Some Iraqi Fraud May Yet Go Punished

(I hadn't heard about this development and am pleasantly surprised. - promoted by desmoinesdem)

Crossposted from Hillbilly Report. Come join the conversation on Rural America, our issues and candidates for the 2010 elections!! City-Slickers welcome too!!

We all remember the no-bid contracts we were so opposed to under the last administration. Now, it has long appeared that all the crimes committed on all levels in this fiasco will go unpunished. Although we are still far from punishing the lies and propoganda unleashed on the American people to start this war, after a court ruling hopefully at least part of the rampant fraud that will cost Americans well over a trillion dollars will be punished.  

As reported by the Washington Post, a federal court ruling determined that one American company could not be exonerated from fraud:

A federal appeals court yesterday ruled that a case involving fraud claims against an American contractor in Iraq could not be blocked merely because the contract was administered by the U.S.-led Coalition Provisional Authority, a multinational governing body set up in the chaotic aftermath of the 2003 invasion.…

Even better, this could open the door to more investigations of the massive fraud and manipulation at the expense of the taxpayer by certain companies during the Iraq War:

The decision, which could open the way for other cases to be brought over claims of Iraq reconstruction fraud in the early war period, grew out of allegations by two whistleblowers who worked on contracts awarded to Custer Battles LLC, which had offices in Rhode Island and Northern Virginia. They alleged that the firm created phony Cayman Islands companies to overbill the coalition authority by millions of dollars on a contract to replace Iraqi dinars with new currency that did not bear Saddam Hussein’s picture.

The suit was brought up under the False Claims Act:

The whistleblowers sued the company and its founders in 2003 under the False Claims Act, which makes it illegal for anyone to knowingly make a false claim for payment to the U.S. government. The law allows citizens to sue on behalf of the government. In March 2006, a jury found the defendants liable for fraud amounting to $3 million. Under the law, a judge can assess damages of triple the amount of the fraud. Five months later, a federal judge in Alexandria threw out the award on the grounds that the CPA was not a U.S. government entity and thus not governed by U.S. laws — a highly publicized decision that watchdog groups said probably had the effect of dissuading other Iraq contracting-fraud cases from being filed.

In yesterday’s ruling, a three-judge panel of the U.S. Court of Appeals for the 4th Circuit said U.S. District Judge T.S. Ellis III erred in limiting the scope of the damages and gave the plaintiffs the option of seeking a new trial for additional damages. The panel, in an opinion written by Judge Paul V. Niemeyer, also said Ellis “erred in assuming that U.S. government personnel detailed to the Coalition Authority could not be working in their official capacities as U.S. government employees.”

It appears this company had come up with a pretty straight-forward system of milking the taxpayer dime. Of course, when you are stealing from people it is always best not to leave written details of the theft laying around for all to see:

The ruling noted that after an October 2003 meeting between Custer Battles’s co-owners, Scott Custer and Michael Battles, and representatives of the CPA and the U.S. military, Battles accidentally left behind “an astonishing spreadsheet” that listed amounts invoiced and actual costs. For instance, the firm provided two flatbed trucks to carry new money that cost $18,000, while billing the authority $80,000, the ruling said.

The invoices were typically submitted to a U.S. government employee detailed to the coalition authority, who forwarded them to a U.S.-retained contractor and U.S. military personnel for approval and ultimately to the CPA for payment. The invoices were paid from the Development Fund for Iraq, which included money confiscated by the United States from Iraqi bank accounts, as well as money appropriated by Congress, the ruling noted.

Well, I guess that is better than giving $20,000 for a hammer!!

I think it is interesting to note that all the folks who are dead-set against an Auto Bailout, stimulus money for average Americans, and re-investing in America had no problem whatsoever when defense contractors and buddies of the former President where robbing this country blind. They had no problem with this kind of fraud running rampant, because their corporate controllers were cutting them off a slice. I rather nice one too I would venture.

I applaud this decision and hope to see more of these cases fought and won in the future. I still maintain that the “War on Terror” was a huge propoganda ploy that allowed some people to demonize others and to rake in huge profits based soley on fraud and manipulation. This ruling keeps the fight to bring them to justice alive.


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