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October 31, 2007
Private Soldiers Fuel Fijian Economy
Here's the lead: "On the post-Sept. 11 battlefield, Fiji is marketing for hire its 3,500 active soldiers, 15,000 reservists and more than 20,000 unemployed former troops."
According to Bloomberg's A. Craig Copetas, "Fiji is a martial culture with no problem in fashioning a gross domestic product that includes mangoes and mercenaries."
Since 1978, Fiji has outsourced more than 25,000 troops to the UN, the British Army and independent mercenary contractors -- and sent home $300 million over almost 30 years. In 2003, the mercenaries brought about $9 million in wages to Fiji -- including the 1,000 Fijians deployed to private security contractors in the Middle East, Copetas relates, who adds that eight Fijians have been killed in Iraq.
Soldiers for Hire: A highly trained Fijian soldier can earn about $1,700 a month. That's about 3 percent of the $50,000 a month those same companies will pay for a retired and similarly seasoned U.S. or British combat trooper. ($50,000 sounds high for the going rate to me, but you get the idea.)
That is a good buy for the United Nations peacekeeping missions, apparently.
The UN's Department of Peacekeeping Operations, the multinational force with an annual budget of $5.5 billion and about 100,000 personnel serving in 18 security actions globally, has 243 Fijian troops deployed in the Middle East, Africa and Southeast Asia. It sees Fijian soldiers as a cut-rate blessing.
In the abstract, it is understandable to appreciate the need for private military companies in supporting the military around the world -- ideally, the bring professionalism, experience and a quick, just-in-time response. But the practice also raises some very poignant and substantive questions:
-- What does it say about a nation that relies heavily on paying citizens of other countries to wage war?
-- To what extent should private soldiers engage in war rather than having a nation invest its collective will with a military draft?
-- And if a draft is not politically possible, if, indeed, a draft is political suicide, should there be a long-term war at all?
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October 26, 2007
Embassy Contracts under Review
Contracts won by Baghdad embassy builder First Kuwaiti General Trading and Contracting are "under review," Secretary of State Condoleezza Rice revealed during a congressional hearing Thursday.
Rice was answering questions from Rep. Tom Davis, R-Va., about why the State Department awarded the Baghdad contract to First Kuwaiti in 2005 despite allegations that the company and its founder, Lebanese businessman Wadih al Absi, engaged in a $200,000 kickback scheme on unrelated Army contracts in Iraq.
Following up on the admission, McClatchy reporter Warren P. Strobel confirmed the brief comment with other U.S. officials who said the State Department is "looking at three other subcontracts given to First Kuwaiti General Trading and Contracting Co. to build embassies and consulates in Saudi Arabia, Indonesia and the African country of Gabon."
Apparently, the company's future business depends on how quickly it resolves the problems in Baghdad, "where the massive $740-million embassy complex is behind schedule due to a series of fire safety, electrical and other flaws."
Posted by davidphinney at 01:03 PM | Comments (0) | TrackBack
October 25, 2007
Just Business: Buying a US Embassy Contractor
An Update: Apparently, the sale of the Baghdad embassy contractor's US partner is a done deal -- or nearly a done deal. (Sorry about the earlier typos... I was typing in the dark in an SUV in the back country.)
According to documents: Robert Farah, Paul Jureidini and Robert K. Kelley are the key players to taking control of Grunley Walsh International (according to documents), which recently won over $200 million in new State Department contracts for embassy and consulate construction in Saudi Arabia, Gabon and Indonesia. The Baghdad embassy contractor, First Kuwaiti General Trading and Contracting is the prime subcontractor to the three new contracts.
First Kuwaiti is being bombarded these days by allegations of shoddy construction, horrid labor abuse, worker smuggling, sloppy security and bribery.
Farah of Alexandria, Va., Jureidini of Mechanicsville, Va., and Kelley of Chevy Chase, Md., have apparently formed a Delaware corporation called FJK Holdings, according to documents provided to me that appear to be prepared by the Washington law firm, Morrison & Foerster. (The firm is a big reader of this silly blog. Say hello to my site meter guys!)
Robert Farah: Is the former Washington representative to First Kuwaiti. He has represented the controversial Kuwait-based, Lebanese-run contractor at State Department meetings. Lebanese by birth, Farah is also a former information officer and secretary-general for political affairs of the Lebanese Forces political party from 1986 until at least 2001. His first recorded political contribution to a US national election was in June 2006 when he gave $25,000 to the National Republican Congressional Committee. Farah began making moves around September 2006 to purchase Grunley Walsh’s newly-formed Grunley Walsh International soon after Grunley landed its first embassy work with First Kuwaiti as its prime subcontractor.
Paul Jureidini: Appears to be an associate of Armitage and Associates for many years, an organization run by the former Deputy Secretary of State from 2001 to 2005, Richard Armitage. Armitage was a campaign foreign policy adviser to George W. Bush in 2000 and part of a group led by Condoleezza Rice that called itself The Vulcans.
Robert K Kelley: Is a vice president of the public relations firm Audreac and Associates and serves an adviser to Bell Pottinger USA in Washington, DC., according to one document, which claims that Pottinger presently has classified contracts with the Multinational Corps Iraq at Camp Victory, Iraq. First Kuwaiti has a large logistics presence at Camp Victory, as well. Pottinger's mother ship owner is UK-based and ran public relations efforts for the Coalition Provisional Authority in 2004.
Posted by davidphinney at 09:28 PM | Comments (1) | TrackBack
October 24, 2007
Baghdad Embassy Contractor Wins More US Contracts
Despite allegations of poor construction, lousy and abusive labor practices and missed deadlines for completion, the Kuwaiti contractor building the new $592-million-and-counting US Embassy in Baghdad has been quietly bagging new lucrative contracts to build US diplomatic compounds around the world.
In September, First Kuwaiti General Trading and Contracting Co., won a $122-million State Department contract to build a U.S. consulate in Jeddah, Saudi Arabia, McClatchy reporter Warren P. Strobel has confirmed. Additionally, First Kuwaiti has won US embassy and consulate work over the past 13 months in Libreville, Gabon and a consulate in Surabaya, Indonesia.
