Sex and money bought Iraq contracts

A contractor in Iraq has pleaded guilty to providing money, sex and designer watches to US officials in exchange for more than $8 million in reconstruction contracts. Philip Bloom faces up to 40 years in prison after admitting paying more than $2 million in bribes to US officials with the Coalition Provisional Authority, which ruled Iraq after the US-led invasion in 2003. Bloom's guilty plea on bribery and money-laundering charges is the latest development in a widening corruption scandal centered on a network of US civilians and military officials who worked out of an occupation outpost in the south-central Iraqi town of Hilla. Under the plea agreement, Bloom must pay $3.6 million in restitution and forfeit $3.6 million in assets. The scheme began in January 2004, when Bloom began paying bribes to Robert Stein, a civilian contractor who controlled $82 million in reconstruction funds as the comptroller for the occupation's headquarters in Hilla. Stein, who had a previous conviction for fraud when he was hired, pleaded guilty to accepting bribes in February. He funneled money and favors from Bloom to other officials in Hilla, all of whom helped direct contracts to a group of companies controlled by Bloom, court documents say. Two officers in the US Army Reserve, Lt. Col. Michael Wheeler and Lt. Col. Debra Harrison, have already been arrested in connection with the case and more arrests are expected, investigators said. From January to June 2004, when the occupation government was replaced, Bloom provided Stein and officers with first-class air tickets, real estate lots, weapons, new four-wheel-drive vehicles, cigars, designer watches, alcohol, prostitutes at Bloom's Baghdad villa and cash bribes. In return, Bloom's company, Global Business Group, received $8.6 million in contracts to refurbish a police academy in Hilla, a library in Karbala and other reconstruction projects. In some cases the work was never done, and in others it was shoddy, audits by the inspector-general reveal. The contracts were paid with Iraqi funds held in the Development Fund for Iraq, which has been at the center of many of the corruption scandals in Iraq.