- The Washington Times - Thursday, October 28, 2004

ASSOCIATED PRESS

The FBI has begun investigating whether the Pentagon improperly awarded no-bid contracts to Halliburton Co., seeking an interview with a top Army contracting officer and collecting documents from several government offices.

The line of inquiry expands an earlier FBI investigation into whether Halliburton overcharged taxpayers for fuel in Iraq, and it elevates to a criminal matter the election-year question of whether the Bush administration showed favoritism to Vice President Dick Cheney’s former company.

FBI agents this week sought permission to interview Bunnatine Greenhouse, the Army Corps of Engineers’ chief contracting officer who went public last weekend with accusations that her agency unfairly award-ed KBR, a Halliburton subsidiary, no-bid contracts worth billions of dollars for work in Iraq, according to documents obtained by the Associated Press.

Asked about the documents, Ms. Greenhouse’s lawyers said their client will cooperate, but she wants whistleblower protection from Pentagon retaliation.



“I think [the FBI interview request] underscores the seriousness of the misconduct, and it also demonstrates how courageous Ms. Greenhouse was for stepping forward,” said Stephen Kohn, one of her attorneys.

“The initiation of an FBI investigation into criminal misconduct will help restore public confidence,” Mr. Kohn said. “The Army must aggressively protect Ms. Greenhouse from the retaliation she will encounter as a result of blowing the whistle on this misconduct.”

FBI agents also recently began collecting documents from Army offices in Texas and elsewhere to examine how and why Halliburton got the no-bid work.

“The Corps is absolutely cooperating with the FBI, and it has been an ongoing effort,” said Army Corps spokeswoman Carol Sanders. “Our role is to cooperate. It’s a public contract and public funds. We’ve been providing them information for quite a while.”

Wendy Hall, a Halliburton spokeswoman, said the company is cooperating with various investigations, but she dismissed the latest revelation as election-year politics. She noted that Congress’ auditing arm, the Government Accountability Office (GAO), found the company’s no-bid work in Iraq was legal.

“The old allegations have once again been recycled, this time one week before the election,” Miss Hall said. “The GAO said earlier this year that the contract was properly awarded because Halliburton was the only contractor that could do the work.”

Democrats keep trying to make Halliburton an election-year issue.

“This multibillion dollar no-bid contract to Halliburton was suspicious from day one, and now, our worst suspicions are confirmed,” said Sen. Frank R. Lautenberg, a New Jersey Democrat on the Senate Governmental Affairs Committee who has been investigating Halliburton’s contracts. “The FBI doesn’t get involved unless there are possible criminal violations.”

In a formal whistleblower complaint filed last week, Ms. Greenhouse said the award of contracts without competition to KBR puts at risk “the integrity of the federal contracting program as it relates to a major defense contractor.”

The contracts were to restore Iraq’s oil industry.

Among the evidence cited in the complaint was an internal 2003 Pentagon e-mail that says the Iraq contract “has been coordinated” with Mr. Cheney’s vice-presidential office.

The vice president, who continues to receive deferred compensation from when he was Halliburton’s chief executive in the late 1990s, has steadfastly maintained that he played no role in the selection of his former company for federal business.

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