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Archive for Friday, December 12, 2003

Halliburton may have overcharged Army

December 12, 2003

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— Pentagon auditors found that Vice President Dick Cheney's former company may have overcharged the Army by as much as $61 million for gasoline in Iraq, senior defense officials said Thursday.

Halliburton apparently didn't profit from the possible overcharges, the officials said, speaking on condition of anonymity. The problem, the officials said, was that Halliburton may have paid a subcontractor too much for the gasoline in the first place.

The Pentagon officials said the Halliburton subsidiary involved in Iraq reconstruction work, Kellogg, Brown & Root, also submitted a proposal for cafeteria services that was $67 million too high. The officials said the Pentagon rejected that proposal.

The defense officials said they had no reason to believe the problems were anything other than "stupid mistakes" by Halliburton.

In an e-mail, Halliburton spokeswoman Wendy Hall denied the company had overcharged. She said Halliburton was responding to questions from Pentagon auditors and was "confident our responses will satisfy" them.

News of the problems came as President Bush worked to justify his decision to limit Iraq reconstruction contracts to companies from the United States or countries that supported the war. The move angered governments whose firms were cut out of the bidding process, including France, Germany, Russia and Canada.

Many prominent Democrats also have criticized the Halliburton contracts specifically, suggesting they were a political payoff for a company with strong ties to the GOP.

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