US

Military Admits: $360M in Taxpayer Money Lost to Taliban & Criminals in Afghanistan

$360 Million in U.S. Taxpayer Dollars Went to Taliban, Criminals

WASHINGTON (The Blaze/AP) — Has America been funding her enemies? That’s what the results of a new report seem to indicate.

After examining hundreds of combat support and reconstruction contracts in Afghanistan, the U.S military estimates $360 million in U.S. tax dollars has ended up in the hands of people the American-led coalition has spent nearly a decade battling: the Taliban, criminals and power brokers with ties to both.

The losses underscore the challenges the U.S. and its international partners face in overcoming corruption in Afghanistan. A central part of the Obama administration’s strategy has been to award U.S.-financed contracts to Afghan businesses to help improve quality of life and stoke the country’s economy.

But until a special task force assembled by Gen. David Petraeus began its investigation last year, the coalition had little visibility into the connections many Afghan companies and their vast network of subcontractors had with insurgents and criminals – groups military officials call “malign actors.”

In a murky process known as “reverse money laundering,” payments from the U.S. pass through companies hired by the military for transportation, construction, power projects, fuel and other services to businesses and individuals with ties to the insurgency or criminal networks, according to interviews and task force documents obtained by the AP.

$360 Million in U.S. Taxpayer Dollars Went to Taliban, Criminals“Funds begin as clean monies,” according to one document, then “either through direct payments or through the flow of funds in the subcontractor network, the monies become tainted.”

The conclusions by Task Force 2010 represent the most definitive assessment of how U.S. military spending and aid to Afghanistan has been diverted to the enemy or stolen. Only a small percentage of the $360 million has been garnered by the Taliban and insurgent groups, said a senior U.S. military official in Kabul. The bulk of the money was lost to profiteering, bribery and extortion by criminals and power brokers, said the official, who declined to provide a specific breakdown.

The official requested anonymity to discuss the task force’s ongoing investigation into the movement of U.S. contract money in Afghanistan. The documents obtained by The Associated Press were prepared earlier this year and provide an overview of the task force’s work.

Overall, the $360 million represents a fraction of the $31 billion in active U.S. contracts that the task force reviewed. But insurgents rely on crude weaponry and require little money to operate. And the illicit gains buttress what the International Crisis Group, a Brussels-based think tank, referred to in a June report as a “nexus between criminal enterprises, insurgent networks and corrupt political elites” in Afghanistan.

$360 Million in U.S. Taxpayer Dollars Went to Taliban, CriminalsMore than half the losses flowed through a large transportation contract called Host Nation Trucking, the official said. Eight companies served as prime contractors and hired a web of nearly three dozen subcontractors for vehicles and convoy security to ship huge amounts of food, water, fuel and ammunition to American troops stationed at bases across Afghanistan.

The Defense Department announced Monday that it had selected 20 separate contractors for a new transportation contract potentially worth $983.5 million to replace Host Nation Trucking. Officials said the new arrangement will reduce the reliance on subcontractors and diminish the risk of money being lost. Under the new National Afghan Trucking Services contract, the military will be able to choose from a deeper pool of companies competing against one another to offer the best price to move supplies. The new arrangement also gives the U.S. more flexibility in determining whether security is needed for supply convoys and who should provide it, according to a description of the contract.

The Pentagon did not provide the names of the 20 companies picked due to worries that larger contractors who weren’t selected might try and coerce them into a takeover, the senior defense official said. None of the eight prime contractors affiliated with the Host Nation Trucking contract are part of the new arrangement, the official added.

HEB International Logistics of Dubai, a Host Nation Trucking prime contractor, “made payments directly to malign actors,” one of the task force documents reads. In 2009 and 2010, an HEB subcontractor identified in the document only as “Rohullah” received $1.7 million in payments. A congressional report issued last year said Rohullah – whose name is spelled Ruhallah in that report – is a warlord who controlled the convoy security business along the highway between Kabul and Kandahar, the two largest cities in Afghanistan.

Half a dozen attempts to reach officials at HEB’s offices in Dubai by telephone were unsuccessful due to calls being transferred and lines going dead. It is also the holy month of Ramadan when many employees work shortened days and offices close early.

