Useless USACE

A report from the Special Inspector General for Afghanistan Reconstruction (SIGAR) looks into the problems at Camp Pamir, built by DynCorp for the Afghan Army. It appears to be a classic example of the gravy train principle, where a major contractor builds a load of shoddy facilities that begin to fall apart, but walks away from responsibility having been paid in full for its rubbish work.

Loo with a view

In 2010 SIGAR reported that the newly-built facilities at Camp Pamir in Kunduz in northern Afghanistan were at risk of structural failure because of poor site grading and serious soil stability issues. However, in December 2011 the US Army Corps of Engineers (USACE), which had let the $72 million contract to DynCorp, released the company from further liability and warranty obligations. In doing so, the USACE did not comply with specific regulations that require an independent audit. As a result the Defense Department is now apparently responsible for sorting out the mess. Repair costs are estimated at $2 million.

This one cracked me up

SIGAR has asked the commanding officer of USACE to justify the cost of further repairs and submit the DynCorp settlement to an appropriate audit agency for review. They have also asked the CO to explain in writing why the settlement was determined to be fair and reasonable.

$2 billion costs of US civilian uplift in Afghanistan

When the US decided to expand its civilian presence in Afghanistan in 2009, it had little idea of how much it would cost. Now a report from the Special Inspector General for Afghanistan Reconstruction (SIGAR) has been able to answer that question.
In increasing the number of US civilians from 320 in early 2009 to 1,040 by June this year, the US has spent nearly $2 billion. It costs US taxpayers between $410,000 and $570,000 to deploy one civilian employee to Afghanistan for one year and those costs will undoubtedly rise. Remarkably this is the first time any US agency has worked out how much it costs to keep civilian staff in country. 

How aid ends up financing mansions in Dubai

A new report from the US Office of Special Inspector General for Afghanistan Reconstruction (SIGAR) looks in detail at the scandal of large US currency exports from Afghanistan - mostly to private bank accounts in the Gulf - and shows that efforts to safeguard US cash entering the Afghan economy have been hampered by ineffective coordination, inconsistent Afghan cooperation and insufficient cash controls.
This is not a new problem, but it has not been investigated very thoroughly in the past. The same problem dogged US operations in Iraq, where billions of dollars simply disappeared.
SIGAR says US agencies cannot easily follow what happens to cash dollars that enter Afghanistan, with the possibility (and likelihood) that much of it is being stolen or, in some cases, diverted to the Taliban.
“The United States has poured billions of aid dollars into a country plagued by corruption, insurgency and the narcotics trade. It is essential that we use all available tools to ensure that US dollars are protected from fraud and diversion to the insurgency. We must also ensure that the Afghan government is a full partner in efforts to set a fledgling financial sector on sound footing,” said Herbert Richardson, acting head of SIGAR, when launching the report today.
He pointed out that the Afghan government has not cooperated with US officials to build a strong and clean financial sector.
SIGAR says that since 2002 the US Congress has appropriated more than $70 billion to implement security and development assistance in Afghanistan. Although only a small proportion of this ends up as cash in the Afghan economy, tens or possibly hundreds of millions of dollars - SIGAR does not give a figure - very quickly leaves the country in suitcases destined for foreign bank accounts.
A recent report published by Spiegel Online found that many of the most expensive properties in Dubai have been bought by Afghans with close connections to the government.
Vulnerabilities identified by SIGAR's auditors include failing to record serial numbers of cash given out to contractors and other recipients of US funds and the failure of Afghan commercial banks to record the serial numbers of Electronic Funds Transfer payments by US agencies to contractors when they are converted to cash.
The report notes that the Afghan Attorney General's office has not cooperated fully in prosecuting individuals suspected of having committed financial crimes; out of 21 leads forwarded by FinTRACA to the Afghan government, only four were prosecuted. President Karzai has even prevented US government advisers from gaining access to the Central Bank, where the atmosphere is described as "hostile".

SIGAR boss goes out with a bang

The Special Inspector General for Afghanistan Reconstruction (SIGAR), General Arnold Fields, appears to be going into overdrive in his last few weeks in the job. After being criticised for little activity, he has published his second report in a week.
Like the previous report (see below) the most recent offering concerns reconstruction funds that may be at risk due to lack of planning.
This audit of the Commander's Emergency Response Program (CERP) in Laghman found that 27 of the 69 CERP projects in the province, worth $49.2 million out of a total budget of $53 million, were at risk or have questionable outcomes.
The CERP program is basically a large pot of cash that military officers can dole out locally for humanitarian and reconstruction projects without having to go through the tiresome business of tenders and all that. Since 2004 Congress has appropriated nearly $2.64 billion for CERP projects in Afghanistan.
What the SIGAR report has found out is that most of the money spent so far has gone on road contracts, but there appears to be no money in the pot to pay for maintenance, meaning the roadways may simply revert to tracks in a few years. "“Our audit found that these projects and groups of related infrastructure initiatives were approved without adequate assurance that the Government of Afghanistan had the resources to operate and maintain them. This suggests that the Afghans have not been sufficiently involved, despite a U.S. strategy emphasizing Afghan First,” said General Fields, who visited Laghman in September last year. "Building multimillion dollar projects, and then trying to figure out a sustainability plan, is a nonsensical way of planning," he added.
Is it possible that General Fields is trying to prove a point, now he has been sacked from his job?
In his final report to Congress, issued today, Fields notes that there are 16 ongoing audits in his office. The Investigative Directorate opened 35 new cases and closed seven bringing the total number of ongoing cases to 105. At present 86 per cent of current investigations are focussed on contract or procurement fraud. Presumably this includes the case of the lying, cheating Sarah Lee Mitcham of Bennett-Fouch and K5 Global, who I have written about before and who left Afghanistan last year without paying her local contractors.

