WASHINGTON, Nov. 1, 2007

Fuel Fraud Latest In Army Contracting Woes

CBS News Exposes Kickback Scheme, As Epidemic Of Wartime Military Contract Fraud Grows

  • 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.

  • A new report said the Army lacks the leadership and personnel, both military and civilian, to provide sufficient contracting support.

    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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(CBS/AP)  The delivery of aviation gas to the giant U.S. air base at Bagram in Afghanistan is the latest case of fraud to hit a contracting system overwhelmed by war and practically begging to be ripped off, CBS News national security correspondent David Martin reports exclusively.

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.

Investigative Unit Blog: Read more about the Bagram fuel scheme.
Untrained contract managers are one reason there is so much fraud.

"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.

Quote

It usually takes a crisis to make change. We have a crisis.

Jacques Gansler, head of investigative panel
The panel recommends adding 400 military personnel and about a thousand Army civilians and says another 600 Army staff should be assigned to the Defense Department's contract management agency to provide greater oversight of the contracts.

U.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.

Continued



© MMVII, CBS Interactive Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.
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by flipantflaw November 5, 2007 4:31 AM EST
'' ... the bloating earth, forests replaced with crops replaced with forests glued atop forests with swashy blooms ... ''

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'' ... which came first eternity or the earth ... ''
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by usprophet November 3, 2007 1:38 AM EDT
Americans just don''t seem to care that our nation, along with The Constitution upon which it was founded, is being flushed-down the NWO toilet by our nations'' bought and paid for politicians and media. While the Oligarchs warn and insite fear in the sheeple about the prospect of terrorism, they at the same time leave our border wide open, and fund and conduct illegal wars overseas that do nothing but encite the terrorism which their Orwellian Laws like the Patriot Act and The Real ID Act pretend to protect us from. Wake up America! It''s not about protecting you from terrorism, or saving the planet from Global Warming, or any of that other fear-mongering garbage the sold-out, mainstream media feeds you 24/7. It''s about feeding the bankers and the military industrial complex, and facilitating the ruling elite''s ability to ratchet-down control over the American people, placing us into a total control grid where they can surveille, track and control everywhere we go and everything we do. It''s the groundwork for totalitarianism, my friends. It''s New World Order plan of Bush, Clinton, Giuliani, et.al., being executed quite beautifully. You''re a victim of mass mind control--a frog in a pot. In order to cook the frog, you don''t throw him into a pot of boiling water. If you do, he''ll resist and jump-out. What you do instead is, you turn the heat-up REAL SLOW, and by the time the water is boiling he won''t be able to jump out anymore, because it''s too late--he''s already doomed.
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by usprophet November 3, 2007 1:11 AM EDT
I support Ron Paul and his non-interventionist foreign policy. Hitlery wants to continue our illegal police action in Iraq until at least 2013, and she does not rule out a preemptive (nuclear) first strike against Iran. Ron Paul voted against our (undeclared) war in Iraq, which was sold to us with lies. The area is more dangerous now than when we entered it. We destroyed a regime hated by our direct enemies--the jihadists, and created thousands of new recruits for them. This war has cost more than 3,400 American lives and almost a trillion dollars. We must have new leadership in the White House to ensure this never happens again. Both Jefferson and Washington warned us about entangling ourselves in the affairs of other nations. Today, we have 750 foreign bases and troops in 130 countries. We are spread so thin that we have too few troops defending America. And now, there are new calls for a draft of our young men and women. We can continue to fund and fight no-win police actions around the globe, or we can refocus on securing our borders against illegal immigrants and bring our troops home. No war should ever be fought without a Declaration of War voted upon by the Congress, as required by the Constitution. Under no circumstances should the U.S. again go to war as the result of a resolution that comes from an unelected, foreign body, such as the United Nations. Too often, we give foreign aid and intervene on behalf of governments that are despised. Then, we too become despised.
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by rickstas November 2, 2007 9:14 PM EDT
Hey USAProphet:

