June 28, 2005 - Democrats allege that the US oil services giant Halliburton, the biggest private contractor in Iraq, used its buddy relationship with the Pentagon to run up more than 1.4 billion dollars (1.15 billlion euros) in questionable charges.
The Democrats released a report in the House of Representatives alleging that low-quality service, overbilling and questionable contracts were among Halliburton's many abuses.

"The report documents more than one billion dollars in 'questioned' Halliburton costs and additional 442 million in 'unsupported' charges," Democrat Henry Waxman told the House on Monday.

Once managed by Vice President Dick Cheney, Halliburton "inflated" its cost estimates, charged "excessive costs," billed for equipment that "wasn't necessary," and submitted millions of dollars in "duplicate costs," the congressman added citing Army auditors.

Bunnatine Greenhouse, a member of the US Army Corps of Engineers (USACE) told lawmakers about dubious conditions under which Halliburton obtained a secret seven billion dollar contract to rebuild Iraq's oil production infrastructure.

"The independence of the USACE contracting process was unquestionably compromised with respect to the issuance of the Restore Iraqi Oil contract, known as RIO," Greenhouse told the panel.

"I observed firsthand that essentially every aspect of the RIO contract remained under the control of the Office of the Secretary of Defense," run by Defense Secretary Donald Rumsfeld," she said.

"This troubled me and was wrong," Greenhouse added. She questioned the contract's duration -- five years instead of the standard one -- and the price charged for the services.

Greenhouse said she was shocked to see senior Halliburton officials take part in an internal meeting of the Pentagon.

Rory Mayberry, a former employee of Hallburton subsidiary KRB, who was in charge of the canteen of Camp Anaconca, 90 kilometers (55 miles) northwest of Baghdad, said his company bosses did their utmost to avoid Pentagon auditors.

KRB employees, he said were told not to speak with the auditors or they would be sent to more dangerous places to work in Iraq.

Mayberry told lawmakers in videotaped testimony that the auditors' questions were reasonable since KRB produced 20,000 meals per day when only 10,000 were actually served.

He alleged that some frozen foods had expiry dates more than a year old, meals with pork were served to Muslim troops, and sometimes there was no meat for the troops because KRB officials had taken it for their parties.

"Personally, I was sent to Fallujah for three weeks. The manager told me I was being sent away until the auditors were gone because I had opened my mouth to the auditors," Mayberry said.

"When I returned from Fallujah, the convoy was attacked. I was put in danger because the KBR management didn't want me to talk to the US auditors," he added.

Democratic Senator Frank Lautenberg harshly criticised the Republican majority in Congress for failing to properly investigate Halliburton's contractual anomalies in Iraq.

"The bottom line is the Republican leadership in the Congress is giving Halliburton a free pass," he said.

"And I don't know whether that's because Vice President Cheney still receives a pay check from Halliburton. That goes on through 2007. On that payroll was stock options.

Cheney was Halliburton's chief executive from 1995 until 2000, when he became US President George W. Bush's running mate in his first election. Cheney last year acknowledged he was still receiving pension payments from Halliburton.

"Time and time again, the administration told us that everything was fine, the system was working, no one was fleecing the taxpayers," said Waxman.

"Meanwhile, the unreasonable charges were mounting and they're still mounting after two years."

"Whether the explanation is gross incompetence or deliberate malfeasance, the result is the same: Taxpayers are being bilked," Waxman added.