March 20, 2007

CARDIN: AMERICAN CONTRACTORS WHO COMMIT FRAUD AND WAR PROFITEERING IN IRAQ MUST BE HELD ACCOUNTABLE

Oren Shur: 202-224-4524

Susan Sullam: 410-962-4436


WASHINGTON - At a Judiciary Committee hearing today, Sen. Benjamin L. Cardin (D-MD) told the acting Inspector General for the Department of Defense that fraud and war profiteering by American contractors in Iraq will not be tolerated. Despite reports that billions of taxpayer dollars spent in Iraq have been lost or unaccounted for, the Department of Justice has done very little to prosecute the companies responsible.

"It is unconscionable to think that American companies are stealing money from the American people while our nation is at war," said Sen. Cardin. "But even worse, the Bush Administration has known about the widespread fraud and has chosen to do virtually nothing. Such fraud and deceit demeans the sacrifices that our military personnel are making in Iraq and Afghanistan, and around the world. We must hold contractors accountable for every taxpayer dollar they receive. The war in Iraq is no place for corporate greed."

The Office of the Inspector General has opened hundreds of investigations to look instances of contractor fraud, war profiteering, illegal kickbacks and over-billing. It reported that billions of dollars spent in Iraq cannot be accounted for, or have been lost to fraud or other misconduct.

As reported to the Committee by the Department of Justice, many of these crimes were committed by employees of Kellogg, Brown & Root, one of the largest contractors in Iraq, and a division of Halliburton. In these cases, KBR employees have admitted to receiving kickbacks, inflating costs, embezzling money, and stealing millions from the American people.

The Justice Department has brought no specific legal action, whether civil or criminal, against KBR or Halliburton in these cases. In fact, the Justice Department has committed few resources to investigating war profiteering and has only brought eight criminal cases involving less than 25 individuals after more than four years of war.

At today's hearing, Sen. Cardin expressed his support for the War Profiteering Prevention Act of 2007 (S. 119), which was introduced by Judiciary Committee Chairman Patrick J. Leahy (D-VT). The bill makes war profiteering a special crime and would extend extraterritorial jurisdiction to reach contracting fraud in Iraq.