USAID Contractors Plead Guilty

Two separate cases within 8 days

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On September 2, an Oklahoma man pleaded guilty today for his role in a scheme to solicit kickbacks in connection with the award of a private security services subcontract to protect U.S. government personnel and contractors in Afghanistan. The man identified by DOJ as Bryan Lee Burrows, 42, of Wagoner, Okla., pleaded guilty before U.S. District Court Judge Leonie M. Brinkema in the Eastern District of Virginia to one count of conspiracy to solicit a kickback.

In August 2006, USAID awarded a $1.4 billion contract known as the Afghanistan Infrastructure Rehabilitation Project (the AIRP contract). The AIRP contract required the award of numerous subcontracts, including for the provision of security services to protect AIRP workers. According to court documents, from approximately February 2009 through May 2009, Burrows was employed in Kabul, Afghanistan, by Civilian Police International, a Virginia-based company that provides law enforcement training internationally. Burrows admitted that he conspired with others to solicit kickbacks from private security vendors in return for favorable treatment for those potential bidders in connection with the award of one or more subcontracts. According to court documents, the subcontracts provided for private security services to protect USAID personnel and contractors in Afghanistan operating under the AIRP contract.

On September 9, Delmar Dwayne Spier, the chief executive officer and managing director of United States Protection and Investigations, LLC (USPI), pleaded guilty in U.S. District Court for the District of Columbia to conspiracy, major fraud and wire fraud arising from an alleged scheme to defraud the United States. His wife, Barbara Edens Spier, the president and owner of USPI, also pleaded guilty to conspiracy to defraud the United States in connection with U.S.-sponsored rebuilding efforts in Afghanistan.

From the DOJ press release:

According to court documents, USPI, a Houston-based security firm, was a subcontractor for the U.S. Agency for International Development (USAID) based on a USAID contract with the Louis Berger Group Inc. (LBGI) as part of the Rehabilitation of Economic Facilities Program (REFS Program). The REFS Program was developed by USAID to provide a broad range of assistance to the people of Afghanistan. Under the USAID contract with LBGI, LBGI constructed a variety of infrastructure improvements, including electrical facilities, health facilities, schools and irrigation systems. USPI provided security at many LBGI construction sites.

According to court documents, the USPI subcontract was a cost-reimbursement contract, which required LBGI and ultimately USAID to reimburse USPI for all incurred expenses and pay USPI a fee equivalent to a percentage of its incurred expenses.

Delmar Dwayne Spier, 73, of Houston, admitted in his plea before U.S. District Judge Rosemary M. Collyer today that from June 2003 through July 2007, he defrauded the United States by obtaining reimbursement for inflated expenses purportedly incurred by USPI for rental vehicles, fuel and security personnel. Delmar Dwayne Spier and Barbara Edens Spier, 60, also of Houston, admitted before Judge Collyer today that they conspired with USPI employees to fabricate invoices from fictitious companies to obtain reimbursement from LBGI and ultimately from USAID to cover USPI’s inflated expenses.

The Spiers’ plea agreements require them to forfeit $3 million in proceeds that can be traced to the fraud. The conspiracy charge carries a maximum sentence of five years in prison and a $250,000 fine. The charge of wire fraud carries a maximum sentence of 20 years in prison and a $250,000 fine. The charge of major fraud carries a maximum sentence of 10 years and a $1 million fine. Sentencing has not yet been scheduled for either defendant.

Delmar Dwayne Spier and Barbara Edens Spier were initially indicted, along with former USPI employees William Felix Dupre and Behzad Mehr, on Sept. 30, 2008. Dupre is scheduled to go to trial on Dec. 10, 2009.

In a Mother Jones article profiling the Spiers’ company, USPI, Daniel Schulman quoted a contractor saying that “Everyone’s accountable in the end.” Schulman concludes that “there’s a big difference between being accountable and being held to account. The latter comes only after you’ve been caught.”

More to come?

Donald Gambatesa, Inspector General, U.S. Agency for International Development who recently testified at the Subcommittee on National Security and Foreign Affairs hearing on “Afghanistan and Pakistan: Accountability Community Oversight of a New Interagency Strategy” says that his office has opened 44 investigations that have resulted in 8 indictments, 9 arrests, and 3 convictions, and that savings and recoveries have totaled $87 million.

The State Department’s OIG office says that during fiscal year 2009, its Middle East Investigative Branch’s investigations in Afghanistan include: Six (6) open investigations and four (4) preliminary inquiries, covering alleged criminal violations such as Fraud, False Statements, Conspiracy to Distribute a Controlled Substance, Sexual Exploitation of a Minor, Sexual Exploitation of a Third Country National, Unlawful Arrest/Detention, Reprisal, Assault, Embezzlement, Kickbacks, International Traffic in Arms violations, Human Trafficking, and Federal Acquisition Regulations violations.


