Overseas Civilian Contractors

News and issues relating to Civilian Contractors working Overseas

Limited Discovery in USA v. KBR Case

Courthouse News  September 6, 2012

WASHINGTON (CN) – Kellogg Brown & Root can force Uncle Sam to produce records on the Army’s alleged failure to provide force protection for KBR logistical services workers in Iraq, a federal judge ruled.
KBR could face civil penalties of more than $300 million, on the United States’ claims that it billed the federal government more than $100 million for private security contractors it hired.
The government says its LOGCAP III contracts with KBR prohibited the use of such contractors.
U.S. Chief Judge Royce Lamberth ruled on Aug. 31 that he would allow discovery, after dismissing, in April, the contractor’s argument that the federal government failed to provide adequate security.
KBR also asked the government to identify which KBR claims it believes are false, by releasing the invoices, and it sought documents relating to government contracts with other contractors in Iraq, and their relations with private security firms.
Lamberth ruled that the government already has released information relating to the specific claims in question, and that the government’s relationship with other contractors is not KBR’s business.

Please read the entire story here

September 6, 2012 Posted by | Civilian Contractors, Contractor Oversight, Iraq, KBR, Lawsuits, Private Security Contractor | , , , , , | Leave a comment

Documents Reveal Details of Alleged Labor Trafficking by KBR Subcontractor

The Najlaa Episode Revisited

By DAVID ISENBERG and NICK SCHWELLENBACH at POGO

In December 2008, South Asian workers, two thousand miles or more from their homes, staged a protest on the outskirts of Baghdad. The reason: Up to 1,000 of them had been confined in a windowless warehouse and other dismal living quarters without money or work for as long as three months.

In a typical comment made by the laborers to news organizations at the time, Davidson Peters, a 42-year-old Sri Lankan man, told a McClatchy Newspapers reporter that “They promised us the moon and stars…While we are here, wives have left their husbands and children have been shut out of their schools” because money for their families back home had dried up.

The men came to Iraq lured by the promise of employment by Najlaa International Catering Services, a subcontractor performing work for Houston-based KBR, Inc. under the Army’s Logistics Civil Augmentation Program (LOGCAP) III contract.

Now, a cache of internal corporate and government documents obtained by POGO offer insight into this episode of alleged war zone human trafficking by companies working for the U.S.—and suggest that hardly anyone has been held accountable for what may be violations of U.S. law.

The subcontractor, Najlaa, appears to have suffered no repercussions for its role in luring hundreds of South Asian workers to Iraq with promises of lucrative jobs only to turn around and warehouse at least 1,000 of them in dismal living conditions without work—and pay—for several months. In fact, Najlaa continues to win government contracts.

Despite strongly worded “zero tolerance” policies against human trafficking, the U.S. has directly awarded contracts to Najlaa after the December 2008 protests, including one contract that lasts through 2012.

The Najlaa Incident: An Accountability Case Study

The freshly unearthed documents show that for several months, KBR employees expressed exasperation at Najlaa’s apparent abuse of the laborers and said the subcontractor was embarrassing KBR in front of its main client in Iraq: the U.S. military. But despite its own employees’ strongly worded communications to Najlaa, to this day, KBR continues to award subcontracts to the company.

The documents also suggest that Najlaa rehired former KBR employees who were terminated for what appear to be trafficking-in-persons violations. It is not clear what, if any, repercussions these employees faced besides their termination.

Additionally, the documents raise questions about government officials’ response in the wake of the 2008 protests by Najlaa employees. Although, at the time, the press reported that the U.S. government was investigating alleged trafficking by Najlaa, it has not led to any prosecution or termination of the subcontract. A Sri Lankan company that supplied laborers to Najlaa told POGO it complained about Najlaa’s abusive practices to both KBR and the U.S. government, but said that U.S. law enforcement agencies never followed up.

Please read this entire report here

June 14, 2011 Posted by | Civilian Contractors, KBR, Legal Jurisdictions | , , , , , , | Leave a comment

Justice joins lawsuit against Defense contractor KBR

See Also at MsSparky with the Complaint

Robert Brodsky at GovExec February 22, 2011

The Justice Department has intervened in a false claims lawsuit against KBR Inc., one of the Defense Department’s largest contractors, claiming the goliath logistics firm made illegal payments to a Turkish subcontractor.

