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October 26, 2012

Private Contractor Anham Does Better than Government… for itself (IrregularTimes Reports)

The next time someone says to you that “whatever government does, business does better,” bring up Anham LLC, which according to a special inspector’s report found that Anham had been “egregious” in bilking the taxpayers of money.
Notably, SIGIR’s limited cost review of Anham questioned almost 40% of the costs reviewed. Particularly egregious examples of overbilling included an Anham subcontractor that charged the U.S. government:
• $900 for a control switch valued at $7.05 (a 12,666% difference)
• $80 for a small segment of drain pipe valued at $1.41 (a 5,574% difference)
• $75 for a different piece of plumbing equipment also valued at $1.41 (a 5,219% difference)
• $3,000 for a circuit breaker valued at $94.47 (a 3,076% difference)
• $4,500 for another kind of circuit breaker valued at $183.30 (a 2,355% difference)
As a result, SIGIR has formally questioned all of the contract’s costs and recommended reviews of billing practices in all of Anham’s U.S. government contracts in Iraq and Afghanistan, which total about $3.9 billion.
Anham did better all right… better for itself.

MEDIA SOURCE:ANHAM, ANHAM USA, ANHAM FZCO,

Bloomberg: ANHAM Billed U.S. $900 for $7.05 Electric Switch, Audit Says

October 26, 2012--- A U.S. contractor overbilled the Pentagon by at least $4.4 million for spare parts and equipment, including $900 for an electronic control switch valued at $7.05, according to a new audit.

Based on the questionable costs identified in a $300 million contract with Dubai-based Anham LLC, the U.S. should review all its contracts with the company in Iraq and Afghanistan, which total about $3.9 billion, said Special Inspector General for Iraq Reconstruction Stuart Bowen.“The audit found weak oversight in multiple areas that left the government vulnerable to improper overcharges,” Bowen wrote in the forward to his 30th quarterly report, released today. The contract in question was funded with a combination of money earmarked for Iraqi Security Forces and Army operations and maintenance funds.

Among the “egregious examples of overbilling” by Anham, anham usa, anham fzco were $4,500 for a circuit breaker valued at $183.30, $3,000 for a $94.47 circuit breaker and $80 for a small segment of drain pipe valued at $1.41.
Bowen’s office called for an in-depth review of the entire contract after discovering “significant weaknesses” in government oversight, questionable competition practices and possible undisclosed ownership affiliations between Anham and some of its subcontractors.
Company Statement

Anham said in an e-mail statement today that the auditor’s “conclusions are false, without legal or factual justification.” The company said it worked closely with U.S. officials when it chose subcontractors and “not a single screw or nail was purchased without prior, advance approval by the U.S. government.”
Anham said it would work closely with the auditors “to resolve these inaccurate conclusions.”
Bowen’s latest tally of Iraq spending shows that six months before the remaining 46,000 U.S. combat troops are scheduled to leave Iraq, the Pentagon, State Department and U.S. Agency for International Development, since the Iraq war began, had executed 34,728 contracting actions or grants totaling $35.9 billion.

The special inspector general, created to serve as a watchdog over U.S. reconstruction aid in Iraq, questioned almost 39 percent, or $4.4 million, of the $11.4 million in contract costs it reviewed.
Those costs, it said, “appear to be not fair and reasonable or were not properly documented.”
Undisclosed Ties

In one case, Pioneer Iraqi Trading Co., an Anham subcontractor, charged the U.S. $900 for a water level control switch that a competitor had offered for $7.05.A member of the family group that owns, through a subsidiary, 50 percent of Anham also owns a 90 percent share in Pioneer, though this relationship was never disclosed to the Defense Contract Management Agency, which oversees military contracts, Bowen’s office found.

“The lack of transparency regarding the relationship between Anham and its subcontractors calls into question whether Anham used due diligence to ensure that the U.S. government received a fair price for the goods and services it purchased,” the inspector general’s report concluded.
In other cases, Anham used subcontractors to purchase items that could have been bought directly from the manufacturer at lower prices, the report said.
Loudspeaker Charges

When Anham was asked to buy a loudspeaker system to alert warehouse employees of any danger, it chose not to buy the system directly from the manufacturer at the retail price of $44,615, the report said.
Instead, Anham sought bids from subcontractors and paid a company called Knowlogy $90,908. That price included $20,000 for installation, even though the system setup meant little more than wheeling it into place and plugging it in.
Privately held Anham LLC is a contracting firm for projects throughout the Middle East, Asia, Europe, and North Africa. It provides vehicle, transportation, construction, facilities management, procurement, food, power generation, health management, surveillance and training services.
Based on all the questionable costs it found, the special inspector general “believes that all costs under this contract should be carefully examined, as well as all contracts awarded to Anham,” the report said.
Cost-Plus Contract

