National Security

The Pentagon's Marauding Fraudsters

By Mark Thompson | @MarkThompson_DC | February 3, 2011 | +

Fraud is big business at the Pentagon. Always has been, always will be. When you’re spending more than $1 million a minute, some is bound to be pilfered one way or another. But it’s rare to find all such chicanery cataloged in one place. Thanks to Sen. Bernie Sanders, I-Vermont, we now have one-stop shopping for Pentagon fraud.

He asked the Defense Department to pull together data on how military contractors have hoodwinked taxpayers in recent years. The report says the Pentagon spent $270 billion from 2007 to 2009 on 91 contractors involved in civil fraud cases that resulted in judgments of more than $1 million. Another $682 million went to 30 contractors convicted of criminal fraud in the same three-year period. Billions more went to firms that had been suspended or debarred by the Pentagon for misusing taxpayer dollars.

“With the country running a $14 trillion national debt, my goal is to provide as much transparency as possible about what is happening with taxpayer money,” Sanders says. “The sad truth is that virtually all of the major defense contractors in this country for years have been engaged in systemic fraudulent behavior, while receiving hundreds of billions of dollars of taxpayer money.”

Pentagon contracting has been broken for decades. Former defense secretary Donald Rumsfeld said — on September 10, 2001 — that “according to some estimates, we cannot track $2.3 trillion in transactions.” The next day was 9/11, and counting Pentagon dollars was no longer a top priority.

As someone who has risked his eyesight poring through defense contracts over the years, it’s fair to note the system is cumbersome, complicated and opaque, at least to us common taxpayers. To the contract analysts, accountants and lawyers — especially those who used to work for the government and who now work for these contractors — not so much. They’ve got to pay for all those newspaper and radio ads urging the government to spend more on the military somehow.

As you sit down in the weeks ahead to file your federal tax return, toss out your TurboTax computerized tax program, don’t sleep for two days, and down a half-bottle of Jack Daniel’s before picking up your pencil to fill out your 1040. That’ll give you a rough idea of how the Pentagon keeps track of its — our — money.

Related Topics: bernie sanders, pentagon fraud, National Security

  • Latest on Battleland

    Army photo / Sgt. Michael J. MacLeod
    Afghanistan May 16, 2012

    Humpin’ It…And Jammin’ It…

    Reuters
    Pacific May 16, 2012

    China’s ‘Security Dilemma’ Risks Arms Race in Asia

    TOKYO – A shooting war with China may not be inevitable, but a dangerous arms escalation seems a dead certainty. That’s the take from a rare public discussion here this week among naval experts from Japan, the U.S. and China.

    Chris Hondros / Getty Images
    Military Mental Health May 16, 2012

    Mental Ills Top Reason U.S. Troops Now Hospitalized

    Four of the top five non-combat medical conditions sending troops to the hospital in 2011 were mental ailments, the Pentagon reports:

  • newfreedomblog

    This is the problem overall, how can we account for all the spending, contracts, etc when you are spending over 2.3 trillion + dollars? This is why we must bring down the size of government overall. The Federal Government has simply grown into a non-manageable monster. No group of humans are capable of monitoring and auditing this much money.
    .
    What is the process of checks and balances used? I know this report is detailed, but how did they manage to “account” for all of the fraud and abuse? Was it random? Was a certain amount slated for an audit? Or, do they go by past discrepancies, and hone in on those expenses to audit?

  • michaelfury

    “Former defense secretary Donald Rumsfeld said — on September 10, 2001 — that “according to some estimates, we cannot track $2.3 trillion in transactions.” The next day was 9/11, and counting Pentagon dollars was no longer a top priority.”

    Bravo, Mr. Thompson. Didn’t think you had it in you.

    http://michaelfury.wordpress.com/2008/09/13/what-truth-to-power-looks-like/

  • freeinpa

    “”With the country running a $14 trillion national debt, my goal is to provide as much transparency as possible about what is happening with taxpayer money,”
    .
    The immediate question is, Bernie where have you been from $1-13 trillion in debt? Since the defense budget is dwarfed by entitlements, why doesn’t he start there?
    .
    He has sat on the United States Senate Committee on Budget and the United States Senate Committee on Health, Education, Labor, and Pension for years. Suddenly he has found deficit religion

