Soldiers of Misfortune 

Critical elements of the war in Iraq have been outsourced to private contractors. John Mancini's story shows the many perils of that approach.

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In 2001, Halliburton received a no-bid, multibillion-dollar contract to provide logistical support for any and all military operations in the Persian Gulf region. No other company was considered; the contract just landed in the company's lap. This set the tone for what would become a remarkably casual use of government money, as Halliburton employees allegedly ignored the basic principles Mancini had spent his professional life upholding.

Halliburton subsidiary Kellogg, Brown and Root (KBR) hired Mancini fourteen months later to keep an eye on cost overruns in its Middle East operations. War was approaching, and KBR executives knew they would have to provide everything from mess halls to water purification plants for the occupation. Mancini landed in Kuwait and was driven to "Camp Khalifa," a former tourist resort that had been converted into KBR's base of operations. The heat hovered above one hundred degrees, but Mancini and his colleagues had no time to splash around in the resort's swimming pools. They were busting their humps fourteen hours a day, doling out hundreds of millions of dollars in public funds through buy orders for everything from cell phones and fire trucks to exercise equipment.

Mancini found an operation in complete disarray. Kellogg, Brown and Root had no computers with which to record its transactions. Everything was written on scraps of paper, and employees skimming off the top or taking bribes from subcontractors could simply tear up and rewrite the records. According to Mancini, KBR managers told employees not to worry about the price of whatever they were buying, that it was "cost-plus," and that the company would be reimbursed by the government, with a profit slapped on top. One employee, Mancini said, logged a multimillion-dollar contract as a $200 purchase in company records. Company officials told Mancini to keep individual purchases under $2,500 as often as he could, to avoid the headache of soliciting bids.

Slowly, Mancini grew friendly with Henry Bunting, a "field buyer" who shared his misgivings about how business was being conducted. "One of the things that KBR said was the fastest way to get sent home from Kuwait was talk to the press, talk to the congressmen, or get drunk or use drugs," Bunting said. "We used to joke that if they kept harassing us, we'd talk to our congressman."

Mancini's worst discovery involved the purchase of cell-phone contracts. KBR official Jeff Mazon was using a Kuwaiti middleman to secure cell-phone services for KBR, and charging a 10 percent markup. With just a few phone calls, Mancini learned that neither the middleman nor the markup was necessary. After he pointed this out to his supervisor, KBR officials took the project from him and transferred it to a different department. Mancini began to suspect that Mazon was on the take.

That, Mancini said, was the beginning of a campaign of harassment and intimidation by KBR officials. His Bosnian supervisors informed him that they were transferring him to a new office inside Iraq, where mortar fire and attacks were frequent. Mancini refused to go. "They restricted me to quarters; 'You're not doing this, you're not doing that,'" he said. "I says, 'Fuck you. You're not even an American.'" Eventually, Mancini's bosses gave him an ultimatum. "They say, 'You have to go, you're leaving tomorrow,'" he said. "And I said, 'Fuck you, I ain't leaving.' They got pretty nasty. But I had contacted the embassy. I wanted to make sure nothing happened to me. The thing is, it's a big desert out there. People do disappear."

In midsummer 2003, Mancini quit and got on a plane home to Phoenix. He kept in touch with Bunting via e-mail, and the two men got angry. "I just got fed up with the poor business practices," Bunting said. "They weren't good stewards of the government's money. ... I think they were in cahoots with many of these vendors that they had on this preferred-vendor list. I can't prove it, but it's mighty suspicious when you're not looking for the lowest price." Bunting quit in August, but as the months went by, he realized that someone had to hear about Kellogg, Brown and Root's business practices. In January 2004, he decided to talk.

Bunting spilled his guts in e-mail to Congressman Henry Waxman, the ranking Democrat on the House Committee on Government Reform, the body charged with ensuring that government contracts are free of corruption and fraud. When Waxman's staff contacted Bunting, he provided a host of supporting documents and told them to talk to John Mancini. The two men became the first Halliburton employees to expose what would become a historic scandal.

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