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Fraud finders punished

Those who speak up against corruption in Iraq contracts pay a heavy price.

By ASSOCIATED PRESS
Published August 25, 2007


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One after another, the men and women who have stepped forward to report corruption in the massive effort to rebuild Iraq have been vilified, fired and demoted.

Or worse.

For daring to report illegal arms sales, Navy veteran Donald Vance says he was imprisoned by the American military in a security compound outside Baghdad and subjected to harsh interrogation methods.

There were times, huddled on the floor in solitary confinement with head-banging music blaring dawn to dusk and interrogators yelling the same questions over and over, that Vance began to wish he had just kept his mouth shut.

He had thought he was doing a good and noble thing when he started telling the FBI about the guns and the land mines and the rocket launchers - all of them being sold for cash, no receipts necessary, he said. He told a federal agent the buyers were Iraqi insurgents, American soldiers, State Department workers and Iraqi embassy and ministry employees.

'A Wal-Mart for guns'

The seller, he said, was the Iraqi-owned company he worked for, Shield Group Security Co.

"It was a Wal-Mart for guns," he says. "It was all illegal and everyone knew it."

So Vance says he blew the whistle, supplying photos and documents and other intelligence to an FBI agent in his hometown of Chicago because he didn't know whom to trust in Iraq.

For his trouble, he says, he got 97 days in Camp Cropper, an American military prison outside Baghdad that once held Saddam Hussein, and he was classified a security detainee.

Also held was colleague Nathan Ertel, who helped Vance gather evidence documenting the sales, according to a federal lawsuit both have filed in Chicago, alleging they were illegally imprisoned and subjected to physical and mental interrogation tactics "reserved for terrorists and so-called enemy combatants."

Corruption has long plagued Iraq reconstruction. Hundreds of projects may never be finished, including repairs to the country's oil pipelines and electricity system. Congress gave more than $30-billion to rebuild Iraq, and at least $8.8-billion of it has disappeared, according to a government reconstruction audit.

Despite this staggering mess, there are no noble outcomes for those who have blown the whistle, according to a review of such cases by the Associated Press.

"If you do it, you will be destroyed," said William Weaver, senior adviser to the National Security Whistleblowers Coalition.

Penalty overturned

Bunnatine "Bunny" Greenhouse knows this only too well. As the highest-ranking civilian contracting officer in the U.S. Army Corps of Engineers, she testified before a congressional committee in 2005 that she found widespread fraud in multibillion-dollar rebuilding contracts awarded to former Halliburton subsidiary KBR.

Soon after, Greenhouse was demoted. "It's just amazing how we say we want to remove fraud from our government, then we gag people who are just trying to stand up and do the right thing," she says.

Then there is Robert Isakson, who filed a whistleblower suit against contractor Custer Battles in 2004, alleging the company - with which he was briefly associated - bilked the U.S. government out of tens of millions of dollars by filing fake invoices and padding other bills for reconstruction work.

He and his co-plaintiff, William Baldwin, pursued the suit for two years. Eventually, a federal jury awarded a $10-million judgment against the now-defunct firm.

But in 2006, a U.S. district judge overturned the award, saying Isakson and Baldwin failed to prove that the Coalition Provisional Authority, the U.S.-backed occupier of Iraq, was part of the U.S. government.

Not a single Iraq whistleblower suit has gone to trial since.

"It's a sad, heartbreaking comment on the system," said Isakson, a former FBI agent. "I tried to help the government, and the government didn't seem to care."

[Last modified August 24, 2007, 23:14:22]


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