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09:45 AM, August 10, 2017
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UK-based Sub-contractor Accused of Fund-misuse In Afghanistan Training Contract
US military in Afghanistan (Image for reference)

A US Senator has accused a UK-based sub-contractor of misusing funds meant for training intelligence officers in Afghanistan by spending on luxury vehicles and six-figure salaries to employees' 'significant others.'

Senator Claire McCaskill on the Senate Homeland Security and Government Affairs committee blew the whistle on a federal contract following an audit that left taxpayers on the hook for over $50 million in questionable costs, including seven luxury vehicles and $400,000 average salaries for 'significant others' of corporate officers to serve as “executive assistants.”

The audit revealed that a subcontractor, New Century Consulting (NCC), billed over $50 million to the Army through its contractor, Imperatis. The costs passed on to taxpayers included seven luxury cars—including Porsches, Alfa Romeos, a Bentley, an Aston Martin, and Land Rover. In addition, the significant others of the CEO and CFO were kept on payroll as “executive assistants,” despite the fact that these employees worked from home and never traveled to customer locations, and no documentation existed to prove they actually performed any work. Despite all this, in 2012 the average salary of these “executive assistants” reached approximately $420,000 each.

In a letter to Secretary of Defense James Mattis, McCaskill demanded answers on the “Legacy East” contract, a project to provide counterinsurgency intelligence experts to mentor and train the Afghan National Security Forces, after the Defense Contract Audit Agency’s (DCAA) review of the contract called into question $50 million in expenses.

The DCAA also found that the company spent over $1,500 on alcohol, and $42,000 in cash on automatic weapons despite regulations or contract provisions prohibiting such expenditures.  In addition, NCC had millions of dollars in other questioned or unallowable expenses, including severance payments, rent, unnecessary licensing fees, extensive austerity pay, and expenses for air travel for personal reasons.

In response, McCaskill is demanding answers, including:

The DCAA conducted its review in part because McCaskill had previously demanded answers after an earlier audit of the contract by the Special Inspector General for Afghanistan Reconstruction revealed millions of dollars in questionable costs.  The primary contractor, Imperatis, formerly Jorge Scientific, has previously drawn fire from McCaskill on multiple occasions, including in 2012 when video surfaced of Imperitis contractors intoxicated in what former employees called a pattern of inappropriate behavior. In 2016, Jorge Scientific/Imperatis defaulted on a major IT contract that had been awarded after McCaskill repeatedly raised concerns.

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