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AFGHANISTAN AND PAKISTAN: ACCOUNTABILITY

COMMUNITY OVERSIGHT OF A NEW INTERAGENCY STRATEGY

HEARING

BEFORE THE

SUBCOMMITTEE ON NATIONAL SECURITY

AND FOREIGN AFFAIRS

OF THE

COMMITTEE ON OVERSIGHT

AND GOVERNMENT REFORM

HOUSE OF REPRESENTATIVES

ONE HUNDRED ELEVENTH CONGRESS

FIRST SESSION

SEPTEMBER 9, 2009

Serial No. 111–119

Printed for the use of the Committee on Oversight and Government Reform

(

Available via the World Wide Web: http://www.fdsys.gov

http://www.house.gov/reform

(II)

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

EDOLPHUS TOWNS, New York, Chairman

PAUL E. KANJORSKI, Pennsylvania

CAROLYN B. MALONEY, New York

ELIJAH E. CUMMINGS, Maryland

DENNIS J. KUCINICH, Ohio

JOHN F. TIERNEY, Massachusetts

WM. LACY CLAY, Missouri

DIANE E. WATSON, California

STEPHEN F. LYNCH, Massachusetts

JIM COOPER, Tennessee

GERALD E. CONNOLLY, Virginia

MIKE QUIGLEY, Illinois

MARCY KAPTUR, Ohio

ELEANOR HOLMES NORTON, District of

Columbia

PATRICK J. KENNEDY, Rhode Island

DANNY K. DAVIS, Illinois

CHRIS VAN HOLLEN, Maryland

HENRY CUELLAR, Texas

PAUL W. HODES, New Hampshire

CHRISTOPHER S. MURPHY, Connecticut

PETER WELCH, Vermont

BILL FOSTER, Illinois

JACKIE SPEIER, California

STEVE DRIEHAUS, Ohio

——— ———

DARRELL E. ISSA, California

DAN BURTON, Indiana

JOHN M. MCHUGH, New York

JOHN L. MICA, Florida

MARK E. SOUDER, Indiana

JOHN J. DUNCAN, JR., Tennessee

MICHAEL R. TURNER, Ohio

LYNN A. WESTMORELAND, Georgia

PATRICK T. MCHENRY, North Carolina

BRIAN P. BILBRAY, California

JIM JORDAN, Ohio

JEFF FLAKE, Arizona

JEFF FORTENBERRY, Nebraska

JASON CHAFFETZ, Utah

AARON SCHOCK, Illinois

BLAINE LUETKEMEYER, Missouri

RON STROMAN, Staff Director

MICHAEL MCCARTHY, Deputy Staff Director

CARLA HULTBERG, Chief Clerk

LARRY BRADY, Minority Staff Director

SUBCOMMITTEE ON NATIONAL SECURITY AND FOREIGN AFFAIRS

JOHN F. TIERNEY, Massachusetts, Chairman

CAROLYN B. MALONEY, New York

PATRICK J. KENNEDY, Rhode Island

CHRIS VAN HOLLEN, Maryland

PAUL W. HODES, New Hampshire

CHRISTOPHER S. MURPHY, Connecticut

PETER WELCH, Vermont

BILL FOSTER, Illinois

STEVE DRIEHAUS, Ohio

STEPHEN F. LYNCH, Massachusetts

HENRY CUELLAR, Texas

MIKE QUIGLEY, Illinois

JEFF FLAKE, Arizona

DAN BURTON, Indiana

JOHN L. MICA, Florida

JOHN J. DUNCAN, JR., Tennessee

MICHAEL R. TURNER, Ohio

LYNN A. WESTMORELAND, Georgia

PATRICK T. MCHENRY, North Carolina

JIM JORDAN, Ohio

JEFF FORTENBERRY, Nebraska

——— ———

ANDREW WRIGHT, Staff Director

(III)

C O N T E N T S

Page

Hearing held on September 9, 2009 ....................................................................... 1

Statement of:

Fields, Major General Arnold, retired, Special Inspector General for Afghanistan Reconstruction; Gordon Heddell, Inspector General, Department of Defense; Donald Gambatesa, Inspector General, U.S. Agency

for International Development; Harold Geisel, Inspector General, Department of State; and Jacquelyn Williams-Bridgers, Managing Director, International Affairs and Trade, Government Accountability Office 9

Fields, Major General Arnold ................................................................... 9

Gambatesa, Donald ................................................................................... 57

Geisel, Harold ............................................................................................ 107

Heddell, Gordon ......................................................................................... 30

Williams-Bridgers, Jacquelyn ................................................................... 117

Letters, statements, etc., submitted for the record by:

Fields, Major General Arnold, retired, Special Inspector General for Afghanistan Reconstruction:

Article dated August 31, 2009 .................................................................. 11

Prepared statement of ............................................................................... 22

Gambatesa, Donald, Inspector General, U.S. Agency for International

Development, prepared statement of .......................................................... 59

Geisel, Harold, Inspector General, Department of State, prepared statement of ........................................................................................................... 109

Heddell, Gordon, Inspector General, Department of Defense; Donald

Gambatesa, Inspector General, U.S. Agency for International Development ............................................................................................................... 32

Tierney, Hon. John F., a Representative in Congress from the State

of Massachusetts:

SIGAR Audit–09–5 Commander’s Emergency Response Program ....... 159

Prepared statement of ............................................................................... 5

Williams-Bridgers, Jacquelyn, Managing Director, International Affairs

and Trade, Government Accountability Office, prepared statement of .... 120

(1)

AFGHANISTAN AND PAKISTAN: ACCOUNTABILITY COMMUNITY OVERSIGHT OF A

NEW INTERAGENCY STRATEGY

WEDNESDAY, SEPTEMBER 9, 2009

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON NATIONAL SECURITY AND FOREIGN

AFFAIRS,

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM,

Washington, DC.

The subcommittee met, pursuant to notice, at 9:33 a.m., in room

2154, Rayburn House Office Building, Hon. John F. Tierney (chairman of the subcommittee) presiding.

Present: Representatives Tierney, Murphy, and Quigley.

