UN audit says Halliburton overcharged Iraq - Yahoo! News

A UN auditing board has recommended the United States pay as much as 208 million dollars to Iraq for overbilling or shoddy work performed by a subsidiary of the US oil services firm Halliburton, The New York Times reports.

The work, carried out by Kellogg, Brown and Root, was paid for with Iraqi oil revenues but was delivered at inflated prices or done poorly, the board said, quoted by the US newspaper.

While audits had called into question 208 million dollars worth of contracting work, it was too early to say how much of the funds should be paid back because analysis of financial statements and documents was still under way, the newspaper wrote.

Once the analysis was finished, the UN monitoring board "recommends that amounts disbursed to contractors that cannot be supported as fair be reimbursed expeditiously," the board said in a statement, quoted by the daily.

The board, which relied mainly on Pentagon audits for its findings, could only make recommendations and the ultimate decision on repayment would be up to the United States government. The Pentagon has yet to release its audits of the contracting work.

A spokeswoman for Halliburton told the newspaper questions raised by earlier US military audits had focused on documentation and not the quality of the work performed by Kellogg, Brown and Root.

"Therefore, it would be completely wrong to say or imply that any of these costs that were incurred at the client's direction for its benefit are 'overcharges,'" spokeswoman Cathy Mann was quoted as saying in an e-mail to the paper.

Halliburton, once managed by now Vice President Dick Cheney, has been accused previously of overbilling and opposition Democrats have alleged it enjoyed preferential treatment for government contracts. Cheney has rejected the allegations.

A former Iraqi academic, Louay Bahry, told the newspaper that the board's findings would confirm suspicions among ordinary Iraqis that Washington's underlying motive in going to war against Saddam Hussein's regime in 2003 was to control the country's oil wealth.

"Something like this will be caught in the Iraqi press and be discussed by the Iraqi general public and will leave a very bad taste in the mouth of the Iraqis," Bahry, who works at the Middle East Institute in Washington, told the newspaper.

Charged with overseeing Iraq's oil revenues and money seized from Saddam Hussein's regime, the monitoring board includes representatives from the United Nations, the International Monetary Fund, the Arab Fund for Economic and Social Development, the International Bank for Reconstruction and Development and the Iraqi government.

The results of the audit should allow the Iraqi government "the right to go back to K.B.R. (Kellogg, Brown and Root) and say, 'Look, you've overbilled me on this, this is what you could repay me,'" a board member was quoted as saying by the paper.