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U.S. panel says billions lost to war contract waste, fraud

(Xinhua)

08:55, September 01, 2011

WASHINGTON, Aug. 31 (Xinhua) -- An independent panel on Wednesday submitted a report to U.S. Congress, saying at least 31 billion dollars have been lost to contract waste and fraud in Iraq and Afghanistan, and that major reforms are required.

The report submitted by the congressionally chartered Commission on Wartime Contracting in Iraq and Afghanistan estimates that waste and fraud have amounted to at least 31 billion, and possibly as much as 60 billion, during the operations in Iraq and Afghanistan. The report warned that at least as much additional waste may develop if host countries cannot or will not sustain U.S.-funded projects and programs after the United States hands them over or reduces its support.

The commission noted fraud and abuse are problems in wartime contracting, but the biggest challenge is waste. Commission Co- Chair Michael Thibault, former deputy director of the Defense Contract Audit Agency, noted "billions of dollars of waste stemming from a variety of shortcomings -- poor decision making, vague contract requirements, lack of adequately trained federal oversight people in the field, duplicative or unnecessary work, failure to revise or recompete contracts, unsustainable projects, inadequate business processes among contractors, and delayed audits. There are many causes, and no simple solution."

Co-Chair Christopher Shays, a former U.S. Representative for Connecticut, said the Commission report lays blame at the doorsteps of both government and the contracting industry.

"Many of the convictions and guilty pleas for bribery, kickbacks, theft, and other offenses involve federal civilians and members of the military," he said. "Likewise, poor performance shows up both in government and contractor operations. We've had soldiers injured or electrocuted because of faulty wiring in base showers, and we've had federal officials tolerating a far greater supply of contract labor than was needed for military-vehicle maintenance. There is plenty of blame to go around."

The commission recommended reform to improve federal planning for use of contracts, strengthen contract management and oversight, expand competition, improve interagency coordination, and modify or cancel U.S.-funded projects that host nations cannot sustain.

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