Posted on 02/13/2004 10:27:54 PM PST by kcvl
Feb. 14, 2004, 12:06AM
Halliburton questioning focuses on towels' cost By DAVID IVANOVICH Copyright 2004 Houston Chronicle WASHINGTON -- Lawmakers wanted to hear about the towels.
When would-be Halliburton Co. whistle-blower Henry Bunting of Houston came to Capitol Hill on Friday, Democratic senators peppered him with questions about the suddenly famous embroidered towels purchased for an exercise facility for U.S. troops in Baghdad.
Bunting, a former Halliburton field buyer once stationed in Kuwait, told lawmakers a manager for Halliburton subsidiary KBR insisted on buying 2,500 towels costing $4.50 to $5.50 apiece, rather than ordinary towels for $1.60 each.
The gold or white embroidered towels were emblazoned with the logo MWR Baghdad, military shorthand for the "morale, welfare and recreation" facility, and also sported the KBR logo.
Halliburton spokeswoman Cathy Gist said the company had requested the towels but said they cost $3 each and were embroidered in an attempt to prevent pilferage.
"When towels are clearly marked and easily recognizable, they are more frequently returned to the correct facility -- either by patrons or laundry staff -- thereby reducing the need to constantly reorder to replenish the supply," Gist said.
"Apparently, however, this anti-theft device is not completely foolproof, as Mr. Bunting proved that he was in possession of one of these towels without proper authorization," Gist said.
Her comments were part of a detailed response to Bunting's accusations.
Sen. Richard Durbin, D-Ill., doing a quick calculation, figured the extra cost for the embroidered towels would have paid for 12 suits of body armor, which some soldiers didn't have when they were sent to Iraq.
Bunting was appearing at a "hearing" convened by the Democratic Policy Committee, a panel of Democratic senators. No Republican lawmakers were present, and Pentagon officials refused to appear.
The Democrats said they resorted to this approach because Republicans, who are in control of both the House and Senate, have refused to hold hearings on the Halliburton controversy.
The issue is politically charged. Vice President Dick Cheney served as Halliburton's chief executive officer for five years before joining the Bush presidential ticket.
KBR builds bases, cooks food, washes clothes, delivers mail and provides other basic services for U.S. troops under a 10-year contract with the Pentagon valued at more than $3.6 billion.
Bunting, along with an unnamed former Halliburton procurement supervisor who did not appear at Friday's session, accused the company of routinely overcharging for work in Iraq and Kuwait.
Bunting, who said he worked for Halliburton for 15 weeks -- the company says 10 -- told the panel KBR paid $7,500 a month to lease a sport utility vehicle, perhaps a Ford Expedition.
Halliburton officials searched through 100 vehicle procurement files but could find no price anywhere near that amount.
"The only thing we can suppose is that Mr. Bunting must have been confused," Gist said.
The former employees have accused KBR of systematically avoiding competitive bidding among its vendors -- and thereby pushing up the value of the company's own contract -- with a practice called "string bidding."
Company managers, they say, ordered employees to break up purchase orders into pieces of less than $2,500, the threshold at which a contractor must seek bids from more than one vendor. One vendor could receive several contracts under the threshold without sparking greater scrutiny.
Halliburton's Gist said a company official can dispense with seeking competitive bids "if and only if the buyer is able to determine that the price is reasonable" and then documents this information in the file.
While Pentagon auditors are now taking another look at some of Halliburton's books, Bunting said he never personally saw an auditor while he was stationed in Kuwait. And workers were told if they spoke to an auditor -- or the press -- they would be shipped home, Bunting said.
The former employees have also criticized KBR for using an unnecessarily expensive telephone service.
Gist said there were time pressures that pushed up the price. Halliburton had to buy more than 2,000 mobile phones quickly and used a company with a proven track record. "To switch the phone service to another vendor after the fact would have meant changing every single phone number, and possiblly all the phone equipment, which would have completely disrupted the implementation of the mission."
Bunting came to lawmakers' attention when he contacted Rep. Henry Waxman, D-Calif., who perhaps more than any other lawmaker has challenged Halliburton's military contracts.
Friday's testimony, Waxman said, "highlighted repeated repeated and routine overcharging by Halliburton in its Iraq contracts. If what the company insiders say is true, overcharging and improper business practices are part of the corporate culture at Halliburton."
Bunting, who has worked at Hewlett-Packard, Tyco and the Metropolitan Transit Authority, said he currently works for Volt Technical Services in Houston, a technical staffing company.
But he doesn't expect he'll be working in Houston much longer.
"Hallilburton is a very powerful force in Houston," Bunting said. "Who wants to hire a purchasing agent who blew the whistle?"
But Norma Kraus, a spokeswoman for Volt, said: "We don't know anything about his relationship with Halliburton, and we don't fire whistle-blowers."
I just saw this guy on Fox. The guy had to quit, he says, because he just couldn't take the bad business practices. The towel thing just sent him over the edge I guess, he wasn't even able to call the Halliburton hotline number to report these problems, he just had to quit. Is this really the best the Dems can can find, some dull clerk whose world is rocked to the point of breakdown because of towels?
Maybe the Honorable Mr. Durbin would sacrifice one staffer and use that payroll for body armor?
''Apparently, however, this anti-theft device is not completely foolproof, as Mr. Bunting proved that he was in possession of one of these towels without proper authorization,'' Gist said.
LOL
Actually, that doesn't prove that the embroidery doesn't help things. All it means is that Mr. Bunting hadn't managed to discretely sneak the towel back to the facility.
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