Army Takes Further Action to Fight Fraud
August 29, 2007
By U.S. Army
Throughout 2007 the Army has undertaken a rigorous effort to remediate weaknesses in contracting. Today, the Secretary of the Army has established two efforts to broaden the Army's ongoing efforts to ensure policies and procedures are in place for all joint, expeditionary contracting operations in Iraq, Afghanistan and Kuwait and better prepare the Army for acquisition and logistical support of combat operations in the future.
First, a Special Commission on Army Contracting has been given a broad charter to examine current operations as well as to ensure future contracting operations are more effective, efficient and transparent and report back in 45 days.
Second, an Army Task Force has been stood up to reinforce and immediately address existing contracting issues and aggressively implement fixes as problems are identified.
The Special Commission on Army Contracting will be led by the Honorable Jacques Gansler, former Under Secretary of Defense for Acquisition, Technology and Logistics. The Commission will fully examine theater acquisition and program management processes; review management controls to prevent fraud, waste and abuse; assess legislative needs; and recommend changes in policies and procedures.
"The Commission will take a big picture look and ensure we are properly organized to support Army and Joint Force expeditionary operations in an era of persistent conflict," Secretary of the Army Pete Geren said. "The Commission will look at how we currently are doing things and how we should be doing things, and examine policies and procedures in the world of contracting and logistics - even the way we promote those who are serving in our contracting forces."
Dr. Gansler, a professor at the University of Maryland, has vast experience with contracting issues and is one of the most respected members of our nation's acquisition community. From 1997 to 2001 he served as the Under Secretary for Defense for Acquisition, Technology, and Logistics where he led the Department's work in Acquisition Reform. He also served as Vice Chairman, Defense Science Board; Chairman, Board of Visitors, Defense Acquisition University; Director, Procurement Round Table; member of the FAA Blue Ribbon Panel on Acquisition Reform; and senior consultant to the "Packard Commission" on Defense Acquisition Reform. Other members of the commission include Mr. David Berteau, former Assistant Secretary of Defense for Production and Logistics; retired Gen. Lester Lyles, former commander, Air Force Materiel Command; retired Gen. Leon Salomon, former commander, Army Materiel Command; Mr. George Singley, retired former SAIC Group president and career Army acquisition official. Col. George A. Sears, Commander, Contracting Center of Excellence, is serving as executive officer for the commission.
The Department of the Army began audits and the U.S. Army Criminal Investigation Command, commonly known as CID, increased investigative activity into allegations of corrupt contracting in Southwest Asia in late 2005. Deployed commanders also expressed their concerns and requested the Department send in additional CID Special Agents, auditors and contract specialists from the Army Audit Agency and from CID. In 2005, CID established the Iraq Fraud Detachment and in 2006, CID established the Kuwait Fraud Office - both staffed with specially-trained CID Special Agents. Throughout the investigation, the Army has provided timely updates to Congress and has taken corrective actions as warranted.
In February 2007, after then Secretary of the Army Dr. Francis Harvey was briefed on the matter, he directed action to correct deficiencies. Dr. Harvey tasked the Assistant Secretary of the Army for Acquisition, Technology, and Logistics (ASA(ALT)) to assess contracting activities throughout Central Command (CENTCOM) and to implement a Contracting Action Plan.
In response, in March 2007 ASA(ALT) deployed a senior contracting Operations Review Team to review all contract operations and in April began implementing a Contracting Action Plan which reorganized the Kuwait Contracting office, installed new leadership, established a Joint logistics procurement support board, increased staffing and deployed senior contracting professionals and attorneys to Kuwait, and provided ethics training and organic legal support.
"We've been doing quite a lot in this area for over a year, and now we're doing more," Geren said.
A second independent, but complementary effort is an Army Internal Task Force led by Lt. Gen. N. Ross Thompson, Military Deputy to the Assistant Secretary of the Army for Acquisition, Logistics, and Technology, and Ms. Kathryn Condon, Executive Deputy to the Commanding General, Army Materiel Command.
"The Army Task Force will take an intensive look at current operations and implement reforms and corrections immediately," Geren said. "Based on earlier findings, the Army already has taken several actions and will continue to implement a number of recommendations, including transferring contracting authority for major contracts from Kuwait to Army Materiel Command, reviewing past contract actions and establishing Requirements and Contract Teams in Kuwait by September 30."
As of August 28, there are 76 ongoing criminal investigations involving contract fraud committed against the U.S. military in the Iraq, Afghanistan and Kuwait theater of operations.
As the scope and scale of contracting in Southwest Asia has evolved, the Army has recognized the need to assess its contract management capacity. The Army went from supporting one Kuwait base camp in 2002 to supporting eight in 2007. Contracts increased from $150 million in 2002 to nearly $1 billion in 2006. While 20 military and civilian Army employees have been indicted on charges of contract fraud, the vast majority of Army contracting professionals fulfill operational requirements everyday for Soldiers serving in harm's way. With no exceptions, we continue to expect every Soldier and Army Civilian to reflect Army Values and the high standards to which the entire Army adheres, regardless of its mission area.