The FBI is investigating whether the US Army's handling of a large Iraq contract with the Halliburton Co violated procurement rules, according to lawyers for an Army official who made the charges of improprieties.
FBI agents have requested an interview with the official, Bunnatine Greenhouse, the chief of contracting with the Army Corps of Engineers, on her allegations regarding a contract with Halliburton to repair Iraqi oil fields last year, her lawyer, Michael Kohn, said in an interview Thursday.
Greenhouse, in an Oct. 21 letter to the acting Army secretary, charged that officials had shown favoritism toward Halliburton, the Houston-based conglomerate formerly led by US Vice President Dick Cheney, in the awarding and oversight of the oil contract. She also said officials at the Army Corps of Engineers had tried to remove her as chief contract monitor after she persistently raised questions about Halliburton contracts. The Army says it has referred her letter to the Pentagon's inspector-general.
The oil contract was awarded in early last year without competition to the Halliburton subsidiary Kellogg Brown & Root (KBR), as the invasion of Iraq began, and was initially for five years and worth up to US$7 billion.
Greenhouse argued that if the press of war required granting an award without competition, its duration should be restricted to one year. After a public outcry over the large contract with Halliburton, the Pentagon did cut short the agreement after less than a year and US$2.4 billion in expenditures and put the remaining work out for bid.
One aspect of the company's performance -- the importation of high-priced fuels into Iraq soon after the invasion -- had already attracted the attention of Pentagon auditors, who say the government may have been overcharged by US$61 million.
The FBI has been investigating those charges and has collected documents from Washington and Texas offices of the Army Corps of Engineers as well as from KBR.
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