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- Washington - The Bush administration knew that Halliburton
had overcharged the US government on an Iraq reconstruction contract before
it awarded the company a separate lucrative contract last week to repair
Iraqi oilfields.
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- Halliburton - the oil services company formerly run by
vice-president Dick Cheney - informed the Pentagon inspector-general on
January 15 that its Kellogg Brown & Root subsidiary overcharged the
US government by $6m on a contract to supply US troops. But the following
day, the Army Corps of Engineers gave the company another contract worth
up to $1.2bn to rebuild southern Iraq's oil industry.
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- The Houston-based company on Friday repaid the government
$6.3m. KBR has also dismissed two employees in Kuwait who may have colluded
with a Kuwaiti subcontractor to overcharge KBR for services that were paid
for with US taxpayer money. "One, perhaps two former KBR employees
may have accepted improper payments from a Kuwaiti subcontractor as part
of the potential $6m overcharge," said Wendy Hall, Halliburton spokeswoman.
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- Halliburton has become a lightning rod for Democrats'
criticism of the White House's handing of reconstruction in postwar Iraq.
Critics accuse the Bush administration of doling out contracts to companies
with close White House ties.
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- "When the American people hear that much of that
money may now be under a cloud, it is all the more imperative we act to
remove that cloud, to provide the confidence, the transparency, the oversight,
and certainly the corrective actions required," said Tom Daschle,
Senate minority leader, who called on Congress to investigate the matter.
Halliburton yesterday emphasised that it informed the Pentagon inspector-general
of irregularities as soon as they were discovered.
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- In December, Pentagon auditors found that KBR had overcharged
the US government by $61m for importing fuel into Iraq. Later that month
the Army Corps of Engineers, which administers the contract, concluded
that Halliburton's prices had been reasonable.
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- Earlier this month, however, the auditors asked the Pentagon
inspector-general to launch a full investigation into potential unlawful
activities by the company.
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- Henry Waxman, top Democrat on the House reform committee
and leading critic of Halliburton's Iraq deals, on Friday sought a committee
hearing into the contracts. "It is my understanding that the Halliburton
officials involved in the kickbacks may have had responsibility for administering
hundreds of millions of dollars in federal contracts," he wrote to
Tom Davis, Republican committee chairman.
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- "The administration should have understood the full
extent of the procurement problems at Halliburton before rewarding the
company with another billion-dollar contract." The Pentagon yesterday
appointed Stuart Bowen, a former counsel to Mr Bush, as new inspector-general
at the Coalition Provisional Authority in Baghdad.
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