US War And Theft: Millions Of Dollars Financial Crimes In Iraq-Afghanistan Wars

06 May, 2015
Countercurrents.org

Financial crimes worth millions of dollars by the U.S. military personnel have been unearthed in Afghanistan and Iraq. The amount goes to $50 million.

Citing a case of fuel theft in a base near the Afghanistan-Pakistan border and a comprehensive tally of court records a report by the Center for Public Integrity (http://www.publicintegrity.org/2015/05/05/17268/us-military-personnel-have-been-convicted-50-million-worth-crimes-iraq-and) said:

The involved person in the case “contributed to thefts by U.S. military personnel of at least $15 million worth of fuel since the start of the U.S. war in Afghanistan. And eventually” the person “became one of at least 115 enlisted personnel and military officers convicted since 2005 of committing theft, bribery, and contract rigging crimes valued at $52 million during their deployments in Afghanistan and Iraq.”

The report by Julia Harte cited other cases and said:

“Soldiers were selling the U.S. military’s fuel to Afghan locals on the side, and pocketing the proceeds.”

It said:

“Many of these crimes grew out of shortcomings in the military’s management of the deployments that experts say are still present: A heavy dependence on cash transactions, a hasty award process for high-value contracts, loose and harried oversight within the ranks, and a regional culture of corruption that proved seductive to the American troops transplanted there.”

The report headlined “U.S. military personnel have been convicted of $50 million worth of crimes in Iraq and Afghanistan” said:

“Additional crimes by military personnel are still under investigation, and some court records remain partly under seal. The magnitude of additional losses from fraud, waste, and abuse by contractors, civilians, and allied foreign soldiers in Afghanistan has never been tallied, but officials probing such crimes say the total is in the billions of dollars.”

It said:

“Those numbers might not seem huge — at least a million troops rotated through the region in this period, and the overall U.S. budget for these wars has so far exceeded $1.5 trillion — but those who investigate and prosecute military wrongdoing say the convictions so far constitute a small portion of the crimes they think were committed by U.S. military personnel in the two countries.”

The May 5, 2015 datelined report said:

“Former Special Inspector General for Iraq Reconstruction Stuart Bowen, who served as the principal watchdog for wrongdoing in Iraq from 2004 to 2013, said he suspected “the fraud … among U.S. military personnel and contractors was much higher” than what he and his colleagues were able to prosecute. John F. Sopko, his contemporary counterpart in Afghanistan, said his agency has probably uncovered less than half of the fraud committed by members of the military in Afghanistan.

“As of February, he said he had 327 active investigations still under way, involving 31 members of the military. ‘You don’t appreciate how much money is being stolen in Afghanistan until you go over there,’ said Sopko, who says price-fixing and other forms of financial corruption are rampant in the country.

“These and other experts, as well as some of those who have pleaded guilty to criminal wrongdoing, point to some recurrent patterns in the corrupt activity, which in turn illustrate the special challenges created when a sizable military force is deployed so far from lawful domestic routines. Sometimes ill-trained military personnel were given authority for making large cash transactions, in a region where casual corruption in financial dealings — bribes, kickbacks, and petty theft — was commonplace. Commanding officers, they add, were typically so distracted by urgent war challenges they could not carefully check for missing fuel or contractor kickbacks.”

The report added:

“So far, officers account for approximately four-fifths of the value of the fraud committed by military personnel in Iraq, while in Afghanistan, the ratio was flipped, with enlistees accounting for roughly the same portion, according to the Center’s tally. The reasons for the difference are unclear. But Sopko said he expects more officers to be investigated for misconduct in Afghanistan as the U.S. military mission there continues, so the ratio could change.

“Soldiers who had little or no prior criminal history … say the circumstances of their deployments made stealing with impunity look easy, and so they made decisions that to their surprise eventually brought them prison sentences ranging from three months to more than 17 years.”

It cited retired Army Reserve Maj. Glenn MacDonald, whose reports about fraud, waste, and abuse in the military reach a monthly Web audience of up to 6 million, and said:

“The volume and value of fraud committed by soldiers in Afghanistan and Iraq seems higher to him than what he recalled as a young soldier in Vietnam in the 1960s.”

MacDonald, 68, editor-in-chief of the website MilitaryCorruption.com, co-founded the site after a 33-year career in the Army and Army Reserve.

During his career he witnessed many small instances of corruption. “What you can make out of these [recent] wars is staggering. It’s an opportunity for anybody, even a non-commissioned officer, to become very rich overnight,” MacDonald said. Many have probably been tempted, he said, because they saw others getting away with the theft of thousands or even millions of dollars.

The CPI report said:

“Military fuel in Iraq and Afghanistan has been a perennial target of theft during the past 14 years of war.”

It cited an incident of theft and bribery, which was committed by three persons conspiring together. The convicted persons are now serving sentences. The thefts alone caused more than $1.5 million in losses to the U.S.

