The Ad Hoc Subcommittee on Contracting Oversight in the U.S. Senate Committee on Homeland Security and Governmental Affairs held a hearing on Allegations of Waste, Fraud, and Abuse in Security Contracts at the U.S. Embassy in Kabul on June 10.
The purpose of the hearing was to examine concerns relating to the State Department’s contract to acquire security services at the U.S. Embassy in Kabul. The Subcommittee has learned of allegations that the security of the Embassy may have been jeopardized over the last two years because of the contractor’s failure to comply with U.S. laws and contract terms. The hearing will examine these allegations and explore potential abuses in the management and oversight of the contract.
Called to testify were Mr. William H. Moser, the Deputy Assistant Secretary for Logistics Management at the Department of State and Samuel Brinkley, the Vice President for Homeland and International Security Services of Wakenhut Services, Inc.
Mr. Mosher states that prior to the award of ArmorGroup, North America, the Department had terminated a contract with MVM due to the contractor’s failure to meet contract requirements.
“In March 2007, a new guard contract was awarded to Armor Group, North America. As required by law, this contract was awarded based on the lowest price, technically acceptable offer. The award was for one base year and four option years. The Department is currently in the first option year.” […] “…the Bureau of Diplomatic Security has conducted 14 program management reviews since contract award. Through this constant oversight, the Department identified several issues and deficiencies and worked to correct them with Armor Group, North America. However, at no time was the security of American personnel at the U.S. Embassy compromised.” […] “Effective contract administration in a war zone is challenging. However in this case, we feel we found the right balance of enforcing contract compliance without losing sight of protecting our people and facilities in Kabul.”
Mr. Brinkley, in his testimony says that in its April 30, 2008 notice, the State Department identified sixteen specific deficiencies and weaknesses under their Contract. “We confirmed that the situation with regard to each of these was not good. The sixteen Contract deficiencies and weaknesses were as follows:
1. Failure to provide an armorer
2. Failure to provide relief guards
3. Failure to submit Moderate Risk Public Trust (MRPT) packages for new hires
4. Failure to obtain clearances for watch keepers/standers
5. Failure to provide required amounts of ammunition
6. Failure to provide deliverables on time and continued late submission of deliverables
7. Deficient employee DS/IP/OPO forms
8. Deficient staffing of open posts
9. Overuse of dog handlers
10. Provision of weapons for re-qualification and training
11. Deficient gym equipment
12. Deficient generators at Camp Sullivan
13. Leaky roofs at Camp Sullivan
14. Deficient invoicing
15. Failure to provide relief guards for posts stood up on Nov. 1, 2007
16. Failure of all guards to meet required language level
[…] In no way do we minimize the significance of AGNA’s non-compliance with the Contract. AGNA’s compliance with and administration of the Contract was inadequate. Corrective measures were necessary – and important. At the same time, it is important to recognize that AGNA’s non-compliance with Contract requirements did not result, to WSI’s knowledge, in impairment of guard force operations. Guards were equipped and on-post getting the job done. To our knowledge, at no time was the Embassy not secure.
Then Mr. Brinkley dropped a bombshell -- WSI and its parent are incurring losses of approximately $1 Million per month to ensure security of the Kabul embassy:
"We feel we can safely say that adequate guard services for the Kabul Embassy cannot be provided for the Contract price. AGNA proved that it could not provide adequate services for the price. In our year on the Contract, I have become convinced that we cannot provide the services required by the Contract for the Contract price. […] WSI’s costs of providing the services required under the Contract are exceeding the Contract price by approximately $1 million per month – $12 million per year with no profit."
I’m glad they are still in Kabul even as it’s burning a rather deep and expensive hole on their balance sheet. A million dollars a month! Holy mooo! I'm glad he did not say "that's it ... we're quiting..."
- Mr. William H. Moser’s Testimony [View PDF] Deputy Assistant Secretary for Logistics Management, Department of State
- Samuel Brinkley’s testimony [View PDF] Vice President, Homeland and International Security Services, Wakenhut Services, Inc.