KBR Got Bonuses for Work that Killed


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By Jeremy Scahill

The Department of Defense paid former Halliburton subsidiary KBR more than $80 million in bonuses for contracts to install electrical wiring in Iraq. The award payments were for the very work that resulted in the electrocution deaths of US soldiers, according to Department of Defense documents revealed today in a Senate hearing. More than $30 million in bonuses were paid months after the death of Sgt. Ryan Maseth, a highly decorated, 24-year-old Green Beret, who was electrocuted while taking a show at a US base in January 2008. His death, the result of improper grounding for a water pump, has been classified by the US Army Criminal Investigations Division (CID) as a “negligent homicide.” Maseth’s death had originally been labeled an accident. Bonuses were paid to KBR in 2007 and 2008, after CID investigators had officially expressed concerns about the quality of KBR’s electrical work. For its part, KBR denies any culpability for the electrocution deaths.


This information was revealed at a hearing of the Senate Democratic Policy Committee. According to the committee’s chair, Sen. Byron Dorgan, the rewards KBR received under its LOGCAP contracts were supposed to be for work of the “highest quality” with “no deficiencies” or problems. Dorgan said KBR’s work was “shoddy” and “unprofessional.” Some eighteen US soldiers have died since 2003 as a result of KBR’s “shoddy work,” according to Sen. Frank Lautenberg. KBR/Halliburton, of which Dick Cheney was chairman and CEO from 1995 to 2000, has been the single largest corporate beneficiary of the US wars in Iraq and Afghanistan. It continues to operate globally on US government contracts.

Charles Smith, the former Army official who managed the contracts under which KBR performed electrical work in Iraq, testified that it was “highly inappropriate” that KBR received these bonuses for what he called “dangerously substandard” work. He said that the Army was well aware of KBR’s “poor performance” since the beginning of the Iraq invasion, and yet continued to reward KBR because the military was “afraid” KBR would cease work. He said there was “a culture that decided KBR was too big to fail and too important to be held to account.” The “perverse incentive is that there was no incentive” for KBR to do quality work because they received bonuses for poor work.

Senator Dorgan said there are “tens of thousands of examples” of unnecessary risks to US soldiers, including deaths that have arisen as a result of KBR’s work. “Why should [KBR] be getting more contracts now that we know all this information?” asked Sen. Bob Casey. “The Defense Department has not answered these questions.”

James Childs, a master electrician hired by the Army to review electrical work in Iraq during 2008, testified that KBR’s work in Iraq was the “most hazardous, worst quality work” he’d ever seen. He said his investigation found improper wiring in “every” building KBR wired in Iraq (of which there are thousands) and that KBR’s rewiring work in buildings that were previously safely wired resulted in the electrical system becoming unsafe. Childs said that KBR did not do any work “according to code.” He also testified that the same risks exist in Afghanistan, which he recently visited. “While doing inspections in Afghanistan, I found the exact same code violations,” Childs said.

Eric Peters, a master electrician who worked for KBR in Iraq as recently as 2009, said that 50 percent of the KBR-managed buildings he saw were not properly wired. “I worried every day people would be injured or killed as a result of this work,” Peters testified. He estimated that at least half the electricians hired by KBR–many of them cheaper-costing Third Country Nationals (TCNs)–to service the US military in Iraq would not have been hired to work in the United States, saying they were not trained in US or UK electrical standards. TCNs–from places like India, Bangladesh and Bosnia–are estimated to have done some 60 percent of the electrical work for KBR in Iraq. Peters charged that KBR allowed trainees to take notes in to certification tests, making it very easy to be cleared for work.

Peters also charged that KBR “frowned upon” any refusal to sign off on work that Peters deemed incomplete or unsafe. Peters and others who testified said that “all over theater,” meaning everywhere in Iraq, KBR would effectively double-bill US taxpayers by leaving electrical work half-done or incorrectly done and then billing taxpayers again to repair its own shoddy work.