The congressional report said Rohullah’s hundreds of heavily armed guards operated a protection racket, charging contractors moving U.S. military supplies along the highway as much as $1,500 a vehicle. Failure to pay virtually guaranteed a convoy of being attacked by Rohullah’s forces, said the report, “Warlord Inc.” Rohullah’s guards regularly fought with the Taliban, but investigators believe Rohullah moved money to the Taliban when it was in his interest to do so.

Both Rohullah and the security company he was affiliated with, Watan Risk Management, denied ever making payments to the insurgents, according to the report. But in December, the U.S. placed Watan in “proposed debarment status,” which prevented it from signing new contracts or renewing existing contracts. Watan challenged the decision in federal court. Two weeks ago, Watan and U.S. officials signed an agreement that states the company may not bid on any mobile security contracts for the next three years. The ban does not affect other companies controlled by Watan’s owners.

The task force also said contractors engaged in profiteering by forming dummy companies. A task force document shows three tiers of subcontractors below Guzar Mirbacha Kot Transportation, an Afghan-owned trucking company known as GMT. Four of the subcontractors appear on the first and second tiers, collecting $14.2 million in payments.

Basir Mujahid, a GMT representative in Kabul, said top company officials were in Dubai and could not be reached for immediate comment.

Power brokers – a term widely used in Afghanistan – refer to Afghans who leverage their political and business connections to advance their own interests.

Another task force document details the case of a power broker who owned a private security company and was known to supply weapons to the Taliban. The power broker, who is not named in the document, received payments from a contractor doing business with the U.S. Over more than two years, the power broker funneled $8.5 million to the owners of an unlicensed money exchange service used by insurgents, according to the document.

$360 Million in U.S. Taxpayer Dollars Went to Taliban, Criminals

Rep. John Tierney

Rep. John Tierney, D-Mass., former chairman of the House oversight panel that investigated the wayward payments, said that the U.S. must stop the diversion of taxpayer dollars to the enemy. “When war becomes good business for the insurgents, it is all the more difficult to convince them to lay down their arms,” Tierney said.

U.S. authorities in Afghanistan are screening contractors more carefully to be sure they can handle the work and also are trustworthy, the senior military official said. Authorities also are being more aggressive in barring companies if they violate contract terms or are found to be involved in illicit activities. Since the task force was created last year, the number of debarred Afghan, U.S. and international companies and individuals associated with contracting in Afghanistan has more than doubled – from 31 to 78, the official said.

Petraeus, who recently relinquished command in Afghanistan to become CIA director, told his commanders in a September 2010 memo to keep close watch over contracting dollars and “know those with whom we are contracting.“ Failing to do so could ”unintentionally fuel corruption, finance insurgent organizations, strengthen criminal patronage networks, and undermine our efforts in Afghanistan,” he wrote.

Tierney, the top Democrat on the House Oversight and Government Reform national security subcommittee, said the new trucking contract announced Monday is a welcome step. But he said he is still worried the military still lacks sufficient visibility and accountability over payments. The subcommittee has scheduled a hearing next month to examine the contract and the risks of outsourcing security in a combat zone.

Comments (97)

  • TRILO
    Posted on August 17, 2011 at 9:47am

    The government is always wasting our money and stealing us blind. I’m sure someone will get promoted over this debacle, just like the ATF agents who were promoted. Once again the American taxpayer gets shafted and the criminal gets a windfall.

    Report Post » TRILO  
    • Dakota
      Posted on August 17, 2011 at 10:50am

      Duh…become active and get that freak out of the WH. Start now and mobilize people to go over your counties voting rolls…and eliminate all the dead people that are still registered. Get involved now…don’t just sit around and write comments.

