Vice President Dick Cheney was in charge of the firm. Last month, a dozen truckers told Knight Ridder that Halliburton sent them back and forth across Iraq with empty trailers more than 100 times.
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Sounds like waste to me.
My bad, I was looking at another FR article on this. But the point still stands...the tent thing may be understandable, but many of the other problems of alleged waste are not as explainable.
The $139 figure could be read either way. This is sloppy reporting.
Note also how they had to put Dick Cheney's name in the article, even though he had nothing to do with the supposed financial abuses.
"Halliburton" ping
The company I worked for hired a cook who formerly worked on the pipeline. The food he served in our cafeteria was extremely high quality with mouth-watering variety. The company subsidy for the cafeteria was probably not enough to cover the unexpected expenses. It was great while it lasted.
Well, it happens.
Not on anything but a temporary basis, but it happens.
Oh, I'm aware of that, I had to put up contractors in tents on Al Jabar, they were making big bucks on perdiem, so they weren't complaining....
We also supplied them with desert BDUs, flak vests, and chem gear...
Yeah, we have all of that. I'm not in a tent, but newcomers have had to stay in them for a couple of weeks on occasion as the camp grew.
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