Staff present: Adam Hodge and Catherine Ribeiro, communications directors; Mariana Osorio, Daniel Murphy, Ken Cummings,

and Robyn Russell, legislative assistants; Andy Wright, staff director; Elliot Gillerman, clerk; Talia Dubovi and Scott Lindsay, counsels; Brendan Culley and Steven Gale, fellows; Dan Blankenburg,

minority director of outreach and senior advisor; Adam Fromm, minority chief clerk; Seamus Kraft, minority deputy press secretary;

Tom Alexander, minority senior counsel; Christopher Bright, minority senior professional staff member; Lieutenant Glenn Sanders,

minority Defense fellow; and Bob Bordon, minority general counsel.

Mr. TIERNEY. Good morning, everyone. A quorum being present,

the Subcommittee on National Security and Foreign Affairs’ hearing entitled, ‘‘Afghanistan and Pakistan: Accountability Community

Oversight of a New Interagency Strategy,’’ will come to order.

Before we begin the hearing, I would just like to quickly address

one piece of business that is left over from the subcommittee’s June

6, 2009 hearing that was entitled, ‘‘U.S. Contributions to the Response to Pakistan’s Humanitarian Crisis: The Situation and the

Mistakes.’’ After that hearing, I received a request of the U.S.

Agency for International Development to submit a statement for

the record. I would note that USAID received an invitation to submit a statement prior to the hearing but declined to do so. However, given the relevance of their statement to the subject matter

of the hearing, I ask unanimous consent that the hearing record be

reopened, USAID statement be submitted for the record, and that

the hearing record then be reclosed. Without objection, so ordered.

I ask unanimous consent that only the chairman and ranking

member of the subcommittee be allowed to make opening statements. And without objection, so ordered.

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I ask unanimous consent that the hearing record be kept open

for 5 business days so that all members of the subcommittee be allowed to submit a written statement for the record. Without objection, so ordered.

So once again, good morning to everybody here. I’ve already explained to the people on our panel that I’m sure there is no sign

of disrespect from Members to the people that are kind enough to

come and testify, and that those Members that don’t get here to the

hearing will certainly read the testimony for the record and the

transcript afterwards. But I know that at least on the Democratic

side, there is a caucus going on, as I indicated, probably some discussion about health care if I’m not mistaken. So we just want to

express that.

In other words, the hearing today probably couldn’t be more

timely than it is, because in the coming days the commanding general in Afghanistan, Lieutenant General Stanley McChrystal, is expected to request that President Obama provide significant additional numbers of troops for our effort there.

Meanwhile in the coming weeks, Congress will consider final pas- sage of a bill to triple U.S. aid to Pakistan to almost $11⁄2 billion

a year. In short, the United States is on the verge of doubling down

on a commitment of troops and treasure to Afghanistan and Pakistan.

As we have learned in Iraq, however, a sudden increase in conflict resources exponentially increases the likelihood of waste, fraud

and abuse. Unfortunately, some of our programs in Afghanistan

and Pakistan to date have been flawed and have lacked basic accountability measures. For example, last year the subcommittee

and the Government Accountability Office conducted major investigations of the Coalition Support Funds Program by which the

United States reimburses Pakistan for expenses it incurs in certain

counterterrorism operations. This program has represented the

bulk of the U.S. aid to Pakistan in the past 7 years, some $6.7 billion to date.

The investigations found that there were no receipts for a significant portion of the U.S. reimbursements to Pakistan and that the

program lacked basic accountability provisions. Further, the reimbursement program isn’t really designed to improve the Pakistani

military’s capabilities for counterterrorism and counterinsurgency

operations.

In Afghanistan in January 2009, the Government Accountability

Office report brought attention to the significant lack of accountability for 242,203 small arms provided to the Afghan National Security Forces. The Department of Defenses Combined Security

Transition Command in Afghanistan [CSTC–A], could not provide

records, did not track serial numbers, or could not locate a significant portion of the weapons provided. In addition, the report drew

attention to the inability of the Afghan National Security Forces to

safeguard those weapons.

While we are at a crossroads in U.S. policy here in Washington,

DC, it appears that we are also at a crossroads on the ground in

Afghanistan and Pakistan. Trends in Afghanistan have not been

good. The Taliban is resurgent from Kandahar to Kunduz. Three

weeks ago, Afghanistan held presidential and provincial elections

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in the middle of this deteriorating security situation. The results

of that election are not final, but there are credible reports of widespread fraud. Any cloud over the legitimacy of Afghanistan’s President would add a sense of insecurity that threatens international

efforts there.

In Pakistan, the story is more mixed. After years of inconsistent

attention to the threat posed by extremist militants, Pakistan civilian leadership and military forces seem to have gathered the resolve necessary to confront the challenges they face. They harnessed the political will and manpower to retake the Swat Valley

and the adjoining areas of the Malikan region. Many Pakistani soldiers paid the ultimate sacrifice during this campaign. Unfortunately it stalled at the border of south Waziristan, by all accounts

a hotbed of militancy, including senior al Qaeda leadership.

The killing last month of Baitullah Mehsud was a significant development, but it must be followed by concerted efforts by the Pakistanis themselves to bring security and to reassert the authority

and services of their government in these troubled regions.

In Afghanistan, the United States and international reconstruction and aid efforts face a daunting challenge trying to rebuild a

war-torn country in the midst of active insurgency.

In Pakistan, security challenges and political sensitivities currently restrict inspectors general from the mobility, access and

presence necessary to do the task.

The principal question guiding today’s hearing is whether the accountability community is prepared to ramp up its own efforts to

mirror the massive increase in resources that the United States

will devote to Pakistan and Afghanistan in the coming years.

Frankly, I have serious concerns about the community’s collective

ability to provide comprehensive oversight coverage that keeps

pace with the rapid boom in U.S. activities in the region, especially

given the enormous burdens already borne by those offices.

The threshold challenge they face is security. After numerous

trips to Afghanistan and Pakistan, I’m acutely aware of the strict

limits imposed on personnel in country. However, a sustained physical presence in Afghanistan and Pakistan is crucial to establishing

the relationships necessary to receive tips of waste, fraud and

abuse. Three-week rotations are not enough to establish the informal interactions that can provide vital information about flawed

and fatal activities.

