Whistle-Blower Asks for Halliburton Investigation

Mon Oct 25, 2004
By Sue Pleming

WASHINGTON (Reuters) - The Army Corps of Engineers' top contracting official
has demanded an investigation into contracts given to Halliburton, citing
improper action that favored Vice President ***** Cheney's old company.

According to documents made available to Reuters on Monday by congressional
sources, Army Corps whistle-blower Bunny Greenhouse complained of repeated
interference in billions of dollars of contracts given to Halliburton unit
Kellogg Brown and Root for work in Iraq and the Balkans.

"This interference was largely focused on multibillion-dollar contract
issues pertaining to a Halliburton subsidiary Kellogg Brown and Root," said
a letter faxed on Thursday to Acting Army Secretary Les Brownlee by lawyers
for Greenhouse.

"As set forth below, employees of the U.S. government have taken improper
action that favored KBR's interests," the letter said.

An Army attorney said the matter was being referred to the Defense
Department's inspector general and the Corps was asked not to act against
Greenhouse until a sufficient record was available.

The Corps said it supported the right of employees to use established
procedures to ensure governmental actions complied with applicable laws but
declined further comment.

The Pentagon inspector general's office said it could neither confirm nor
deny the existence of any investigation.

A decision could take months or even years.

FEAR OF LOSING JOB

Greenhouse lawyer Michael Kohn said his client went public after the Corps
tried to remove her from her post as principal assistant responsible for
contracting and not because she wanted to influence next week's election by
raising questions about Halliburton, which Cheney ran from 1995-2000.

Halliburton, which is already under investigation for overcharging for work
in Iraq, has been a target of Democratic criticism ahead of the Nov. 2
election, with suggestions the Texas firm got special treatment because of
Cheney.

A spokesman for Democratic Sen. Frank Lautenberg said the New Jersey senator
would introduce a resolution after the election to create a special
committee to look into the contracts given to KBR.

"When Halliburton is sitting in on the drafting of its no-bid contract, you
know lines have been crossed," said Lautenberg, referred to complaints by
Greenhouse that KBR officials were allowed to attend military planning
meetings before it was awarded a sole-source Iraq contract.

Halliburton spokeswoman Wendy Hall said KBR did not have any information on
what Greenhouse may or may not have said to Pentagon officials in 2003 when
a no-bid contract worth up to $7 billion was given to KBR to rebuild Iraq's
oil industry.

"On the larger issues, the old allegations have once again been recycled,
this time one week before the election," said Hall.

Greenhouse said the Iraq oil contract given to KBR, which was later replaced
by a competitively bid deal, as well as another to feed and house U.S.
troops in the Balkans, put at risk the "integrity of the federal contracting
program."

Kohn said KBR contracts were awarded despite his client's reservations,
which she expressed in hand-written notes on official documents, a tactic
her superiors asked her to stop.

In one case, he said Army Corps officials bypassed getting a signature from
Greenhouse to grant a waiver for KBR to be relieved of its obligation to
provide cost and pricing data for bringing fuel into Iraq.

That waiver was granted after a draft Army audit said KBR may have
overcharged the military by at least $61 million to bring in fuel to Iraq to
ease a shortage of refined oil products.

http://tinyurl.com/6zac4