Dec. 13, 2007 — -- A federal grand jury has indicted two former employees of government contractor KBR for an alleged scheme that defrauded the Pentagon out of more than $2 million.
James Sellman and Wallace Ward, formerly of Houston-based Kellogg Brown and Root, Inc., face charges for allegedly conspiring to defraud the Department of Defense through a bribery scheme involving fuel shipments they received at Bagram Airfield in Afghanistan.
According to the indictment, Sellman and Ward allegedly pocketed cash payments that Afghan truck drivers gave them in exchange for overstating fuel quantities on receipts for deliveries to the airfield.
As a result of the alleged transactions, which the government says took place between May and September 2006, truckers diverted more than 784,000 gallons of fuel — valued at over $2.1 million — away from the base.
Both men were employed by KBR, the contractor responsible for "inspecting the fuel deliveries; verifying the quality, quantity and delivery of the fuel claimed" on the drivers' paperwork at the time of delivery, the indictment says.
Sellman and Ward allegedly forged the signatures of other KBR employees, who were authorized to complete and sign the forms, and returned them to the Afghan drivers, according to the indictment.
The deliverymen would then allegedly submit the paperwork to their company, British-based Red Star Enterprises Limited, which caused the company to erroneously bill the Defense Department for fuel.
Sellman, Ward and co-conspirators not named in the indictment, falsified paperwork "showing that the drivers' trucks had delivered fuel to the airfield when, in fact, the fuel had not been delivered, and was going to be diverted for sale outside the airfield, to parties not authorized by the United States Government to receive the fuel," the indictment claims.
Sellman, 31, and Ward, 25, each face four charges; if convicted, they could be sentenced to a maximum five-year prison sentence for each count.
Heather Browne, corporate communications director for KBR, released a statement to ABC News, saying that the company "in no way condones or tolerates unethical behavior," and that all employees are expected to follow the company's code of conduct, or immediate disciplinary action is taken.
"KBR remains committed to fully cooperating with the authorities in this case," the statement concluded.
According to its Web site, KBR is the largest contractor for the U.S. Army, a top 10 contractor for the U.S. Department of Defense, and "is currently the world's largest defense services provider," employing 50,000, worldwide.