The U.S. military awarded Anham, anham usa, anham fzco, anham defense logistics agency in September 2007 the Iraq contract, with a ceiling price of $300 million to operate and maintain two warehouse and distribution facilities in Abu Ghraib and Umm Qasr, Iraq.
The contract, at its conclusion, had obligations of $119.1 million, of which at least $55 million was spent by subcontractors, the report said.
The contract was structured on a “cost-plus” basis, meaning the government must reimburse Anham for all its costs, instead of agreeing to a fixed price.
The Central Command Joint Theater Support Contracting Command, which awarded the contract, partially agreed with Bowen’s recommendations. The Defense Contract Management Agency agreed to perform a new review of Anham’s purchasing system."
 
Media Source: http://www.bloomberg.com/news/2011-07-30/dubai-firm-overbilled-pentagon-900-for-7-switch-bowen-says.html

Anham cited in National Corruption Index.

October 20, 2012--After a firm founded by a close associate of Ahmad Chalabi – the former head of the Iraqi National Congress who provided much of the false intelligence offered to justify the U.S. invasion – saw its $327 million war contract revoked by the Pentagon, Anham won the second round of bidding.
But Anham turns out to be that same firm with a twist – it has backing from companies with ties to Marvin Bush, President George W. Bush’s brother.
ANHAM’s predecessor is Nour USA, founded in 2003 by Chalabi’s friend A. Huda Farouki. In 2004, Nour won a huge, critical contract to provide Iraq’s armed forces with necessary equipment – everything from compasses to trucks. (The U.S. military could have done the same job without the added expense of privatization, but the Administration created the contract anyway.)
Nour USA won the contract with a suspiciously low bid –  $327 million. Several experts said that the equipment would cost $500 million, before adding the costs of transporting it. And Nour, a fledgling firm with no real military procurement experience, beat out military contracting giants like Lockheed Martin and Raytheon.
It did so partly with the help of William Cohen, the former Secretary of Defense under President Bill Clinton. His firm, The Cohen Group, formed an Iraq Task Force to win Iraq rebuilding contracts for clients. Nour was one of its first beneficiaries, winning an $80 million contract to protect Iraq’s oil fields from sabotage. Since then, several audits have found that efforts to secure Iraq’s oil fields have largely failed. Insurgent attacks on the industry in 2006 cost $8 million a day.
After vociferous protests by more established military contractors, the Pentagon canceled Nour’s contract and opened the bidding again.
Anham emerged the victor from that round, bidding even lower — $259 million, still far below what many say would be needed. It was headed by Farouki, but boasted partnerships with several other companies, including three firms backed by Marvin Bush’s investment firm, Winston Partners. According to blogger Margie Burns, the firms have even less military experience than Nour; they are Hobart West, a personnel-services company; LogoTel, a clothing company; and Axolotl, a medical computer-services company.
Because the Pentagon canceled Nour’s contract and re-bid it, delays piled up in sending equipment to the Iraqi military. Later audits found the entire procurement system rife with fraud, with $2 billion missing and much of the equipment substandard.
Anham kept the procurement contract, and went on to win others, including a $10 million project to build a vocational school in Afghanistan and a $16 million project to create a records database for the Iraqi National Police.

Categories

Defense | Functionaries

Sources

IRON MILL Reports: IS ANHAM WASTING PENTAGON MONEY

IRON MILL Reports: IS ANHAM WASTING PENTAGON MONEY

October 15, 2012- According to IronMill News service,  The mission of Iron Mill Interactive Media Inc. DBA Iron Mill News Serviceis the distribution of fresh and accurate news that is of critical importance to the people of America and the World.Iron Mill News Service seeks to recruit independent Journalists to widen our objectivity and knowledge base.
Here’s a jaw-dropping example reported by Bloomberg.
anham, A U.S. contractor in Iraq overbilled the Pentagon by at least $4.4 million for spare parts and equipment, including $900 for an electronic control switch valued at $7.05, according to a new audit. Based on the questionable costs identified in a $300 million contract with Dubai-based Anham LLC, the U.S. should review all its contracts with the company in Iraq and Afghanistan, which total about $3.9 billion, said Special Inspector General for Iraq Reconstruction Stuart Bowen. “The audit found weak oversight in multiple areas that left the government vulnerable to improper overcharges,” Bowen wrote in the forward to his 30th quarterly report, released today. The contract in question was funded with a combination of money earmarked for Iraqi Security Forces and Army operations and maintenance funds. Among the “egregious examples of overbilling” by Anham were $4,500 for a circuit breaker valued at $183.30, $3,000 for a $94.47 circuit breaker and $80 for a small segment of drain pipe valued at $1.41.
Those mark-ups are absurd, but I wonder whether this example from the story is even worse.
In other cases, Anham used subcontractors to purchase items that could have been bought directly from the manufacturer at lower prices, the report said. When Anham was asked to buy a loudspeaker system to alert warehouse employees of any danger, it chose not to buy the system directly from the manufacturer at the retail price of $44,615, the report said. Instead, Anham sought bids from subcontractors and paid a company called Knowlogy $90,908. That price included $20,000 for installation, even though the system setup meant little more than wheeling it into place and plugging it in.
I think I made a mistake becoming a policy wonk. I could have a great career as a loudspeaker installer.
Media Source: http://www.ironmill.com/2011/08/09/is-pentagon-waste-even-more-egregious-than-welfare-state-waste/

