Blood Money In Iraq

T. Christian Miller

September 13, 2006

T. Christian Miller is a staff writer for the Los Angeles Times.

I wrote a story for the Los Angeles Times this weekend about yet another lawsuit accusing Halliburton of fraud in Iraq. This time, the company allegedly bought a big-screen television and tubs of chicken wings and cheese sticks for the Super Bowl, and then stuck us with the tab.

I'm not going to weigh in on the merits of the lawsuit; Halliburton gets blamed for plenty of things it didn't do. But what is clear is that when it comes to the Bush administration’s record on prosecuting corruption in Iraq, there’s no there there. More than 30,000 contractors have spent the past three-and-a-half years running around Iraq with sackfuls of cash, loaded AK-47s and bullet proof SUVs. In that time, there have been exactly two criminal cases arising from Iraq contracting. That record of good behavior is not believable on its face.

The upshot is, either we've only sent angels to Iraq, or somebody hasn't been paying attention. As I document in my new book about the reconstruction of Iraq, Blood Money, the record suggests that the “accountability administration” has let the war profiteers run amok.

Consider this astonishing fact: For the past three years, the U.S. military has been spending $1 billion a week in Iraq. During much of that time, the Pentagon’s inspector general, the largest, most important watchdog in the U.S. government, has had exactly zero inspectors on the ground in Iraq. How’s that for watching over your taxpayer dollars?

The lack of oversight has encouraged fraud, waste and abuse. It has threatened our soldiers and Iraqis. And it has turned Iraq into a Wild West, a place without law, a judge or even a traffic cop.

It’s not as if there has been a lack of leads. Consider these well-documented cases, many of them found in my new book on the reconstruction of Iraq and its failures:

Custer Battles: A federal jury found the private security company guilty of fraud earlier this year. Among other allegations, the company was accused of setting up shell companies in the Cayman Islands, backdating documents and submitting false invoices.

But a judge overturned the verdict on the grounds that Custer Battles' contract was with the Coalition Provisional Authority, not the federal government. The ruling was essentially a get-out-of-jail-free card for every contractor who signed up in the entire first year of the occupation.

Blackwater: Two Blackwater guards opened fire and killed an Iraqi taxi driver as a convoy containing the senior U.S. spokesman in Iraq drove down a Baghdad street last year. An internal State Department investigation found that the men had violated procedures by failing to give the Iraqi driver enough warning before opening fire. Their punishment? Plane tickets home. No investigation, no charges, nothing.

Zapata Engineering: A group of private security guards working for Zapata Engineering rolled into Fallujah last year, where they allegedly begin randomly firing at Iraqis and Marine guard posts. The Marines arrested them, confiscated their weapons and forbade them from operating in the area. Here’s a quote from the Marine Corps’ letter to the men, which I obtained during the course of reporting on the incident for the Los Angeles Times :

Your convoy was speeding through (Fallujah) and firing shots indiscriminately, some of which impacted positions manned by U.S. Marines….Your actions endangered the lives of innocent Iraqis and U.S. service members in the area.

None of the accused security contractors were ever charged with a crime, much less prosecuted. Is it possible to imagine someone firing a shot at a Marine Corps outpost anywhere in the United States and being told to simply go home?

The above list does not even include the Big Stuff, documented in audit after audit by the Special Inspector General for the Reconstruction of Iraq: shoddy workmanship by Parsons; questionable accounting by Bechtel; missing equipment by Halliburton; an astounding $9 billion in Iraqi funds overseen by the United States never properly accounted for. Not a single corporate executive or government contracting officer has faced the music in any of these cases.

I acknowledge that many, if not most, contractors and government officials in Iraq were good people doing a nearly impossible job. Iraq was a difficult place to police. The laws were unclear, the working conditions were hazardous, and people had a job to do that required considerably more creativity than working in the United States.

That said, Iraq did not have to be the Wild West. There could have been more control. There could have been more order. There could have been the rule of law.

If someone had wanted it.