Afghanistan: SIGAR October 2019 Quarterly Report to the United States Congress

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EXECUTIVE SUMMARY

This report summarizes SIGAR’s oversight work and updates developments in the five major areas of reconstruction efforts in Afghanistan from July 1 to September 30, 2019. It includes an essay highlighting the findings in SIGAR’s recently released Lessons Learned Program report, Reintegration of Ex-Combatants: Lessons from the U.S. Experience in Afghanistan. This reporting period, SIGAR issued 14 audits, inspections, reviews, and other products assessing U.S. efforts to build the Afghan security forces, improve governance, facilitate economic and social development, and combat the production and sale of narcotics. During the reporting period, SIGAR criminal investigations produced six sentencings, two indictments, one criminal information, 120 months’ prison time, 240 months’ supervised probation, and a combined total of $18.1 million in criminal forfeitures and restitutions.

SIGAR OVERVIEW

AUDITS AND INSPECTIONS

This quarter, SIGAR issued two performance audits, six financial audits, and three inspection reports.

The performance audit reports examined:

• the effectiveness of USAID’s implementation and oversight of the $861.7 million Power Transmission Expansion and Connectivity (PTEC) project from August 2011 through March 2019

• the impact of the more than $90 million spent by the U.S. Army Corps of Engineers (USACE) on a personalservices contract with Versar Inc. to hire Afghan engineers and specialists to help oversee construction projects.

The six financial audit reports identified $498,840 in questioned costs as a result of internal-control deficiencies and noncompliance issues.

The inspection reports found:

• construction deficiencies, contractor noncompliance, and poor oversight at the $39.5 million Pul-e Alam power substation in the North East Power System, including increased safety risks to residents living near transmission lines

• safety hazards and maintenance issues at the Afghan National Army Garrison at South Kabul International Airport, including elevated manholes that could damage vehicles driving over them

• five construction deficiencies posing safety hazards to motorists, pedestrians, and cyclists on the Ghulam Khan road project.

SPECIAL PROJECTS

This quarter, SIGAR’s Office of Special Projects issued an inquiry letter concerning equipment acquisitions, in addition to two reviews concerning:

• textbooks and materials distributed to primary schools through USAID’s Afghan Children Read (ACR) program

• observations from SIGAR site visits to 171 USAID-funded Afghan schools across 10 provinces

LESSONS LEARNED

SIGAR’s Lessons Learned Program released its seventh lessons-learned report, Reintegration of Ex-Combatants: Lessons from the U.S. Experience in Afghanistan. The report examines and assesses the five main post-2001 reintegration efforts in Afghanistan. It also examines several past local security agreements for efforts on reintegration. The report found that none of the reintegration programs enabled any significant number of ex-combatants to socially and economically rejoin civil society. Programs targeting Taliban insurgents did not substantially weaken the insurgency or contribute meaningfully to parallel reconciliation efforts.

The Lessons Learned Program has four projects in development: U.S. government support to elections; monitoring and evaluation of reconstruction contracting; advancing and empowering women and girls; and police and corrections.

INVESTIGATIONS

During the reporting period, SIGAR investigations resulted in six sentencings, 120 months’ prison time, 240 months’ supervised probation, and a combined total of $18.1 million in criminal forfeitures and restitutions. In addition, one criminal information and two indictments were obtained. SIGAR initiated nine new cases and closed 17, bringing the total number of ongoing investigations to 158. SIGAR’s suspension and debarment program referred two individuals for suspension or debarment based on evidence from investigations conducted by SIGAR in Afghanistan and the United States.

Investigations highlights include:

• The former owner of a now-defunct marble mining company in Afghanistan, Adam Doost, was sentenced to 54 months’ imprisonment, 36 months’ supervised probation, and 250 hours’ community service. He was further ordered to forfeit $8,940,742 and pay $8,940,742 in restitution. Doost was found guilty in September 2018 for his role in defrauding the Overseas Private Investment Corporation (OPIC) and defaulting on a $15.8 million loan from OPIC.

• A former U.S. Army Special Forces member, Joseph Russell Graff, was sentenced to 52 months’ imprisonment and three years’ supervised probation, in addition to $150,000 forfeiture from the proceeds of the sale of a house he purchased with questionable funds. Graff smuggled illegally obtained weapons from Afghanistan during his 2012–2013 military deployment, and smuggled an additional estimated $350,000 in illegal proceeds.

• A former CEO of two U.S. government contractors, James O’Brien, was sentenced to six months’ imprisonment, four months’ home confinement, and three years’ supervised release. O’Brien pleaded guilty in June 2019 for making false statements that increased his companies’ competitiveness.

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