On Friday, the government joined a lawsuit first filed in February 2007 by a KBR whistleblower who claimed the former Halliburton subsidiary violated the False Claims Act in connection with the Army’s third-generation Logistics Civil Augmentation Program contract.

“Contractors hired to provide support to our men and women in uniform must play by the rules,” said Tony West, assistant attorney general for the civil division of the Justice Department. “As we’ve done today, the Justice Department will take action against those whom we believe charge the taxpayers for goods and services that were not provided to American troops.”

Under the mammoth LOGCAP III contract, KBR provides a host of logistics and support services to troops in Iraq, Kuwait and Afghanistan, including meals, water, mail, sanitation, fuel and showers. KBR performs the LOGCAP III contract largely through subcontractorsPlease read the entire article here

February 22, 2011 Posted by | Civilian Contractors, Contractor Corruption, Department of Defense, Halliburton, Iraq, KBR, Whistleblower | , , , , , , | Leave a comment

Fix the Pentagon Part I: Create an Independent Audit Agency

Truthout February 16, 2011

Today’s Solution column is written by Charles Smith, a little known, retired, Army civilian employee hero, who went up against the Iraq contractor KBR on behalf of the troops and the taxpayers and was demoted. Smith was chief of the Field Support Contracting Division of the Army Field Support Command in Rock Island Arsenal, and one of his main jobs was to oversee the enormous Army contract with KBR during the Iraq and Afghanistan wars. In 2004, he became concerned when the auditors of the Defense Contract Audit Agency (DCAA) told him that KBR could not justify more than a billion dollars in spending because of their chaotic documentation. He backed the auditors and would not sign off on payments and bonuses to KBR until they provided documented proof of their costs. He also backed DCAA and told KBR that he would legally be withholding 15 percent of all payments to KBR until their auditing systems caught up to their spending.

KBR, with their enormous influence and ability to stop their work on the Iraq and Afghanistan bases, pushed back. Smith was replaced and shuttled off to look at future contracts, while his replacement approved and paid KBR the money without major changes in the billings. That contract, known as LOGCAP III, has now provided KBR with over $40 billion for slinging hash, doing laundry, driving trucks and building barracks in Iraq and Afghanistan. For the full picture of what can happen when a contractor “owns” the service they are working for, i.e. the US Army, see a New York Times profile outlining how Smith, with all his experience, could not get away with doing the right thing for the troops and taxpayers.

The DCAA, even with all the auditing problems and undue influence in DoD contracting, is being used to audit more and more of the rest of the federal government. This is a dangerous trend and could cause the bad contracting habits to infect the rest of the government agencies. DoD has not been able to pass a fiscal audit since 1999, when required by law, and the fraud, waste and abuse of their contractors is legendary, with overruns and lost money. As I mentioned in last week’s column introducing our Solutions series on DoD problems, the DoD is considered “unauditable” on many levels, with contracts and with fiscal audits. As one of my Defense Financial and Accounting Service (DFAS) sources has told me over the years, the DoD may never be able to get its financial and contracting house in order because they don’t know where their money is going at the base level, so it is “garbage in, garbage out.” And, now, the rest of the government may also go down that road by using the DCAA for their auditing, or even worse, hire private contractor auditors, as the Army did to justify pouring money on KBR.