      Report Post »  
    • Mark13
      Posted on August 17, 2011 at 11:56am

      Speaking of criminals getting windfalls,see if you can spot the pattern:
      Leading Union Political Campaign Contributors 1990-2010
      Democrats/Republicans
      American Fed. of State, County, & Municipal Employees
      $40,281,900/ $547,700
      Intel Brotherhood of Electrical Workers
      $29,705,600/ $679,000
      National Education Association
      $27,679,300/ $2,005,200
      Service Employees International Union
      $26,368,470/ $98,700
      Communication Workers of America
      $26,305,500/ $125,300
      Service Employees International Union
      $26,252,000/ $1,086,200
      Laborers Union
      $25,734,000/ $138,000
      American Federation of Teachers
      $25,682,800/ $200,000
      United Auto Workers
      $25,082,200/ $182,700
      Teamsters Union
      $24,926,400/ $1,822,000
      Carpenters and Joiners Union
      $24,094,100/ $658,000
      Machinists & Aerospace Workers Union
      $23,875,600/ $226,300
      United Food and Commercial Workers Union
      $23,182,000/ $334,200
      AFL-CIO
      $17,124,300/ $713,500
      Sheet Metal Workers Union
      $16,347,200/ $342,800
      Plumbers & Pipefitters Union
      $14,790,000/ $818,500
      Operating Engineers Union
      $13,840,000/ $2,309,500
      Airline Pilots Association
      $12,806,600/ $2,398,300
      International Association of Firefighters
      $12,421,700/ $2,685,400
      United Transportation Workers
      $11,807,000/ $1,459,300

      Report Post »  
    • ProbIemSoIver
      Posted on August 17, 2011 at 12:04pm

      The Military Industrial Complex lost 360 million more in tax-payer money ???? lol. What a joke !!!
      They steal Trillions of your tax dollars anyway under the guise of Spreading “freedom” and “democracy” around the world.
      This Military is nothing more than a global corporate machine operating 24/7 to make trillions of your tax money and eventually rule the world.
      I am not talking about the honorable men and women serving these evil puppet masters. And I one day believe our military will once again operate the way it was designed.
      TO PROVIDE FOR THE COMMON DEFENSE !!!! not OFFENSE !!!!!!

      ** RON PAUL – Pres. / HERMAN CAIN – V.P. 2012 **

      Report Post » ProbIemSoIver  
    • smithclar3nc3
      Posted on August 17, 2011 at 12:39pm

      Did Japan Rebuild Pearl Harbor? Did the British pay the rebuild America? No
      Why the he77 are we paying to rebuild our enemy’s house that we blew up in the first place.

      Report Post »  
    • michael48
      Posted on August 17, 2011 at 12:53pm

      in 66′ we called it Carpet BOOM, BOOM…bring the youngsters home and lay CARPET…or better yet, bring the youngsters home and DRAFT EVERY AZZ-WIPE in D.C. now there’s some YELLOW BERETS !!!!!!!

      Report Post »  
    • EqualJustice
      Posted on August 17, 2011 at 3:39pm

      Hey MARK. you better go bcak and check your figures there…

      Report Post » EqualJustice  
    • ProbIemSoIver
      Posted on August 17, 2011 at 6:49pm

      Disregard my statement GHOSTOFJEFFERSON. I slightly misunderstood the Obama comment. You are absolutely Brilliant. I know you were just making an observation about him. You Know what is going on !!! :)

      Report Post » ProbIemSoIver  
  • Jake Wilde
    Posted on August 17, 2011 at 9:45am

    No guys the government is efficient. You all remember that report a year ago that said they only have 5% waste. lol

    Sorry, it is just so ludicrous that people choose to act like this **** is ok. The dems are pushing harder than ever and demonizing the GOP by not wanting to raise taxes, yet we have this being covered up. We also have subsidies and so much waste that could be cleaned up. Who needs to give a wealthy university a subsidy for geigh men’s wee wee size in the greater Miami area? Doesn’t that ruin their surprise? lol

    It is maniacal all of the crap that these poppinjays on both sides pull, it’s just that the GOP is the lesser of the two evils…..

    Hey maybe we can let Hillary give more money to Pakistan also just so they can take it and laugh at our dumb a$$e$.

    Report Post »  
  • copatriots
    Posted on August 17, 2011 at 9:45am

    @ Ghost,

    I would argue that the terrorists of 9/11 started this. Bush mishandled a lot but he surely didn’t start it.

    Report Post »  
    • GhostOfJefferson
      Posted on August 17, 2011 at 11:52am

      There was no need, at all, to invade Iraq because of 9/11. That was on the agenda before 9/11, they simply used it as a convenient excuse. That was (at the time) the major money waster. We were duped.

      That said, Obama has quadrupled down on the spending and is driving us into oblivion.