Total Amount of Contracts: Well over $200 million.
First Kuwaiti has only been able to win more US State Department embassy work because it partnered with the US firm, Grunley Walsh LLC of Rockville, Md. Apparently, First Kuwaiti wields a hefty influence over management of Grunley Walsh's international operations.
Why? Because US law requires that only U.S. firms can bid on embassy construction as the prime contractor.
Strobel notes:
But industry analysts said that First Kuwaiti appears to be the financial muscle behind the partnership with Grunley Walsh. Lebanese businessman Wadih al Absi founded the company in 1996. News reports and Middle East experts say that Absi is a supporter of Lebanese Christian politician Michel Aoun, an ally of Syria and the Iranian-backed Islamic militant group Hezbollah.
Last year, First Kuwaiti's Washington representative, Robert Farah, began negotiations to buy Grunley Walsh. Farah told me recently that the negotiations were ongoing, but one State Department source believe that Farah and two other unnamed partners were successful in the purchase.
Most Amusing: First Kuwaiti has hired the public relations firm, Saylor Company, according to Strobel. The firm claims to specialize in "crisis" public relations and " is known for handling high stakes communications."
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Check Out My New Website
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Privatized War is Here to Stay
Taking the stance that the U.S. is fighting a war in Iraq with more private contractors than military personnel with a ratio estimated at around 180,000 contractors to 160,000 uniformed personnel, Reuters columnist Bernd Debusmann dishes up his realistic analysis:
Even if there were political will to stop using civilians for roles previously carried out by the military, it would take years to reverse a relentless trend towards outsourcing that began with the end of the Cold War and has accelerated since.
Meanwhile, The New York Times weighs in with a review of the US State Department's explosive reliance on outsourcing in troubled spots: State Department Use of Contractors Leaps in 4 Years.
The amount of money the State Department pays to private security and law enforcement contractors has soared to nearly $4 billion a year from $1 billion.....
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Iraq Revokes Security Contractor Immunity
The Iraqi government has decided to revoke immunity from prosecution that the US-led Coalition Provisional Authority extended to private security companies operating in the war-ravaged country, according to journalist Ammar Karim.
"The cabinet held a meeting yesterday and decided to scrap the article pertaining to security companies operating in Iraq that was issued by the CPA (Coalition Provision Authority) in 2004," government spokesman Ali al-Dabbagh said in a statement.
Article 1 of Section 2 of CPA order 17: Issued by then US administrator for the CPA, Paul Bremer, stipulates that the "multinational force, foreign liaison missions, their personnel, property, funds and assets and all international consultants shall be immune from Iraqi legal process."
The immunity granted to private contractors has become controversial since a series of shootings involving foreign security guards, the most infamous of them a September 16 shooting in which employees of the Blackwater firm killed 17 Iraqis in Baghdad.
Posted by davidphinney at 02:15 PM | Comments (0) | TrackBack
What Happened to Saba and Nashat?
Iraqi officials jailed two young men in the summer of 2005 for allegedly pocketing the wages of hundreds -- if not thousands -- of Iraqis working for the Sandi Group, a Washington, DC, firm doing a multi-million-dollar business in Iraq as the leading subcontractor to DynCorp's $1.2-billion Iraqi police training contract, according to sources familiar with the two men.
People working with Sandi who should know the details of the young Kurds, known as Nashat and Sabah, say they don’t know or ignore the question.
How much money did they allegedly skim from payroll? Company executives with The Sandi Group declined comment, but inside sources say salaries for Iraqi security workers averaged around $600 a month, and Sabah and Nashat are thought to have skimmed $200 off each monthly salary. Sandi documents represent Sabah as the chief of finance for the Sandi Iraq operations and Nashat as the chief of staff. If the two were in charge of a thousand workers, that could be $200,000 a month. Multiplied by 12 months and it starts adding up to big money: $2.4 million.
"When a worker complained, he would be threatened with being fired," one former Sandi employee says, who recalled Nashat driving around Iraq in a car with trunk loads of cash for payroll.
The Sandi Group and its affiliates once boasted of employing 7,500 Iraqi workers and claimed to be the largest employer in Iraq during much of 2004 and 2005.
MORE BELOW FOLD
Former Sandi employees recall Nashat and Sabah as two handsome and charming men from an area around the northern Iraqi town of Zakho, near the Turkish border. Zakho also is the hometown of Rubar Sandi, the hard-driving businessman and head of the company bearing his name. Employees recall Sandi fondly introducing Nashat and Sabah as his relatives -- some say Nashat even changed his name to Sandi. But the familial relations were more an expression of close national bonds and affection rather than blood. (Others remember Nashat's last name as either Younis or Hamed; and Sabah's as Permos or Bermos. Records represented as belonging to The Sandi Group provided by one former security guard identify them as Nashat Y. Hamed and Sabah Abdul Waheed Bermos.)
After immigrating to the United States in the 1970s, Sandi earned advanced degrees in business and economics and staked out a successful career as an entrepreneur, developer and financier. Now in his mid-50s, Sandi also cultivated friendships with prominent Republicans and became an active voice in pushing for the liberation of Iraq at the US State Department where he was an advisor in a pre-war planning effort, the "Future of Iraq Project."
Sandi returned to Iraq with the 2003 liberation and quickly scooped up interests in major hotels that were leased to other contractors, took an immediate interest in reconstruction, invested in the Al-Ahali Newspaper, and assembled the largest private security force in Iraq -- said to have numbered in the thousands.
"The Sandi Group was like an octopus," one former employee says.
At one time, sources say Sandi even entertained a bid for building the new $592-million US embassy in partnership with Philip Bloom, an American businessman who pled guilty in April 2006 to conspiracy, bribery and money laundering in connection to contracts in Iraq unrelated to Sandi. Although Sandi lost out on the embassy project, the State Department did award the company an open-ended agreement for work in Iraq when needed, including on the new embassy project.
