Tuesday, December 24, 2013 06:08 AM
By: Elliot Jager
The Pentagon is investigating whether the main food and water supplier to U.S. forces in Afghanistan illegally moved provisions bound for U.S. service members through an Iranian port, the Wall Street Journal reported.
Anham FZCO was awarded a contract by the United States Defense Logistics Agency in the summer of 2012 — worth an estimated $8.1 billion — to provide food, water, and produce to American forces throughout Afghanistan.
According to the Journal, Anham shipped equipment it needed to establish the infrastructure for its food supply system in Afghanistan — steel, tractors, and refrigeration panels — through the Iranian port of Bandar Abbas.
After Journal inquiries, the company notified U.S. government authorities that some supplies had been moved by its foreign subcontractors through Iran and that it was trying to determine what had happened.
While Iran is the least expensive and most straightforward route for moving supplies into Afghanistan, U.S. law prohibits conducting business with Iran as a way to pressure that country into curbing enrichment of uranium which the United States and its allies believe is part of Teheran’s push for nuclear weapons.
Two Republican senators, Mark Kirk of Illinois and New Hampshire’s Kelly Ayotte had called on the Pentagon’s Inspector General to probe whether Anham had done business with the Iranian Revolutionary Guard which has economic control over the Bandar Abbas port, according to the Journal.
Supplying U.S. troops in Afghanistan is immensely complicated logistically.
While the U.S. troop presence is winding down, in 2012 the Pentagon needed to supply 250 locations and some 100,000 troops around Afghanistan. This required each week moving 22 million pounds of food, water, and produce.
Supplies need to be moved into the landlocked country, surrounded by Iran and Pakistan and in the north by Turkmenistan, Tajikistan, and Uzbekistan. Shipping through the former Soviet republics is said to be too expensive.
Pakistan has occasionally blocked U.S. shipments to protest drone strikes within its country.
Anham, headquartered in Dubai, was founded in 2004. Its principals have ties to predecessor companies in Saudi Arabia and Jordan. The company holds other lucrative contracts with the Pentagon elsewhere in the Middle East.
Anham’s Afghanistan bid was more than $1 billion lower than its main competitor, the Journal reported.
Related Stories:
Pentagon Contractor Suspected of Violating Iran Sanctions
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Tag Archives: anham logistics
Did ANHAM, Virginia-Based Firm, Use Our Tax Payer Dollars to Fund Iranian’s Revolutionary Guards to delivery food supplies to u.s. soldiers in Afghanistan? Sounds Crazy? Think Again!
Did ANHAM use American tax payer dollars to finance Iran’s Revolutionary Guards to delivery food supplies to u.s. soldiers in Afghanistan? Worse, how is IT POSSIBLE THAT ANHAM STILL holding the largest food contract for feeding American soldiers?A new December 23, 2013 reports by Bloomberg cited that Pentagon’s criminal investigations arm is seriously probing one of the American military’s largest suppliers in Afghanistan over allegations that it violated U.S. law by moving supplies through Iran, the Defense Department told lawmakers. An article in The Wall Street Journal in September, which prompted the investigation, disclosed that Anham relied on the Iranian port of Bandar Abbas and on Iranian supply routes to move steel, tractors and refrigeration panels into Afghanistan to build warehouses and other logistical centers. Anham’s actions may have violated strict U.S. sanctions laws that prohibit American entities from conducting trade with Iran or Iranian companies by moving materials through the country, Obama administration officials said.
Anham made a voluntary disclosure in September to the Treasury and Commerce Departments regarding transshipments through Iran, after the company was contacted about the matter by the Journal. The logistics agency said Anham was “still in the process of providing documentation on the matter.” It added that “no changes have been made to the SPV Afghanistan contract” since the disclosure. “As Anham is still in the process of preparing their official disclosure to the Department of Commerce and Department of Treasury, any actions would be premature,” the statement read. “We will make an informed decision on next steps once we have all the facts.”
Senators Mark Kirk (R., Ill.) and Kelly Ayotte (R., N.H.) pressed the Pentagon’s Inspector General to open an investigation into Anham due to concerns the company may have directly done business with Iran’s elite military unit, the Revolutionary Guard Corps. The corps controls some of the container ports at Bandar Abbas, the U.S. Treasury says. The U.S. lawmakers asked in an October letter to the Inspector General whether Anham’s contract could be restricted or terminated and if any disciplinary action had been taken against Anham executives. “Until the investigation is able to establish the relevant facts, we will not be able to respond meaningfully to the three questions posed,” Acting Assistant Inspector General Larry Turner responded to Mr. Kirk in a letter late last month. In that letter, the Inspector General’s office notified Mr. Kirk that it has “initiated an investigation into the public revelations concerning Anham FZCO’s alleged use of Iranian ports to supply U.S. forces in Afghanistan.” Anham executives also said Monday that the company’s chief executive officer, A. Huda Farouki, will step away from the day-to-day management of Anham in January, but will continue as the company’s board chairman and oversee an executive committee. Mr. Farouki will be succeeded by Jay Ward, who has served for the past year as Anham’s chief operating officer.