As they say in China, Ron Paul can chew mau wang.
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by usprophet November 2, 2007 9:02 PM EDT
You get the sense that our country is desperate for someone to show us the way. Not the old way. Not the same way, but a NEW WAY. Think about this for a minute. What if we pulled all of our troops out of South Korea? They''ve been there for 50+ years. What if we quit worrying about Iran, but instead, realized that its having a nuclear weapon will not mean the end of the world? What if we pulled all of our troops out of the Middle-East, and brought them all home? What if we realistically addressed the National Debt, and paid attention to REALLY DOING SOMETHING about stopping illegal immigration? These are the ideas of Republican Presidential candidate, Dr. Ron Paul. He''s a ten term Congressman and a physician who has delivered over 4,000 babies. He''s an intellectual who''s published four books, three of which are devoted entirely to sound economics. He was raised on a dairy farm in Pennsylvania as a pious Lutheran, but now he attends a Baptist church. Paul is given to mulling things over morally. Whenever he recollects the helicopter pilots he treated as an Air Force Flight Surgeon (Captain) during the Vietnam War, a war which he now says was "totally unnecessary and illegal," he laments, "They were gung-ho. I%u2019ve often thought about how many of those people never came back." Candidates with the high level of personal integrity and proven track record of adherance to The Constitution, Congressman Paul has always demonstrated only come around once in a lifetime, if we''re lucky.
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by usprophet November 2, 2007 9:01 PM EDT
Ron Paul represents a different Republican Party from the one that Iraq, deficits and corruption have soured the country on. It''s ironic that other GOP candidates are scared to death of his message, BECAUSE his is more conservative than theirs. Being anti-war IS CONSERVATIVE. Another key difference between his message and the others is that he is a strong defender of The Constitution, which protects our civil liberties. The other Presidential candidates, who are mostly NWO Oligarchs, want to erase your liberties. They''ve tried hard to exlude Paul from the spotlight, along with the sold-out, mainstream media (CBS). In late June, despite a life of antitax agitation and pious churchgoing, he was excluded from a Republican forum sponsored by Iowa anti-tax and Christian groups. Ron Paul does not represent your Father''s school of political thought. He represents your Founding Fathers. He stands for a certain idea of the Constitution; the idea that much of the power asserted by modern presidents has been usurped from Congress, and that much of the power asserted by Congress has been usurped from the States. Though Dr. Paul acknowledges flaws in both The Constitution (it included slavery) and its Bill of Rights (it doesn%u2019t go far enough), he still thinks a comprehensive array of positions can be drawn therefrom: against gun control; for the sovereignty of States; and against foreign-policy adventures. His message draws on the noblest traditions of American decency and patriotism.
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by usprophet November 2, 2007 9:00 PM EDT
Some people say, "a Republican? I''d never vote for a Republican." Let me remind you folks that Abraham Lincoln, who freed the slaves, and who won the war to preserve our Union, WAS himself a Republican. Would you have voted for Stephen Douglas, who was ardently pro slavery, against Lincoln simply because he was a Democrat? Of course you wouldn''t. It''s the person your voting for, and the ideas he or she represents, NOT the party. Ron Paul represents a different Republican Party from the one that Iraq, deficits and corruption have soured the country on. The Republican party has "lost its way," he said recently, during a GOP debate. Like the limited federal government principles espoused by Dwight D. Eisenhower, his school of Republicanism stands for a certain idea of the Constitution that much of the power asserted by modern Presidents has been usurped from Congress, and that much of the power asserted by Congress has been usurped from the States. Though Paul acknowledges flaws in both the Constitution (it included slavery) and the Bill of Rights (it doesn''t go far enough), he still thinks a comprehensive array of positions can be drawn therefrom: against gun control; for the sovereignty of States; and against foreign-policy adventures like the ones currently being played-out in the Mid-East. After ten terms of service as a U.S. Congressman, Ron Paul has demonstarted a consistent track record of adherance to The Constitution unmatched by anyone in either party. Go Ron Paul!
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by usprophet November 2, 2007 8:59 PM EDT
Most intelligent people can see right through the mainstream media''s bias against Ron Paul. "What about the polls?", you ask. As someone who''s been in the business, I know you can make a poll result look anyway you want. All you have to do is call or not call on people in a certain demographic group to achieve your desired result. You can see the man has support. He''s won ALL of the viewer call-in polls in ALL of the GOP debates he''s been in. People everywhere are in the street, and on the Net, supporting him like no other. And his campaign chest is growing daily, and not from huge corporate donations like the other GOP and Democratic party candidates get from defense contractors and bankers, but from grass root supporters who give what little they can afford--$5, $10, whatever. This is a 21st Century political revolution, my friends, and the Oligarchs or on the defensive. Ignore what the media network giants like CBS tell you. They sold-out to the status quo decades ago. This man has some major grass roots support across this country. Millions of Americans believe he is our only hope to restore peace, prosperity and freedom in this country. Presidential candidates with the personal integrity and proven track record of adherance to The Constitution Congressman, Paul has always demonstrated only come around only once in a lifetime, if we''re lucky. The stakes are too high. The cause of freedom is too important. Get off your couch, put the remote down and support Ron Paul!
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by usprophet November 2, 2007 8:58 PM EDT
Ron Paul can win the GOP nomination. If he does, I predict a landslide victory in November of 2008. Even the oddsmakers in Vegas aren''t willing to discount his chances. They''re currently giving him 6:1 odds to win against Hitlery if he gets the nomination. Romney, McCain and the globalist, sell-out Giuliani aren''t given anything better than a 25:1 chance of winning if they get the GOP nod. All it takes is for formerly apathetic individuals to get off the couch and nominate him in their local Republican primary or caucus process. Political parties are nothing more than tools. Those who read the manual and use the tools properly will win the nomination for their candidate. For the past 20 years, many good people have stayed at home and accepted whatever candidate they let others select for them. This year, those people are learning how to use their vote to bring about positive and long overdue political change in this country. To make a difference, you must participate in the Republican primary election or caucus process in your county, precinct or district. Nothing else matters. If we do this, we win. If not, we lose. The GOP has been suffering from declining participation for decades. Fewer than 10% of registered voters have ALL the power because they actually participate. Now the remaining 90% must surge to use their vote as a tool for bringing about positive change to our country. The time to act is now. The time for political revolution has come. The time for Ron Paul is NOW!
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by usprophet November 2, 2007 8:57 PM EDT
What''s Ron''s message? Whatever you think Dr. Paul''s campaign is about, the main thing it has done thus far is to serve as a clearinghouse for voters like me who feel unrepresented by New World Order Fasciscts (mainstream Republicans) and their Socialist comrades in crime (mainstream Democrats). They''re actually one and the same. There is no real difference between the two parties. Most people, though, are too distracted, dumbed-down, or outright brainwashed by mainstream media, which endlessly regurgitates scientifically-crafted streams of information and entertainment aimed at imprisoning their minds and keeping their eyes closed to the realities of the world around them, to recognize this. Those currently in power, and those being groomed to take [major] political power, are the global elite, and we are their "Plebs." People on the right and those on the left have many differences, maybe irreconcilable ones. But they have a lot of common beliefs too, and their numbers and anger are of a considerable magnitude. No matter what happens in 2008, I personally believe Ron Paul will influence the national conversation about what the role of the federal government is, how much power should government have over our lives, how much liberty we should give up for security. These are important issues, and frankly, no one''s talking about them as seriously and sincerely as Ron Paul. What''s for sure is that his growing army of supporters like me will be a force to be reckoned with in 2008.
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by usprophet November 2, 2007 8:56 PM EDT
"The means of defense against foreign danger historically have become the instruments of tyranny at home."
- 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
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by pakaal November 2, 2007 8:21 PM EDT
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 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.
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by pakaal November 2, 2007 8:18 PM EDT
If George Bush had a shred of fiscal responsibility, he''d be pursuing these cases of military fraud and taxpayer waste. Instead he vetoes fiscally sound pay-and-spend programs like SCHIP.

