Pentagon audit reveals Halliburton overcharges
Nearly $108 million in unsupported costs found

By Jim Miklaszewski
NBC News
Updated: 7:28 p.m. ET March 15, 2005

Pentagon auditors have found that the Halliburton Co., which was awarded a no-bid $2.5 billion contract to deliver fuel to Iraq, may have overcharged by more than $108 million. That includes $61 million auditors found in questionable charges more than a year ago.

And Democrats in Congress predict more to come.

"This may be the tip of the iceberg because this is only one of their task orders, and we have nine others that we haven't had reports on," says Rep. Henry Waxman, D-Calif.

Yet another Pentagon audit completed last August and obtained by NBC News found that a Halliburton contract to provide food and housing for American troops had a staggering $1.8 billion in unsupported costs.

In a written response, Halliburton defends the costs for delivering fuel, calling it a "mission fraught with danger," which increased the prices. They promised full cooperation with Pentagon auditors.

But when this latest audit was first released this week, significant portions were blacked out. Congressional Democrats say Halliburton asked the Bush administration to redact many portions of the audit the company considered to be inaccurate or misleading. But when you look at the complete audit, posted today on a congressional Web site, and click on the blacked-out segments, it reveals that auditors found the company was unable to demonstrate the fuel proposal was based on actual cost, and that Halliburton charged more than $108 million in questioned costs.

"We want the Pentagon not to help cover it up, we want them to go back and collect the money," says Waxman.

Late Tuesday night, Halliburton officials said the company has the right to redact any information it considers proprietary.

But Democrats in Congress aren't satisfied and are calling for immediate hearings into the way the United States is spending its money with Halliburton and other contractors in Iraq.
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