Inside the Cutthroat World of Billion-Dollar Military Supply Contracts

By Against Crony Capitalism

May 15, 2018


Inside the Cutthroat World of Billion-Dollar Military Supply Contracts


But KGL has continued to face questions, as in May 2016, when Fuad Dashti — a significant KGL shareholder and brother of its chairman — was arrested at San Francisco International Airport and charged with trying to transfer airplane parts to Iran. When he was brought to Washington for FBI interrogation, the U.S. government quietly allowed him to slip out of the country in the waning days of the Obama administration.


Inside the Cutthroat World of Billion-Dollar Military Supply Contracts


Just because The Pentagon is on the other side of the Potomac River doesn’t mean that it isn’t part of the Swamp. Indeed some of the darkest most infested parts of the Swamp are in Virginia. And the Swamp spreads around the world from there.

The military, especially when handing out contracts, is the epitome of the Swamp. I grew up in the military. I have respect for the military. (Though I am a peace loving libertarian.) But there is so much money sloshing around the Pentagon. There are camouflaged (and non-camouflaged civilian) swamp creatures of every species trying getting their piece of the taxpayer.

(From Foreign Policy)
The latest controversy involves a contract from January of this year, when the Pentagon’s Defense Logistics Agency awarded $1.38 billion for food supplies to a subsidiary of the behemoth Kuwait and Gulf Link Transport, or KGL, long a logistics linchpin for American forces in the region. Yet the award came just weeks after a top KGL lawyer acknowledged to a U.S. court that the firm had years earlier set up a “ghost structure,” i.e., a company that existed in name only, as a go-between for a joint venture it had with a U.S.-sanctioned Iranian partner.
The award was also announced as two of the company’s recently resigned top executives sat in a Kuwaiti jail. On Sunday, those two executives, Saed Dashti and Marsha Lazareva, were sentenced in a Kuwaiti court to 15 and 10 years in prison, respectively.
The contract has also attracted congressional attention. Shortly after the January award, Marco Rubio, the Republican senator from Florida, called on the Office of Inspector General at the Defense Department to investigate wide-ranging aspects of KGL’s business. A copy of Rubio’s letter was obtained by the Project On Government Oversight.
In the cutthroat competition to win lucrative U.S. government business, KGL and its rivals sometimes operate on the edge of the law. But as America considers further sanctions against Iran and termination of the Obama-era nuclear pact, KGL’s recent acknowledgements in testimony point to deeper problems with U.S. military contractors in the Middle East and have heightened concern in Congress.

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Reprinted with permission from Against Crony Capitalism.