Bush Plan To Stop Fraud Does Not Apply To Overseas Contracts

The Justice Department now claims that the overseas exemption was a simple mistake. Bush Plan To Stop Fraud Does Not Apply To Overseas ContractsBy Cliff Montgomery – Feb. 15th, 2008George W. Bush’s proposal for cracking down on contractor fraud contains a multi-billion-dollar loophole: His plan does not apply to overseas contracts, including those made with corporations working in Iraq and Afghanistan.For decades, there frankly has been no law to punish clear company abuse of the American government’s contracting process. Contractors simply were asked to report overpayment or internal fraud on U.S.-funded projects. Compliance with this “gentleman’s agreement” was strictly voluntary.The result of all that blind faith in those with fat wallets is clear: There has been a sharp decline during the last 20 years in contractor-reported fraud.In 1987, the Justice Department (DOJ) received 44 voluntary reports of contractor fraud; by 2002, only eight cases of fraud and abuse was reported.Last year, the DOJ received a paltry three voluntary reports of fraud from contractors.The Justice Department, now under Attorney General Michael Mukasey, says it’s ready to apply the same rule of law to corporations as to everyone else–well, almost. New rules will force companies to tell the U.S. government about any contract abuse over $5 million.It’s not much of a rule–it’s still not necessary to report any contractor fraud under $5 million, after all. And apparently it never occurred to anyone at DOJ to have a third party oversee the government’s contracting process. All the same, a proven failure to follow the new rule may keep a company from getting future government work.But the suggested regulations, now in the last stages of approval, expressly exempt “contracts to be performed outside the United States,” stated a notice printed in January’s Federal Register.Taxpayers Against Fraud, a government watchdog group, says that the overseas exemption is just too obvious to ignore.”I hate to sound cynical, but what lobbyist working for a contractor in Iraq wanted this get-out-of-jail card?” spokesman Patrick Burns was quoted as saying to The Associated Press (AP) in an article printed yesterday.”I’m not saying that’s the way it went–I’m just suggesting that’s the most logical line to draw,” added Burns.”I think somebody’s got some explaining to do,” he told AP.The Justice Department has claimed that the overseas exemption was a simple mistake, one that will be fixed during the finalization of the White House plan.And if the Bush Administration has proven anything during its seven-year-reign, it’s that Americans can always trust its empty boasts…”We do not agree with also excluding contracts performed entirely outside the United States,” wrote Assistant Attorney General Alice Fisher in a Jan. 14th letter discussing the new rules.”These types of contracts, which in many cases support our efforts to fight the global war on terror, need greater contractor vigilance because they are performed overseas where U.S. government resources and remedies are more limited,” wrote Fisher.A spokesperson for the Office of Management and Budget (OMB), which regulates federal procurement policy, would not answer AP questions regarding the overseas contractor exemption.”This is [only] a proposed rule,” said OMB spokeswoman Jane Lee.”We are currently reviewing the public comments that were submitted” on the planned exemption, Lee added.After the U.S. and its allies invaded Afghanistan and Iraq, the Bush White House began scores of billion-dollar projects in the two nations.But with the political lies used to morph Iraq into a country central to the so-called “War on Terror”, came the corporate fraud. The DOJ so far has accused 44 people of money laundering, bribery, conspiracy and other acts of contract fraud tied to Bush’s overseas spending, both on the real war in Afghanistan and the made-up war in Iraq.About $350 billion a year is given away in government contracts, says the White House office of Federal Procurement Policy. With all those dollars being parceled out to contractors and sub-contractors, both domestic and foreign, it’s almost impossible to figure out just how much U.S. government money is being spent overseas, claim experts.”Almost impossible” and “strictly impossible” are not the same thing, however. The only way for an oversight of government contracts to be strictly impossible would be to do nothing at all.The watchdog group Center for Public Integrity reports that over $100 billion already has been spent on ‘post-war’ contracts in Afghanistan and Iraq since 2003. Inaction simply is not an option for U.S. taxpayers anymore.Like what you’re reading so far? Then why not order a full year (52 issues) of thee-newsletter for only $15? A major article covering an story not being told in the Corporate Press will be delivered to your email every Monday morning for a full year, for less than 30 cents an issue. Order Now!