Halliburton execs deny overcharging

By Robert O'Harrow Jr. and David S. Hilzenrath
The Washington Post

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A hearing by the House Committee on Government Reform was the first time executives of Halliburton's KBR subsidiary appeared on Capitol Hill to respond to charges it systematically misspent government money while doing $5.6 billion worth of work in Iraq.

"While we have undoubtedly made some mistakes, we are confident that KBR has delivered and accomplished its mission at a fair and reasonable cost," said Alfred Neffgen, chief operating officer of government operations in the Americas.

The hearing was deeply partisan from the start. Democrats led by Rep. Henry Waxman, D-Calif., repeatedly noted Dick Cheney was Halliburton's chief executive before he was vice president. They suggested Halliburton and its subsidiaries defrauded the government.

Waxman said he believes Cheney or his staff had more involvement in Halliburton contracts than they have said. "It's a boondoggle that is enriching a lot of contractors," he said of the projects in Iraq.

Waxman's request to have the committee subpoena communications between Cheney's office and the Pentagon failed on a party-line vote.

Chairman Tom Davis, R-Va., called the Democrat's efforts a "witch hunt" in search of "sensational" material instead of facts. "We are having this hearing today because there are those who believe we have a company, Kellogg, Brown and Root, that is wasting tax dollars or abusing its contracting role, or even defrauding the U.S. taxpayer," he said in opening remarks.

Witnesses before the panel reflected the political rift. Among them were former KBR employees in Iraq, including two truck drivers and a former logistics specialist, who said the company routinely wasted government money.

They told of trucks abandoned during convoys because of flat tires, inflated bills for KBR employees at luxury hotels and $45 cases of soda — details Waxman said exemplified Halliburton's disregard for thrift.

Adding to that litany, Waxman cited a new report by his staff that he said showed Halliburton charged the government $167 million more than necessary to import gasoline into Iraq.

The KBR executives followed up with an appeal for understanding of the hazards and rapidly shifting demands of a combat zone under which some of their died.

They also challenged the former employees' allegations. Every Halliburton convoy traveled with spare tires, contrary to the testimony of one former truck driver, said Keith Richard, a KBR transportation manager. It was the Army, he said, not KBR, that determined whether to abandon or fix a vehicle.

Copyright © 2004 The Seattle Times Company

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