Peters characterized KBR managers as “completely unqualified” and said he is not a “disgruntled former employee” but rather a “disgusted former employee.”

About Jeremy Scahill

Jeremy Scahill, a Puffin Foundation Writing Fellow at The Nation Institute, is the author of the bestselling Blackwater: The Rise of the World’s Most Powerful Mercenary Army, published by Nation Books. He is an award-winning investigative journalist and correspondent for the national radio and TV program Democracy Now!. more…



Someone sent me this comment via email last night (6-13-09) .  I post it here for everyone’s information. -VM




Posted by Brendan


Having worked for KBR in the past nothing in this article surprises me in the slightest. I worked next to the electricians in the plumbing shop for almost 16 months. There was one building that had electrified pipes that shocked one of our workers. The Electricians came by and cleared that building (4 hours later) and our guy went back to work repairing a drain to a sink. This time he tested the pipes with a pen like device that flashes and beeps if electricity is present. Not only was the pipe still electrified, but the electrician had not even checked in the right wing of the building. We all tested the pipes after that. Though I have to say that when dealing with a third world electrical system that exists in Iraq I have always preferred to have TCN or Bosnians as my electrical counterparts. They understand the systems better and in my experience do a better job. In my zone I had an American electrician so bad I wouldn’t go anywhere near her work unless her TCN “trainee” signed of on it to me. He was a far better electrician in my view since I have never been fried but his work, but I had been by hers on more than one occasion.

Also I think that KBR should check on the validity of the “licensed” people. In my shop we had 5 master plumbers on the books but only 2 of them had real licenses. The other 3 had been forged, and if KBR had tried to match the names and numbers with state records they would not have matched at all. I expect the same is true for the electricians since they actually get paid a lot more for having a license.


 Thank you for your comment, Brendan.  It is amazing to me in some ways that we even have to deal with this kind of contractor corruption and stupidity that you and Ms. Sparky and her readers have described.  On the other hand, given the environment of greed and corruption in federal contracting that has progressively increased during the past decade, it could be expected.  Besides noting the attendant problems that occur when people are not adequately trained for their particular job assignments, I encourage everyone to do the following:


Contact all of your elected politicians and support further improvements to protections for whistleblowers who are federal or private contractor employees.  The people who have been standing up the crap and corruption have been absolutely targeted by the corrupted ones for doing so.  Ethical and responsible employees should not be punished and persecuted to doing the right thing.


Contact all of your elected politicians and demand that real “change” in the form of cleaning up federal agencies from the very top on down to eliminate industry influence and control that is currently damaging the ability of oversight employees in the field from doing their jobs as they wish to do them – ethically.


Contact all of your elected politicians and demand that real “change” in the form of cleaning up industry, particularly defense contractors, be initiated immediately. 


Contractors, including large corporations who have government contracts, should not feel and behave as though they are in the driver’s seat.  Through lobbying, bribes and other less than ethical manipulations, such as packing government advisory committees, work groups, congressional and other political influence groups, contractors have developed an unacceptable attitude of arrogance.  These contractors do not believe they have to follow even the federal laws and requirements we do have about continuing to keep their federal contracts and the huge sums of money they are paid for that contracted work. 


Field oversight people who have been trying to do their jobs are hard pressed to successfully do so, with people higher in the management chain, who are corrupted, actively undermining them.  Also, careers are being destroyed on a regular basis for many federal oversight employees (and defense contractor employees) who do not just shut up and rubber stamp inspections and allow the corrupted ones to continue on corruptly. 


There are certain large defense contractors that few, on their own without a lot of public pressure, will stand up to take on.  Please help pressure your elected officials, particularly those you believe may be less compromised and indebted to the defense contractors, (those without large and frequent campaign contributions from defense contractors), to help clean out the thoroughly corrupted ones by holding them accountable, and forcing defense contractors to follow the rules and meet the expectations that go along with their receipt of billions of U.S. taxpayers’ dollars for these contracts.  -GFS