Another concern I have is the accountability community’s coverage of the U.S. aid to Pakistan. Security challenges in Pakistan

make U.S. aid efforts all the more vulnerable to waste, fraud and

abuse. In particular, I have serious questions regarding oversight

coverage of aid efforts in the Northwest Frontier province and the

Federally Administered Tribal Areas.

Finally, I would like all the panelists’ thoughts on Ambassador

Eikenberry’s call to ‘‘Afghanize’’ more of our aid efforts in order to

build Afghan Government capacity.

How will the U.S. Government accountability community navigate its role in overseeing such aid programs? We count on the inspectors general and the GAO as bulwarks against waste, fraud

and abuse. Especially in these difficult economic times, we must

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demand absolute transparency and accountability for every last

taxpayer dollar. Thank you.

[The prepared statement of Hon. John F. Tierney follows:]

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Mr. TIERNEY. With that, I will ask Mr. Flake for his opening remarks.

Mr. FLAKE. I thank the chairman. I want to mention also that

Republicans are caucusing as well. I apologize. Both of us have to

slip away. But I have the same concerns as the chairman with regard to the oversight community’s ability to police and to make

sure that there isn’t significant waste, fraud and abuse.

I think with the backdrop here of a commitment to step up our

troop levels there, with what Michael Mullen and others have described as a serious and deteriorating situation in Afghanistan,

makes this kind of hearing very important to see what safeguards

are in place and if you have the resources and the tools to ensure

that our money is being well spent. So with that, I look forward

to hearing the witnesses.

Mr. TIERNEY. Thank you. The subcommittee will now receive testimony from the panel before us today. I will give a brief introduction of each of the panelists, and thankfully it is brief, because if

we really read all of your credentials, it would probably take up the

rest of the hearing.

We have a very distinguished panel here today that has been

doing great service to the country, which we appreciate, and we understand also the difficulty of what you’re asked to do.

To my far left is Major General Arnold Fields, who serves as the

Special Inspector General for Afghanistan Reconstruction [SIGAR].

From 2007 to 2008, he served as the Deputy Director of the Africa

Center for Strategic Studies in the Department of Defense. He retired from the U.S. Marine Corps in 2004 and previously served as

the Deputy Commander of the Marine Corps forces in Europe. General Fields holds a B.S. from South Carolina State University and

an M.A. from Pepperdine University.

Mr. Gordon Heddell serves as the Inspector General for the Department of Defense. From 2001 to 2009, he served as the Inspector General at the Department of Labor. Prior to this position, he

served in the U.S. Secret Service for 29 years, where he worked as

the assistant director leading the Secret Service’s inspection in internal affairs programs worldwide. Mr. Heddell holds a B.A. from

the University of Missouri and an M.A. From the University of Illinois.

Mr. Donald Gambatesa, serves as the Inspector General of the

U.S. Agency for International Development and concurrently holds

this position at the Millennium Challenge Corp. and the U.S. Africa Development Foundation and the Inter-American Foundation.

Prior to this post, Mr. Gambatesa served as the Deputy Director

of the U.S. Marshals Service. He previously spent 24 years as a

Special Agent in the U.S. Secret Service and he holds a B.A. From

John Carroll University.

Ambassador Harold Geisel serves as the Acting Inspector General for the Department of State. From 2002 to 2003, he served as

the head of delegation for negotiations for the People’s Republic of

China on the construction of new embassies. Prior to assuming this

post, he served for more than 25 years in the U.S. Foreign Service.

He holds a B.A. From John Hopkins University and an M.S. From

the University of Virginia.

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Ms. Jacquelyn Williams-Bridgers serves as the Managing Director of International Affairs and Trade in the U.S. Government Accountability Office. From 2002 to 2004, she led the strategic planning and external liaison unit in the Government Accountability

Office. Prior to this position, she served as the Inspector General

of the U.S. Department of State and the U.S. Arms Control and

Disarmament Agency and the U.S. Information Agency and the

Broadcasting Board of Governors.

I want to thank you all again for being witnesses here today and

making yourselves available with your substantial expertise. As

you all know, it is the policy of this committee to swear witnesses

in before they testify. So I ask you to please stand and raise your

right hands. If there is anybody else that will be testifying with

you, I ask that they also do the same.

[Witnesses sworn.]

Mr. TIERNEY. The record will indicate that all the witnesses answered in the affirmative. I do tell you that all of your written

statements will be put on the record. I know some of you were kind

enough to file extensive written statements. You needn’t feel compelled to stick just to that. We’re happy to have comments for 5

minutes, if we can, and then we will go to questions and answers.

So why don’t we start with you, General? Thank you again for

being here.

STATEMENTS OF MAJOR GENERAL ARNOLD FIELDS, RETIRED,

SPECIAL INSPECTOR GENERAL FOR AFGHANISTAN RECONSTRUCTION; GORDON HEDDELL, INSPECTOR GENERAL, DEPARTMENT OF DEFENSE; DONALD GAMBATESA, INSPECTOR

GENERAL, U.S. AGENCY FOR INTERNATIONAL DEVELOPMENT; HAROLD GEISEL, INSPECTOR GENERAL, DEPARTMENT OF STATE; AND JACQUELYN WILLIAMS-BRIDGERS,

MANAGING DIRECTOR, INTERNATIONAL AFFAIRS AND

TRADE, GOVERNMENT ACCOUNTABILITY OFFICE

STATEMENT OF MAJOR GENERAL ARNOLD FIELDS

General FIELDS. Good morning, Chairman Tierney, Ranking

Member Flake, and other members of this subcommittee. Thank

you very much for inviting me to participate at this hearing. In

keeping with our mandate which focuses on Afghanistan, my opening remarks this morning will be provided accordingly.

I have provided a written statement and I wish to at this time

highlight a few of the elements of that statement. As the newest

organization at this table, it was less than a year ago that SIGAR

obtained funding. We continue to aggressively build our organization to conduct reviews of our reconstruction projects and to provide findings and recommendations that will serve the Congress

and the administration appropriately. Congress has appropriated about $38 billion since 2002 to rebuild Afghanistan. The President’s fiscal year 2010 budget request

includes additional funding for Afghanistan, which would bring

funding for Afghanistan to about $50 billion through 2010. Together with my colleagues at this table, SIGAR certainly is committed to providing the oversight needed to prevent waste, fraud and

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abuse, and to promote the effective implementation of the reconstruction program in Afghanistan.

