U.S. Wasting Money On Iraq Contracts?

The U.S. has currently spent at least $286 billion on the Iraq war, according to the Congressional Research Service. An estimated $170 billion will be spent in 2007. Much of that money is going to 60,000 civilian contractors involved in reconstruction and providing services to the troops.

But recently, the Pentagon admitted it has a hard time accounting for how billions of your tax dollars is being spent — how much of it is lost to contractor waste, fraud and abuse, CBS News investigative correspondent Armen Keteyian reports.

A document — part of a whistleblower lawsuit obtained by CBS News — alleges a blueprint of contractor abuse in Iraq. Detailing how the government was billed 10 times more than it should have been when U.S. troops used a recreation facility in Iraq.

That's because they were not billed once per visit, but rather billed repeatedly every time a soldier used:
  • a computer
  • a phone
  • ping pong equipment or pool equipment
  • a towel
  • a bottle of water

    The contractor in question, Kellogg Brown and Root, denies any wrongdoing.

    "Eventually we're going to have a bill for about a trillion dollars and people are not going to be able to account for a very, very large part of it," Sen. Patrick Leahy said.

    The Pentagon and Congress are currently investigating about 80 cases of alleged contractor waste, fraud and abuse in Iraq. To date, 26 have been referred to the Justice Department for possible prosecution.

    So far a few individuals have been charged, most from a single case, and only a few million dollars has been paid back. After three and a half years of war, not a single criminal case has been filed against any large corporation doing work in Iraq.

    "The Bush Administration doesn't give a damn about contractor fraud in Iraq," Attorney Alan Grayson said.

    He has filed dozens of civil "whistleblower" lawsuits against contractors, and he says with no help from the government because of what describes as the administration's ties to major military contractors.

    "After three and a half years, shouldn't they actually have brought some of these people to justice? What's the big problem?" Grayson said.

    A Justice Department spokesperson says contractor fraud and corruption allegations are taken "seriously" and its "aggressively" pursuing "a number...of investigations."

    In addition, a senior Justice Department official tells CBS News that it takes two to three years to investigate civil fraud cases and, even then, only about one in five meet the standards necessary for prosecution.

    As the incoming chairman of the Senate Judiciary Committee Leahy just isn't buying it. He plans to get to the bottom line...of just how hundreds of billions of U.S. dollars have been spent in Iraq.

    "This is not going to be a game of gotcha," Leahy said. "This is going to be a game of being responsible if we are going to spend tax payer dollars, the tax payers have a right to know where the money is going."

    Just yesterday, Leahy introduced a bill mandating criminal penalties for those who exploit the war effort.
    • Christine Lagorio

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