Rubar Sandi boasted of his willingness to hire thousands of Iraqis and said it was fundamental to demonstrating support for the Iraqi people; something he encouraged other companies to do as well. Among those Iraqis that the company hired were Nashat and Saba.
"They knew Baghdad," said Louis Brown, who ran Sandi’s Iraq operation until autumn 2005 and was then based in Washington, DC as vice president of special projects until last spring before resigning. "I trusted them with my life."
Nashat, who began work with Sandi as a driver, and Sabah as an interpreter, soon rose to the highest levels of management in Iraq, Brown said.
Asked in March what happened to Nashat and Sabah and where are they now, Brown replied tersely: "I don't know."
One source laughed when told of Brown professing ignorance of his two Iraqi lieutenants, Nashat and Sabah. Loyalty and friendship may just be trumping candor.
"That sounds just like Lou," said the former employee. “But he knows exactly what happened to them and why.”
Posted by davidphinney at 12:15 AM | Comments (0) | TrackBack
October 23, 2007
State Department Inspector General Under Fire
(Sorry about the previous typos, guys. I am in the market for a new blog program.) The $592-million Baghdad embassy contract, the $1.2-billion police training program in Iraq and Afghanistan, and the security contract for Blackwater are all under intense scrutiny -- and so is the State Department Inspector General who is responsible for investigating these contracts after receiving credible complaints: Oversight body looks into complaints against State IG.
Circle the Wagons: GovExec reports that Krongard hired Barbara van Gelder for legal counsel. Van Gelder relates that allegations about Krongard having blocked his staff from investigations are based on “imperfect recollections.” Van Gelder recently defended the former White House contracting policy chief, David Safavian, who was found guilty in June 2006 of lying and obstructing justice as part of the Abramoff scandal.
Posted by davidphinney at 05:03 PM | Comments (0) | TrackBack
Iraq's Police Training Program Records in Disarray
The State Department so terribly managed a $1.2 billion contract for Iraqi police training that it can't figure out what it got for the money spent, a new report says (pdf).
Total Disarray: in invoices and records on the project -- and because the government is trying to recoup money paid inappropriately to contractor DynCorp International, LLC -- auditors have temporarily suspended their effort to review the contract's implementation, said Special Inspector General for Iraq Reconstruction Stuart W. Bowen Jr.
Maybe investigators should look into DynCorp's relationship with its prime subcontractor, Corporate Bank, aka, The Sandi Group, aka, TSG.
This is what I found in Sandi documents:
When DynCorp hired Sandi’s Corporate Bank in October 2004 to build a regional camp with 24 living trailers at Ad Diwaniyah, Corporate Bank billed $1,194,197. One month later, Corporate Bank then hired the Hozan General Construction Company of Baghdad for $605,000 to do the work. Similarly, DynCorp agreed to pay $833,680 for a 16-trailer camp at Al Kut. Corporate Bank then hired Hozan for $388,000. In Karbala, DynCorp agreed to pay $809,520. Corporate Bank turned to Hozan for $388,000.
Here's a taste of those documents....
Where to Look: Other than my thumb drives, perhaps Sandi's new office. Sources confirm that a fire broke out in Sandi's old office in December 2006. Some say all the records disappeared. Others say the records were untouched by flames because the fire took place in the basement and first floor and all of accounting and proposals were kept on floors 2 through 4.
According to Bowen's Report: Records prior to October 2006 could not be validated at the State Department. However, since October 2006, incoming invoices from DynCorp have been validated.
Sandi's Interesting Staffing:
Tim Crawley: Left DynCorp as vice president of contracting last June (2005), joined Sandi as executive vice president and general manager. At DynCorp, Crawley was responsible for "making sure that any subcontracts awarded were in compliance with all laws, regulations, and company policies -- including (where required) competitive bidding, cost-price analysis, and eligibility for award of government contracts," according to a DynCorp source. Crawley has since left Sandi, I am told.
"There’s a lot of confusion about this,” Crawley said of the contracts between DynCorp and Sandi.
Russell Hugo: Served as the Regional Director for Oversight and Support for the Department of State, Bureau for International Narcotics and Law Enforcement Affairs. In this role, he was responsible for financial controls and oversight for over twenty-five countries in Asia, Africa, Middle East and Europe -- presumably including DynCorp contracts. He is now Sandi's chief financial officer and senior vice president.
See: Marking Up the Reconstruction:
Of the seven major regional training camps ... none were visited by the State Department. The government contracting officer who authorized the spending on the projects told Bowen’s investigators that he "never visited the sites" because of security concerns and that he relied on reports from others regarding the status of the camps.
Posted by davidphinney at 10:01 AM | Comments (0) | TrackBack
October 22, 2007
Matt Drudge Rocks
There have been reasons for blasting Matt Drudge, but one has to hand it to him. More than a decade ago, his Drudge Report brilliantly pointed the way to the vitality of the Internet as a news medium. And personally, he stood tall against his critics -- largely in the mainstream news media who found his early years a threat to their pipeline of distributing news and among liberals who didn't like his sometimes erroneous meddling or huge impact in bringing President Clinton's affair with a White House intern to the forefront.
So congratulations to Drudge for receiving page-one coverage in the New York Times about his abilities to set the news agenda in the presidential coverage. The glowing story says:
The site is a potent combination of real scoops, gossip and innuendo aimed at Mr. Drudge's targets of choice -- some of it delivered with no apparent effort to determine its truth, as politicians of all stripes have discovered at times.Aides in both parties acknowledge working harder than ever to get favorable coverage for their candidates -- or unfavorable coverage of competitors -- onto the Drudge Report's home page, knowing that television producers, radio talk show hosts and newspaper reporters view it as a bulletin board for the latest news and gossip.
Here's the story: Clinton Finds Way to Play Along With Drudge
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October 21, 2007
Read It: 'Suicide Is Not Painless'
New York Times columnist Frank Rich delivers a scathing analysis of Pentagon and US government-guided procurement in Iraq begins with the suicide of Charles D. Riechers, 47, the second-highest-ranking procurement officer in the United States Air Force who killed himself by running his car’s engine in his suburban Virginia garage several weeks ago.