Related Item:

Mother Jones (7/27/09): The Cowboys of Kabul by Daniel Schulman
How a pair of bankrupt Texas grandparents cashed in on Afghanistan’s contracting bonanza

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New US Consulates Opening in Afghanistan

New US Consulates Planned: Herat and Mazar-e-Sharif

Ambassador Joseph Mussomeli who says he’s one of “the many Ambassadors at the U.S. Embassy” in Kabul recently gave an interview with Radio Azadi regarding reports that the United States plan to open consulates in various parts of Afghanistan. Below are some excerpts from that interview:

Question: […]How many consulates do you want to open in Afghanistan, and in which cities?

Ambassador Mussomeli: Sure. For now, and only for now, there are two consulates that we plan to open very quickly. One is in Herat and the other is in Mazar. These are the first. The way I understand it, these are the first consulates of any Western government. So we’re very excited about this. We think it will take very soon “Inshallah.”

Question: […]Why have you chosen these two cities? And what kind of political impact will it have on these areas?

Ambassador Mussomeli: I don’t think it’s true, but I think some people feel that we have neglected the West and the North, that all of our concentration, all of our developmental assistance, hundreds of millions of dollars are going all to the South and the East. This is a way of showing that we are concerned about the entire country of Afghanistan. We want to pay more attention, not ignore the South and the East, but also pay more attention in the future to the North and the West. (italics added)

Question: Can you give us some details about the activities of this consulate? What kind of services will they provide to the people?

Ambassador Mussomeli: At first we’ll begin very slowly, because the consulates here will be like the consulates throughout the world. There will be a management officer, a political officer, a public affairs officer, and a consular officer for American services. Eventually we would like them to grow and become much larger so we could issue visas there, and so we can engage more with the local communities, as well as have AID officers there for assistance programs and things like that.


Question:
Do you have any security concerns about the consulates that you are going to open?

Ambassador Mussomeli: Of course there are always security concerns and it’s not unique to Afghanistan. There are worries about security throughout the world, even in Washington, DC. In fact an times when I’m walking through the streets of Herat or Mazar I feel safer than when I’m walking in Washington, DC. But certainly, yes, we are going to be careful to make sure that there’s adequate security, but we have great faith in the Afghan people, that the Afghan people will be part of that security. That they will, since we are guests here, take care of us.

Question: […]Don’t you think that this initiative has been taken rather late?

Ambassador Mussomeli: Well, we’re the first of the Western countries, so maybe we’re early. To be honest, some of us wanted to open consulates much sooner. I think they’re very important to open. I think one of the main things is that it shows our commitment to Afghanistan. That you know, to be very honest, our relationship and our interest in Afghanistan has not always been enough. But once you open up consulates it shows very deeply our close and deep commitment to Afghanistan. So we’re very proud we’re doing this. Maybe we should have done it even sooner, and maybe we should do even more consulates at some point. But these consulates, more than an embassy, show a long-lasting commitment to Afghanistan in a way that America has never had here before. It is a way of saying that we’re not leaving. We’re staying. Not only are we staying, but we want to engage with the Afghanistan people everywhere. In a funny sort of way it’s sort of like wedding rings. This is not a temporary relationship. We’re here for a long, long time. (italics added)

Read the transcript of the interview here.

Thoughts?

One – the ambassador says “some people feel” – WHO are these people?! Sorry, did not mean to shout … but why should we care how they feel? Are they writing checks or pouring hundreds of millions of dollars to Afghanistan, these people? Do they have names?

Two – “it’s sort of like wedding rings?” Um…wedding rings makes me think about anniversaries. On October 7, 2001, we’d be on our 9th anniversary. Here’s how much this marriage has cost us so far: $226,000,000,000.00 and going up every single second. Click here to see the trade offs if you are residing in the District of Columbia, or search your state’s trade-off in this marriage.

Three – “This is not a temporary relationship?” I don’t want to be indelicate here but doesn’t it take two to tango? Our beloved is badmouthing us to the in-laws already. And as usual it has to do with power, money and relations. Of course, every marriage has a dark horse. In any case, I’m just wondering what happens if this is nothing more than a temporary relationship or a starter marriage for our partner. How mighty expensive the alimony would be if our partner walks?

Four – he says “We’re here for a long, long time.” Hardy families and relations (sorry no kids and grandkids unless they’ve been to survival schools) will have to visit Kabul, Herat and Mazar-e-Sharif in Afghanistan, every single year to help shore up this marriage. This is in addition to year-long visits to dysfunctional relations in other places like Baghdad and Pakistan, of course. Well, go round up all the cousins, half-cousins, and distant cousins; this is going to be a long haul. How long a haul? I don’t know. One cousin across the pond did say 40 years, but that was quickly retracted.

I tell you what worries me — there are too many people on this bed, too much money going around and there’s not enough love and trust. Even in the best of times and places, this would make for a disastrous marriage. Perhaps this would be an exception?