Sen­a­tor says mil­i­tary firm bilked U.S.

Northwest Arkansas Democrat-Gazette - - NATIONAL - RICHARD LARD­NER

WASH­ING­TON — A Bri­tish com­pany hired to train Afghan in­tel­li­gence of­fi­cers billed the U.S. gov­ern­ment for high-end cars, in­clud­ing Porsches and an As­ton Martin, and paid the “sig­nif­i­cant oth­ers” of the firm’s top ex­ec­u­tives six-fig­ure salaries even though there’s no proof they did any work, ac­cord­ing to de­tails of a Pen­tagon au­dit made pub­lic Wed­nes­day.

U.S. Sen. Claire McCaskill, D-Mo., said New Cen­tury Con­sult­ing also spent $42,000 on au­to­matic weapons, us­ing cash to get around a pro­hi­bi­tion in the con­tract on pur­chas­ing the firearms, and show­ered other per­son­nel with hefty pay and bonuses they hadn’t earned. Over­all, the mil­i­tary con­trac­tor “left tax­pay­ers on the hook for over $50 mil­lion in ques­tion­able costs,” McCaskill said in a state­ment.

McCaskill, the top Demo­crat on the Home­land Se­cu­rity and Gov­ern­men­tal Af­fairs Com­mit­tee, sum­ma­rized the au­dit’s ma­jor find­ings in a let­ter to De­fense Sec­re­tary James Mat­tis. She de­manded to know which De­fense Depart­ment of­fice was re­spon­si­ble for over­see­ing the con­trac­tor, what steps are be­ing taken to re­cover the dis­puted pay­ments and whether New Cen­tury Con­sult­ing will face dis­ci­plinary ac­tion.

Michael Grun­berg, chief ex­ec­u­tive of­fi­cer of New Cen­tury Con­sult­ing, said the com­pany is be­ing por­trayed un­fairly and that it works to fol­low fed­eral ac­qui­si­tion rules. Grun­berg said it “is most un­fair and is sig­nif­i­cantly in­ac­cu­rate” that the ex­ec­u­tive as­sis­tants re­ceived ex­ces­sive salaries.

He said the au­dit “ques­tioned solely the use and de­pre­ci­a­tion treat­ment of ve­hi­cles” and that New Cen­tury Con­sult­ing “ac­counted for no more than three ve­hi­cles across the en­tire busi­ness at any one time.” The pur­chase of the weapons was done prop­erly and at the di­rec­tion of the U.S.-led com­mand over­see­ing the train­ing and equip­ping of the Afghan se­cu­rity forces, ac­cord­ing to Grun­berg.

McCaskill’s dis­clo­sure of the au­dit’s key find­ings pro­vided a glimpse into the world of bat­tle­field con­tract­ing. Con­trac­tors are in­dis­pens­able in Afghanistan, han­dling se­cu­rity, trans­porta­tion, con­struc­tion and more. Yet the De­fense Depart­ment has faced wide­spread crit­i­cism that it of­ten fails to per­form rig­or­ous over­sight of the com­pa­nies and how ex­actly U.S. tax­payer dol­lars are spent.

The re­port also comes amid the tense de­bate in­side Pres­i­dent Don­ald Trump’s ad­min­is­tra­tion over the way ahead in Afghanistan. Two of Trump’s se­nior ad­vis­ers — chief strate­gist Steve Ban­non and son-in-law Jared Kush­ner — have been ad­vo­cat­ing for mil­i­tary con­trac­tors to fight the war there in­stead of Amer­i­can forces.

The United States has about 8,400 troops in Afghanistan, and so far Trump has re­sisted the Pen­tagon’s rec­om­men­da­tions to send as many as 4,000 more. The As­so­ci­ated Press re­ported last week that Black­wa­ter World­wide founder Erik Prince, the brother of Ed­u­ca­tion Sec­re­tary Betsy DeVos, was ap­proached by Trump’s top ad­vis­ers to de­velop pro­pos­als to grad­u­ally swap out U.S. troops and put con­trac­tors in their place.

The De­fense Con­tract Au­dit Agency ex­am­ined New Cen­tury Con­sult­ing’s in­voices be­tween fis­cal 2008 and fis­cal 2013, when it was a sub­con­trac­tor to an­other com­pany, Im­per­atis Corp. Among the costs charged to the U.S. were ex­pen­di­tures for seven high­end cars — Porsches, Alfa Romeos, a Bent­ley, an As­ton Martin and a Land Rover, ac­cord­ing to McCaskill’s let­ter to Mat­tis. The ac­tual cost of the ve­hi­cles isn’t spec­i­fied.

“NCC claimed that the ve­hi­cles were avail­able to all em­ploy­ees but the ve­hi­cles ac­tu­ally were used ex­clu­sively by the chief ex­ec­u­tive of­fi­cer, chief op­er­at­ing of­fi­cer, chief fi­nan­cial of­fi­cer and the sig­nif­i­cant oth­ers of the CEO and CFO,” McCaskill told Mat­tis. Her let­ter doesn’t iden­tify who the sig­nif­i­cant oth­ers are.

These “sig­nif­i­cant oth­ers” also were em­ployed by New Cen­tury Con­sult­ing as ex­ec­u­tive as­sis­tants and had an av­er­age salary in 2012 of close to $420,000 each even though, McCaskill said, the com­pany was un­able to pro­vide ev­i­dence they ac­tu­ally per­formed any work.

The au­dit also chal­lenged mil­lions of dol­lars in com­pen­sa­tion for other em­ploy­ees, in­clud­ing the con­sul­tants whom the com­pany sent to Afghanistan to train the forces there. McCaskill said the con­sul­tants were sup­posed to be paid at a 100 per­cent rate when de­ployed over­seas, but only at 60 per­cent when on leave. But New Cen­tury Con­sult­ing gave its con­sul­tants the full rate re­gard­less of where they were.

“These ex­ces­sive pay­ments cost tax­pay­ers over $15 mil­lion,” she wrote.

New Cen­tury Con­sult­ing also gave its con­sul­tants more than $3.3 mil­lion in bonuses that they either didn’t earn or that weren’t re­quired by their con­tracts, ac­cord­ing to the sen­a­tor.

McCaskill said the au­dit, com­pleted last year, was con­ducted partly in re­sponse to con­cerns she and Sen. Rob Port­man, R-Ohio, had raised af­ter the Spe­cial In­spec­tor Gen­eral for Afghanistan Re­con­struc­tion iden­ti­fied a litany of prob­lems with Im­per­atis’ billing and record-keep­ing prac­tices. The De­fense Con­tract Au­dit Agency doesn’t pub­licly re­lease its au­dits.


Se­nate Home­land Se­cu­rity and Gov­ern­men­tal Af­fairs Com­mit­tee rank­ing mem­ber Sen. Claire McCaskill, D-Mo., asks a ques­tion June 6 dur­ing a hear­ing on Capi­tol Hill in Wash­ing­ton.

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