Iraq Inspectors Progress on DynCorp Audit

By Dana Hedgpeth
Washington Post Staff Writer
Monday, April 28, 2008

Nearly six months ago, the Special Inspector General for Iraq Reconstruction office said it couldn't do an audit of a $1.2 billion contract DynCorp International of Falls Church had to train Iraqi policemen because records kept by the State Department and the company were inaccurate and in disarray.

Last week, the inspector general gave the department and the company a better report card, saying an audit showed improvements in the oversight and management of the deal.

The inspector general office, which tracks waste, fraud and abuse in the roughly $40 billion U.S. reconstruction effort in Iraq, had criticized the State Department's Bureau of International Narcotics and Law Enforcement Affairs for poor oversight and management of the deal and questioned some of the charges for DynCorp's work.

Since then, DynCorp has refunded $14 million to the State Department and located $2.5 million worth of missing vehicles.

After the inspector general raised questions about missing weapons and body armor, the narcotics division inventoried 3,292 9mm Berettas in February. It found that 10 of those guns were damaged or lost in battle. Seventeen more were lost or stolen and DynCorp will be held "financially accountable" for them.

DynCorp was awarded the contract in 2004. As part of the deal, it provides housing, food, security, training and other services to help Iraqi police.

The State Department paid $43.8 million to DynCorp to manufacture and temporarily store trailers for a residential camp that had never been used, according to the inspector general's report last October, but it has since made plans to use the 1,040-person camp. Some of the trailers will go to the Baghdad airport for a 500-person camp; others will be used at the U.S. Embassy in Baghdad.

The inspector general credited the narcotics division with organizing its files, improving its oversight by adding more contract management staff and boosting its efforts to try to get compensated for work it didn't order.

Still, there is one well-known point of dispute.

The Office of Acquisition Management issued a "demand letter to DynCorp," saying it owed the government $4.2 million because it did unauthorized work, which included building an Olympic-size swimming pool, adding extra trailers for "very-important-persons" and moving a residential camp.

Acquisition officials said there was "unequivocal and overwhelming justification" showing that the work was unauthorized and improper. DynCorp disagreed, saying previous contracting officials had authorized the work.

That matter is still under review.

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