Riechers' job had been previously held by an officer named Darleen Druyun, who was sentenced to nine months in prison for securing jobs for herself, her daughter and her son-in-law at Boeing while favoring the company with billions of dollars of contracts. The Bush-appointed Pentagon inspector general delivered a report on Druyun to Congress was full of holes in 2005. "Specifically, black holes: dozens of the report’s passages were redacted, as were the names of many White House officials in the report’s e-mail evidence on the Boeing machinations."
Where is that inspector general now?: Joseph Schmitz, was already heading for the exit when he delivered his redacted report. His new job would be as the chief operating officer of the Prince Group, Blackwater’s parent company.
Blackwater's Lobbyist: Paul Behrends, who first represented the company as a partner in the now-defunct Alexander Strategy Group. That firm, founded by a former Tom DeLay chief of staff, proved ground zero in the Jack Abramoff scandals.
Alexander may be no more, but since then, in addition to Blackwater, Mr. Behrends's clients have included a company called the First Kuwaiti General Trading and Contracting Company, the builder of the new American embassy in Iraq.
FYI: Paul Behrends now is a Partner with C&M Capitolink LLC, a subsidiary of Crowell & Moring, the law firm now representing First Kuwaiti. Attorneys Robert Nichols and Angela Styles, President Bush’s former procurement policy director, took First Kuwaiti's account to the firm last year.
Rich Continues:
That Vatican-sized complex is the largest American embassy in the world. Now running some $144 million over its $592 million budget and months behind schedule, the project is notorious for its deficient, unsafe construction, some of which has come under criminal investigation. First Kuwaiti has also been accused of engaging in human trafficking to supply the labor force. But the current Bush-appointed State Department inspector --guess what -- has found no evidence of any wrongdoing.Both that inspector general, Howard Krongard, and First Kuwaiti are now in the cross hairs of Henry Waxman’s House oversight committee. Some of Mr. Krongard’s deputies have accused him of repeatedly halting or impeding investigations in a variety of fraud cases.
Here's the column Suicide Is Not Painless.
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October 19, 2007
Grapes and Sex and Government Contracts
Talk about low-hanging fruit:
A prostitute testified Wednesday that former U.S. Rep. Randy "Duke" Cunningham fed her grapes as she sat naked in a Jacuzzi before they headed to a bedroom at a Hawaiian resort.The woman testified at the bribery trial of defense contractor Brent Wilkes, who is accused paying the former congressman with $700,000 in cash and perks in exchange for help securing about $90 million in government contracts.
Wilkes has denied the charges.
I have as many grapes as a contractor can eat in exchange for finishing my kitchen.
The Associated Press has the story.
Posted by davidphinney at 02:28 PM | Comments (0) | TrackBack
Baghdad Embassy Coverup
A project manager and the State Department Inspector General covered up "enormous problems" in the management of the $592-million embassy project in Baghdad, McClatchy newspaper reporters Warren P. Strobel and Jonathan S. Landay report today.
Problems became apparent after a mortar shell smashed into the sprawling new U.S. Embassy last May, damaging a wall and causing minor injuries to people inside the building:
The State Department contractor in charge of the project, James L. Golden, attempted to alter the scene of the blast, according to government officials familiar with the incident. The State Department inspector general prevented Department officials from investigating the incident, according to interviews and documents.
Meanwhile: A congressional committee is examining whether the walls of the still-unfinished embassy complex, which are supposed to be blast-resistant, performed as they should have during the mortar attack.
More Delays: Problems with the fire suppression system were "serious," according to Patrick Kennedy, the State Department's director of management policy.
Joints in underground water mains supplying the sprinklers leaked when they were tested -- but he emphasized that this and other problems were discovered as part of OBO's rigorous inspections.
Asked when the structure would be ready to occupy, Kennedy said, "Soon. But I'm not going to tell you whether soon is in two weeks, or six weeks or eight weeks."
More details to follow when I get a moment.
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October 18, 2007
Blackwater Morphing
Robert Young Pelton's take on Blackwater -- as filtered by Dan Rather Reports on HDNet.
Petlon says the interview took place nine months ago, but was netcast only recently:
Go to minute 37:50 after first story:
Petlon and Rather talking about Blackwater.
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October 17, 2007
What is USProtect Doing in Iraq?
If these bribes between USProtect and the General Services Administration in California took place, you have to wonder how USProtect is going about its business in Iraq:
A former chief executive for USProtect, a security company pleaded guilty earlier this month to giving bribes to a contracting officer at the General Services Administration in exchange for helping win over $150 million in federal contracts for the company. (USProtect was formerly known as Holiday International Security Inc., before a name change in 2003.)
The executive and former cop, Michael B. Holiday of Silver Spring, Md., said in his plea agreement that he gave vacations and other benefits to GSA contract manager Dessie Ruth Nelson, age 65, of Oakland, Calif., in exchange for assistance in awarding three multi-million dollar contracts.
All of the contracts were in California for private security at federal buildings.
Nelson now faces charges by separate criminal information with accepting over $100,000 in bribes from Holiday and evading taxes on the bribe payments.
According to the Justice Department press release:
A former officer of the company, Richard S. Hudec, age 44, of Naples, Florida, also was charged by criminal information for a scheme to conceal material information from federal contracting officials -- including four prior felony convictions -- in connection with federal contracts worth over $150 million and tax evasion.
While USProtect CEO in 2003, Hudec was a sponsor of the famous "Gold Rush" conference in Washington, DC, for contractors wanting work in Iraq. He also had a long rap sheet -- four felony fraud convictions on his record and served time in prison as recently as 2001, according to federal court filings, The Washington Times reported.
USProtect keeps popping up at other reconstruction conferences, including one that featured Hudec as a panelist on Strategies for Entry in Iraq, What Will it Take to Structure a Deal and Eliminate Barriers of Entry? Developing the Right Practice, Setting the Stage for Effective Entry in Iraq.
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Unknown Number of Federal Civilian Workers
For many years, there was no accurate estimate on the number of contractors working in Iraq and Afghanistan until The Los Angeles Times came up with a headcount that contractors now outnumber the miliary.
