'Crucial' audit on Afghanistan contractors

By Karen DeYoung
Washington Post Staff Writer
Thursday, October 28, 2010

U.S. government agencies obligated nearly $18 billion in payments to 7,000 contractors and others involved in broadly defined "reconstruction" projects in Afghanistan between 2007 and 2009, according to a report released Wednesday by government auditors.

The report, by the congressionally mandated Special Inspector General for Afghanistan Reconstruction, or SIGAR, is the first government-wide compilation of such data, drawn from seven U.S. agencies that separately hire contractors for construction and other projects.

"This audit is crucial, because if we don't even know who we're giving money to, it is nearly impossible to conduct systemwide oversight," Special Inspector General Arnold Fields said.

There is currently no mechanism for the agencies - four in the Defense Department, two at the State Department and the U.S. Agency for International Development - to share information that would allow them to judge overall contractor performance. Navigating the records is a "confusing labyrinth" that makes assessments "difficult, at best," SIGAR spokeswoman Susan Phalen said.

In a separate audit Wednesday, SIGAR cited one of the Defense Department agencies, the Army Corps of Engineers, with "lack of oversight" of an Afghan contractor paid $5.5 million to build seven district police headquarters in the key southern provinces of Helmand and Kandahar, all of which were found to be structurally deficient and five of which remain uncompleted.

According to the wider contracting report, the Corps of Engineers has signed a total of $12 million in contracts with the Afghan-based company, Basirat Construction. The company's Web site also lists projects for the U.S. Embassy in Kabul and the United Nations in Afghanistan, among others.

In Iraq, where extensive corruption and waste was uncovered in U.S.-funded reconstruction projects, a database eventually was developed to collate all contractor and project information.

No such system exists in Afghanistan, where the United States has spent $55 billion in reconstruction funds since 2001.

To compile the list of contractors, SIGAR auditors went separately to each of the seven U.S. government agencies. Data available before 2007 was "too poor to be analyzed," Phalen said.

SIGAR made no recommendations in the report, which did not identify individual contracts. Field said the list would be used to "more effectively prioritize future contract audits and more quickly identify contracts at risk of fraud, waste and abuse."

"It certainly helps to reduce the stovepipes and lend more transparency to U.S. departments and agencies so that they may learn more about what their own organizations are doing and what other departments and agencies are contracting for," Fields said.

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