Pentagon Paid $998,798 to Ship Two 19-Cent Washers
August 16th, 2007Via: Bloomberg:
A small South Carolina parts supplier collected about $20.5 million over six years from the Pentagon for fraudulent shipping costs, including $998,798 for sending two 19-cent washers to an Army base in Texas, U.S. officials said.
The company also billed and was paid $455,009 to ship three machine screws costing $1.31 each to Marines in Habbaniyah, Iraq, and $293,451 to ship an 89-cent split washer to Patrick Air Force Base in Cape Canaveral, Florida, Pentagon records show.
The owners of C&D Distributors in Lexington, South Carolina — twin sisters — exploited a flaw in an automated Defense Department purchasing system: bills for shipping to combat areas or U.S. bases that were labeled “priority” were usually paid automatically, said Cynthia Stroot, a Pentagon investigator.
…
C&D’s fraudulent billing started in 2000, Stroot, the Defense Criminal Investigative Service’s chief agent in Raleigh, North Carolina, said in an interview. “As time went on they got more aggressive in the amounts they put in.”
The price the military paid for each item shipped rarely reached $100 and totaled just $68,000 over the six years in contrast to the $20.5 million paid for shipping, she said.
“The majority, if not all of these parts, were going to high-priority, conflict areas — that’s why they got paid,” Stroot said. If the item was earmarked “priority,” destined for the military in Iraq, Afghanistan or certain other locations, “there was no oversight.”
Scheme Detected
The scheme unraveled in September after a purchasing agent noticed a bill for shipping two more 19-cent washers: $969,000. That order was rejected and a review turned up the $998,798 payment earlier that month for shipping two 19-cent washers to Fort Bliss, Texas, Stroot said.
The Pentagon’s Defense Logistics Agency orders millions of parts a year. “These shipping claims were processed automatically to streamline the re-supply of items to combat troops in Iraq and Afghanistan,” the Justice Department said in a press release announcing today’s verdict.
As Kevin frequently says, “Move along here folks, nothing to see here.”
The fraud discovered here is the tip of the iceburg, I’m quite sure of it.
HA HA HA – what was it years ago, the $5K toilet seat?
I’m going out on a limb here – but I surmise that there are others who have had it up to the eyeballs with what’s going down Iraq re the crooks, stealers, and liars, not to mention the death, destruction,and chaos.
Haliburton and Bechtel unallowable costs are waved off by some larger Big Head above as if nothing ever happened here folks – lets move along. This contractor will get a slap on the wrist after years of litigation. Will have to pay back the erroneous charges. But then of course, like the rest of the U.S. the company will be bankrupt. Oh, but then they can feed at the government trough again if they incorporate under another name!
Anything “earmarked for Iraq” as in the example above – falls into a big black hole in federal contracting law. All the dollars to Halliburton, Bechtel, and Blackwater, oh, they will be deemed “costs necessary” to SUPPORT OUR TROOPS even if every freakin dime of the money US taxpayers have paid to these con artists is riddled with fraud, waste, and abuse.
This investigator better watch out – GWB has signed an Executive Order that says anyone who is against what’s going on in Iraq is subject to having their assets frozen.
Man, that’s almost as bad as some ebay auctions I’ve seen! *rimshot*
If the Defense Logistics Agency was being egregiously ripped off on shipping costs, then Federal Express must have had a hand in this crime too, as they are the Defense Department’s international shipping contractor.
One of the dirty little secrets of these corrupt, crony capitalist Bush Administration years is that its not just the weapons systems and traditional military services contractors (such as Boeing and Halliburton) who have been gouging at the public trough. Such outwardly respectable firms as Fed Ex, Dell and Oracle have received an unprecedented windfall over the last 6 years in Federal contracts.
We clearly are at the banana republic stage of capitalism in this country. So when can we expect the violent leftist insurgency to erupt as eventually happens in all corrupt Third World countries?