Anham’s lawyer, Clif Burns, said Monday the company hadn’t been notified of the probe and that the Inspector General’s office wouldn’t confirm to him any investigation. The probe introduces an unexpected turn in a contract that is likely to be one of the last major wartime-support awards in Afghanistan. It underscores the challenges facing the U.S. in the region after pursuing wars on Iran’s borders—in Iraq and Afghanistan—since 2001 and enacting a series of sanctions against Tehran in recent years in an effort to curb its nuclear program. The debate over Iran sanctions has intensified in Washington in recent weeks, after the Obama administration struck an interim deal with Tehran in November that seeks to curb the most advanced parts of Iran’s nuclear program, including the production of near weapons-grade fuel, in return for the West easing financial sanctions. The White House has opposed congressional efforts to impose new sanctions, and Iranian officials have chafed over recent U.S. enforcement of the existing sanctions.
Media Sources for this blog included:
I. http://www.unitedagainstnucleariran.com/company/anham-fzco
II. http://www.newsmax.com/Asia/afghanistan-pentagon-food-probe/2013/12/24/id/543560
III. http://blogs.defensenews.com/intercepts/tag/anham/
V. http://www.cfr.org/about/newsletters/archive/newsletter/n1626
POGO CALLS ANHAM, MAJOR MILITARY FOOD SUPPLIER “DUBIOUS”
July 9, 2013– In new scathing report, released on July 9, 2013, Project On Government Oversight (POGO) stated “It is galling that our government awards millions of dollars to companies accused of serious crimes of dishonesty, and the lack of transparency in this process adds insult to injury…The DLA justified the waiver on the basis that “if ordering under [PV2] ceases, there would be mission failure in Iraq and Kuwait.” The DLA approved a 180-day extension of the contract on November 16, 2009. The following May, the DLA extended the PV2 contract until December 4, 2010, due to difficulties in transitioning to the new vendor, the Dubai-based logistics company Anham FZCO, a company that also has a dubious track record as a supplier to the U.S. military.
The DLA issued four determinations to modify and extend a storage and distribution support services contract with Agility. At first, the DLA twice modified the contract and added nearly $8.8 million in funding because it determined that Agility was the only source capable of completing the work by the contractual deadline of August 31, 2010. At the start of June 2010, however, the DLA determined it had to extend the contract an additional six months and increase funding by $33.7 million in order to “ensure sufficient time for a quality transition” to a new vendor. On November 24, 2010—more than a year after Agility was indicted—the DLA extended the contract another six months, through August 31, 2011, at an additional cost of $20.6 million. At this point, the more cynical among you are probably wondering whether there was a genuine compelling reason to stay with this particular contractor or whether the DLA was unnecessarily slow-walking the contract transition.
The third contract for which the DLA waived Agility’s suspension was a contract with an Agility-led joint venture called AFH Fuel Services for fuel storage at the Air Force’s base at Ramstein, Germany. The March 25, 2010, memo approving a six-month, $60,000 extension of AFH’s contract does not state the specific compelling reason(s) behind the decision. In fact, three of the seven DLA memos lack the “reason” part of the compelling reason determination.
POGO requested these documents through the Freedom of Information Act (FOIA) last October after learning of their existence in a September 2012 Government Accountability Office (GAO) report. The GAO found that the Department of Defense (DoD) made a total of 14 compelling reason determinations during fiscal years 2009 through 2011—seven each by the Army and the DLA. The GAO did not identify the contractors involved. The GAO also found that the government was not keeping DoD compelling reason determinations in a public file as required by law.
Source: Founded in 1981, the Project On Government Oversight (POGO) is a nonpartisan independent watchdog that champions good government reforms. POGO’s investigations into corruption, misconduct, and conflicts of interest achieve a more effective, accountable, open, and ethical federal government.