Read more of Dina Rasor’s lead in here

The Need for a Federal Contract Audit Agency
Charles M. Smith

Last fiscal year, the United States Government awarded over $535 billion in contracts with private corporations, nonprofits and other entities. A significant percentage of these contracts are awarded not as safer fixed-price contracts or they were awarded without adequate price competition, meaning auditing is the only realistic defense American taxpayers have against contractor overbilling. There is only one agency with the authority and the ability to audit contractor proposals, assist negotiations and audit incurred costs under massive, fraud-prone and complicated cost-type contracts. That agency, despite conducting work across most of the federal government, is located within the Defense Department, underneath several layers of senior officials. The DCAA conducted 76 percent of contracts audits outside of the DoD, according to a recently published Senate fact sheet. But despite the existence of the DCAA as a de facto government-wide contract audit agency, the US government still does not have the complete capability to use audits to help manage and provide oversight on the hundreds of billions of taxpayer dollars that go out the door to contractors every year. Also, the DoD has the worst history of all agencies in knowing where its money is, having flunked many contract audits and having never passed an overall fiscal audit, as required by law. If this trend is allowed to continue, the DoD’s tolerance for disastrous contracting habits could infect the rest of the government

On February 1, Sen. Claire McCaskill (D-Missouri) chaired a hearing where she explored this issue in her Senate Homeland Security and Governmental Affairs Subcommittee on Contracting Oversight. She noted that the DoD utilized contract auditing far more than the rest of the federal government – while the DCAA conducts one audit for every $24.7 million, the rest of the US government conducted one audit per every $511 million spent. (Ironically, the DoD contracting officers can ignore the DCAA audit results and billions of dollars are not recovered.)

The reason why the DoD had approximately 15,000 contract audits conducted in 2009, and the rest of our government had 1,800 audits conducted in the same period, is due to DCAA’s DoD-centric orientation, the way it is funded and its lack of visibility to the rest of the federal government. A proposed Federal Contract Audit Agency would remedy all of these problems, and bring numerous other benefits, such as greater independence and less pressure from undue agency influences.  Please read the entire report by Charles Smith here

February 16, 2011 Posted by | Civilian Contractors, Contingency Contracting, Contractor Oversight, Department of Defense, Follow the Money, Government Contractor, KBR, Pentagon | , , , , , , , | Leave a comment

Defense Contract Management Agency Acquisition Workforce for Southwest Asia

DCMA and Contractor Oversight

By David Isenberg at Huff Post

Let us start out by acknowledging that most federal government auditors and contracting officers charged with doing oversight on private contractors have a difficult job. As has been documented for years they are overburdened and until recently, under resourced. I am sure most of them try to do an enormously difficult job as professionally and competently as they can.

That said, they can only be as good as the agency they work for. When we think of private contractors working for the U.S. military that means places like the Defense Contract Auditing Agency and the Defense Contract Management Agency (DCMA) . DCMA is the DOD Component that works directly with Defense suppliers to help ensure that DOD, Federal, and allied Government supplies and services are delivered on time, at projected cost, and meet all performance requirements.

With regard to the latter let’s look at a recent report by the Department of Defense Inspector General. Titled “Defense Contract Management Agency Acquisition Workforce for Southwest Asia” its objective was to determine DCMA requirements to support Southwest Asia (SWA) contracting operations and the number of available DCMA civilian, military, foreign national, and support contractors supporting the operations. Specifically, it determined whether DCMA identified its requirements to support SWA contracting operations. It also evaluated whether a sample of the DCMA acquisition workforce for SWA was adequately trained and certified.

Southwest Asia means Afghanistan so one can see this is not a just a subject of academic concern.

Unfortunately for U.S. troops there the report makes DCMA look a bit like the Keystone Cops. The report found that as of December 31, 2008, DCMA provided contract oversight and contract administration for contract actions valued at $1.3 trillion.

But DCMA could not determine its resource requirements for contractor oversight and
contract administration in SWA because:

DCMA is reactive rather than proactive in assuming its role to provide contractor oversight and contract administration.
DCMA did not define its acquisition workforce requirements to support contracting operations in SWA,

AT&L [Under Secretary of Defense for Acquisition, Technology, and Logistics] does not require Defense agencies to document acquisition workforce requirements, and

DCMA must be delegated contractor oversight and contract administration responsibility for work in SWA.

On the not so outlandish assumption that one can’t do good oversight if you don’t have good auditors the report dismayingly reports that:

DCMA Southwest Asia personnel did not have the proper training and certification for contingency contracting positions in SWA. Specifically, of the 221 DCMA personnel training records reviewed from a universe of 1,170 from FY 2004 through FY 2009: 103 DCMA personnel were not fully qualified for the position occupied, and

57 quality assurance representatives did not have or could not produce proof of Defense Acquisition Workforce Improvement Act certification.

