SIGAR Seeks Debarment of Contractors Who Aid the Enemy

On Tuesday, the Special Inspector General for Afghanistan Reconstruction (SIGAR) posted a letter to top U.S. diplomatic, military, and U.S. Agency for International Development (USAID) officials calling for immediate action to stop the disbursement of federal funds to several companies and individuals believed to be actively supporting the insurgency in Afghanistan.

Government investigations have uncovered instances of U.S. taxpayer money being funneled to the enemy in Afghanistan, a serious problem largely caused by weak oversight. To remedy this, Congress inserted Section 841 into the Fiscal Year 2012 National Defense Authorization Act, which requires the Commander of the United States Central Command (CENTCOM) to review recipients of U.S. contracts, grants, and cooperative agreements with an estimated value exceeding $100,000 to determine if they are actively supporting an insurgency or otherwise opposing U.S. or coalition forces in a contingency operation. If this determination is made with regard to a particular person or corporate entity, CENTCOM puts Department of Defense (DoD) Heads of Contracting Activities (HCAs) on notice to restrict, terminate, or void their contracts, grants, and cooperative agreements.

According to the SIGAR letter, in July, CENTCOM Commander General James N. Mattis identified the following 5 individuals and entities as “actively supporting an insurgency” in Afghanistan:

• Arvin Kam Group LLC
• Arvin Kam Construction Company
• Vakil Saadat
• Haji Mohammad Almas Khan
• Haji Khalil Fruzi

Two months later, General Mattis identified 15 more:

• The Nur Rahman Group of Companies
• Nur Rahman (a/k/a “Noor Rahman” and “Noor Rahman Safa”)
• Mohammad Rhaman
• The Hiwad Brothers Company (a/k/a “Noor Rahman Construction Company” and “Koh-e Safi Mining Company”)
• The Zurmat Group of Companies
• Yousef Zaland
• Mohammad Ayub
• The Zurmat Group of Businesses
• Zurmat Foundation
• Haji Amir Muhammad
• Nurullah Jan
• Abdul Wakil Wasim
• Triangle Technologies
• Haji Dost Mohammad Zurmat Construction Company
• Zurmat General Trading Company

Section 841 only affects DoD contracts, so notice of the identification of active supporters of the insurgency in Afghanistan is only provided to DoD offices. By issuing this letter, however, SIGAR alerted the two other principal contingency contracting agencies—the State Department and USAID, both of which, as SIGAR pointed out, use many of the same contractors as DoD or have the potential to use them in the future. SIGAR has taken steps to initiate government-wide debarment of these companies and individuals. SIGAR is also working to ensure that, from now on, Section 841 identifications are shared routinely and in a timely manner with State and USAID.

The authority provided under Section 841 will expire (sunset) on December 31, 2014. Hopefully, with uncertainty as to whether and to what extent the U.S. will maintain a military presence in Afghanistan after 2014, Congress will consider extending the sunset date.

The recurrence of several names in CENTCOM’s list indicates shared corporate ownerships or affiliations, which brings to mind the complex corporate webs spun by companies like the private security contractor Blackwater/Xe/Academi. It is well known that keeping track of these convoluted arrangements sometimes proves too difficult for contracting officers. Fortunately, SIGAR did some digging and was able to sort out the relationships among some of the entities identified by CENTCOM:

• Vakil Saadat, Haji Mohammad Almas Khan, and Haji Khalil Fruzi operate the Arvin Kam Construction Company, as well as other entities named Arvin Kam Group Security, Arvin Global Logistics Services Company, and the Arvin Kam Group Foundation.
• The Nur Rahman Group of Companies has previously done business under the names RUCCL Rahman Umar Construction Company, Rahman Trading & Logistics Company LLC, and NUCCL Construction Company.
• The Zurmat Group of Companies has also operated under the names Zurmat LLC and Zurmat Material Testing Laboratory.

If only the rest of the government could similarly keep tabs on contractors and grantees, some of which are extremely adept at circumventing a suspension or debarment through name changes, ownership transfers, and all other sorts of chicanery.

In September, SIGAR provided to Congress a letter containing a list of contractors in Afghanistan that were referred for debarment due to affiliations with terrorist organizations, including Al Qaeda. This list includes some of the CENTCOM-identified entities, as well as companies and individuals identified by the Department of Commerce as “providers of material support to persons engaged against U.S. and coalition forces in Afghanistan,” affiliated companies identified by SIGAR, and the date each company or individual was referred for debarment.

As reflected in that September letter, SIGAR is seeking the independent authority to suspend and debar contractors, which is often the only way to hold foreign contractors accountable. To date, none of the companies and individuals named in the SIGAR letters have been suspended or debarred. One company, Zurmat Material Testing Laboratory, had a $20,000 contract terminated; otherwise, all of those companies and individuals who may be actively undermining the U.S. mission in Afghanistan are still eligible to receive U.S. taxpayer money.

The Project On Government Oversight has been encouraged by the changes taking place at SIGAR since John Sopko was appointed to lead the office in May. SIGAR has assumed a much more proactive watchdog role. In addition to cracking down on contractors who support or collaborate with insurgents and to seeking suspension and debarment power, SIGAR has issued a safety alert warning troops about a heightened IED threat, increased its reporting output, and provided frank testimony to Congress about the challenges we face in Afghanistan.