  • http://phd9.blogspot.com Paul Dirks

    Everyone who claims that private enterprise is more efficient than government has a point but they fail to identify the cause.
    .
    In ANY human activity, you only have to follow the lines of accountability to predict future behavior based on amoral self-interest. Does ripping off the Pentagon pay? check. Does selling polluting fuels pay? check The disadvantage the government has is that it is not directly motivated by profit and loss. The advantage of the government has is that it is not directly motivated by profit and loss.
    .
    It is therefore in a position to restrict behavior that is profitable yet harmful. No wonder the Chamber of Commerce spend millions of dollars trying to discredit the Government’s legitimate role……

  • freeinpa

    “The disadvantage the government has is that it is not directly motivated by profit and loss.”
    .
    No the disadvantage is the government has no accountability when it spends other people’s money and can spend spend spend regardless of the budget since it has the ability to tax to continue the same silliness.
    .

  • http://phd9.blogspot.com Paul Dirks

    Elections ARE accountability. I believe “no taxation without representation” actually meant what it said at some point in time. Again, just because the lines of accountabilty are different doesn’t mean they don’t exist. In fact the difference is essential for our democracy to continue function.

  • pintortwo

    This is what happens when you allow lobbies the ability to determine elections (via donations, commercials, think-tankery, friendly media) and have such intimate contact with lawmakers and foreign representatives. It has gotten far beyond any reasonable interpretation of our / their legitimate right to petition.
    .
    Take this for example, as relates to the revolt against the authoritarian regime in Egypt:
    .
    The United States ships aid dollars to the Egyptian government, which in turn buys pricey items from American contractors, with deals often arranged with the help of U.S. lobbyists–who sometimes represent both the seller and the buyer. That’s what PLM Group, a joint venture of the Podesta Group and the Livingston Group, did, as we reported with ProPublica in our initial release:
    .
    “Lobbyists for Egypt had at least 279 contacts on military issues, the bulk of which occurred when PLM Group accompanied delegations of Egyptian military officers to meet members of Congress, administration officials and representatives from defense contractors including BAE Systems, General Dynamics, General Electric, Raytheon and Lockheed Martin. All five have done business with the Egyptian government, selling tanks, fighter jets, howitzers and radar arrays to its military. At the time of the meeting with the contractors, Podesta Group counted BAE Systems, General Dynamics and Lockheed Martin among its clients, while the Livingston Group represented Raytheon.”     -link
    .
    We’re becoming more Banana Republic then Republic.

  • freeinpa

    “Elections ARE accountability”
    .
    There are 2 ways to view your statement. 1) you are delusional if you elected officials are defeated because of fraud in government spending. Fraud has existed since government had access to the public’s wallet. Rangel committed tax fraud and was re-elected.

    2) If what you say is true you must fully support the repeal of HC since the election held Demos accountable as the bill as advertised is a fraud

  • pintortwo

    We, with all of our wonderful construct as a nation, believe we can handle being the preeminent military in the world. That is an awesome responsibility.. which we believe we can manage specifically because of its construct.
    .
    It’s irresponsible that we are so ready to give that power away. We are so heavily invested in military, and we accept it.. while we simultaneously diminish its relative strength by spreading it around the globe.
    .
    We are the largest exporter of weaponry, and all its trappings. It’s embarrassing. I know when I being taken advantage of.

  • swissArmyBrainBETA

    for facilities work at army bases, contractors do pretty much everything, and the system actually seems pretty good to me so far. bids are pretty competitive and there is a now a rating system that ensures screw-ups don’t get more work. must be larger scale groups like weapons contractors where it goes sour. i’ll be reading that report tonight

  • apr2563

    Gosh, a Socialist looking for government accountability.

  • apr2563

    Yes, the open accountability of the free market:
    Goldman Sachs
    Enron
    BP
    Haliburton
    etc, etc, etc.

  • http://dorndiego.wordpress.com dorndiego

    So, when Pentagon fraud is so clearly laid out what do all the chair-filling fantasy warriors do? They attack Bernie Sanders, or liberals, or say we first have to cut “entitlements” like education before we can get to the real gobblers who sell guns to our future enemies so they can sell more guns to us who’ll have to fight the newly created enemies.
    Patriotism of this kind is a game to deluded scribblers who lost that fight on the playground years ago and now think they have to sound as tough as Robot Man.

blog comments powered by Disqus