Apparently, no official count has been made for federal civilian employees either. The Washington Post reports that the Defense Department has sent about 6,000 civil service employees to Iraq since 2001 and the Treasury Department has assigned 75 to Iraq since 2003. Otherwise, "there is no tally of how many federal employees have been deployed to Iraq or Afghanistan, and the deployments vary by agency."
Reporter Stephen Barr continues:
Federal employees are generally not ordered into war zones -- though some, because of their occupation, can be assigned to hardship posts and left with no choice but to accept or resign. For Iraq and Afghanistan, agencies have relied on qualified employees who are willing to volunteer.
The money can be good: Up to $212,100 this year in base pay and differentials. Employees also are provided with trips home and rest breaks in the region.
One problem: The pool of qualified Foreign Service officers may be shrinking because of projected retirements. Mark S. Ward, senior deputy assistant administrator for USAID's bureau for Asia and the Near East, said more than 30 percent of USAID's Foreign Service officers are eligible to retire this year, and 46 percent will be eligible by 2011.
The story begins by recognizing the death of Steven Thomas Stefani, a U.S. Forest Service employee on assignment in Afghanistan, killed by a roadside bomb near Ghazni on Oct. 4 while serving as an agricultural adviser to a provincial reconstruction team.
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October 10, 2007
Baghdad Embassy Contractor Aims for More Business
Sloppy construction, safety problems, bribes, slave-like labor practices, missed deadlines, internal disputes and inflated costs -- the new $600-million US embassy compound in Baghdad is swamped in a rising deluge of allegations from lawmakers and the news media.
Meanwhile, the former Washington representative for the Kuwait-headquartered contractor now building Baghdad embassy project is actively negotiating to buy the contractor’s US partner company -- along with contracts for classified embassy work around the world that the US State Department awarded the two companies.
Alexandria, Va., real estate agent and businessman Robert Farah has repeatedly represented the Baghdad embassy contractor First Kuwaiti General Trading and Contracting at State Department meetings in Washington. Riding on the success of winning the Baghdad deal for the largest diplomatic compound in the world, First Kuwaiti then partnered up last year with Grunley Walsh of Rockville, Md., to win other US embassy and consulate contracts in other countries worth more than a $100 million dollars.
The wedding with a US firm appears to be a key strategy for First Kuwaiti's efforts to winning more State Department business because only US-owned and headquartered companies may perform classified embassy work. And soon after the Grunley Walsh won three new contracts in Africa, India and Indonesia in September 2006 as the lead partner, Farah began making moves to purchase Grunley Walsh’s newly-formed Grunley Walsh International for an undisclosed sum along with the new embassy work.
Nothing precludes Farah from purchasing the company, although the Lebanese national and naturalized US citizen (and a former information officer and secretary-general for political affairs of the Lebanese Forces political party from 1986 until at least 2001), could be prevented from taking on classified embassy work if he used other than US-sourced financing.
Nevertheless, Farah's timing and his affiliations with First Kuwaiti as well as First Kuwaiti's apparent muscle in the ongoing management of Grunley Walsh does raise eyebrows. As one State Department career officer noted: "It's a bit strange for a newly-formed firm to win three contracts worth $150 to $200 million and then sell the company."
But that is exactly what appears to be going on according to a draft letter laying out the terms for Farah's proposed buyout. The three-page, Dec.22, 2006, document stresses that Grunley Walsh holds "secret-level security clearances issued by the U.S. Government," which are deemed essential to a potential deal. "Given that the State Department contracts require the renamed Grunley Walsh International LLC to hold a security clearance, the acquisition can occur only if the (US State Department) doesn't rescind the current security clearance based upon the name change or the change in ownership."
Attorney Robert Nichols, who drafted the letter for Farah, also had recently represented First Kuwaiti, as did Miller Chevalier law partner Angela Styles, President Bush’s former procurement policy director. Both Nichols and Styles have since moved to a new Washington law firm, Crowell & Moring, where the two continue to represent First Kuwaiti.
One February 12, 2007, Grunley Walsh also began working with staff from a Lebanese firm closely associated with First Kuwaiti, according to a document provided by a source familiar with the companies.
A document obtained by me seeks approval from the State Department for 19 senior GMD employees working with Grunley Walsh for clearance on the newly-awarded embassy contracts. GMD, also known as Global Management and Development and based in Lebanon, took part in designing and building the Baghdad embassy project as well as First Kuwaiti headquarters in Kuwait, according to the document.
In addition to representing First Kuwaiti at State Department meetings, Farah represents and is president of the Global Management and Development Group. Farah said it is only a coincidence in the similarity of names and that Global Management and Development Group is based in Virginia.
"It can be very confusing. Everyone uses the words 'Global Management,'" Farah said in a telephone interview.
Meanwhile, the marriage of Grunley Walsh and First Kuwaiti continues to be promising. First Kuwaiti and Grunley Walsh International are thought to be poised for building a State Department project in Saudi Arabia. They also were believed to have been at the top of the list for building a new US embassy in Beirut, Lebanon, that the US State Department nixed this summer after protests from the U.S. ambassador there who said the area was unsafe.
Canceling the project caused a stir within the State Department because the department’s Overseas Building Operations division, known as OBO, had already purchased land for the project for more than $22 million, according to ABCnews.com. Friction became so great that the U.S. Embassy refused to allow a State Department official managing the project, James Golden to enter the Lebanon by denying normally standard "country clearance."
Golden is an independent contractor hired by OBO to lead the independent contractor who plays an influential hand in the award of embassy construction in trouble spots around the world, including the Baghdad embassy. Multiple sources say he has spent much of his time in Kuwait and Baghdad where he played a guiding role in awarding contracts to First Kuwaiti and its subcontractors
Asked about his affiliation with First Kuwaiti, Farah said he had not worked the company for "six or seven" months, but that he was still actively negotiating a purchase of Grunley Walsh International. "Money is not a problem."
Representatives of Grunley Walsh and First Kuwaiti have not responded to numerous inquiries about their association, although it appears First Kuwaiti does wield a hefty hand in Grunley Walsh's management, according to emails and documents obtained from State Department sources.
