“Contracting with the Enemy”

More than 80 percent of the Defense Department’s Afghanistan reconstruction contracts are vulnerable to putting U.S. taxpayer money into enemy coffers, a government watchdog says in a new report.

According to the Special Inspector General for Afghanistan Reconstruction (SIGAR), a poorly written section of the defense authorization bill means that “millions of contracting dollars could be diverted to forces seeking to harm U.S. military and civilian personnel and derail the multi-billion dollar reconstruction effort.”

“The possibility that taxpayer money could be supporting the insurgency is alarming and demands immediate action,” said John Sopko, the SIGAR. “Every effort should be made to implement stronger controls that protect our troops and ensure the success of our reconstruction efforts.”

The section of the law in question gives DOD power to keep funds from companies who associate with enemy elements. But, SIGAR said, the rule “only applies to contacts more than $100,000 — but roughly 80 percent of contracts awarded in Afghanistan fall below this threshold.”

SIGAR also found that contracting agencies simply do not know who their subcontractors are, on many projects. That’s a typical problem across the federal government for oversight officials, who often must rely on prime contractors, often small overseas companies, to identify their subcontractors adequately.

Spoko has turned up the heat on the federal government since taking the position last summer. On Wednesday, he took a moment to boast, in House testimony, that his office has produced more investigations in the last 3 months than were completed in the previous nine months. But inspector generals can effect change only if the government heeds their recommendations, he argued.

“SIGAR currently has 73 open recommendations. If all of them were accepted, the U.S. government could potentially save about $450 million,” he said.

Sopko named several factors contributing to wasted U.S. taxpayer money in Afghanistan, including poor planning, security, and monitoring.

Additionally, the U.S. has failed to establish an anti-corruption plan across the spectrum U.S. efforts in Afghanistan.

“More than two years ago, SIGAR recommended that the United States develop an integrated anti-corruption strategy. Although the U.S. Embassy in Kabul produced a draft strategy, it was not adopted,” he said.

There is plenty of money to keep watch over. Congress has appropriated nearly $93 billion for Afghanistan reconstruction since 2002, Sopko said. Last fiscal year, Central Command’s Joint Theater Support Contracting Command “awarded 9,733 contracts, valued at approximately $1.7 billion,” according to the SIGAR report.

To keep U.S. money out of enemy hands, CENTCOM now publishes a list of suspect companies — so far, just five companies — but Sopko’s team found contracting officers aren’t checking the list.

UPDATE: Following the release of the SIGAR report, Sens. Kelly Ayotte, R-NH, and Richard Blumenthal, D-Conn., introduced the “Never Contract With The Enemy” bill, on Thursday. “American taxpayer dollars should never benefit our enemies,” said Ayotte, who co-authored the original provision with former Sen. Scott Brown, R-Mass. The new language fixes the problem, the senators said in a statement, “by allowing officials across government to more expeditiously stop contracts that have been found to benefit our enemies.”