Jury Says Contractor Defrauded Government

[Dover]

Jury Says Contractor Defrauded Government

Thursday, March 09, 2006 7:40 p.m. ET
By ANDREW MIGA Associated Press Writer

ALEXANDRIA, Va. (AP) -- A federal jury Thursday ordered military contractor Custer Battles to pay nearly $10 million in damages and penalties for defrauding the government on its work in Iraq.

"Americans are fighting and dying in Iraq," said Alan Grayson, the lead attorney for two whistle-blowers who brought the civil suit on behalf of the government. "Companies like Custer Battles go there with the idea of stuffing their pockets with cash. This jury of eight people heard the evidence and were repelled by it."

The jury's decision followed a contentious three-week trial featuring charges that Custer Battles used fake invoices, forgery and shell companies in the Cayman Islands to run up millions of dollars in profits...cont'd


http://wireservice.wired.com/wired/story.asp?section=Breaking&storyId=1170542&tw=wn_wire_story

[bullimiami]

1. give them another billion dollar contract then.

[saigon68]

10. They are HOGS swilling at the PUBLIC TROUGH

DISGUSTING CRIMINAL BEHAVIOR

And the CHIMPANZEE'S justice dept is busy going after seniors who attempt to get their arthritis prescriptions from Canada and people who sneak into Cuba to smoke cigars

TOTAL ASS-CLOWN BUTT BOY GONZALEZ IS RESPONSIBLE FOR NOT DOING ANYTHING TO THESE CORPORATE THUGS AND HOOLIGANS

[Sanity Claws]

2. Notice how Bush Admin did not pursue this claim

Instead it was brought by a couple of guys who had been wrongfully terminated. Bush has no interest in auditing the military industrial complex.

[Up2Late]

3. Absolutely.

They should get at least 20 years in prison for this.

[TacticalPeek]

4. Security firm found guilty of bilking government in Iraq - Custer Battles

StarTribune

Last update: March 09, 2006 – 8:49 PM
Security firm found guilty of bilking government in Iraq

T. Christian Miller, Los Angeles Times

WASHINGTON - In the first action of its kind, a federal jury found Thursday that a private security company bilked the U.S.-led government in Iraq out of millions of dollars.

Custer Battles, which has had offices in Virginia and Rhode Island, was found to have used shell companies, fake invoices and even stolen forklifts in an elaborate scheme to defraud the Coalition Provisional Authority that oversaw Iraq after the invasion.

snip

After a three-week trial, the jury found Custer Battles responsible for 37 separate fraudulent acts, meaning that the firm could face payments and penalties totaling more than $10 million.

"There is an orgy of greed among contractors in Iraq, and the Bush administration is for all practical purposes participating in it," said Alan Grayson, lawyer for the whistle-blowers who filed the case. "They have done nothing to get the taxpayers' money back. They've done nothing to punish the wrongdoers."

more
http://www.startribune.com/722/story/297097.html


Found at Eschaton

[gristy]

5. $10Million fine? Sounds like the cost of doing business.

Is no one going to jail???

[bobbieinok]

6. is this the company suing/trying to sue Randi?????

[barbaraann]

8. I think that's CACI, the mercenary contractors.

n/t

[The Roux Comes First]

7. "Bush administration is for all practical purposes participating in it" -

"They have done nothing to get the taxpayers' money back. They've done nothing to punish the wrongdoers."

No shit, Sherlock!

Hell, the Bush administration as we all know pretty well invented this game. They can even do it without a war, though a good mess of shed blood and the chance to disguise the looting with a bunch of uniforms and ordnance means they can play with one hand behind their back.

"Orgy of Greed" is probably stitched on their boxers.

[Judi Lynn]

9. Jury Finds Custer Battles Liable in Iraq False Claims Act Case

Jury Finds Custer Battles Liable in Iraq False Claims Act Case
20 Corporate Crime Reporter 11(1), March 9, 2006

A federal jury in Alexandria, Virginia has found contractor Custer Battles and its owners – Scott Custer and Michael Battles – liable for fraud in the first Iraq military contract case prosecuted under the False Claims Act.

The jury hit the defendants with a $10 million judgement.

The case was filed on behalf of the government by two former employees – Robert J. Jackson and William Baldwin.

The federal government refused to join the case.

And Patrick Burns of the advocacy group Taxpayers Against Fraud says it was a political decision.

“I believe this case was declined for political reasons,” Burns said. “The hope was that the whistleblowers would go away and that this case would not be a front page story. Out of sight, out of mind. In Iraq, the U.S. government’s position on fraud has been – don’t ask, don’t tell, don’t listen.”
(snip)

Another trial, with the same set of whistleblowers, is scheduled on a separate $16.8 million contract Custer Battles was awarded to provide security at Baghdad International Airport.

Retired brigadier general Hugh Tant III told the court that Custer Battles' fraud "was probably the worst I've ever seen in my 30 years in the Army."
(snip/...)

http://www.corporatecrimereporter.com/custer030906.htm

[donkeyotay]

16. The little company came from nowhere and managed the plane load

of currency delivered, IIRC? Sounds like a front. Sounds like the tip of the revolving door iceberg as revealed by the Cunningham scandal.

The False Claims Act lawsuit alleged that the company defrauded the government of $3 million worth of services as part of an Iraqi money-exchange program in which a new Iraqi currency was distributed following the collapse of Hussein's government.

[salin]

11. yet Halliburton gets all its 'defrauding' paid up

by the Pentagon (that is, the Pentagon decided to pay fully on the jobs - even through fraudulent charges to the govt were documented to the tune of hundreds of millions of dollars.)

I doubt many in the public are familiar with Custer Battles, nor recognize that this case shows a road map on how easy it is for these contractors to commit huge fraud - if the public were more aware, then the phrase "war profiteer" would create the outrage that it did in past eras.

[Toots]

12. Only ten million dollars, these are the little guys

To bad Betchel and Halliburton can't be taken to court..

[OKNancy]

13. Kick

[Coexist]

14. WP: Contractor Bilked U.S. on Iraq Work, Federal Jury Rules

What a HUGE victory for the taxpayers!!!


http://www.washingtonpost.com/wp-dyn/content/article/2006/03/09/AR2006030902150.html

Custer Battles Is Told It Should Pay More Than $10 Million in Damages

By Charles R. Babcock
Washington Post Staff Writer
Friday, March 10, 2006; Page A14
<snip>
Two Army veterans and their company cheated the U.S. government on a contract to furnish Iraq with a new currency in 2003 and should pay more than $10 million in assorted damages, a federal jury in Alexandria ruled yesterday.

In the first civil fraud verdict arising from the war effort, the eight-member panel decided, after two days of deliberation, in favor of two former workers who claimed in a lawsuit that Custer Battles LLC created phony Cayman Island companies to overcharge the Coalition Provisional Authority that ran Iraq after the U.S.-led invasion in 2003.

<snip>
Grayson said yesterday that there are "dozens" of other fraud cases about contracts in Iraq that remain sealed because the department has not decided whether to join them or not. He called such delay "a dereliction of duty." His clients will get 25 to 30 percent of the awarded damages, with the rest going to the U.S. Treasury, he said.

<snip>
He testified that of the 36 trucks the firm supplied, 34 did not work. When he confronted Battles, he said Battles responded: "You asked for trucks and we complied with our contract and it is immaterial whether the trucks were operational."

[Captain Hilts]

15. But the army lets Halliburton walk away free? nt