First Kuwaiti's general manager Wadih al Absi wrote in an email to Grunley Walsh president, Kenneth M. Grunley and Farah (using a First Kuwaiti email address), outlining the chain of decision making in their partnership:
"Since we care about our relation with GW (Grunley Walsh) whether it is sold out to Mr. Robert Farah or otherwise we need to set some policies and procedures in place as to avoid further complications and to continue a good and long working relationship" al Absi wrote in reference to embassy work supervised by the State Department’s Overseas Building Operations division, known as OBO.More below the fold....
Among al-Absi’s demands, he notes:
The following is related to FKTC’s scope i.e. areas which do not require security clearance.
1. Both parties are fully aware and reconfirm that the arrangement of Prime/Subcontractor is solely for the purpose of satisfying the requirements of OBO. Each Party will be fully responsible for its own scope of work as per the initial agreement.
2. Prior to any written communications with OBO, GW shall obtain FKTC’s approval in writing. Any verbal communications shall not be binding and no decision may be formalized other than in writing.
3. GW will forward any communication received from OBO immediately to FKTC. Further FKTC shall be informed instantly of any conversations in relation to their scope of works.
4. GW shall not enter into any contracts or agreements without prior written approval of FKTC. FKTC will undertake all negotiations and finalize any agreement. GW will bear any consequences to any agreements entered without prior written approval of FKTC.
5. GW will be responsible in regard to all requirements related to their scope of works including but not limited to design requirements and personnel.
6. FKTC is responsible for providing the bonding/LC’s for any of the awarded jobs and the charges thereof shall be shared by both parties pro-rata to their scope of works.
7. GW will forward to OBO or others any communications submitted by FKTC without questioning, provided that such communications would not negatively affect GW’s image and reputation. It is FKTC sole decision whether such communications are to be discussed with GW or not prior to submittal to OBO.
8. Each party will have full control over its scope of work including but not limited to execution, procurement, recruitment and subcontracting.
9. FKTC will keep GW informed about the progress of works as it goes and of any problem are being encountered.
10. GW will finalize and submit to the bank the letter of assignment of rights to FKTC in regard to their portion of the works.11. GW and FKTC will agree on a liaison to communicate among GW, FKTC and OBO.
II. BIDDING FOR 2006 – 2007 - 20081. FKTC will decide which projects will be bid and as initially agreed each party will be responsible for the costs they incur in their own right.
2. In case GW are unable to participate within any of the bids then FKTC will arrange another cleared American firm as to participate within any such bids under GW supervision and GW fee will be agreed on.
Posted by davidphinney at 04:50 PM | Comments (3) | TrackBack
October 09, 2007
Embassy to be Finalized 'Later this Month'.... Huh?
Stop the Press: Charles Williams, director of the State Department's overseas building operations, told USA TODAY that the new embassy in Baghdad will be finalized later this month. The delay was shorter than those seen during recent construction of smaller embassies, he said.
Seems the State Department just can't get its story straight. State Department spokesman Sean McCormack said just earlier today: "I can't tell you when the embassy is going to open.... We don't have an answer."
So what's the extra $150 million in added costs going to be spent on -- a sum that has grown since last week when sources originally suggested to me would be just $100 million over budget?
We'll see.... The House Government Oversight and Reform Committee is planning a hearing on matters related to the Baghdad embassy. It may be on October 16.
Posted by davidphinney at 08:36 PM | Comments (0) | TrackBack
Baghdad Embassy Delayed Indefinitely with Cost Overruns
The opening of the mammoth new U.S. Embassy in Baghdad has been delayed indefinitely, according to Reuters as the Kuwaiti contractor "fixes a punch list of problems," the State Department said on Tuesday.
The sprawling complex, whose cost is edging toward $750 million, was set to open last month but U.S. lawmakers say shoddy work by the contractor and poor oversight by the State Department have delayed it.State Department spokesman Sean McCormack rejected claims of inadequate oversight and said there was no indication how long it would be before the new embassy opened.
"I can't tell you when the embassy is going to open," said McCormack. "We don't have an answer."
That "punch list" appears to have an estimated cost of $144 million, but McCormack suggested otherwise: original specifications of the contract changed after it became clear that more office and living space was needed for civilian and military staff.
Originally the Bush administration requested $1 billion in emergency funding to build what is touted as the largest diplomatic mission in the world. Congress balked and cut it back to $600 million, but apparently the sum is climbing skyward again.
Here's the Reuters report: Embassy opening in Baghdad delayed indefinitely
This development of delays and costs directly contradicts sworn testimony before US congress in July by the head of embassy construction who said: "We are slated to complete the project in September of this year and personnel can begin to move into offices and residences shortly thereafter."
Posted by davidphinney at 04:02 PM | Comments (0) | TrackBack
Waxman Takes More Swings at Baghdad Embassy Contractor
A leading Democrat in Congress is blasting the US State Department for apparently casting a blind eye on allegations of widespread construction flaws at the $600-million-and-counting embassy project in Baghdad.
In a letter to Secretary of State Condoleezza Rice, Rep. Henry Waxman, who chairs the House Government Oversight and Reform Committee, also questions the background of the embassy contractor First Kuwaiti General Trading and Contracting. By relaying court documents and auditing reports, he expresses outrage of an alleged $200,000 bribe and inflated costs charged to the Pentagon for military trailers in Iraq.
Here's the letter: Documents Show Extensive Flaws in Iraq Embassy Construction.
Posted by davidphinney at 12:58 PM | Comments (0) | TrackBack
October 06, 2007
US Embassy Contractor Missing Laptop?
A laptop belonging to a high-level executive supervising construction of the new US embassy in Baghdad went missing in May 2006 at the Kuwait office of the contractor hired to build the new US embassy in Baghdad.
Multiple sources formerly working with the contractor have detailed the theft of the computer, but my questions to the State Department and the contractor, First Kuwaiti General Trading and Contracting, have been met with silence.
