NYT: Memos Warned of Billing Fraud by Firm in Iraq (Custer Battles)

http://www.nytimes.com/2004/10/23/politics/23whistle.html?ei=5094&en=784b8d41486149bf&hp=&ex=1098504000&partner=homepage&pagewanted=print&position=

Managers of a security firm that won large contracts in Iraq warned their bosses in February of what they called a pattern of fraudulent billing practices, internal company memorandums suggest.

The memorandums, written primarily by two company managers, charged that the security firm, Custer Battles, repeatedly billed the occupation authorities for nonexistent services or at grossly inflated prices.

The company, which quickly grew to garner security contracts worth $100 million in little more than a year, denies the charges. It argues that the managers confused sincere attempts to document jobs done in a hurry, in a war zone, with deliberate deception and that the company provided all contracted services for the agreed-upon price.

The memos and a lawsuit filed by former employees cite several specific instances, including billing the Coalition Provisional Authority $157,000 for a helicopter pad that in fact cost $95,000, and repainting forklifts abandoned by Baghdad Airways and then charging the authority thousands of dollars a month, claiming that the forklifts were leased.

<snip>

The company founders, Scott Custer and Michael Battles, are both Army veterans. Mr. Battles unsuccessfully ran for Congress in Rhode Island as a Republican two years ago.

if this information is covered in the article, but just in case it isn't, here's some more stuff from liberal bloggers regarding Custer Battles (includes a link to a story WaPo did almost a month ago, now, about the company):

http://bodyandsoul.typepad.com/blog/2004/10/custer_and_the_.html

Lawsuit claims politically connected firm defrauded millions in Iraq

By SETH BORENSTEIN

Knight Ridder Newspapers


WASHINGTON - A politically connected start-up firm, awarded a no-bid contract to provide security for Baghdad's airport, defrauded U.S. taxpayers of tens of millions of dollars, two top former workers charge in a lawsuit unsealed Friday.

The Bush administration decided not to join the whistleblowers' civil suit alleging fraud against the company, run by a former Republican congressional candidate. The whistleblowers' attorney said a Justice Department lawyer told him the reason was that the alleged victim was the U.S.-financed and led Coalition Provisional Authority, not the U.S. government.

more:

http://www.macon.com/mld/macon/news/nation/9872408.htm

snip>
It's unusual for the Justice Department to decline to join a suit that has a load of documents and when criminal prosecution is likely, said Patrick Burns, a spokesman for Taxpayers Against Fraud, a group that monitors citizen suits.
----------

Ten, twenty, thirty millions lost? Chicken feed considering how much the crooks have bilked out of us. Hardly worth mentioning!

"When the government joins such suits, the whistleblowers win or settle about 95 percent of the time, but they win only 25 percent of the time when the government passes. No reason was listed in the document the Justice Department filed with the U.S. District Court in Alexandria, Va."