In addition, of the 75 position descriptions DCMA provided, 30 position descriptions were either incorrect or did not have a requirement for certification.

Although the Pentagon has said numerous times in the past several years that it is increasing the size of its acquisition workforce the IG report noted that

DCMA reported that its civilian staffing decreased from 19,403 full-time equivalents as of October 1, 1992, to 9,423 as of December 31, 2008 (a 51 percent decrease). DCMA military staffing decreased from 570 on January 1, 2003, to 542 as of December 31, 2008. From October 1, 1999 through December 31, 2008, the number of DCMA-administered contracts increased from 309,000 to 321,000, while the obligated value of those contracts increased from $866 billion to $1.3 trillion (50 percent increase). Conversely, during the same period the number of contractors administered by DCMA decreased from 18,600 to 18,500.

With those numbers it is small wonders problems keep cropping up.

Considering what I wrote in my last post , regarding contractors overseeing contractors, it is worth noting that the report says “DCMA does not (nor is required to) report the number of contractor and foreign national personnel in the acquisition workforce. However, the Logistics Civil Augmentation Program (LOGCAP) contract requires contractor personnel to perform contract administration functions. As a result, an unknown number of contractor and foreign national personnel may be supplementing the contract administration workforce.”

For those who wonder why that is a problem, consider this excerpt from the IG report::

The Army awarded the LOGCAP III contract to Kellogg, Brown, and Root in 2001 and delegated the responsibility of managing the LOGCAP III contract to DCMA in August 2006. Although DCMA was delegated contract administration authority for the LOGCAP III contract, DCMA relied on the prime contractor to perform quality assurance, inspections, and repair in those facilities. DOD Inspector General (IG) Report No. IE-2009-006, “Review of Electrocution Deaths in Iraq: Part I – Electrocution of Staff Sergeant Ryan D. Maseth, U.S. Army,” July 24, 2009, found that the prime contractor did not advise DCMA of electrical deficiencies in facilities that soldiers and contractors occupied. As a result, one service member died in those facilities due to faulty electrical wiring and improperly grounded electrical equipment. The report stated that the Government in good faith relied upon the contractor to provide qualified people to do the work as part of the “workmanlike” standard and quality provisions provided for under the terms of the contract. In addition, the report stated that LOGCAP III Support Unit contracting officer acceptance of prime contractor assumptions during contract negotiations resulted in a false perception that buildings and peripheral equipment were in acceptable condition during the transfer of Radwaniyah Palace Complex facility operations and maintenance to LOGCAP III.

Follow David Isenberg on Twitter: www.twitter.com/vanidan

April 15, 2010 Posted by | Civilian Contractors, Contractor Oversight, Wartime Contracting | , , , , , , , , , , , , | Leave a comment

KBR changes policies to comply with Franken Amendment

Thanks to MsSparky for the best in KBR updates

Well….it’s official. By KBR’s own email admission, they will no longer force you into “behind closed doors secret arbitration” if they falsely imprison you, if you are raped and/or assaulted by a boss or co-worker, if you are discriminated against or harassed by your boss or co-worker  etc. One might think they made these changes because it was the morally and ethically right thing to do. But sadly, that is not the case. KBR had to be forced to make these changes. Thank you Jamie Leigh Jones and Senator Al Franken! SHAME ON YOU KBR!

Below is an excerpt from “The Weekly Delivery” KBR’s LOGCAP III weekly magazine distributed to all employees.

