THE BURNED OVER DISTRICT

The Iraqistan War should be claiming another victim today but it probably won't. The Department of Justice has filed charges of defrauding the public on contracts it held to train police in Iraq and Afghanistan. DynCorp, a major mercenary corporation was accused of overcharging for services that may have been rendered.

Papers filed in a Washington DC federal court on Tuesday allege that DynCorp, a fixture of wartime US contracting in Iraq and Afghanistan, knowingly inflated costs during a four-year stretch when the company held a contract with the US state department for training Iraqi police.

Since 2010, DynCorp has held a contract with the US defense department for training Afghanistan’s ministry of defense and its own national police. DynCorp essentially inherited that contract thanks to a prior deal for the same Afghan police training with the state department that began in 2003.

The company received an extension on that contract in March under limited competition. Although in the past the contract was worth approximately $1bn over three years, the dollar value on the reaward, a far shorter period, was redacted.

The fraud allegation against DynCorp stems from a subcontractor it used, Corporate Bank, during a period from 2004 to 2008 when it held the Iraqi police training contract. According to the justice department complaint, DynCorp was aware that rates from the subcontractor – for hotels for US government officials, local security personnel, drivers and interpreters – were “unreasonable”, yet the firm billed them to the state department anyway.

“DynCorp’s invoices, which reflected these inflated subcontractor rates, and DynCorp’s own fees and mark-ups, were false and fraudulent claims,” the complaint alleges.

DynCorp, which provides private security guards as well as aviation and logistics services, was not among seven contractors awarded state department contracts in February to protect its diplomats. It was a departure for state, which has included the security company on its previous awards of its Worldwide Protective Services contract, most recently in 2010.

Yet the firm currently holds contracts with the US department of defense, according to a federal contracting database, atop the Afghanistan interior ministry training deal.

Among them is an air force contract for supplying materiel relevant to a training aircraft for which DynCorp was the sole bidder, and an army contract for support services at a base in Honduras. A different contract, with the navy for maintenance on test aircraft, is set to expire on 31 July.

According to the justice department complaint, DynCorp management called its subcontractor Corporate Bank’s labor and hotel rates “expensive” during an internal presentation, without the subcontractor providing evidence justifying the costs. DynCorp allegedly presented those rates to the state department as justified by “historical data” or a “vendor quote”, and is alleged to have billed the government for unoccupied hotel rooms.

They were making $Millions 'legitimately' with their contracts, this is only attributable to unrestrained greed. However they are a genuine "defense contractor" so they will skate on this with a penalty of perhaps 10 cents on the dollar at the end.