The Pentagon has launched a criminal investigation into possible fraud at Halliburton, the oil services firm formerly run by the United States Vice-President, Dick Cheney.
The inquiry centres on allegations of overcharging for importing fuel from Kuwait into Iraq by Halliburton subsidiary Kellogg Brown & Root (KBR). Initial findings by Pentagon auditors argued that KBR had overcharged by at least $61-million.
Two weeks ago a gym towel supplied by Halliburton to US troops and embroidered with KBR’s logo was at the centre of a Democratic Party hearing. According to a former employee, the company tripled the price it charged the army, just to add its own initials.
The towel is likely to become a potent symbol in the US presidential election.
Halliburton has been awarded more than $9-billion worth of work in Iraq, but has suffered relentless bad publicity. The company said in a statement last week it had temporarily suspended $174-million of invoices for meals to the US army in Iraq and Kuwait. The announcement came two weeks after Halliburton agreed to repay $27-million for meals served at five military bases last year.
According to a Pentagon e-mail quoted in the Wall Street Journal, in one camp alone last July, KBR billed for an average 42 000 meals a day but served only 14 000. In a seven-month period, alleged overcharging in that camp totalled $16-million.
KBR’s CEO, Randy Harl, said the firm was working with the army to predict numbers more accurately.
In addition, the US Justice Department has begun investigating claims that Halliburton bribed Nigerian officials to win a contract, while the Treasury Department has reopened an inquiry into whether the company broke trade embargoes with Iran.
A Pentagon official confirmed that the defence criminal investigative service had launched an inquiry into the oil issue. A Halliburton spokes- person said the company delivered fuel to Iraq ”at the best value, the best price and the best terms” in the ”current political environment”. — Â