A missing laptop from May 2006 may be of concern if it contained information about any US government projects in Iraq -- or elsewhere. The company has collected nearly $2 billion in US-funded contracts since the 2003 invasion of Iraq.
It may be of even greater concern since the laptop is said to have belonged First Kuwaiti's construction director, Samir Ida.(Remember the furor or the internet posting of architectural renderings of the embassy by the American subcontractor Berger Devine Yaeger Inc.? They are now all over the web.)
This interview from more than a year ago discusses the missing laptop with one former First Kuwaiti employee:
Q: Sounds like you have a professional job?
A: This company does not have proper procedures to be professional.
Q: What do you think happened to the laptop?
A: Well, there is a big chance that someone stole it just to get some data out of it.
Q: Hmmmmm
A: They left a wallet with money and a mobile phone lying next to it. Those things weren't stolen.
Q: Could be evidence for a fraud case?
A: I think this is what freaked out the general manager so much. Whoever did it must have known a lot about this company.
Q: Do you remember when it happened?
A: It was May 27 (2006)
Following the laptop theft, word is that First Kuwaiti's general manager, Wadih al-Absi then ordered a virtual lockdown of his Kuwait office where more than 100 employees work. He is said to have wanted the building as "secure as the Pentagon." Al -Absi immediately installed video security cameras throughout the building, curtailed all internet access, forbid most employees from using floppy disk drives and thumb drives and ordered that all telephone calls be monitored and recorded, according to sources who worked for the company at the time.
This July 23, 2007, email is one of many I sent to State Department officials and First Kuwaiti. They have all been ignored.
Ms. French,I am a journalist writing for Iraqslogger.
I have it on good sources that a laptop was stolen from a high level embassy contractor building the US embassy, First Kuwaiti General Trading and Contracting. The computer disappeared at the end of May 2006 from the offices of FKTC and possibly belonged to Samir Ida, a top executive with the company.
I am also told that you have personal knowledge that this laptop was missing.
How important was this theft to the security of the embassy?
Was a formal report ever filed?
Was the missing computer ever located?
What corrective measures were taken after the theft of the computer?
Thanks, I am on deadline and a response at your earliest opportunity would be appreciated.
-------
Deadline? What a joke.
Posted by davidphinney at 04:24 PM | Comments (1) | TrackBack
Rumors of First Kuwaiti Airplanes for People Moving
From spring 2006: The general manager for the US Embassy contractor, First Kuwaiti General Trading and Contracting has two airplanes the company can't register and is piloted by a German pilot named Wolfgang .... The general manager also has another plane piloted by Brits flying in and out of Kuwait and a fourth that may be registered.
Another source related around the same time: "Some people have rumoured that First Kuwait use Chapman Freeborn flights every Thursday on their 737 and also Phoenix on their 737 with other people carried by Air Cargo Integrators ACI out of Kuwait. We, of course, could not possibly comment on how accurate these rumours are. I am sure you can get to the bottom of things. Hope this helps."
Posted by davidphinney at 04:24 PM | Comments (1) | TrackBack
Misleading Statements under Sworn Testimony?
Two months ago, a top US State Department official in charge of embassy construction gave misleading statements under sworn testimony about the new US embassy in Baghdad. He claimed that it would be completed on budget and on time. Now numerous news reports say that the project's completion will be delayed for months.
Sunday's Washington Post piled on with its own story:
The massive U.S. embassy under construction in Baghdad could cost $144 million more than projected and will open months behind schedule because of poor planning, shoddy workmanship, internal disputes and last-minute changes sought by State Department officials, according to U.S. officials and a department document provided to Congress.
This remarkable turn of events directly contradicts July 27 sworn testimony before the House Oversight and Government Reform Committee by the State Department's Charles E. Williams, director of overseas buildings operations:
"We have received numerous accolades as to the extremely high quality of construction," Williams told the committee. "It is among the best.... We are slated to complete the project in September of this year and personnel can begin to move into offices and residences shortly thereafter."
Interestingly enough, Republicans sought to make political mileage in discounting sworn testimony by two witnesses, John Owens and Rory Mayberry during that same hearing about the embassy project. Both witnesses made allegations of faulty construction, worker smuggling and other abuses at the embassy project.
One Republican called Mayberry a professional "whistleblower." Another threatened to press charges against Owens for meandering on his answers about whether or not he had filed a fraud claim over shoddy construction at the embassy (Owens had just traveled 24 hours from Cambodia and he was not allowed to comment on the matter by his legal counsel).
Will Republicans now be equally hostile towards Williams? (Hey, didn't the Republican-controlled Congress impeach a president on a less consequential issue?)
More to come on this about "misleading" testimony by congressional witnesses and other statements by US State Department officials relating to the Baghdad project.
Posted by davidphinney at 04:24 PM | Comments (0) | TrackBack
My Mailing Address
The source wanting my geographic postal location needs to give me a proper email address or simply look me up.
Posted by davidphinney at 01:58 PM | Comments (0) | TrackBack
October 05, 2007
New US Embassy in Baghdad Delayed
Widespread construction flaws and substandard work have delayed completion of the US State Department’s mammoth new $592-million embassy in Baghdad despite previous official statements that the ambitious fortified compound would be finished in September, numerous sources familiar with the project have been telling me for several weeks.
Those charges now seem to be corroborated by the Associated Press and Reuters. Both news agencies report that the sprawling, Vatican-sized embassy compound has been beset by construction and logistical problems.
"They are substantially behind at this point," and it would be surprising if any offices or living quarters could be occupied before the end of the year, one official told the Associated Press.Reuters reports that in a letter to U.S. Deputy Secretary of State John Negroponte, Rep. Tom Lantos, D-Caif., said such delays raised concerns over the adequacy of the department's management of overseas building operations.
"These delays and deficiencies undermine the security and the living standards of almost 1,000 foreign service officers and other embassy staff that will be housed at the Baghdad Embassy," wrote the California lawmaker, who chairs the House of Representatives Committee on Foreign Affairs.