We are members of the Southwest Asia Joint Planning Group

and its Pakistan/Afghanistan Subcommittee on Afghanistan and

Pakistan, which serve as forums for coordinating our work. I want

to stress that we do coordinate. Also in our investigations work, we

collaborate with the National Procurement Task Force and the

International Contract Corruption Task Force.

SIGAR has grown from an office of 2 to an office of 46, with an

additional 17 prospective employees in the pipeline. We have offices

in Arlington, VA, and in Afghanistan, where we have offices in

Kabul. Today, 12 personnel are located at the Embassy in Kabul,

and we are leaning toward 20, which we have negotiated by way

of the NSDD process with the Ambassador and the Department of

State.

We have personnel or office space in several other locations in

Afghanistan, including Bagram Airfield, as well as Kandahar Airfield; Bagram, the province of Parwan, and Kandahar, the province

of Kandahar.

While growing, we have watched closely as the U.S. Government

has developed and expanded policy in Afghanistan. And I wish to

note the extraordinary work of Ambassador Holbrooke who recently

testified before this very committee. He has consistently highlighted the importance of oversight in the new Afghanistan-Pakistan strategy.

[The information referred to follows:]

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General FIELDS. Over the past several months, SIGAR has met

regularly with senior government officials in both Washington and

Afghanistan. In Kabul, we have attended the meetings at the Embassy. We have also built a strong network among the agencies, the

international community, and the military components throughout

Afghanistan. These meetings, together with our ongoing work, help

us monitor the administration’s development of a new approach in

Afghanistan. And, of course, we are using this information as a

basis to adapt and expand our oversight plans.

We work continuously with members of the oversight community

to make sure that oversight work is coordinated and not duplicative; targets the highest priority areas; aims to produce positive

change; and does not overburden the U.S. civilian and military personnel who are implementing the reconstruction programs.

We are keenly aware that it is our job to find and document

waste, fraud and abuse with the express purpose of working to improve the U.S. assistance program and identify wrongdoers. Likewise, we are poised to identify lessons learned.

Our mission is difficult. It has taken time to hire staff capable

and willing to do this work in a dangerous environment; however,

we have made considerable progress. As of last week, we have

issued four mandated quarterly reports to this Congress and five

audit and inspection reports, each with recommendations for improved processes and corrective action. Another three draft reports

are currently at the agencies for comment as we speak. We have

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reports before the end of this month. SIGAR’s investigative work has resulted in over $4 million in

cost avoidance in one case and the guilty pleas of two people offering $1 million in bribes for contracts in another. Our investigators

are working 25 other active cases as we speak. Our work has identified problems with contract oversight, the lack of integrated information on reconstruction activities and concerns with sustainment

capacity.

The impact of oversight cannot be measured solely by statistics.

We believe that being on the scene is a real deterrent to waste,

fraud and abuse. We also operate a hotline giving U.S. coalition

partners and the Afghan citizens various methods by which to report allegations of waste, fraud and abuse related especially to the

reconstruction efforts. The hotline has produced a number of credible leads that we, of course, are pursuing.

We are working hard to produce and provide the robust oversight

substantial for the successful implementation of reconstruction programs in Afghanistan. And I welcome your questions there unto

pertaining. Thank you.

Mr. TIERNEY. Thank you, sir.

[The prepared statement of General Fields follows:]

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Mr. TIERNEY. Mr. Heddell.

STATEMENT OF GORDON S. HEDDELL

Mr. HEDDELL. Chairman Tierney, Ranking Member Flake and

members of the subcommittee, thank you for the opportunity to appear before you this morning.

Mr. Chairman, oversight in Southwest Asia, with emphasis on

Afghanistan and Pakistan, is one of my top priorities. It is my goal

to ensure the health, safety and the welfare of our troops and to

ensure that taxpayer dollars are being spent wisely.

Our current efforts include increased oversight by enhancing our

in-theater presence and ensuring comprehensive and effective

interagency coordination. The oversight we provide through audits,

investigations, inspections and assessments truly make a difference, especially in such an unstable and dangerous region where

Department of Defense operations and troop levels are increasing.

Earlier this year, President Obama announced a comprehensive

new strategy to disrupt, dismantle and defeat al Qaeda in Pakistan

and Afghanistan, and to prevent their return to either country in

the future. This strategy will involve several departments and

agencies in our government.

We have conducted oversight on Pakistan in 2003 and again in

2009, and started oversight efforts in Afghanistan in 2004. And we

are increasing our resources in the region to ensure proper oversight and staffing in regard to the new strategy and the buildup

of U.S. forces and programs in Afghanistan.

To support our oversight, we have established field offices in

strategic locations in Southwest Asia. We also utilize an expeditionary work force model to support our efforts. This helps facilitate

timely reviews and reporting of results while minimizing disruption

to the warfighter.

Our central field office in the region is located at Bagram Airfield. With the support and endorsement of the Commander of U.S.

Central Command, we have staffed new offices in Kandahar and

Kabul with 14 deployed personnel, 6 investigators and 8 auditors.

In addition, our staff travel as needed for field work in Afghanistan. Currently there are five auditors and two engineers, for instance, on temporary travel in Afghanistan. And I will be traveling

there myself in the near future to meet with General McChrystal

and other commanders in theater.

I have created a new key position within the DOD Office of Inspector General to ensure that there is effective coordination and

communication within the oversight community within Southwest

Asia. This position, the Special Deputy Inspector General for

Southwest Asia, will report directly to me and act on my behalf to

coordinate and deconflict oversight efforts.

The DOD IG is the lead oversight agency for accountability in

the Department. For Southwest Asia, including Afghanistan and

Pakistan, there are three critical coordination and planning mechanisms: the Southwest Asia Joint Planning Group, the Comprehensive Oversight Plan for Southwest Asia, and our many investigative task forces.