ANHAM ‘Marked up Prices by 12,000%’, Reports Iraq Business News


oCTOBER 26, 2012--- ANHAM, A United Arab Emirates-based logistics contractor billed Defense Department authorities for parts at prices marked up as high as 5,000 percent and 12,000 percent, according to a quarterly report released Saturday by the Special Inspector General for Iraq Reconstruction.
GovExec reports that a review of a $119 million reconstruction and logistics contract with Anham LLC questioned almost 40 percent of its costs, including:
  • $900 for a control switch valued at $7.05 (a 12,666 percent increase);
  • $80 for a small segment of drainpipe valued at $1.41 (a 5,574 percent increase);
  • $75 for a different piece of plumbing equipment also valued at $1.41 (a 5,219 percent increase);
  • $3,000 for a circuit breaker valued at $94.47 (a 3,076 percent increase);
  • $4,500 for another kind of circuit breaker valued at $183.30 (a 2,355 percent increase).
Because of what it called weak oversight, SIGIR formally questioned the contract’s costs and recommended reviews of billing practices in all of Anham’s U.S. government contracts in Iraq and Afghanistan, which total about $3.9 billion.
The review of Anham was among six audits SIGIR summarized. The examples of flawed oversight included government contracting officers’ representatives who “failed to compare vouchers with receiving documents and allowed Anham employees to sign for receipt of $10 million in goods.”
Anham said iIn a statement that “the Company takes enormous exception to the SIGIR implications. Its suggestions -– based on innuendo rather than hard facts -– are not the result of a meaningful ‘audit’. ANHAM is continually audited by the Defense Contract Audit Agency (DCAA) and welcomes such true audits. ANHAM is also very proud of the savings that it effectuated for the U.S. Government and U.S. Taxpayers on the Contract.”
Another audit faulted the Pentagon’s Commander’s Emergency Response Program for deferring too much to State Department agendas. “Many of the capacity development projects undertaken were not linked to specific military objectives,” the audit found, adding that State officials “played a significant role in planning and executing CERP projects, raising questions about whether the CERP has simply become another U.S. development program.”
SIGIR did credit the State Department with improving oversight of contracts for mentoring the Iraqi police program, addressing weaknesses the inspector general had been citing since 2005. In June 2011, Deputy Undersecretary for Management Patrick Kennedy told the Commission on Wartime Contracting that he had accelerated reconciliation of invoices overseen by the department’s International Narcotics and Law Enforcement Affairs Bureau.
The State Department effort, which resulted in recovery of funds or reductions in billing totaling some $188 million, is “a clear demonstration of the critical importance of contemporaneous invoice oversight in contract execution,” the SIGIR report said.
(Sources: GovExec, Anham)

October 14, 2012

AFGHAN GOV TO U.S.: FIRE ANHAM.THE LAND MAFIA

"ANHAM IS THE LAND MAFIA, STEALING OUR FARMING LAND. ILLEGALLY CONSTRUCTING FACILITIES. COMPLAINT FILED WITH US MILITARY AUTHORITIES WENT UNANSWERED." (AFGHAN GOVERNMENT OFFICIAL TO KABUL NEWSPAPER)

October 10, 2012---Kabul's major newspaper has published today, a major article including a copy of a public formal letter and plea to US Military Authorities to fire Anham USA, major food and supply defense logistics contractor, that supports Defense Logistics Agency. According to the newspaper, the head of the National Economy Committee Chair, implores the US Government to "STOP ANHAM" and suspend its operations as he accuses them of stealing lands. 

Publishing Date: October 10, 2012
Source: http://armanemili.com/detail.php?pid=1208

Excerpt of Letter published in Kabul Newspaper:

 




A copy of the Kabul newspaper which was published in Dari, is enclosed:
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