Contractor in Iraq disputes inspector general’s allegations of overbilling

The United Arab Emirates-based Anham LLC has issued a statement denying charges made Saturday by the Special Inspector General for Iraq Reconstruction that the contractor had marked up the cost of parts by as much as 12,000 percent.

"These conclusions are false," the company said through a publicity agent. "In fact, the company saved the U.S. government and the U.S. taxpayers nearly $153 million dollars through its performance of the contract."

SIGIR, in its quarterly report, summarized an audit that found that, due to weak oversight, the Defense Department was billed $900 for a control switch valued at $7.05 (a 12,666 percent increase) and $80 for a small segment of drainpipe valued at $1.41 (a 5,574 percent increase), among other items.

In rebuttal, the company said: "Every purchase by every subcontractor was the result of a competitive bidding process where the lowest price subcontractor was selected, and not a single screw or nail was purchased without prior, advance approval by the U.S. government after their review of the competitive bidding process amongst potential subcontractors. Full disclosure of the nature of every potential subcontractor was fully disclosed to the U.S. government."

Anham added that it "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 and welcomes such true audits."

Stuart W. Bowen Jr., the IG for Iraq reconstruction, told Government Executive that SIGIR stands by the report. He said neither DCAA nor the Defense Contract Management Agency has performed audits on costs incurred by Anham. "DCAA is years behind in audits," he said. "But for our audit, these excessive billings would not have been uncovered, possibly for years." He added that DCAA and DCMA concurred with his conclusions and have agreed to review the company's contract, which goes back to 2007.

"The one true point Anham makes," Bowen said, "is that the government didn't complain about the charges. There was a breakdown in the process of cost review, which wasn't as strong as it should have been, but that doesn't render the billings valid."

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
FROM OUR SPONSORS
JOIN THE DISCUSSION
Close [ x ] More from GovExec
 
 

Thank you for subscribing to newsletters from GovExec.com.
We think these reports might interest you:

  • Forecasting Cloud's Future

    Conversations with Federal, State, and Local Technology Leaders on Cloud-Driven Digital Transformation

    Download
  • The Big Data Campaign Trail

    With everyone so focused on security following recent breaches at federal, state and local government and education institutions, there has been little emphasis on the need for better operations. This report breaks down some of the biggest operational challenges in IT management and provides insight into how agencies and leaders can successfully solve some of the biggest lingering government IT issues.

    Download
  • Communicating Innovation in Federal Government

    Federal Government spending on ‘obsolete technology’ continues to increase. Supporting the twin pillars of improved digital service delivery for citizens on the one hand, and the increasingly optimized and flexible working practices for federal employees on the other, are neither easy nor inexpensive tasks. This whitepaper explores how federal agencies can leverage the value of existing agency technology assets while offering IT leaders the ability to implement the kind of employee productivity, citizen service improvements and security demanded by federal oversight.

    Download
  • IT Transformation Trends: Flash Storage as a Strategic IT Asset

    MIT Technology Review: Flash Storage As a Strategic IT Asset For the first time in decades, IT leaders now consider all-flash storage as a strategic IT asset. IT has become a new operating model that enables self-service with high performance, density and resiliency. It also offers the self-service agility of the public cloud combined with the security, performance, and cost-effectiveness of a private cloud. Download this MIT Technology Review paper to learn more about how all-flash storage is transforming the data center.

    Download
  • Ongoing Efforts in Veterans Health Care Modernization

    This report discusses the current state of veterans health care

    Download

When you download a report, your information may be shared with the underwriters of that document.