Sure, let''s ignore fiscal oversight and keep our children uninsured. Welcome to Year Seven of the Bush/Cheney Administration.
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by finewoven November 2, 2007 7:46 PM EDT
Many of us knew this a couple months after the "war" began. Bush knew about it even before the "war" began, as it was his plan. Several times I, and many others have posted this information months ago on these threads, just now it makes the news.
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.
Reply to this comment
by finewoven November 2, 2007 7:36 PM EDT
Get off your couch, put the remote down, and support Ron Paul!
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.
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by usprophet November 2, 2007 5:38 PM EDT
Most intelligent people can see right through the mainstream media''s bias against Ron Paul. "What about the polls?", you ask. As someone who''s been in the business, I know you can make a poll result look anyway you want. All you have to do is call or not call on people in a certain demographic group to achieve your desired result. You can see the man has support. He''s won the viewer phone-in polls in ALL of the GOP debates he''s been in. People everywhere are in the street, and on the Net, supporting him like no other. And his campaign chest is growing daily, and not from huge corporate donations like the other GOP and Democratic party candidates get, but from grass root supporters who give what little they can afford--$5, $10, whatever. This is a 21st Century political revolution, my friends, and the Oligarchs or on the defensive. Ignore what the media network giants like CBS tell you. They sold-out to the status quo decades ago. This man has some major grass roots support across this country. I believe he is our only hope to restore peace, prosperity and freedom in this country. Presidential candidates with the high-level of personal integrity and proven track record of adherance to The Constitution Congressman, Paul has always demonstrated only come around only once in a lifetime, if we''re lucky. The stakes are too high. The cause of freedom is too important. Get off your couch, put the remote down, and support Ron Paul!
Reply to this comment
by gkc99 November 2, 2007 5:35 PM EDT
Oh the Dems can, and do, steal. They are very like the Repugs, in general. However, the pattern of corruption and obstruction under the Bushit admin trumps anything Dems have come up with in the last 50 years. Richard Daley, Sr., was a Democrat and a corrupt thief, but he was small time compared to the massive theft perpetrated by the Neoconscum Fascists and their camp followers.
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by jetranger7 November 2, 2007 4:54 PM EDT
IMPEACH-IMPEACH-IMPEACH-IMPEACH-IMPEACH-IMPEACH-IMPEACH IMMEDIATELY RIGHT NOW !!!!!
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by toolmangler-2009 November 2, 2007 4:45 PM EDT
If this was a REAL WAR, heads would roll!

Posted by BareEmperor at 01:11 PM : Nov 02, 2007


Only if we had a REAL PRESIDENT!!!!!!!!!!!
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by missingamerica November 2, 2007 4:39 PM EDT
Huh...KBR and this Administration must share the same P&O department.
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