      Report Post » GhostOfJefferson  
    • ProbIemSoIver
      Posted on August 17, 2011 at 12:38pm

      Don’t you get it? I know you are intelligent GHOSTofJEFFERSON !!!
      It does not matter who dominates the house, senate, or oval office !!!! The Military Industrial Complex / global elite finance the entire political career of DEMOCRATS and REPUBLICANS !!!! Obama was a hand-picked Socialist puppet to appease the Libs for a while. Bush Jr. was hand-picked but not a puppet because his daddy is at the top of the illuminati totem pole !!! He is one of the few that rule the Military / Industrial Complex !!!! He had more power as head of CIA than ANY president EVER had !!!!! he told Carter NO !!! he could not see AREA 51 info !!! Dwight D. Eisenhower warned us of this on his farewell address !!!!
      PEOPLE WAKE UP !!!!
      ELECT PEOPLE that can Finance their own Campaigns!!!!
      RON PAUL – President / HERMAN CAIN – V.P. **2012**

      Report Post » ProbIemSoIver  
    • ProbIemSoIver
      Posted on August 17, 2011 at 6:41pm

      GHOST of JEFFERSON My point was, even a Republican “conservative” would be quadrupled down on the spending, and driving us into oblivion.

      Report Post » ProbIemSoIver  
  • Centralsville
    Posted on August 17, 2011 at 9:37am

    You can’t set up a government based on fairness, freedom and justice, Christian principles, in a Muslim country. It is a waste of time, money and lives.

    Report Post »  
  • copatriots
    Posted on August 17, 2011 at 9:34am

    Money was lost…..PLEASE! More likely, the money was funneled. Just another day in Obama-corruption-land.

    Report Post »  
    • 101
      Posted on August 17, 2011 at 10:34am

      The US government has to keep the war going some how, what better than buying more guns & ammo for the Taliban…they were getting low on supplies

      Report Post »  
  • AJAYW
    Posted on August 17, 2011 at 9:24am

    Our goverment just cannot manage money- anything it is involved in cost 10 to 40 fold of what the actual cost should be. I blame the crooked contractors as well for ripping off the tax payers

    Report Post »  
    • MONICNE
      Posted on August 17, 2011 at 9:32am

      Well said. The policy of buying loyalty is tricky, expensive, and can backfire.

      TEA

      Report Post » MONICNE  
    • 13th Imam
      Posted on August 17, 2011 at 9:41am

      A fish stinks from the HEAD down.

      Report Post » 13th Imam  
  • SpankDaMonkey
    Posted on August 17, 2011 at 9:20am

    .
    Well if it works like the Food Stamp Program, they created jobs and made a $1.83 for every U.S. Tax dollar recived & spent so that comes to $ 658,000,000.00. WOW what a return…..

    Report Post » SpankDaMonkey  
  • TomFerrari
    Posted on August 17, 2011 at 9:20am

    Why are contractors and subcontractors “TRUCKING”?
    Does our military not have enough trucks?
    Who owns these subcontractors?
    .
    .
    .
    Has anybody seen my wallet?
    It was here a minute ago.
    It was black, and it had $4,000,000,000.00 in it.
    .
    .
    .

    Report Post » TomFerrari  
  • hempstead1944
    Posted on August 17, 2011 at 9:19am

    Helluva lot more than 360M

    Report Post »  
  • Darla_K
    Posted on August 17, 2011 at 9:18am

    Our country has gotten so out of control. We are broke and borrowed to the hilt, yet we are giving money to other countries that hate us. How can this be happening? I am thinking alot of these people that keep track of our money is stuck on stupid. We need to take our country back and get our house in order and the people need to stand strong.

    Report Post » Darla_K  
  • TRONINTHEMORNING
    Posted on August 17, 2011 at 9:17am

    We will be better served with a strict Constitution-following conservative that actually cares about the country. This idiotic, self-loving, marxist, poser prez called Obama has exposed all of his inabilities in all areas of govt. and really should be impeached. Since that isn’t gonna happen; 2012 should take of this problem.

    Report Post »  
  • Mateytwo Barreett
    Posted on August 17, 2011 at 9:13am

    But, your dollar gets you so much in return in hese developing markets. Ponder this! The repubs got a tax cut of 61 Billion a while back. Actually it ended up beig $3ooM or so. Now they’re saying they lost $300 M over there. Who’s counting. . . Oh, Look it’s the same guy!!
    SHEESH!

