ICCTF COMBATS CONTRACT FRAUD AND CORRUPTION IN

UNCLAS SECTION 01 OF 02 BAGHDAD 002927 SENSITIVE SIPDIS JUSTICE FOR JJONES, ANORMAN, TBARTLETT, BSWARTZ STATE FOR INL/I, NEA/I E.O. 12958: N/A TAGS: PGOV SOCI IZ KCRM KJUS SUBJECT: ICCTF COMBATS CONTRACT FRAUD AND CORRUPTION IN IRAQ RECONSTRUCTION EFFORT ¶1. (SBU) SUMMARY: To address corruption and fraud that pervaded the government procurement process during the initial stages of the USG's Iraq reconstruction effort, DOJ created the International Contract Corruption Task Force (ICCTF) in March 2006. The ICCTF is a joint law enforcement task force comprised of law enforcement agents from DOJ, DOS, and DOD that seeks to detect, investigate and dismantle corruption and contract fraud resulting from U.S. Overseas Contingency Operations, including in Afghanistan, Iraq and Kuwait. In FY 2009, ICCTF joint investigations in Iraq led to nine U.S. indictments and facilitated the opening of several cases by Iraqi authorities through the Major Crimes Task Force (MCTF),a joint US-Iraqi team that investigates high-profile and sensitive cases for the GOI. END SUMMARY. ¶2. (SBU) The ICCTF has personnel based at several sites in Iraq, Kuwait and Afghanistan where the US has engaged private contractors to develop and deliver services to the USG on a massive scale. The ICCTF,s mission is to integrate the full spectrum of investigative, intelligence, audit and prosecutorial resources to combat contract fraud and public corruption related to USG spending, with an emphasis on Southwest Asia Operations, and to enhance operational effectiveness among US law enforcement entities and with GOI partners. Located in four Iraq sites (International Zone, Balad Airbase, Al-Asad Airbase and Victory Base Complex),the ICCTF is comprised of 22 agents from the FBI, Defense Criminal Investigative Service (DCIS),SIGIR, State OIG, USAID OIG, U.S. Army Criminal Investigative Command (CID), Air Force Office of Special Investigations (OSI),and Naval Criminal Investigative Service (NCIS). As corruption and fraud schemes often cross international boundaries, the ICCTF has positioned 46 agents overall in the Southwest Asia region (Iraq, Afghanistan and Kuwait) to investigate cases of contract fraud and public corruption in support of U.S. Overseas Contingency Operations. ¶3. (SBU) In FY 2009, the ICCTF maintained 109 open investigations in Iraq, obtained 9 indictments/informations, and secured 8 convictions in U.S. Federal Court. The task force has three case categories: public corruption (bribery, kickbacks and conflicts of interest); procurement fraud (false claims and statements, and/or undelivered/defective/counterfeit products); and theft and diversion (large scale theft and diversion of assets). ICCTF investigations have led to arrest and indictment in U.S. Federal Court of U.S. civilian and military contracting officers who have used their positions and responsibilities to defraud the USG of funds or assets or to solicit bribes from Iraqi companies in exchange for award of contracts. ¶4. (SBU) One case developed by the ICCTF was the investigation in United States vs. William Dubois, et. al. The case involved the theft of nearly USD 40 million in diesel and aviation fuel from a DOD facility in Baghdad, Iraq. Using fraudulent documents and identification cards, the subjects gained access to a U.S. military base to steal the fuel. The fuel was later sold on the black market. These thefts could lead to an inadequate fuel supply for military operations at a time of emergency should fuel not be available when needed. Dubois was sentenced in August 2009 to three years in prison for his role in the fuel theft Qto three years in prison for his role in the fuel theft scheme. His co-conspirators have been convicted in the U.S. Federal Court for the Eastern District of Virginia and are awaiting sentencing. ¶5. (SBU) In furtherance of the goals of Section VIII of the US-Iraq Strategic Framework Agreement (SFA),when ICCTF investigations of fraud and corruption involve Iraqi nationals, information is shared with the GOI,s Ministry of Interior (MOI) in order to facilitate an investigation by Iraqi authorities with assistance from US law enforcement personnel. In February 2009, the ICCTF uncovered a fraud scheme involving a non-governmental agency falsifying contracts in order to steal the funding for the projects. The ICCTF shared this information with the MCTF, which opened an investigation and obtained 11 arrest warrants for Iraqi nationals alleged to have participated in the scheme. (NOTE: The MCTF is a joint task force comprised of MOI investigators and U.S. federal law enforcement agents, under the leadership of the FBI. END NOTE). ¶6. (SBU) COMMENT: The ICCTF is both an important element of the US federal law enforcement effort in Iraq as well as an example to GOI counterparts and partners that the U.S. BAGHDAD 00002927 002 OF 002 &walks the walk8 when it comes to investigating and prosecuting public corruption and fraud. The engagement by the ICCTF with Iraqi investigators through the MCTF is illustrative of the important relationships being established by USG and GOI law enforcement which will benefit future investigative cooperation, in accordance with the principles of law enforcement and judicial cooperation outlined in Section VIII of the SFA. END COMMENT HILL