One uncorroborated source told me that the State Department is considering as much as $100 million in new spending to bring the new embassy compound up to snuff. Touted as the largest embassy in the world with over two dozen fortified buildings, the 104-acre compound spans an area equal to two-thirds the size of the National Mall.Asked about the completion date, State Department spokeswoman Nicole Thompson stressed recently that the embassy project is nearly finished but that no determined time has been set for ribbon cutting. She said the official handover to the State Department and final inspection -- known as "accreditation" --has yet to be scheduled. Those things, Thompson said, won't take place until the project is deemed complete and State Department officials have combed through the compound "with a white glove."
The State Department spokeswoman also said that no formal requests for additional funding have been made although "the project is in a constant state of evaluation."
In July, the State Departments director for US embassy construction assured Congress in July that the contractor, First Kuwaiti General Trading and Contracting, would be completing the project in September.
"We have received numerous accolades as to the extremely high quality of construction," Charles E. Williams told the Committee on Oversight and Government Reform on July 26. "It is among the best.... We are slated to complete the project in September of this year and personnel can begin to move into offices and residences shortly thereafter."But some say that officials now may be scrambling to adjust the move-in schedule, which could be well into 2008, according to once source who insists that government inspectors have found "widespread and serious flaws" in the project and have refused to allow occupancy of the new compound until the problems are repaired.
Some of alleged troubling issues include poor water filtration, weak blast walls, electrical problems, sinking foundations and substandard water lines in the fire extinguishers. If true, these issues could take six months to address, the source said, who added that if more spending is called for, the sum may be veiled as new additions to the project, but, in fact, also cover up defective and incomplete work that "will be hidden forever."
The Associated Press quotes a State Department official saying there will be no additional funding and that "delays would have no direct cost to taxpayers because contractor First Kuwaiti General Trading & Contracting Co. had agreed to deliver for a set $592 million price."
The project has come under increasing scrutiny of US Congress and an investigation by the US Justice Department into allegations of fraud and labor abuse.
The State Department's own inspector general also entered into the fray just days before being accused of ignoring allegations of waste, fraud, and abuse related to the project. The inspector genera was also singled out for "highly irregular procedures in exonerating the prime contractor, First Kuwaiti Trading Company, of charges of labor trafficking," by House Committee of Government Oversight and Reform chairman Henry Waxman, a California Democrat.
Sources say that Inspector General Howard Krongard opened an investigation of the embassy and First Kuwaiti after ignoring complaints for more than a year. just days before receiving Waxman's September 18 letter. "The investigation opened on a Friday and people were working until 9 pm that night," once source said.
The following week, Krongard then made a personal trip to Afghanistan and then Baghdad, sources said..
In January 2007, the Department of Justice contacted Krongard's office to request assistance investigating allegations of misconduct by First Kuwaiti, according to Waxman, who quoted an internal email stating that "the allegations are basically contract fraud and public ... corruption." According to the email, the public corruption allegations implicated a senior State Department offrcial overseeing the embassy construction project.
State Department project manager in Baghdad, Mary French, and First Kuwaiti have not responded to emails about the clams of faulty work, however some familiar with the project said the allegations may be overblown and reflect simple delays in finishing the details.
"No US embassy has ever been finished on time," said one former project manager of the Baghdad embassy project under contract with the State Department, Juvencio Lopez. "First Kuwaiti is a first rate company" and "had a first-rate team in place."
Lopez said two inspections of blast walls around the perimeter of the compound during construction by State Department inspectors had no "negative observations" although one perimeter fence needed replacement because it "just gave out."
But even Lopez speculated that the project will not be complete until well into next year. He said he recently met with Verizon on installing communications systems but that the company did not anticipate starting work until January 2008.
Another worker for the embassy subcontractor Hardline Installation, which installed security doors and windows, said talk about the delays are not surprising because of the security environment. "I know that the building is behind on the target opening day," he said. "The unsafe work is probably due to the fact that there are thousands of workers there from India, Philippines, etc., and they probably were not watched closely enough."
One former labor foreman claims that First Kuwaiti employed 2,000 to 3,000 migrant low-paid laborers from South Asia and Africa -- many more than were necessary if they had been skilled construction workers, he said. "Some were just goat herders from Pakistan and didn't even know they were going to work in Baghdad."
The new embassy project, located along the dusty banks of the Tigris River inside the US-controlled Green Zone, has lagged behind its projected finish dates in the past. The original target date was set for June 2007, but was first extended to July and then again to September. Some blame routine matters exacerbated by the war-time environment that delay shipments of needed materials and periodic interruptions caused by incoming rockets and mortars.
Posted by davidphinney at 03:06 PM | Comments (0) | TrackBack
It Ain't Like the Clinton Years: Fawning over Chris Matthews
Friday's DC edition of the Examiner opens with what sounds like an explosive lead:
Chris Matthews had barely finished praising his colleagues at the 10th anniversary party for his "Hardball" show Thursday night in Washington, D.C. when his remarks turned political and pointed, even suggesting that the Bush administration had "finally been caught in their criminality."The Clinton camp, he said, never put pressure on his bosses to silence him.
"Not so this crowd" he added, explaining that Bush White House officials -- especially those from Vice President Cheney's office -- called MSNBC brass to complain about the content of his show and attempted to influence its editorial content. "They will not silence me!" Matthews declared.
These are the words of the guy who made his TV career in 1997 on redfaced blabber fests over Bill Clinton's affair with White House intern Monica Lewisky -- an event that inspired the Republican-controlled Congress to impeach the president .
GOOGLE COUNT:
"Chris Matthews" and "Monica Lewinsky": 63,900.
"Chris Matthews" and "Yellowcake": 16,100.
Hmmmm.... Is that White House pressure is working?
Of course not. Sex sells -- especially when you can ride the ratings all the way to impeachment.
ADDED NOTE: A Google foray just popped this up from the leftist Think Progress: Matthews Obsessed With Clinton Sex Speculation.
Of course, I am being flip, but it is telling that the most covered story of the Clinton administration was a blowjob. It was all the news media could do in what was likely the most affluent period in human history.
Posted by davidphinney at 09:12 AM | Comments (1) | TrackBack