Guilty Plea in Iraq Bid-Rigging
Contracting Officer Steered Jobs in Return for Cash, Favors

By Charles R. Babcock
Washington Post Staff Writer
Thursday, February 2, 2006

A former contracting officer for the U.S.-led coalition government in Iraq has agreed to plead guilty to bribery and other charges in a bid-rigging scandal. It would be the first corruption conviction arising from the effort to rebuild the country.

Robert J. Stein Jr., who was a convicted felon when he was put in charge of overseeing $82 million in Iraqi funds in a region south of Baghdad in 2003, was arrested last fall for allegedly steering contracts to Philip H. Bloom, a contractor who ran several companies in Iraq and Romania, according to court papers filed in federal court here.

In a plea agreement filed last week, Stein admitted accepting at least $1 million in cash and cars, jewelry and sexual favors from women provided by a co-conspirator who was identified in a previous court affidavit as Bloom. Stein also admitted stealing $600,000 in cash and goods from the Coalition Provisional Authority, the plea agreement papers said.

Stein, who is scheduled to appear in U.S. District Court here this morning, agreed to plead guilty to five felony counts: conspiracy, bribery, money-laundering, possession of a machine gun, and a felon in possession of a handgun. His attorney, Rita Bosworth of the federal public defender's office, did not a return a call late yesterday seeking comment.

Two Army Reserve officers have been arrested in connection with the investigation, which grew out of audits by the special inspector general for Iraq reconstruction. The court papers say five Army Reserve officers were part of the conspiracy.

In early January 2004, the plea-agreement papers said, Stein, the CPA controller and funding officer for the region, arranged for a contractor to get a $491,000 contract to demolish a police academy in Al Hillah. The filing said he then wrote the contractor an e-mail that said: "I will give you $200k sometime tomorrow afternoon! I love to give you money."

Later that month, another e-mail suggested using another company name, so it did not appear that all the work was going to one contractor.

The e-mail traffic cited as the basis for the plea show Stein awarding the contractor's company with work one day and sending much of the payment within a day or so.

Reports from the inspector general's office showed that some of the work on the projects was never completed.

Stein and the others also smuggled hundreds of thousands of dollars in cash into the United States, according to the plea-agreement papers. Through his crimes, he was able to obtain a Porsche, a Lexus and other cars and trucks, several watches and diamond rings, two lots in North Carolina, more than $800,000 in cash and bank deposits, and a Cessna airplane, the documents said.

Investigators also found that Stein possessed at least 50 firearms, including machine guns and grenade launchers, and silencers, in violation of firearms laws.

Stein pleaded guilty in 1996 to federal fraud charges and was sentenced to eight months in prison and ordered to reimburse $45,000 to a financial institution.

That record did not stop him from being hired by S&K Technologies Inc. of Montana, a Native American company that had a contract to provide experts to the CPA.

Greg DuMontier, president of S&K, said Stein was a construction expert and he did not know why he was working as a contracting officer.

Staff researcher Richard Drezen contributed to this report.

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