Waxman to DoD Inspector General: Investigate Contractor Fraud

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In a letter (PDF) sent yesterday to Claude M. Kicklighter, the Defense Department Inspector General, Rep. Henry Waxman (D-Calif.), the House government oversight committee chairman, asks the IG to investigate “potentially thousands” of cases of contractor fraud in Iraq. In the letter, Waxman refers to the findings from the IG’s earlier investigation of DoD expenses in Iraq, which indicated that 28 transactions worth $35 million “appeared to involve criminal misuse of taxpayer funds.” Since the 28 transactions the IG found came from just a small sample of DoD transactions in Iraq, Waxman asked his staff to extrapolate from the small sample and come up with a figure representing how many of the 180,000 Iraq transactions might involve fraud. The results were shocking. From the letter:

Among the transactions you examined, approximately 4% resulted in criminal referrals. When this percentage is applied to the entire pool of 180,000 transactions, it appears that there may be more than 7,000 potential criminal cases involving more than $190 million in federal spending that have not been identified. This is an astounding amount of potential criminal fraud.

Waxman goes on to ask the IG to “assess the extent of potential criminal fraud” in Iraq and make recommendations to DoD and Congress about how to investigate and prosecute “cases of criminal conduct.” As Waxman also noted in his letter, the DoD has a record of little cooperation with Waxman or its own IG, so it remains to be seen whether the Congressman will get what he wants. Knowing Waxman, he’ll keep trying regardless.

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