Planning failure puts billions at risk - SIGAR

An audit released today by the Special Inspector General for Afghanistan Reconstruction (SIGAR)  found that $11.4 billion is at risk due to inadequate planning for the construction of nearly 900 Afghanistan National Security Forces (ANSF) facilities.
“SIGAR initiated this audit when our auditors found that the Combined Security Transition Command-Afghanistan (CSTC-A) could not provide the plans or justifications for the ANA facilities being built across Afghanistan,” said Inspector General Arnold Fields, who recently announced that he is leaving his post following widespread criticism.
The report found that there was no long-range capital construction plan, needed to improve accountability over the proposed new facilities which are being built to accommodate the expected increase in ANSF personnel. Numbers are already projected to reach 305,000 this year and may reach 400,000 by October 2013. Without such a plan, it would be impossible to adapt to changing requirements, prioritize resources, achieve strategic goals or avert potential waste. Nor was there any long-range maintenance plan for the ANSF facilities now being built, even though contracts worth $800 million had already been let to maintain more than 660 sites.

Anyone here any idea how many contracts we let?

The first attempted audit of some 7,000 reconstruction contracts in Afghanistan let by the US government between 2007-09 notes that the US departments of Defense and State, USAID and other agencies are “unable to readily report on how much money they spend on contracting for reconstruction activities” on contracts worth nearly $18 billion during this period.
The auditors had attempted to look at all contracts issued since 2002, but found the records so sparse that they were unable to do this.
The snappily-titled "DOD, State and USAID Obligated over $17.7 Billion to About 7,000 Contractors and Other Entities for Afghanistan Reconstruction During Fiscal Years 2007-2009", published by the Office of the Special Inspector General for Afghanistan Reconstruction, makes no real attempt to audit the contracts, merely to work out how many contracts had been issued and for how much.
In fact, the SIGAR auditors can't even deal just with US contracts, let alone those of other governments and NGOs working in Afghanistan: "There is still no central U.S. government database to track reconstruction projects from the various US agencies and departments, let alone, the international community," said the SIGAR report.
The 45-page report concludes that: "The audit shows that navigating the confusing labyrinth of government contracting is difficult, at best. Within the Defense Department alone, there are four contracting organizations managing DOD-funded reconstruction contracts. The audit found that not only do those four DOD contracting organizations not coordinate and share information with one another, there is minimal sharing of information across government agencies."
Predictably, "a relatively small number of contractors and other entities accounted for the majority of obligations." All the obvious big boys - the Beltway Bandits - are there. As are a number of smaller and more exotic companies. Who, for example, are No Lemon Ltd, which received contracts from the Defense Department worth $95million?
Here's just part of the list, showing USAID contracts. All figures in millions of dollars:

Contracts reported by USAID, FY 2007-FY 2009

Louis Berger International, Inc. $736m
Development Alternatives, Inc. $296m
Chemonics International, Inc. $230M
Bearing Point, Inc. $130m
Association for Rural Development $70m
Deloitte Consulting $60m
Norse Air Charter, Ltd. $48m
Creative Associates International, Inc. $47m
Checchi & Company $42m
International Foundation for Election Systems $37m
Personal services contracts(a) $36m
AECOM International Development $36m
International Relief and Development $34m
Emerging Markets Group $32m
Associates in Rural Development $24m
Advanced Engineering Associates $24m
Constella Futures International $14m
International Resources Group $14m
State University of New York $8m
Al-Haj Abdul Ghafar Ghazanfar Co.Ltd $8m
Rashad Elham Trading Company, Ltd. $8m
Ahham FZCO, Ltd. $6m
Partnership for Child Healthcare $ 6m
PA Government Services, Inc. $6m
Global Strategies Group $6m
Afghanistan Management Group $5m
Descon Holdings, Ltd. $5m
ECODIT $5m
Camp Dresser McKefee International $3m
Aircraft Charter Solutions, Inc. $3m
IO Global Services $2m
QED Group $2m
Protection Devices, Inc. $2m
Lakeshore Engineering Services, Inc. $2m
University Research Company $2m
Bank Alfalah, Ltd. $2m
Macro International $2m
Agility International, Inc. $1m
GW Consulting $1m
Dell Computer $1m
Computer Sciences Corporation $1m
MWH Americas, Inc. $1m