    Report Post » Mateytwo Barreett  
  • Johnnyp1958
    Posted on August 17, 2011 at 9:13am

    Criminals, do you mean to say that congress is going all the way to Afghanistan to steal our tax dollars

    Report Post »  
    • Mateytwo Barreett
      Posted on August 17, 2011 at 9:15am

      Why do you think they all make their “Assessment ” trips? Thjey like the feel of sand and dust in the warm afternoon sun?

      Report Post » Mateytwo Barreett  
  • 13th Imam
    Posted on August 17, 2011 at 9:11am

    I admit that Trillions of Actual Taxpayers money has been stolen by Barry and his band of thieves in DC. History will show that Harry, Nancy Barry and the rest of this DEMOCRAT criminal conspiracy have stolen Actual American Taxpayers hard earned wages. Barry has declared WAR on America. Anything Goes.

    Report Post » 13th Imam  
  • Gonzo
    Posted on August 17, 2011 at 9:10am

    We throw cash around like we can print as much as we want… oh wait, Bernanke is head of the Fed. I guess we can.

    Report Post » Gonzo  
  • Al J Zira
    Posted on August 17, 2011 at 8:58am

    “Lost”! It’s not lost, it’s a payoff or aid from this administration.

    Now tell me that I feel this way because the president is black, Nancy.

    Report Post » Al J Zira  
  • Christian Kalgaard
    Posted on August 17, 2011 at 8:57am

    like this was not on purpose – would you people rather believe that your government is doing this on purpose, or that they are simply this INCOMPETENT?
    Because I tend to think they’re not that incompetent….unpurposefully….

    Report Post » Christian Kalgaard  
  • CIAtroll
    Posted on August 17, 2011 at 8:52am

    The Central Intelligence Agency was intimately involved with the federal government’s infamous “Operation Fast and Furious” scheme to send American weapons to Mexican drug cartels while simultaneously working with other agencies allowing narcotics to be shipped over the border, according to a series of explosive reports.

    Citing an unnamed CIA source, a Washington Times article theorizes that U.S. officials were actively aiding organizations such as the Sinaloa cartel with guns and immunity in an effort to stymie Los Zetas. That’s because, according to the piece, the powerful and brutal criminal Zetas syndicate has the potential to overthrow the government of Mexico — and might be planning to do so.

    Apparently the secretive U.S. intelligence agency also played a key role in creating and using the American government’s gun-running program to arm certain criminal organizations. The scheme, which has already been implicated in countless deaths including the murders of several U.S. and Mexican law enforcement officers, saw thousands of high-powered American guns delivered to multiple cartels.

    “The CIA’s motive is clear enough: The U.S. government is afraid the Los Zetas drug cartel will mount a successful coup d’etat against the government of [Mexican President] Felipe Calderón,” wrote Robert Farago and Ralph Dixon in the Times’ report, entitled “Was CIA behind Operation Fast and Furious?”
    http://www.infowars.com/reports-cia-working-with-mexica

    Report Post » CIAtroll  
  • Snowleopard {gallery of cat folks}
    Posted on August 17, 2011 at 8:51am

    Money has gone missing and possibly gone over to the control of the enemy? No suprise there, much in the way of foreign aid and assistance does that anyhow. I just wonder now with Obama how much else has been going to the Taliban and the terrorists aside from money — military gear and the intel on our own forces?

    Report Post » Snowleopard {gallery of cat folks}  
    • GhostOfJefferson
      Posted on August 17, 2011 at 9:05am

      And people wonder why I’m against the income tax.

      My money seems to ONLY find its ways into the hands of criminals and terrorists. Why would I ever support a system that steals from me and gives to evil?

      Report Post » GhostOfJefferson  
  • atechgeek
    Posted on August 17, 2011 at 8:50am

    Ron Paul !!!

    Report Post »  
    • theprofessor1031
      Posted on August 17, 2011 at 8:59am

      Only if you have a suicide wish.

      Report Post » theprofessor1031  
    • RepubliCorp
      Posted on August 17, 2011 at 9:33am

      Did you know PR is the only man in America with a copy of the Constitution and the only man that understands it. Everyone else is a trader to the NWO. And if you don’t fall in line with RP you are a neoconservative sheeple……… Just ask a Paulbot

      Report Post » RepubliCorp  
    • GhostOfJefferson
      Posted on August 17, 2011 at 9:42am

      Ah yes, “Paulbot”. I recall hearing that last election, when the GOP offered up the man guaranteed to lose an election against even Hitler, John McCain.

