Iraq corruption whistleblowers face penalties

One whistleblower demoted
Bunnatine “Bunny” Greenhouse knows this only too well. As the highest-ranking civilian contracting officer in the U.S. Army Corps of Engineers, she testified before a congressional committee in 2005 that she found widespread fraud in multibillion-dollar rebuilding contracts awarded to former Halliburton subsidiary KBR.

Soon after, Greenhouse was demoted. She now sits in a tiny cubicle in a different department with very little to do and no decision-making authority, at the end of an otherwise exemplary 20-year career.

People she has known for years no longer speak to her.

“It’s just amazing how we say we want to remove fraud from our government, then we gag people who are just trying to stand up and do the right thing,” she says.

In her demotion, her supervisors said she was performing poorly. “They just wanted to get rid of me,” she says softly. The Army Corps of Engineers denies her claims.

“You just don’t have happy endings,” said Weaver. “She was a wonderful example of a federal employee. They just completely creamed her. In the end, no one followed up, no one cared.”

No regrets
But Greenhouse regrets nothing. “I have the courage to say what needs to be said. I paid the price,” she says.

Then there is Robert Isakson, who filed a whistleblower suit against contractor Custer Battles in 2004, alleging the company — with which he was briefly associated — bilked the U.S. government out of tens of millions of dollars by filing fake invoices and padding other bills for reconstruction work.

He and his co-plaintiff, William Baldwin, a former employee fired by the firm, doggedly pursued the suit for two years, gathering evidence on their own and flying overseas to obtain more information from witnesses. Eventually, a federal jury agreed with them and awarded a $10 million judgment against the now-defunct firm, which had denied all wrongdoing.

It was the first civil verdict for Iraq reconstruction fraud.

But in 2006, U.S. District Judge T.S. Ellis III overturned the jury award. He said Isakson and Baldwin failed to prove that the Coalition Provisional Authority, the U.S.-backed occupier of Iraq for 14 months, was part of the U.S. government.

Not a single Iraq whistleblower suit has gone to trial since.

“It’s a sad, heartbreaking comment on the system,” said Isakson, a former FBI agent who owns an international contracting company based in Alabama. “I tried to help the government, and the government didn’t seem to care.”

U.S. shows little support?
One way to blow the whistle is to file a “qui tam” lawsuit (taken from the Latin phrase “he who sues for the king, as well as for himself”) under the federal False Claims Act.

Signed by Abraham Lincoln in response to military contractors selling defective products to the Union Army, the act allows private citizens to sue on the government’s behalf.

The government has the option to sign on, with all plaintiffs receiving a percentage of monetary damages, which are tripled in these suits.

It can be a straightforward and effective way to recoup federal funds lost to fraud. In the past, the Justice Department has joined several such cases and won. They included instances of Medicare and Medicaid overbilling, and padded invoices from domestic contractors.

But the government has not joined a single quit tam suit alleging Iraq reconstruction abuse, estimated in the tens of millions. At least a dozen have been filed since 2004.

“It taints these cases,” said attorney Alan Grayson, who filed the Custer Battles suit and several others like it. “If the government won’t sign on, then it can’t be a very good case — that’s the effect it has on judges.”

The Justice Department declined comment.

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