cdmawatch.org

The Defense Department has urged the U.S. led Iraqi provisional government to void three contracts for Iraqi cell phone service because of fraud, the Washington Times reported on Tuesday, citing an agency memorandum. The winning bidders, Orascom, Atheer and AsiaCell, are believed to have rigged the bids for the contracts, Deputy Undersecretary of Defense for International Technology Security John Shaw said in the memorandum obtained by the newspaper. Provisions of the contracts forbade them from direct or indirect ownership by anyone who supported or benefited from the Saddam Hussein regime but there were ties, according to the report. The contracts are worth up to about $500 million annually.

Shaw sent his recommendation to Paul Bremer, head of the U.S. led Coalition Provisional Authority, who turned the matter over to the CPA's general counsel, the Times reported. Pentagon investigators have said up to $11.5 million in bribes were paid to help win the contracts for the companies, the newspaper said. A Defense Department spokesman declined to comment. An Orascom official said the company was unaware of the memo while Faisal al-Ayyar, chairman of Kuwait-based National Mobile Telecom which heads the AsiaCell consortium, said his company had not been informed either. The three consortia, led by foreign firms, won cell phone licenses in Iraq in October and were given two years to build up their regional networks.
Posted June 25th 2004 | 0 comments