The latest quarterly report from the Special Inspector General for Iraq Reconstruction (SIGIR), released October 30, has not received much attention. That is a pity because SIGIR does fine work and its reports always provide a wealth of detail on contractor activities in Iraq.
Let's consider a few examples of fraud noted in the report.
As of early October 2010, SIGIR investigators were working 110 open cases. Recent investigative accomplishments included:
• On July 23, Theresa Russell, a former staff sergeant in the U.S. Army, was sentenced in federal court in San Antonio, Texas, to five years probation and ordered to pay $31,000 in restitution and a $100 special assessment. The sentence was the result of a January 27, 2010, guilty plea to a one-count criminal information charging her with money laundering arising from a scheme involving the fraudulent awarding and administration of U.S. government contracts in Iraq.
On August 11, Wajdi Birjas, a former DoD contract employee, pled guilty to conspiracy to bribe U.S. Army contracting officials stationed at Camp Arifjan, an, an Army base in Kuwait, and to money-laundering conspiracy involving former Majors Christopher Murray and James Momon, as well as a sergeant first class deployed to Camp Arifjan as a senior procurement non-commissioned officer.
• On September 2, Dorothy Ellis, a former senior employee of a U.S. military contractor, pled guilty to conspiracy to pay $360,000 in bribes to U.S. Army contracting officials stationed at Camp Arifjan in Kuwait. According to court documents, Hall obtained the work by bribing certain U.S. Army contracting officers, including Momon and Murray. Ellis admitted that she participated in the bribery scheme by providing Momon and Murray access to secret bank accounts established on their behalf in the Philippines. Under the plea agreement, Ellis agreed to forfeit $360,000 to the government. Sentencing is scheduled for December.
• In mid-September, papers were filed in federal court charging a U.S. Army major with one count of bribery. The major, who had served two tours in Iraq and one in Afghanistan, was charged with accepting money and other items of value from two foreign nationals affiliated with companies that sought and received Army contracts. If convicted, the major will have to forfeit all property derived from proceeds traceable to the commission of the offense, including two Rolex watches, real estate, a camper trailer, a Harley Davidson motorcycle, and a Dodge Ram truck.
On October 1, Ismael Salinas pled guilty to receiving hundreds of thousands of dollars in illegal kickbacks from subcontractors in Iraq. Salinas overbilled DoD by $847,904, taking at least $424,000 in kickbacks from six companies. Salinas faces up to five years in prison when he is sentenced in December.
Of course, not all contractors are crooks. Many make the ultimate sacrifice, albeit unheralded.
The Department of Labor (DoL) received reports of 14 additional deaths of contractors working on U.S.-funded reconstruction programs in Iraq this quarter. DoL also received reports of 799 injuries this quarter that resulted in the contractor missing at least four days of work. Since DoL began compiling this data in March 2003, it has received reports of 1,507 contractor deaths in Iraq.
Contractor mortality is now roughly equivalent to U.S. military fatalities, according to the report.
The number of claims for contractor deaths has generally declined since early 2007, but military fatalities have declined even more. Consequently, the number of military fatalities and contractor deaths is now similar. According to GAO analysis of DoL data, approximately 26% of contractor deaths in FY 2009 and the first half of FY 2010 were due to hostile incidents, mostly resulting from improvised explosive devices. Contractor injuries increased sharply in late 2006 and began rising again in 2009.
Note: See the graphic on page 55 for detail. For a month by month breakdown of contractor fatalities see graphic on p. 73.