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By Associated PressA complaint seeks protection for Bunnatine Greenhouse, who said the Army granted contracts without following the rules.
WASHINGTON - The Army has agreed to a Pentagon investigation into claims by a contracting official that a Halliburton subsidiary unfairly won no-bid contracts worth billions of dollars for work in Iraq and the Balkans, according to Army documents obtained Sunday.
The complaint by the U.S Army Corps of Engineers' top civilian contracting official alleges that the award of contracts to KBR, the Halliburton subsidiary, without competition to restore Iraq's oil industry and to supply and feed U.S. troops in the Balkans puts at risk "the integrity of the federal contracting program as it relates to a major defense contractor."
It also asks protection from retaliation for the whistle-blower, Bunnatine Greenhouse, the corps' chief contracting officer.
The Iraq contract with Halliburton has been a focus of the presidential campaign because of Vice President Dick Cheney's past ties to the company. Cheney was chief executive officer of Halliburton and continues to receive deferred compensation from the company.
In a letter to Greenhouse's lawyer, an Army attorney said that the matter is being referred to the Defense Department's inspector general for "review and action, as appropriate." It also said the corps had been ordered to "suspend any adverse personnel action" against Greenhouse "until a sufficient record is available to address the specific matters" in her complaint.
Copies of the letter and complaints, documents which were provided to some members of Congress, were obtained Sunday by the Associated Press.
Halliburton spokeswoman Wendy Hall said from Houston, where the company has its headquarters: "KBR doesn't have any information on what Bunny Greenhouse may or may not have said to other Pentagon officials in early 2003."
"On the larger issues, the old allegations have once again been recycled, this time one week before the election," Hall said.
She emphasized that a report this year by the Government Accountability Office, the auditing arm of Congress, concluded the Iraq contract had been properly awarded and said the Balkans issue "was fully dealt with and resolved several years ago ... (and) since that time KBR has received high marks from the Army on our Balkans support contract."
Michael D. Kohn, who is Greenhouse's lawyer, charged in a letter to acting Army Secretary Les Brownlee that in the Balkan contract a deputy assistant secretary of the Army had ordered changes in documents to legitimate the contract "for political reasons."
Kohn's complaint said contracts were approved over Greenhouse's reservations, handwritten on the original contracts, and extensions were awarded because underlings signed them without her knowledge and in collusion with senior officials.
After her superiors signed off on the Iraq contract and returned it for her necessary approval, the complaint said, Greenhouse wrote beside her signature: "I caution that extending this sole-source effort beyond a one year period could convey an invalid perception that there is not strong intent for a limited competition."
The contracts under investigation grew out of a $7-billion multiple-year award to Halliburton's KBR subsidiary to rehabilitate Iraq's oil industry after the U.S.-led invasion last year; and an 11-month extension, which cost $165-million, of a $2-billion services contract the Army awarded in May 1999.
The Iraq contract was awarded in February 2003, less than a month before the invasion, under a clause specifying no-bid contracts in cases of "compelling emergency." The complaint said Greenhouse objected to the five-year term, asking the reason for the certainty that the emergency would continue for five years.