Military

DATE=01/23/04

TYPE=CORRESPONDENT REPORT

TITLE=PENTAGON / HALLIBURTON (L)

NUMBER=2-312218

BYLINE=NICK SIMEONE

DATELINE=WASHINGTON

CONTENT=

VOICED AT:

INTRO: A U-S company with connections to the White House says it may have overcharged the Pentagon by some six million dollars for work in Iraq. Correspondent Nick Simeone tells us the disclosure was made by the energy giant Halliburton, which used to be headed by Vice President Dick Cheney.

TEXT: Houston-based Halliburton says its own internal audit caught a six million dollar potential over-billing by one of its subcontractors for work in Iraq, where the company already has reconstruction and U-S military contracts worth billions of dollars. The company says at least one person has now left Halliburton subsidiary Kellogg, Brown and Root after perhaps accepting what are being described as millions of dollars in kick-backs from a Kuwaiti subcontractor.

The Pentagon has refused comment on the matter. But at the White House, spokesman Scott McClellan says the president wants a full investigation.

/// McCELLAN ACT ///

We expect the Department of Defense to get to the bottom of it.

/// END ACT ///

Halliburton has already come under fire, especially from Democrats, who charge it has been awarded contracts in Iraq because of its close ties to the White House. Vice President Cheney, who led the energy giant until 2000, responded to critics during an interview with Fox news two days before these latest allegations surfaced.

/// CHENEY ACT ///

They try to make it personal. They come after allegations that somehow I am manipulating contracts for Halliburton. I don't have anything to do with the contracting process and wouldn't know how to manipulate the process if I wanted to.

/// END ACT ///

Still, some Democrats including Senate minority leader Tom Daschle say it's now time for a formal investigation.

/// DASCHLE ACT ///

Clearly, if there has been a kickback, a criminal investigation is certainly warranted. I can't imagine why we would reward one more contract until these matters have been resolved.

/// END ACT ///

Halliburton has been operating in the Middle East for decades and denies receiving preferential treatment for the billions of dollars in contracts it holds in Iraq. It's now promising to refund the government whatever these questionable charges may have cost the American tax payer. (SIGNED)

NEB/NJS/PT/KL