Whistle-Blower Suit May Set Course on Iraq Fraud Cases (Custer Battles)

[Barrett808]

Whistle-Blower Suit May Set Course on Iraq Fraud Cases
By ERIK ECKHOLM
Published: May 22, 2005

To its accusers, the security company Custer Battles exemplifies corporate profiteering in postinvasion Iraq, when officials were pumping out hastily written contracts for everything from air conditioners to armed guards.

In a lawsuit now in federal court, two former associates of the company say it bilked the American-led coalition out of millions, turning in hugely inflated invoices from phantom supplier companies among other misdeeds. If successful, the suit, brought under the False Claims Act, could recover triple damages for the government and handsome rewards for the whistle-blowers.

Custer Battles has denied wrongdoing and the accusation remains to be proved. But before a trial can proceed at all - before any company can be sued for fraud in the chaos of occupied Iraq - a federal judge in Virginia must issue another, more basic ruling that is now anxiously awaited by the company, its accusers and the Justice Department.

Lawyers for Custer Battles argue that the False Claims Act - the prime legal tool against contractor fraud - does not apply because the company signed contracts with the Coalition Provisional Authority, not the American government, and was mainly paid with Iraqi money seized or managed by the United States, rather than with money appropriated by Congress.

(more)

http://www.nytimes.com/2005/05/22/international/middleeast/22reconstruct.html?ex=1117339200&en=ffda2abfc2360bcc&ei=5099&partner=TOPIXNEWS

[bullimiami]

1. so basically. stealing is legal in bushs iraq. is the defense.

[benburch]

2. Yep! That is the message!

I thought the grownups were supposed to be in charge now?

[d.l.Green]

5. "But, your honor, we were just doing what the president of the US has been

doing all along. What's a few extra bucks for the risks we're taking with those towel-heads?"

For all the * supporters, this begins to spell out one of the blatant reasons why a shell government with no accountability was put in place so quickly- to avoid US liability...

[lyonn]

3. We are so silly

thinking those contracts were between the corps and the U.S. when it was actually the Coalition Provisional Authority doing business with Iraqi money. So I guess the CPA are totally at fault. Will the Plaintiffs be able to see the actual paperwork, CPA documents, Bremmer's part, and so on? This will cost the taxpayers money as we vigorously defend the corps.

[maddezmom]

4. when will Congress investigate the CPA accounts

nevermind , I doubt it will be in my lifetime.