The CPI reviewed court filings in more than 100 cases, which show that “many of the military personnel who wound up being convicted had earlier received honors and awards, and were well-regarded by their uniformed colleagues.” The report questions: So what makes such military personnel turn to crime?

It cited the inspectors general for both war zones. The IGs said criminal actions were provoked partly by the high volume of cash and resources flowing into the countries.

It is: “The more money you throw into a weak-rule-of-law situation, the more fraud you’ll see”.

The report said:

“Todd Conormon, a lawyer who served in Iraq in 2004 and now defends service members accused of wrongdoing, said that for some, the sheer pressure of combat ‘has a debilitating effect, and maybe makes it easier…to rationalize, “Well, I deserve this.”’ Others grew used to seeing corruption all around them — like the widespread financial impropriety Sopko described — and convinced themselves that a little more wouldn’t interfere with the essential goals of the U.S. mission, Conormon said.

“For some, the urge to steal was wrapped up in other temptations, such as an illicit romance with another service member, according to court documents.”

Julia Harte’s report cited an incident:

An Army captain, who served in Iraq on two deployments from 2004 to 2007, accepted gifts worth tens of thousands of dollars in exchange for helping an Albanian owner of a company obtain a $250,000 contract from the U.S. military.

The report said:

A few “fraud schemes in Iraq and Afghanistan occurred with the full knowledge — and sometimes the complicity — of the service member’s spouse.”

Citing a sentencing memo the report mentioned a couple engaged in theft and contract fraud during his deployment in Iraq in 2008 and 2009. They netted a total of $1.69 million. They helped Iraqis pilfer equipment from the base, such as generators and air conditioners, and steered military reconstruction contracts to one local firm in particular, arranged for U.S. companies to supply smaller quantities or substandard versions of the equipment that the chosen Iraqi firm was supposed to be producing. When the products arrived in Iraq, one of them signed a Defense Department form stating that the shipments had been sent by the Iraqi firm. The firm then sent the U.S. government a bill another of the couple had prepared, and when it was paid, the firm shared the proceeds with the couple. One of them even roped in two subordinate Marines to help him with the scheme. One of the Marines received $124,000. “There were no checks, no balances.” In addition to serving sentences the couple was ordered to pay the U.S. government $2.1 million in restitution, including income tax.

The report cited another case in Kuwait that culminated in the longest prison sentence given to any U.S. service member for fraud in Iraq or Afghanistan.

The case in Kuwait in October 2004 involved ordering goods such as bottled water in exchange for bribes. The contractors were “cajoling and convincing” the officers involved in the case. The contractors told one of the officers “our God requires that we bless you” for giving them “a chance to do business.” Assistant U.S. Attorney Mark Pletcher responded that the payments had not been blessings, “just bribes.” The involved officer was collecting bribes for awarding contracts and ordering extra goods under those contracts. The officers arranged for their wives to visit, collect the cash profits, and take the money home or send it to foreign bank accounts. Their wives and relatives helped move the illicit funds out of the country, said the report.

The report said:

One of the involved officers hoped to receive $15 million through bribe and spend 10 percent of the money for building a church. In total, they collected at least $14 million in bribes. One of them ended up receiving 17½ years in prison, the longest sentence given to any service member convicted of fraud in the two countries. At least seven other soldiers in Iraq and Kuwait were convicted of participating in the conspiracy. A military-veteran-turned-contractor who played a pivotal role in the case is now in a Philadelphia jail.

The conspiracy — and the suicide of an Army officer who killed herself in 2006 after confessing to federal agents that she had accepted at least $225,000 in bribes from Lee — have garnered wide attention.

The report added:

Auditors faced increasing restrictions in Afghanistan. The investigators were only able to access one-fifth of the country. Investigators say that even now, some service members whom they strongly suspect of fraud wind up getting away without prosecution because they simply cannot muster the evidence to bring them to trial, or because they prefer to go after large cases while letting smaller ones go.

The report cited Iraq, where investigators were sure they had uncovered the culprits behind certain lucrative crimes, but equally sure they would not be able to prove it because the proceeds were stashed in inaccessible overseas accounts.

It cited investigators: “I suspected that many of these guys that we caught were perfectly happy to go to prison for a few years,” because they had much more money stashed overseas in places with little banking regulation, such as Cyprus or Jordan. “Prison was the cost of doing business for them.”

The CPI report said:

In bribery schemes, it is “often difficult to define specifically the loss to the government,” according to Peter Carr, a U.S. Justice Department spokesman.

Part of the challenge is that fraud is seen as a white-collar, non-violent crime. If the service members who stole millions from the U.S. government had taken the same amount during an armed robbery of a bank, he said, they would receive much higher penalties.

“Robbing the government is seen as a victimless crime. It’s not”, one official related to law enforcement said.

http://www.countercurrents.org/cc060515.htm