Fuel Fraud Latest In Army Contracting Woes
CBS News Exposes Kickback Scheme, As Epidemic Of Wartime Military Contract Fraud Grows
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Play CBS Video Video Army Contract Fraud Crisis Bribes and kickbacks are ripping off the U.S. military. Over 80 criminal fraud cases involving contractors in Afghanistan and Iraq are under investigation. David Martin reports.
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A new report said the Army lacks the leadership and personnel, both military and civilian, to provide sufficient contracting support. (CBS/AP)
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Interactive Military 101 Basic training to learn all about America's fighting force.
So far two former employees of Kellogg, Brown and Root have been arrested for their part in a scheme worthy of Tony Soprano.
The two KBR men, who worked for the U.S. military at Bagram, forged receipts for 80 tanker loads trucked in but never delivered, according to court documents. The Pentagon paid for the undelivered fuel while the drivers sold it on the black market. For their role in the scheme, KBR employees divvyed up an estimated $800,000 in kick backs, reports Martin.
That's just one of more than 80 criminal cases involving some $15 million in bribes. It is still a growing scandal which Pentagon officials expect will uncover hundreds of fraudulent contracts.
A new report by a blue ribbon panel is headlined, "Urgent Reform Required."
"It usually takes a crisis to make change," said Jacques Gansler, head of the panel. "We have a crisis."
The panel said the massive logistical demands of Iraq and Afghanistan exposed "key failures" in army contracting. The value of contracts awarded tripled to well over $100 billion, but the number of people managing those contracts stayed the same, Martin reports. There are currently 160,000 contractors working for the United States in the war zone but only 75 contract managers, and most of them are not trained.
"When you go over to Iraq and Kuwait you're going to see that even about 36 percent of them are certified for those jobs," said Gansler.
Untrained contract managers are one reason there is so much fraud.Investigative Unit Blog: Read more about the Bagram fuel scheme.
"They're not trained to do it," said Gansler. "They're not used to doing it, and it's a little bit hard when somebody hands them a bag of money and says manage this - some of it might fall out."
Untrained or just plain dishonest, the fact is nearly 100 Army personnel are under criminal investigation, adds Martin.
It usually takes a crisis to make change. We have a crisis.
Jacques Gansler, head of investigative panelU.S. officials familiar with the panel's report did not say how much the additional personnel would cost. The Army's contracting work force now has just over 10,000 people, according to statistics compiled by the Defense Acquisition University at Fort Belvoir, Va.
The report calls for creating five new general officer positions within the Army's contracting work force, a move to attract talented men and women to a field most would otherwise avoid because of dim prospects for career advancement.
Citing key problem areas, the report said the Army's policies are outdated, training is lacking and a little more than half of the military and civilian contracting personnel are certified for their jobs.
Higher numbers of personnel, better quality and more clout within the Army's contracting ranks are expected to increase professionalism and decrease opportunities for misconduct as tens of billions of dollars continue to be spent on the wars in Iraq and Afghanistan, the officials said.
© MMVII, CBS Interactive Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.

The secrets of tennis legend 



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See all 112 Comments'' ... i went to the store, sort of a hotel of small homes, folk visiting sick beds to stand on their heads or cull food and medicine and basket weaving such and such out of the fertilizables and the irrigateables ... ''
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As they say in China, Ron Paul can chew mau wang.
- James Madison
"Those that give give up essential liberties for temporary safety, deserve neither liberty nor safety."
- Benjamin Franklin
"America will never be destroyed from the outside. If we falter and lose our freedoms, it will be because we destroyed ourselves."
- Abraham Lincoln
"We have nothing to fear but fear itself, and those who would exploit our fear for power and their own personal, selfish, cynical gain."
- Franklin D. Roosevelt
"Peace is not the absence of conflict. It is the ability to handle conflict through peaceful means."
- Ronald Reagan
"Those who expect to reap the blessing of freedom must...undergo the fatigue of supporting it."
- Thomas Paine
"Liberty, when it takes root, is a plant of rapid growth."
- George Washington
"Commerce with all nations. Alliances with none."
- Thomas Jefferson
"Wars are poor chisels for carving-out peaceful tomorrows."
- Martin Luther King Jr.
"Ron Paul does''nt represent your Father''s school of political thought. He represents your Founding Fathers."
- Me
Posted by finewoven at 04:46 PM : Nov 02, 2007
Yes, it''s outrageous what some people will accuse our fine administration of doing. So what if the facts back up the contentions? As we know, Rove-ian politics demand a second set of facts that fit the warped reality they live in.
Sure, let''s ignore fiscal oversight and keep our children uninsured. Welcome to Year Seven of the Bush/Cheney Administration.
Posted by brianbwb at 02:25 AM : Nov 02, 2007
You mean the war hasn''t been about removing the tyrant Saddam Hussein, and helping the Iraq people create a democracy and build their economy? It seems like you''re saying the war was created to profit GOP warmongers with high-dollar contracts that do nothing to stop the threat of terrorism in the middle-east. This is too much.
Posted by USProphet at 02:38 PM : Nov 02, 2007
I still would like to know some of the legislation he has authored. Can you provide some details.
Posted by BareEmperor at 01:11 PM : Nov 02, 2007
Only if we had a REAL PRESIDENT!!!!!!!!!!!
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