This information applies to you if you are currently covered by the Dispute Resolution Program.
AMENDMENTS to the DISPUTE RESOLUTION PROGRAM
Effective March 29, 2010

Copy of February 23, 2010 e-mail:

TO: All KBR Employees
FROM: Andrew Farley, Senior Vice President & General Counsel

Since 1993, the Dispute Resolution Program (DRP) has helped employees with finding productive solutions when workplace conflicts occur. Recent legislation and experiences have necessitated some amendments to the DRP and we are now giving you 30 days notice of these changes, which provide as follows:

  1. The DRP will now exempt from arbitration any claim under Title VII of the Civil Rights Act of 1964 or any tort related to or arising out of sexual assault or harassment, including assault and battery, intentional infliction of emotional distress, false imprisonment, or negligent hiring, supervision, or retention (See Plan Paragraph 2.E.4 and 3.E)
  2. Clarifies who is covered by the Dispute Resolution Program (See Plan Paragraph 2.G)
  3. Updates the selection process for the arbitrator (See Rules Paragraph 4 and 5)
  4. Makes two typographical corrections in the Vacancies paragraph, with references to Paragraphs 5 and 6(instead of 6 and 5 as before) (See Rules Paragraph 6)
  5. Refines how the hearing location is selected and set by the arbitrator (See Rules Paragraph 7.A and C)
  6. Further defines the circumstances under which an arbitrator may modify an award (See Rules Paragraph 27
  7. Clarifies the limitations for filing formal DRP proceedings (See Rules Paragraph 34.B)
  8. Updates the International Ombudsman Association Standards of Practice in the Appendix, now dated 2009

The changes will go into effect on March 29, 2010. However, no change shall apply to a Dispute which is initiated prior to March 29, 2010.

The Dispute Resolution Program brochures will be reprinted and available to you soon, but in the mean time, the revised Plan and Rules is available online at theDRP website.

Should you have questions about these changes, please call the DRP office at 713-753-5383, or 800-947-7658.

Thank you.

Read this with the comments at MsSparky

April 9, 2010 Posted by | KBR, Rape | , , , , , | Leave a comment

U.S. Sues Kellogg, Brown & Root for Alleged False Claims Act Violations Over Improper Costs for Private Security In Iraq

WASHINGTON, April 1 /PRNewswire-USNewswire/ — The United States has filed a lawsuit against Kellogg Brown & Root Services (KBR) alleging that the defense contractor violated the False Claims Act, the Justice Department announced today. The suit, filed in U.S. District Court in Washington, alleges that KBR knowingly included impermissible costs for private armed security in billings to the Army under the Logistics Civil Augmentation Program (LOGCAP) III contract. The LOGCAP III contract provides for civilian contractor logistical support, such as food services, transportation, laundry and mail, for military operations in Iraq.

The government’s lawsuit alleges that some 33 KBR subcontractors, as well as the company itself, used private armed security at various times during the 2003-2006 time period. KBR allegedly violated the LOGCAP III contract by failing to obtain Army authorization for arming subcontractors and by allowing the use of private security contractors who were not registered with the Iraqi Ministry of the Interior. The subcontractors using private security are alleged to have also violated subcontract terms requiring travel only in military convoys. The government’s lawsuit further alleges that at the time, KBR managers considered the use of private security unacceptable and were concerned that the Army would disallow any costs for such services. KBR nonetheless charged the United States for the costs of the unauthorized services.

“Defense contractors cannot ignore their contractual obligations to the military and pass along improper charges to the United States,” said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. “We are committed to ensuring that the Department of Defense’s rules are enforced and that funds so vital to the war effort are not misused.”

This case is being brought as part of a National Procurement Fraud Initiative. In October 2006, the Deputy Attorney General announced the formation of a National Procurement Fraud Task Force designed to promote the early detection, identification, prevention and prosecution of procurement fraud associated with the increase in government contracting activity for national security and other government programs. The Procurement Fraud Task Force is chaired by the Assistant Attorney General for the Criminal Division and includes the Civil Division, U.S. Attorneys’ Offices, the FBI, the U.S. Inspectors General community, and a number of other federal law enforcement agencies.

Along with the Justice Department’s Civil Division, the Defense Criminal Investigative Service, Army Criminal Investigation Division and, FBI participated in the investigation of this matter. This case, as well as others brought by members of the task force, demonstrates the Department of Justice’s commitment to helping ensure the integrity of the government procurement process.

SOURCE U.S. Department of Justice

April 1, 2010 Posted by | KBR, Private Security Contractor | , , , , , , , | Leave a comment