The army just can’t seem to break it off with military contractor KBR. They’re like that couple everyone wants to break up, but they stay together–usually with one party taking advantage of the other. We’ve recently blogged about KBR’s ongoing legal troubles, but here is just one more volume for a shelf sagging under the weight.
Even though the DOJ has just joined a whistleblower lawsuit against KBR, the Army has announced a $568 million no-bid contract with the company through 2011 for military support services in Iraq.
KBR allegedly accepted meals, sports tickets, and golf outings from two freight forwarding companies.
KBR denies the allegations, of course, and in a statement said that “Gifts of dinners, baseball tickets and other similar items would violate KBR policies.” This is sort of like saying, “It would just be so awful if some (hypothetical, of course) company bribed officials. Nothing specific, other than dinners and baseball tickets…er…” KBR went on to say that maybe, possibly, if this hypothetical naughty company did give any gifts, they would have been less than $20,000. No big deal, right?
The problem is that this kind of behavior ends up costing taxpayers money in the end. Although the government hasn’t definitively stated whether the kickbacks cost taxpayers money yet, there is a strong possibility that KBR passed up companies offering lower costs for those that bought the best dinners and seats for games. Choosing a supplier on the basis of the gifts they provide shifts a government contractor’s priorities away from where they belong (providing the best value to the taxpayer) and warps the “bidding” process into one in which the contractor puts its own interests first. Fortunately, there are whistleblowers out there to help keep contractors like KBR in check.
This article was sponsored by The Qui Tam Team, the epicenter for whistleblowers and people interested in the False Claims Act, Qui Tam Provisions, and Medicare and Medicaid fraud. To discuss a potential case, please call Eric Young at 1 (800) 590-4116.