      If you want people to vote for your candidates, try offering up somebody worth voting for. Voting “against” somebody is a wasted vote and has landed us into extreme hot water nationally.

      Report Post » GhostOfJefferson  
  • theprofessor1031
    Posted on August 17, 2011 at 8:50am

    Stop sending money overseas! Period! That would solve the problem rather quickly.

    Report Post » theprofessor1031  
  • CIAtroll
    Posted on August 17, 2011 at 8:49am

    what about the opium trade ?

    Report Post » CIAtroll  
    • ProbIemSoIver
      Posted on August 17, 2011 at 6:55pm

      What about that, Bush Sr ? You want to Own that too? I am sure you do !!!! You are at the Head Round Table at the illluminati. You and Friends Almost Own everything. I am sure you will be the Opium Daddy before ya know it. You POS !!!!!

      Report Post » ProbIemSoIver  
  • BOMUSTGO
    Posted on August 17, 2011 at 8:49am

    Karl Marx – “Democracy is a form of government that cannot long survive,
    for as soon as the people learn that they have a voice
    in the fiscal policies of the government, they will move to vote
    for themselves all the money in the treasury, and bankrupt the nation.”

    Report Post » BOMUSTGO  
    • 13th Imam
      Posted on August 17, 2011 at 9:17am

      “THE PEOPLE” are the 47% of freeloaders, ( All are Barry supporters ) that steal from the labor of the 53% who do pay Taxes.

      Report Post » 13th Imam  
    • Anonymous T. Irrelevant
      Posted on August 17, 2011 at 11:25am

      It’s a good thing we are a Republic, then.

      Report Post » Anonymous T. Irrelevant  
  • JLGunner
    Posted on August 17, 2011 at 8:48am

    barack is not fit to lead our beloved troops anytime, anywhere. He’s not fit to call boots into battle.Lets bring them home.

    Report Post » JLGunner  
  • burr99
    Posted on August 17, 2011 at 8:47am

    “A central part of the Obama administration’s strategy has been to award U.S.-financed contracts to Afghan businesses to help improve quality of life and stoke the country’s economy.” Just another example of how Obama and his lot put the rest of the world ahead of (and as usual, to the detriment of) the United States. Obama has to go!

    Report Post »  
    • MONICNE
      Posted on August 17, 2011 at 8:54am

      Don’t get me started on the almost wanton mismanagement of funds in Iraq and afghanistan for the past 8 years!

      Are you actually insinuating that the President has invented this quagmire? WTF?

      TEA

      Report Post » MONICNE  
    • GhostOfJefferson
      Posted on August 17, 2011 at 9:22am

      @Monic

      Quite true that Dubya started this.

      Keep in mind that Obama could, at a moment’s notice, have all the troops withdrawn. He could have closed Gitmo. He could have taken our boots our of Iraq. He hasn’t. He even started another unConstitutional “kinetic action” or whatever crap he’s calling it. He has blood on his hands as much as Bush, plus he’s run up more debt than Dubya and everyone before him has combined, in one term.

      Report Post » GhostOfJefferson  
    • MONICNE
      Posted on August 17, 2011 at 9:40am

      What he did was, after taking office; he bravely placed the Bush pentagon war-fighting supplemental costs “on budget” which increased the debt magically $1.3 Trillion in ONE DAY.

      You are correct, America could withdraw suddenly, but we are going to phase out gracefully instead.

      Obummer is exactly as bloody as anyone who had to fix a war, just like Truman or Nixon. He is also a peace keeper as bloody as Clinton or Eisenhower. But there was a precedent for the Bush doctrine and hopefully never will be a Perry doctorine.

      Report Post » MONICNE  
    • copatriots
      Posted on August 17, 2011 at 9:43am

      What a shock! Enci/Moni, could you try to use the brain that evolved from a blob to come up with something a tad more original than “it‘s Bush’s fault”? I truly believe you just can’t be that ignorant every single day. My goodness, you are well-paid for your pathetic level of troll contribution. Your poor handlers……they must be so disappointed in you.

      Report Post »  

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