From The Associated Press, 3/9/06:
http://www.newsday.com/news/nationworld/wire/sns-ap-war-contractors,0,4758210.story?coll=sns-ap-nationworld-headlines
Jury Says Contractor Defrauded Government
By ANDREW MIGA
Associated Press Writer
ALEXANDRIA, Va. --
A federal jury Thursday ordered military contractor Custer Battles to
pay nearly $10 million in damages and penalties for defrauding the
government on its work in Iraq.
"Americans are fighting and dying in Iraq," said Alan Grayson, the
lead attorney for two whistle-blowers who brought the civil suit on
behalf of the government.
"Companies like Custer Battles go there with the idea of stuffing
their pockets with cash. This jury of eight people heard the evidence
and were repelled by it."
The jury's decision followed a contentious three-week trial featuring
charges that Custer Battles used fake invoices, forgery and shell
companies in the Cayman Islands to run up millions of dollars in
profits.
The focus of the case was a $3 million advance Custer Battles received
from the Coalition Provisional Authority, the U.S.-led agency that ran
Iraq after the war, to build three camps to distribute Iraq's new
currency.
Under federal law, the government can be awarded triple the amount of
alleged fraud.
Defense attorney David Douglass said his clients did nothing wrong.
"In our view, they billed the appropriate amounts," he said.
He also said he believed the legal question remains as to whether the
Coalition Provisional Authority was an agent of the U.S. government.
Whistle-blowers Robert Isakson and William Baldwin were former
business associates of Custer Battles.
Jurors also awarded $230,000 in back pay and penalties to Baldwin, who
was demoted by Custer Battles.
The two whistle-blowers can receive a fraction of the damages the
government was awarded.
Former Army Rangers Scott Custer and Michael Battles co-founded Custer
Battles, which had offices in Rhode Island and Virginia.
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They're just the ones who were caught. They're the tip of the taxpayer
money-loaded iceberg.
Harry
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