In addition, in May 2009, the Joint Planning Group established

a new subcommittee to coordinate audit and inspection work solely

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in Afghanistan and Pakistan. This subcommittee, chaired by the

Inspector General for the U.S. Agency for International Development, Mr. Gambatesa, issued in August 2009 the AfghanistanPakistan Comprehensive Oversight Plan.

I thank the committee for the opportunity to discuss our ongoing

efforts and I look forward to continuing our strong working relationship with Congress and all oversight organizations engaged in

Afghanistan and Pakistan.

Mr. TIERNEY. Thank you very much.

[The prepared statement of Mr. Heddell follows:]

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Mr. TIERNEY. Mr. Gambatesa.

STATEMENT OF DONALD A. GAMBATESA

Mr. GAMBATESA. Good morning, Chairman Tierney, Ranking

Member Flake, members of the committee. Thank you for inviting

me here to testify today on behalf of the Office of the Inspector

General for the U.S. Agency for International Development. I’m

pleased to be here along with my colleagues from other oversight

organizations with whom we work closely as we execute our audit

inspection and investigative responsibilities in Afghanistan and

Pakistan.

Historically my office has overseen programs in these countries

from our regional office in the Philippines, increasing our staffing

levels there as USAID funding in Afghanistan and Pakistan have

increased. We recently established a full-time presence of Foreign

Service officers in these countries, placing an auditor and a criminal investigator in Kabul and two auditors and a criminal investigator in Islamabad. These employees will be in addition to those

currently providing oversight from our office in the Philippines.

We also have a request for three additional positions in Afghanistan. To date in Afghanistan, we have conducted 27 program performance audits in which we have made 84 recommendations for

operational improvement of USAID programs. Moreover, we have

issued nearly 30 financial audits that have identified more than $8

million in questioned costs of which $1.3 million was sustained.

In addition to conducting audit, we investigate allegations of

fraud and waste in these countries. In Afghanistan, we have

opened 44 investigations that have resulted in 8 indictments, 9 arrests and 3 convictions and savings and recoveries have totaled $87

million.

I want to mention just two of our recent investigations involving

security contracts in Afghanistan. In one, a defendant pled guilty

to conspiracy this past week for his role in a scheme to solicit kickbacks in connection with the awarding of private security contracts.

In another investigation, four individuals and a security company

they worked for were indicted after they obtained reimbursement

for fraudulent expenses. The company and the individuals charged

have also been suspended indefinitely from doing business with the

government. One former employee is serving a 2-year sentence and

more than $24 million has been saved in connection with this investigation.

In Pakistan, since 2002 we have conducted five program performance audits and made 12 recommendations for program improvements. Our 23 financial audits conducted in Pakistan identified approximately $6 billion in questioned costs, of which $3.5 billion was

sustained, and we have several ongoing investigations in Pakistan.

We in the oversight community have been working diligently for

several years to coordinate our oversight activities in Afghanistan.

Our criminal investigators work closely with the National Procurement Task Force, which was established by the Department of Justice to identify and prosecute fraud associated with government

contracting. We are also members of the International Contract

Corruption Task Force and Interagency Law Enforcement Group

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that coordinates contract and procurement fraud investigations in

high-risk international locations such as Iraq and Afghanistan.

A new coordination group which Mr. Heddell mentioned, which

we chair, was formed in June 2009 in response to the administration’s focus on Afghanistan and Pakistan. This subgroup of the

Southwest Asia Planning Group consists of representatives from

the organizations you see with me here today. The AfghanistanPakistan subgroup issued an oversight plan in August 2009. I have

submitted a copy of the plan with my written testimony and ask

it be made part of the record.

This plan corresponds to the strategies developed by the U.S.

Government for assisting Afghanistan and Pakistan in addressing

high-priority issues. The five areas addressed in the plan are security, governance, rule of law, human rights, economic and social development, contracting oversight and performance and cross-cutting programs. The subgroup will monitor this plan and make adjustments as necessary during quarterly meetings.

The members of the Afghanistan-Pakistan subgroup have been

working together to address oversight in this region for several

years and I’m confident that we are effectively coordinating with

one another to provide the best oversight possible. I want to emphasize, however, that oversight is a shared responsibility—that of

the inspector general community and the agencies we oversee, as

well as the contractors and grantees who implement foreign assistance programs. We must all be vigilant to ensure that tax dollars

are not wasted.

Thank you again for inviting me here to testify. I look forward

to answering your questions.

[The prepared statement of Mr. Gambatesa follows:]

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Mr. TIERNEY. Thank you.

Mr. TIERNEY. Ambassador Geisel.

STATEMENT OF HAROLD W. GEISEL

Mr. GEISEL. Chairman Tierney, Ranking Member Flake, members of the subcommittee, thank you for inviting me to discuss the

Department of State OIG oversight plan and our coordination and

planning efforts with other IGs to provide oversight of U.S. resources and projects in Pakistan and Afghanistan. I also led this

office from 1994 to 1995 and am very pleased with the significant

increase in oversight that OIG is conducting around the world. The

State Department OIG is an original member of the Southwest

Asia Joint Planning Group responsible for coordinating the work of

IGs active in this broad geographic region.

This past spring, the Pak-Af subgroup was formed to better focus

on oversight related to Pakistan and Afghanistan. I’m pleased to

report the Pak-Af subgroup is working quite well. In addition to

formal regularly scheduled monthly meetings, members take part

in weekly and sometimes daily discussions. We are acutely aware

of the difficulties in working in Pakistan and Afghanistan and the

burden that our staffs can place on U.S. personnel working in those

countries; therefore, we are committed to avoiding redundancy and

maximizing our effectiveness.

Let me begin with Pakistan. Our Middle East Regional Office,

MERO, will conduct a review this fall of the current management

control environment at Embassy Islamabad in anticipation of a significant increase in funding and program implementation during

the next 5 years. MERO will assess risk and vulnerability associated with achieving current and new program objectives. Our plan

is to use this risk and vulnerability assessment to drill down and

conduct more thorough examinations of those programs and activities designated as most vulnerable to waste, fraud and abuse. As

we learned from Iraq assistance programs in 2004 and 2005, effective management controls are needed at the initial stages of assistance implementation.

