New Fuel To Halliburton Fraud Fire

(CBS)  When it comes to logistical help for U.S. troops in Iraq, Halliburton is the biggest game in town. Under a wartime contract that's $7 billion and growing, it's serving the needs of 200,000 troops.

But the Houston-based conglomerate once headed by Vice President Dick Cheney is neck-deep in allegations of waste and fraud involving millions of taxpayer dollars, reports CBS News Correspondent Sharyl Attkisson.

The U.S. Army is threatening to partially withhold payments to Halliburton for the logistical support the company provides for troops in Iraq. The reason: allegations of millions of dollars in over-charges for food, shelter and services.

"There was no regard for spending limits," says former employee Marie DeYoung.

Some of the most compelling accusations come from people like DeYoung, who worked for Halliburton subsidiary KBR.

She recently told Congress that while troops rough it in tents, hundreds of preferred Halliburton KBR employees reside in five-star hotels like the Kempinski in Kuwait with fruit baskets and pressed laundry delivered daily.

"It costs $110 to house one KBR employee per day at the Kempinski, while it costs the Army $1.39 per day to bunk a soldier in a leased tent," DeYoung said.

"The military requested that Halliburton move into tents, but Halliburton refused."

Documents obtained by CBS News show an auditor repeatedly flagged improper fees for soldiers' laundry. At one site, taxpayers reportedly paid $100 for each 15-pound load of wash - $1 million a month in overcharges.

Halliburton insists it doesn't waste money, it saves it. But overcharging is the subject of one federal investigation and there are separate probes for alleged bribery and kickbacks.

Nobody from Halliburton agreed to an interview, but officials have said the criticisms are politically motivated in an election year. Halliburton also "questions the factual nature" of many assertions from the ex-employees, but is looking into them "because we take all allegations seriously."

With the tab for the war in Iraq now topping $150 billion, all the investigations could help determine whether some Halliburton employees paid by taxpayers to make life better for soldiers are, instead, putting themselves first.