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Breach of Contract

A front-page story in this morning's Washington Post reveals that federal no-bid contracts are not the exception to the rule: to a growing extent, they are the rule. Such contracts are awarded without "full and open" competition and often go to a small group of well-connected companies. Those companies appear to be cleaning up: a recent congressional report found that spending on no-bid contracts has tripled to $207 billion since 2000. Proponents say that foregoing competition by-passes delays, permitting important work to be completed more quickly. Now, one could argue there are situations in which no-bid contracts are appropriate. Say, in New Orleans after Katrina, where there was a desperate need for immediate action.... or in the reconstruction of Iraq. But the potential for (and, sadly, the reality of) abuse is ever present.

For that, reference the Post's Business section. In what is said to be the largest bribery case to come out of the Iraq reconstruction, investigators say that Army Major John L. Cockerham, his wife Melissa, and his sister Carolyn Blake took $9.6 million in bribes from contractors and expected to receive another $5.4 million before they were arrested. Cockerham was a contracting officer deployed to Camp Arifjan near Kuwait City. His position allowed him to approve contracts for up to $10 million. He quickly leveraged his authority to suit his own needs. From the Post:

The Cockerhams and Blake were arrested in late July after investigators searched the Cockerhams' house at Fort Sam Houston in San Antonio and allegedly found evidence linking them to the bribery scheme. Aspects of the case read like a spy novel: a briefcase with $300,000 in cash in a Kuwaiti parking lot; handwritten ledgers that identify money sources with code names like Destiny Carter; and instructions telling co-conspirators to, in a pinch, toss safe-deposit keys out a window, stash key documents in the bosom and, lastly, destroy the instructions.

But, if you believe Cockerham's lawyers, the Major and his co-conspirators were motivated by a desire to please God.

Defense attorneys, however, say the Cockerhams and Blake are hardworking, church-going people. The Cockerhams have confessed to taking money in exchange for the awarding of contracts, according to an affidavit from an Army criminal investigator, but put the amount at a little more than $1 million. Blake told investigators the money was to be used to set up a church, according to the affidavit...

By all accounts, the Cockerhams had not recently gone on any visible spending sprees. As of July 31, the most recent hearing in the case, the couple owed $13,000 in car payments and were driving a 2004 Toyota minivan and 1993 Isuzu pickup. John Cockerham reported an additional $54,000 in debt, in part from credit cards and student loans...

According to the investigator's affidavit, Blake acknowledged that she kept a ledger [of bribes she accepted], but she says it was for a different purpose. She said she wanted to start a church in Africa. On a trip to South Africa, she visited a school for poor girls funded by television star Oprah Winfrey. Blake says she was inspired to do something similar, according to Wilson, her attorney. "She thought this was a calling from God," Wilson said.

Posted by Bruce Falconer on 08/22/07 at 5:36 AM | Comments (3) | Email | Print

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