Additionally, in 2008, MERO completed the review with a Fulbright program in Afghanistan. Our Office of Inspections will conduct a full post inspection of Embassy Islamabad in calendar year

2010. Post inspections thoroughly cover every aspect of Department

activity managed by the Embassy. In August, OIG and Embassy

Islamabad agreed to have MERO open a five-person office at the

Embassy to monitor Department programs. Our auditors and analysts will be stationed in Pakistan, supplemented as needed with

additional OIG staff to provide the necessary oversight. MERO has

effectively used this staffing model at Embassy Baghdad and plans

to open a similar-sized office at Embassy Kabul this month. We expect to have our MERO office in Pakistan to open in early 2010 as

funding levels permit.

Now I will talk about Afghanistan. Our Office of Inspections will

be in Kabul this October inspecting the mission, and should issue

a report later in 2009. About 12 inspectors, including a highly experienced team leader a former Ambassador will conduct the post inspection of all mission aspects, including contracting, mission programs, consular affairs, security and protection. Additionally, the

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Office of Inspections will issue a report later this month on the Department’s demining program in Afghanistan.

In August we released a MERO report covering the performance

of U.S. Training Center, formerly Blackwater, under the terms of

its Afghanistan contract. MERO also is participating in joint StateDOD audit of the Afghan national police training and mentoring

program. They will report at the end of this year.

Looking forward to 2010, MERO plans to work on a number of

Department-funded programs, including the following: refugees and

internally displaced programs, public diplomacy and the Embassy’s

Guard forces.

Regarding investigations: In 2009, we created the Middle East

Investigative Branch to conduct investigations in support of the Department’s expanding Middle East and South Asia missions.

MEIB’s primary mission is to respond to criminal allegations and

support investigative activities concerning Department programs,

employees, and contractors from Pakistan to Morocco, with focused

concentration on high-value, high-risk areas of Iraq, Pakistan and

Afghanistan.

To date, six criminal investigators are assigned to MEIB, with

five posted overseas and one in Arlington, Virginia. We can move

our personnel easily from these forward bases in the region, as

needed, to Islamabad, Kabul, or other priority posts.

We plan to increase MEIB staff at current posts, adding one in

Baghdad, and one in Amman, as 2011 funding permits. In 2010, we

plan to add two staff to MEIB based in D.C. MEIB completed construction and staffing of its Cairo office in 2009.

During fiscal year 2009, MEIB’s investigative activities in Afghanistan include six open investigations and four preliminary inquiries, covering a number of alleged criminal violations.

The committee asked how we would plan our oversight should

the pending bills for increased foreign assistance to Pakistan provide an additional 11⁄2 billion each year over 5 years. There is clear

congressional intent for an in-country presence by OIGs in Pakistan. We’ve been staffing Kabul and Islamabad with temporary deployments, and we’ll increase staff there as necessary. Successful

funding either way will gratefully improve our financial position for

our office in Islamabad which opens in 2010.

The priorities set in the current bill—governance, economic development and investing in people-could touch on a number of

State programs that we oversee and some that we share with the

USAID-OIG. This includes rule of law, international narcotics and

law enforcement, education and cultural affairs, and democracy,

human rights and labor.

Thank you for the opportunity to present this information to you

today. I would be happy to answer any questions.

Mr. TIERNEY. Thank you, Ambassador.

[The prepared statement of Mr. Geisel follows:]

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Mr. TIERNEY. Ms. Williams-Bridgers.

STATEMENT OF JACQUELYN WILLIAMS-BRIDGERS

Ms. WILLIAMS-BRIDGERS. Chairman Tierney and Mr. Flake and

members of the subcommittee, thank you very much for inviting

me to testify to discuss our oversight in Afghanistan and Pakistan

alongside my colleagues in the accountability community.

Since 2003, GAO has issued more than 30 reports and testimonies on U.S. efforts to disrupt, defeat and destroy terrorism in

Afghanistan and Pakistan. Our work has identified the need for

greater attention on issues such as the development of a comprehensive interagency plan for Pakistan, building the Afghan national security forces, accountability over billions of U.S. assistance

to Afghanistan and Pakistan, contract management and oversight

of contractors and U.S. counter narcotics efforts.

GAO’s past work has recommended specific improvements needed in U.S. efforts that should be considered in the administration’s

future strategic planning and implementation. GAO found that several existing conditions such as worsening security, poor infrastructure and the limited institutional capacity of the Afghan Government continue to create challenges for U.S. efforts to assist with securing, stabilizing and rebuilding Afghanistan and combating terrorism in Pakistan.

To address these challenges, GAO has recommended that State,

DOD and USAID improve their planning, enhance interagency coordination, and increase police mentors for training the ANP.

As you noted in your opening statement, Mr. Tierney, we have

also recommended increased oversight of weapons provided to the

ANSF and the coalition support funds provided to Pakistan.

We also reported on the need for improvements in contract management and the numbers of oversight personnel with experience

in contingency operations.

Recently, the administration announced a new integrated civilian

military campaign plan for Afghanistan, and we understand that

the plan for Pakistan is being completed. State and DOD have coordinated their plans for Afghan National Security Force capacity

building. In addition, DOD has taken steps to improve accountability for weapons provided to Afghanistan and coalition support

funds provided to Pakistan.

GAO has several ongoing reviews addressing a wide range of

issues such as the deteriorating condition in Afghanistan, building

the Afghan Army, U.S. contracting, and creating sustainable development programs in both countries. Like our colleagues in the accountability community, GAO works to improve the performance

and accountability of government.

GAO’s authority, of course, extends beyond single departments or

agencies in order to provide assistance and support to the Congress

to make informed policy and funding decisions across government.

GAO’s policy and agency protocols require us to coordinate our

oversight with other members of the accountability community, and

we enjoy a very good working relationship with them.

For example, as a member of the Subgroup of Southwest Asia,

a joint planning group, GAO meets quarterly with the IGs and we

submit our ongoing work for publication and respective documents.

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In addition to these more formal consultations, we regularly communicate with colleagues in various offices to ensure our work is

coordinated and overlap is minimized.

