Senate Panel Hears Army Auditor Axed for Denying $1 Billion in Questionable Charges

WASHINGTON, July 9 - A former Pentagon auditor ousted for refusing to approve more than $1 billion in questionable charges by the largest defense contractor in Iraq testified today for the first time before Congress.

Charles M. Smith appeared before a Senate panel that has held a series of hearings on waste, fraud and abuse in Iraq and Afghanistan involving Pentagon contracts with private businesses. Smith was the top civilian overseeing a multi-billion-dollar Pentagon contract with KBR, the Houston company that has provided food, housing and other services to American troops.

"At a time when the country in more than $9 trillion in debt, it is absurd that KBR has repeatedly gotten away with gouging taxpayers and cheating our troops," said Senator Bernie Sanders (I-Vt.).

Smith, a civilian Army employee for 31 years, was suddenly replaced in 2004 after raising red flags about payments to the company with strong political connections to the Bush administration. KBR was formerly known as Kellogg, Brown and Root, a subsidiary of Halliburton, the Texas contractor where Vice President Dick Cheney was chief executive.

Soon after Smith was shunted aside, the Army hired a contractor, RCI Holding Corp., to review KRB charges. The new contractor, according to Smith, ignored Defense Contract Audit Agency findings about the questionable KRB charges. The Army also awarded KBR performance bonuses, according to Smith.