Are charges that private military contractors commit egregious acts of fraud overblown? Not according to recent news. McClatchy Newspapers reports that the Louis Berger Group, one of the U.S. government’s highest profile American contractors in Afghanistan has agreed to pay tens of millions of dollars to settle allegations that it overbilled the U.S. government.
In return, the Justice Department will end its investigation into allegations that Louis Berger was intentionally overcharging American taxpayers. The settlement, which is just over $69 million, includes civil and criminal penalties.
Louis Berger’s alleged overbilling, a practice that dates to at least the mid-1990s, swelled to tens of millions in lost tax dollars. In 2006, a former Louis Berger employee handed the government evidence against the company, two months before the U.S. Agency for International Development tapped Louis Berger to jointly oversee $1.4 billion in reconstruction contracts in Afghanistan.
Court documents reveal that the Justice Department has been negotiating a deal that would “aid in preserving the company’s continuing eligibility to participate” in federal contracting in Afghanistan and elsewhere.
According to McClatchy Louis Berger is accused of manipulating overhead cost data and overhead rate proposals submitted to the U.S. government and several states including Massachusetts, Nevada and Virginia.
Comment by Robert Steele as posted at Huffington Post:
This is important and will be cross-posted to Phi Beta Iota the Public Intelligence Blog where my review of GRIFTOPIA by Matt Taibbi is getting a lot of traction, along with the inputs from Chuck Spinney on US Government fraud in relation to Wall Street and bankrupting the citizenry.
Your most important point I believe came at the end: the US Government is not serious about the detection and remediation of crime among its contractors, but it will respond to citizens who come forward with information. That’s the solution: every citizen an “intelligence minuteman” as Alessandro Politi put it in 1992, and that is where I want to help America get to: become a Smart Nation in which governance is truly Of, By, and For We the People and not Of, By, and For Wall Street and the Black Lily certificate holders that includes the Bushes and Clintons.