Inevitably, however, in developing our audit plans, we often find

that our planned work is quite similar in scope. Given the statutory mandates of our respective organizations to conduct audits

and evaluate programs and activities that involve multiple agencies, the overlap in our planning is not surprising. However, we

find that through the coordination groups, we have enjoyed fluid

communication that occurs across our office, and we are able to

deconflict and avoid potential overlap.

We have enjoyed particularly a very strong working relationship

with SIGAR as it has stood up its organization over the past year.

That is not surprising since many of the employees of SIGAR are

former employees of GAO and my team in particular.

U.S. personnel face enormous challenges working in Afghanistan

and Pakistan. The security situation limits their movements and

their ability to monitor projects, and the surge of civilian and military personnel has strained housing and other logistical supports.

It is in that environment that GAO and our colleagues in the audit

community enter our Embassies and our military bases in Afghanistan and Pakistan. As such, we work to minimize the burden that

oversight places on program management staff. However, with additional U.S. resources and attention focused by this Congress and

this administration on Afghanistan and Pakistan, there should be

additional oversight to ensure accountability of U.S. efforts.

GAO relies on testimonial evidence, documentation, as well as

onsite verification to conduct our work. GAO has visited Afghanistan and Pakistan over 10 times in the past 2 years to ensure the

integrity of our own work. Nevertheless, we have faced some challenges in conducting oversight in-country due to the unstable security environment and the limited housing available to temporary

duty travelers. We take steps to mitigate these limitations by taking advantage of opportunities to meet with key officials in more

secure locations and when individuals travel to Washington. We

also, whenever possible, take advantage of technologies such as

video conferencing.

To enhance our ability to conduct our work, however, GAO has

established a steady presence in Iraq. We have been there since

January 2008. We have three staff that are stationed there on a

6-month rotational basis. This has proved invaluable to our ability

to conduct oversight in Iraq.

With the challenges confronting the U.S. Government for a successful drawdown in Iraq, and the significant increase in troop

presence and resources planned to execute our new strategy in Afghanistan and Pakistan, GAO has recently initiated an assessment

to determine our requirements in the region as a whole. We plan

to explore several options, including alternative TDY locations in

Afghanistan and Pakistan.

In closing, we recognize that carrying out oversight responsibilities in insecure areas will never be easy or without risk. As importantly, we recognize that the men and women, both civilian and

military, serving our country there endure hardships and risks to

perform the work critical to achievement of our national security

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and foreign policy goals. My colleagues at this table and I know

that we must be judicious in our presence and mindful of any unintended additional burden on our diplomats and service personnel.

GAO stands ready to assist the Congress in its oversight efforts

and will continue to closely coordinate with our colleagues in the

accountability community. I stand ready to answer any questions

you may have.

Mr. TIERNEY. Thank you.

[The prepared statement of Ms. Williams-Bridgers follows:]

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Mr. TIERNEY. I appreciate all of your opening statements, which

were significant in their content as well, but I’m stricken by the

fact that people watching this right now are thinking we are all accountants, we are all auditors. And we sound like it sometimes. It

is unmistakable that we have to do this to cover the ground.

You’ve described very well the organizational structures that you

have and the cooperative efforts that you’re making, but I haven’t

heard a lot about investigative strategy. And I would like you all

to comment on that a little bit. I’m thinking it goes beyond the 5

years that the President identified. You all said you’re going to

take a look at those. What is the strategy there? What type of investigations are your high priority? Are you worried about implementation? Are you worried about results? What about stability?

What is the priority on that? What are you going to attack? What

is the strategy going on that basis?

I know that in one of the testimonies it was conversation about

training and reconstruction, obviously. But what takes priority and

what are we really focusing on and how do you establish or assess

where you’re going to go for the fraud, waste and abuse? So we

start in the middle there with Mr. Gambatesa.

Mr. GAMBATESA. From an audit standpoint——

Mr. TIERNEY. You probably have to push that button again.

Mr. GAMBATESA. Sir, you mentioned investigations. But are you

referring to both audit and investigations or basically our overall

plan? I guess in the simplest terms, I can say that we follow the

money. Wherever the large programs are, we gear our audit to

those areas.

Mr. TIERNEY. So you focus—if there is a lot of money going into

one area, that is the principal consideration? Nothing else? Not the

impact of the program on security, or the impact of the program

on development or whatever? It is basically just where the money

is. That is your——

Mr. GAMBATESA. Well, it is really a combination. We only have

so many people to do it. So we try to focus on the largest impact

both from a financial standpoint and what is important to the government.

Mr. TIERNEY. I’m going to get back to you on that in terms of

personnel. Ambassador.

Mr. GEISEL. Well, we have—I think we all have a common situation that we are both planning and reacting. So if you’re talking

about investigations, criminal investigations, most of the time we

are reacting to information that we have obtained. You have seen

some of it in——

Mr. TIERNEY. I understand that. I don’t mean to cut you short.

Let us talk about those things that you take the initiative, those

things that you go in with a design on that, and tell us what your

strategy is there, what your priorities are.

Mr. GEISEL. Exactly. And like my colleague has said, some of it

is going where the money is, but a lot of it is looking for where it

is the most impact, where we see great risk to the United States.

And that is not always where the most money is.

We also do one other area which is very important and that is

inspections. And the good thing about inspections is that we can be

much more open. We can take a much broader point of view. Most

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of the work is actually publicized. And in both Afghanistan next

month and in Pakistan early next year, we will be using large

teams of investigators—inspectors, I should say—to develop leads,

if you will, leads on the ground to work with Embassy management

and other Embassy staff to figure out where we are going. They are

the obvious bureaus that we are going after, the drugs and thugs,

if you will. But a lot of it is going to be looking for ourselves and

then saying this is where we want to go.

Mr. TIERNEY. Mr. Heddell.

Mr. HEDDELL. Yes, sir. The Department of Defense, Defense

Criminal Investigative Service, I think is playing a major role in

Southwest Asia. In fact, I would go so far as to say it is a leadership role. And it is about impact. The days of statistical results

don’t make a lot of difference anymore; it is about impact.

