THE BURNED OVER DISTRICT

From the WaPo comes this article, thankfully not by hack pundit Dana Milbank, about fraud investigations in the CPA.

The inspector general monitoring reconstruction in Iraq told Congress yesterday that he has presented evidence of three potential fraud cases to federal prosecutors in Alexandria.

The cases stem from an audit released last month that found that nearly $100 million intended for reconstruction projects in south-central Iraq could not be properly accounted for. The audit reported that criminal investigators were looking into the matter.

Bowen spoke at a House subcommittee hearing focused on U.S. handling of the Development Fund for Iraq (DFI), the successor to the United Nations' oil-for-food program. The multibillion-dollar fund, which is composed of Iraqi oil revenue and other Iraqi assets, was run by the U.S.-led Coalition Provisional Authority until last year. That fund is separate from the $18 billion that Congress earmarked in late 2003 for rebuilding Iraq.

An inspector-general report in January faulted the CPA for not implementing adequate controls over $8.8 billion in DFI money. As a result, the report concluded, "there was no assurance that the funds were used for the purposes mandated."

And who is the prime fox in this henhouse? Why our old friends at Halliburton.

One major recipient of DFI money, Halliburton Corp., was a point of contention between subcommittee members and Pentagon officials yesterday. Subcommittee members objected to the fact that Pentagon officials had heavily redacted internal Defense Department audits before providing them to a U.N. board charged with monitoring the DFI program. The audits found more than $200 million in questioned charges that Halliburton had passed to the government, primarily on a no-bid contract for importing fuel.

Pentagon officials said they relied on the company's suggestions for deciding what parts of the audits to redact because they didn't want Halliburton's proprietary information made public. House members from both parties objected to that reasoning.

"Overcharges to the government are not trade secrets," said Rep. Carolyn B. Maloney (D-N.Y.).

Well said!