Related articles
- How U.S. War Funds Get Wasted…..And How To Stop It (fortunascorner.wordpress.com)
- The U.S. Needs a Permanent Military Inspector General (usnews.com)
- Pogo Calls Anham, Major Military Food Supplier “Dubious” (anhamcorp.wordpress.com)
- Inspector General on Anham IG Report: http://www.sigir.mil/files/audits/11-022-F.pdf
IRON MILL Reports: IS ANHAM WASTING PENTAGON MONEY
IRON MILL Reports: IS ANHAM WASTING PENTAGON MONEY
According to IronMill News service, The mission of Iron Mill Interactive Media Inc. DBA Iron Mill News Serviceis the distribution of fresh and accurate news that is of critical importance to the people of America and the World.Iron Mill News Service seeks to recruit independent Journalists to widen our objectivity and knowledge base.Here’s a jaw-dropping example reported by Bloomberg.
anham, A U.S. contractor in Iraq overbilled the Pentagon by at least $4.4 million for spare parts and equipment, including $900 for an electronic control switch valued at $7.05, according to a new audit. Based on the questionable costs identified in a $300 million contract with Dubai-based Anham LLC, the U.S. should review all its contracts with the company in Iraq and Afghanistan, which total about $3.9 billion, said Special Inspector General for Iraq Reconstruction Stuart Bowen. “The audit found weak oversight in multiple areas that left the government vulnerable to improper overcharges,” Bowen wrote in the forward to his 30th quarterly report, released today. The contract in question was funded with a combination of money earmarked for Iraqi Security Forces and Army operations and maintenance funds. Among the “egregious examples of overbilling” by Anham were $4,500 for a circuit breaker valued at $183.30, $3,000 for a $94.47 circuit breaker and $80 for a small segment of drain pipe valued at $1.41.
Those mark-ups are absurd, but I wonder whether this example from the story is even worse.
In other cases, Anham used subcontractors to purchase items that could have been bought directly from the manufacturer at lower prices, the report said. When Anham was asked to buy a loudspeaker system to alert warehouse employees of any danger, it chose not to buy the system directly from the manufacturer at the retail price of $44,615, the report said. Instead, Anham sought bids from subcontractors and paid a company called Knowlogy $90,908. That price included $20,000 for installation, even though the system setup meant little more than wheeling it into place and plugging it in.
I think I made a mistake becoming a policy wonk. I could have a great career as a loudspeaker installer.Media Source: http://www.ironmill.com/2011/08/09/is-pentagon-waste-even-more-egregious-than-welfare-state-waste/
According to IronMill News service, The mission of Iron Mill Interactive Media Inc. DBA Iron Mill News Serviceis the distribution of fresh and accurate news that is of critical importance to the people of America and the World.Iron Mill News Service seeks to recruit independent Journalists to widen our objectivity and knowledge base.Here’s a jaw-dropping example reported by Bloomberg.
anham, A U.S. contractor in Iraq overbilled the Pentagon by at least $4.4 million for spare parts and equipment, including $900 for an electronic control switch valued at $7.05, according to a new audit. Based on the questionable costs identified in a $300 million contract with Dubai-based Anham LLC, the U.S. should review all its contracts with the company in Iraq and Afghanistan, which total about $3.9 billion, said Special Inspector General for Iraq Reconstruction Stuart Bowen. “The audit found weak oversight in multiple areas that left the government vulnerable to improper overcharges,” Bowen wrote in the forward to his 30th quarterly report, released today. The contract in question was funded with a combination of money earmarked for Iraqi Security Forces and Army operations and maintenance funds. Among the “egregious examples of overbilling” by Anham were $4,500 for a circuit breaker valued at $183.30, $3,000 for a $94.47 circuit breaker and $80 for a small segment of drain pipe valued at $1.41.
Those mark-ups are absurd, but I wonder whether this example from the story is even worse.
In other cases, Anham used subcontractors to purchase items that could have been bought directly from the manufacturer at lower prices, the report said. When Anham was asked to buy a loudspeaker system to alert warehouse employees of any danger, it chose not to buy the system directly from the manufacturer at the retail price of $44,615, the report said. Instead, Anham sought bids from subcontractors and paid a company called Knowlogy $90,908. That price included $20,000 for installation, even though the system setup meant little more than wheeling it into place and plugging it in.
I think I made a mistake becoming a policy wonk. I could have a great career as a loudspeaker installer.Media Source: http://www.ironmill.com/2011/08/09/is-pentagon-waste-even-more-egregious-than-welfare-state-waste/
Anham: CRIMINALLY INVESTIGATED BY PENTAGON FOR FINANCING IRANIAN REVOLUTIONARY GUARDS WITH US TAX PAYER DOLLARS 