Photo: U.S. Forces Iraq
In 2008 Rep. Harry Waxman requested a Department of defence audit of fuel delivery contracts to troops in Iraq.Until last week, only a short summary of the report’s findings were available to the public, but on Thursday the Project on Government Oversight (POGO) got a full copy of the report.
The DoD website promises the report will be made publicly available “at a later date”. In the meantime POGO found that the government overpaid for fuel by up to $180 million because:
- The defence Logistics Agency did not properly review contracts worth $2.7 billion
- It had no information on $1.1 billion in costs
- Failed to ensure fuel prices were fair and reasonable
As a result the government paid up to 7% more for fuel than it should have from the International Oil Trading Company (IOTC). POGO also found the company’s profits may have been double what they were under the previous contractor, as much as 14%.
IOTC replaced fuel contractor Kellogg Brown & Root who was strongly denounced for its 7% profit margin.
Through a series of oversights and inadequate policies the government allowed IOTC to sell fuel deliveries to KBR without ever checking invoices for accuracy, and continued its dealings with IOTC owner Harry Sargeant after he was charged with bribing Jordanian officials to eliminate competition.
Despite proving these allegations, the report does not accuse IOTC of war profiteering. After all, every stage of the operation was endorsed and approved by the government.
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