State Dept. Fails to Account for Iraqi Police Contract

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The U.S. State Department is accused of shoddy recordkeeping and outright mismanagement of a billion-dollar contract to train the police force in Iraq.

So badly managed was a $1.2 billion award to contractor DynCorp International, LLC that the State Department is unable to account for what it received for the expenditure, according to a new report by the Special Inspector General for Iraq Reconstruction.

In some instances, there were duplicate payments and in others no follow up occurred to make sure the work had been completed to satisfaction.

Stuart Bowen, the Special Inspector General, said Monday that disarray in invoices and records on the project prompted auditors to temporarily suspend review.

Bowen had been assessing a February 2004 contract that Falls Church, Va.-based DynCorp was awarded to provide housing, food, security, facilities, training support and law enforcement staff with various specialties, as well as weapons and armor for personnel assigned to the program.

The State Department's Bureau for International Narcotics and Law Enforcement Affairs (INL) awarded the contract.

Although training has been conducted and equipment provided under the contract, the bureau is in the process of trying to organize and validate invoices. The bureau does not believe its records accurately show the reasons for most payments that were made, the report said.

"As a result, INL does not know specifically what it received for most of the $1.2 billion in expenditures under its DynCorp contract for the Iraqi Police Training Program," Bowen said in the 18-page report.

The contract, now in its third year, is to support training programs in Iraq and Afghanistan. Bowen focused on the Iraq program in the new report.

"Lack of controls" and "serious contract management issues" at the INL bureau made it "vulnerable to waste and fraud," he said.

The report also noted previous management problems with the bureau as well as its pledge to reform. It has added personnel and is demanding refunds and other reconciliation for some past questionable payments made to DynCorp, said Elizabeth Verville, acting assistant secretary for the bureau.

DynCorp spokesman Gregory Lagana told The New York Times on Monday: "There was no intentional misbilling. It could be just a documents problem." He acknowledged "that we have some problems with invoicing. It's something we're working really hard to clean up."

Sen. Joe Lieberman (I-CT) chairman of the Senate Committee on Homeland Security and Governmental Affairs, said Monday: "Once again, (the inspector general) has shown how vulnerable the federal government is to waste when it doesn't invest up front in proper contract oversight."

He estimates the State Department will need up to five years to review invoices and demand repayment from DynCorp for unjustified expenses. "This scenario is far too frequent across the federal government," he added.

Bowen reported in January that the State Department paid $43.8 million to DynCorp for a residential camp for police training personnel outside of Baghdad's Adnan Palace grounds. He said the camp had been empty for months and about $4.2 million of the money was improperly spent on 20 VIP trailers and an Olympic-size pool — all ordered by the Iraqi Ministry of Interior but never authorized by the U.S.

DynCorp has been mentioned as a possible replacement for Blackwater USA in the contract to provide armed security for diplomats in Iraq following a string of security incidents involving Blackwater guards, including a September shooting that left 17 Iraqis dead.

U.S. and Iraqi officials are negotiating Baghdad's demand that Blackwater be expelled from the country within six months.

From NPR reports and The Associated Press

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