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At least $154.4 million of fuel cost stolen from US, Afghan forces: SIGAR

Due to the amount of fuel needed for military operations, along with the highly transferable nature of this commodity, fuel theft has become a lucrative business in Afghanistan, with at least $154.4 million in fuel stolen from either the U.S. military or the ANDSF. However, because U.S. officials usually detected that the fuel was being stolen only long after the theft began, it is likely that even more fuel has been stolen in Afghanistan, Special Inspector General for Reconstruction of Afghanistan (SIGAR) has said in a statement.

It said corruption throughout the fuel industry and the country potentially benefits the Taliban and other insurgent or terrorist organizations by supplying needed funds and the fuel itself.

SIGAR’s prior audits and investigations, along with oversight work conducted by DOD OIG and USAAA, identified weaknesses in supplying and accounting for fuel in Afghanistan that may have allowed for theft and corruption. Specifically, SIGAR’s investigations and USAAA’s audits identified weaknesses associated with supplying fuel for U.S. military forces that involved a lack of contractor oversight, poor record keeping, and a lack of accurate fuel measurement procedures, the statement added.

Additionally, SIGAR’s audits and investigations and DOD OIG’s reports identified weaknesses associated with supplying fuel for the ANDSF, including falsified consumption data, lack of independently verified fuel deliveries, and corruption. SIGAR has conducted 70 investigations related to fuel theft in Afghanistan, many of which were conducted in partnership with other U.S. and Afghan government agencies. As of December 2017, these investigations had resulted in almost $32 million in fines, restitutions, and forfeitures, and $28.5 million in recoveries and savings. Additionally, the investigations led to 40 convictions that included sentences totaling more than 115 years in prison and 53 years of probation. The investigations also resulted in authorities barring 176 individuals from military installations, according to the watchdog.

It also said the Combined Security Transition Command–Afghanistan (CSTC-A) has been the primary U.S. agency responsible for supplying fuel to the ANDSF. Prior to 2017, CSTC-A used both on-budget and off-budget mechanisms to supply fuel to the ANDSF. Under on-budget mechanisms, CSTC-A gives funds to the Afghan government for it to use to pay for its own fuel contracts. Under off-budget mechanisms, CSTC-A uses DOD-administered contracts to support ANDSF fuel needs. By February 2017, CSTC-A had moved all ANDSF ground fuel procurement off-budget due to concerns about corruption and contract mismanagement within the Ministries of Defense (MOD) and Interior (MOI). CSTC-A subsequently used a contract, awarded by the Expeditionary Contracting Command–Afghanistan (ECC-A), as the primary fuel supply contract for the ANDSF. This contract was initially intended to serve as a back-up to the Afghan government’s on-budget fuel supply contracts.

SIGAR found that this back-up contract had oversight and accountability weaknesses. For example, according to CSTC-A officials, under the contract, they had limited visibility into fuel deliveries, which was partially due to the contract only requiring fuel delivery reports from vendors on a weekly rather than a daily basis. Additionally, CSTC-A has not reliably received fuel consumption data as required by its commitment letters with the MOD and the MOI. CSTC-A representatives also stated that they did not have detailed knowledge of ANDSF fuel site storage capacities, infrastructure, or personnel capabilities. Similarly, ECC-A contracting officials noted that under the backup contract, vendors may have obtained fuel that was of poor quality or from prohibited sources, such as Iran, due to the fact the contract did not require the vendors to submit country-of-origin documentation for the fuel they delivered, according to the statement.