Justice Department May Investigate Halliburton Iraq Contracts

Justice Department May Investigate Halliburton Iraq Contracts
Nov 21 - The investigative arm of the Pentagon referred a military whistleblower's allegations of malfeasance and cronyism in awarding contracts for Iraq's reconstruction to the Justice Department last week, bringing the case out of military control for the first time since an Army Corps of Engineers procurement officer raised questions about the contracts over a year ago, a US senator revealed Friday.

In a statement, Senator Byron Dorgan (D-North Dakota) said the Defense Department Inspector General's office informed him that it had wrapped up its internal investigation of Army Corps of Engineers Senior Procurement Executive Bunnatine H. Greenhouse's charges that Corps officials had improperly awarded more than $10 billion in contracts to Halliburton subsidiary Kellogg Brown and Root (KBR) and referred the matter to the Justice Department. Dorgan and others applauded the decision.

"The hearings conducted by the Senate Democratic Policy Committee have revealed massive waste, fraud and abuse with regard to Iraq contracting, thanks to the testimony of courageous individuals like Bunnatine Greenhouse who have, often at great personal risk, blown the whistle on waste, fraud and abuse," Dorgan said.

At the end of June, Greenhouse testified before Senate Democrats that there was "serious and ongoing contract abuse" in Iraq that she could not address internally. The complaint focused mainly on KBR.

Little more than a month later, military superiors removed Greenhouse from her position, though she remains employed by the Corps of Engineers. Her demotion prompted charges of illegal retaliation, expressed by her attorney, politicians and others.

Lawyers for Greenhouse first made her allegations public in an October, 2004 letter to then-Acting US Army Secretary Les Brownlee that was also provided to members of Congress, Time magazine reported. The letter called for an independent investigation into the contracts, which included both competitive and no-bid awards, and detailed Greenhouse's difficulties in getting military officials to address her concerns.

Halliburton is not commenting directly on the matter due to the investigation but noted that a 2004 Government Accountability Office report failed to find any wrongdoing and said in a statement to CNN that KBR will continue to cooperate with investigations, the cable news outlet reported Friday evening.

The National Whistleblower Center established a defense fund for Greenhouse and is seeking financial support to put her personalized fight "on a more level playing field."