And for instance, the high impact work today isn’t done by one

criminal investigative agency, it is done by task forces. For instance, we are very involved in the National Procurement Fraud

Task Force. We are very involved in the International Contract

Corruption Task Force. These are task forces that look very closely

at contract fraud, major acquisition fraud, but most importantly

they work with other criminal investigative bureaus like the FBI,

Alcohol, Tobacco, and Firearms and so on. But our focus is to prevent as much as it is to prosecute.

For instance, we are very involved in education in Southwest

Asia, teaching those procurement and contract officials what to be

looking for. Right now, for instance, we are very involved in a special project up in Rome, New York. We’re looking at $14 billion in

payment vouchers related to Army purchases. It is not very glamorous or exciting, but out of that will almost certainly come some

very important investigative work that will lead to criminal prosecutions in Southwest Asia. What kind of work are we doing? Defense Criminal Investigative Service, we are—we focus on

technology——

Mr. TIERNEY. My time has expired. So I get it that your folks are

mostly on criminal investigations—more reactive, as the Ambassador was saying, to leads or to things of that nature?

Mr. HEDDELL. We are not just reactive. We are very proactive,

I would say, and I would go so far as to say that the Defense

Criminal Investigative Service is probably one of the foremost investigative agencies in our government.

Mr. TIERNEY. Thank you. I will get to the other two witnesses.

My time has expired. I’m not ignoring you. But I want to give a

chance to Mr. Flake.

Mr. FLAKE. Thank you, Mr. Chairman. Thank you to all the witnesses.

Ambassador Geisel, in your comments, in your testimony, you

refer several times to Pak-Af. We are used to hearing Af-Pak. Are

you suggesting some shift in emphasis here? I have not seen that

in other testimony. But is State leading the way there?

Mr. GEISEL. I hope not, sir. I just like the alliteration of Pak-Af

more than Af-Pak. I think they both work.

Mr. FLAKE. Is that just you, or have others been instructed to do

that?

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Mr. GEISEL. You know, I better check that I didn’t mess up my

testimony; it might have said Af-Pak.

Mr. FLAKE. No, you referred to Pak-Af. But everywhere else——

Mr. GEISEL. No, I have Pak-Af. I don’t know whether my folks

are pulling a fast one or not. I don’t think so.

Mr. FLAKE. I was just wondering there. Sticking with you, Ambassador Geisel, the security guards at the Embassy brought us as

a country, and as our image in the region, untold grief, just like

Abu Ghraib and other things. Who bears responsibility? It seems

unlikely that knowledge of this was with the eight who have been

fired so far. It had to have been broader than that. Can you enlighten us as to what is going on in that regard?

Mr. GEISEL. I will partially enlighten you, sir. Because it

wouldn’t be surprising—I won’t confirm that we have a criminal investigation underway, but I don’t think you would be too surprised.

There are two aspects that we are looking at. The first will be

criminal misconduct, and that I’m not going to speak about. But we

also, when the inspectors come in, they will be looking at just what

you asked about, and that is the oversight over this contract and

identifying just who failed on the job and who has to be held accountable. And that will be quite public.

Mr. FLAKE. Looking at that broadly, for a committee like this, it

gives us a little pause, if we are unable to police the security

guards at the Embassy, on how good a job we can do with other

oversight on broader issues.

Mr. GEISEL. It gives me pause too, sir. And I would say that of

our security programs there are two major efforts. The program

that was mentioned in the newspapers and in the media is the

static guards. There is another area which is equally if not even

more important, and that is what we call the Worldwide Personal

Protective Service, and that is actually protecting our people when

they move. And in that case, we have already done a very significant audit all around the world. And the audits came out well. But

you can count on the fact that there will be audits and inspections

because I was frankly—just like the Secretary—absolutely appalled

by this information.

Mr. FLAKE. General Fields, what progress has the Afghanistan

High Office of Oversight made so far, and how are we working with

them?

General FIELDS. Thank you, sir. The High Office of Oversight, as

the subcommittee may know, is borne out of President Karzai’s attempt to deal with corruption. I have met personally with the minister who heads that organization. My principal deputy, who is located permanently at the Embassy in Kabul, works in support of

the Embassy’s dialog with that organization. I’m pleased that is off

and running. There are some issues. It does not have very much

capacity in that it is an organization of only slightly over a year

old and it really needs support.

Mr. FLAKE. Let us cut to the chase. Do you have much confidence

in that organization or body?

General FIELDS. Sir, I’m pleased that the initiative has been

taken to address corruption and to put in place this particular kind

of device to help deal with it, which in large measure is not really

unlike work that many of us at this table conduct. At the same

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time, again, it needs support, it needs capacity. And I feel that we,

the United States, can help in that regard.

Mr. FLAKE. Thank you. My time is up.

Mr. TIERNEY. I’m going to take the last second of your time.

General, I have met the same individual you are talking about.

I have been to his offices and I’ve looked at them. I don’t have a

great deal of confidence. I’m shocked that you don’t come to that

same conclusion. There is one thing to have individuals sitting in

a chair. There is one thing to talk about this whole deal. But I

think there is also to be a will. I didn’t get a great deal of satisfaction thinking that there was a will from President Karzai and his

staff to go at this issue and go at it hard. And one indication of

that is, by your own admission, their failure so far to staff it up.

Is that fair to say?

General FIELDS. That is fair to say, sir, yes.

Mr. TIERNEY. Mr. Quigley.

Mr. QUIGLEY. Thank you, Mr. Chairman. Mr. Chairman, I guess

following up on what you just said, this is a very distinguished

panel. But I think it would take an equally distinguished panel to

think of a worse environment to try to gauge corruption and to root

it out.

I guess the line that came to me when the chairman was just

speaking is the line from Casablanca where the gentleman says

‘‘Gambling at Rick’s? I’m shocked.’’ This is a government that is

just embedded—it is a culture of corruption. Besides the fact that

the President’s leadership can best be described as weak, he just

got reelected through an extraordinarily corrupt election. So now

we are not only putting billions of dollars at risk, but I also think,

given the lack of accountability and transparency and knowing

where things are, I think we are putting our young people’s lives

at risk. And with the best and brightest of us all, and you all, and

almost unlimited resources, I don’t have confidence that we can do

this or that we can operate in Afghanization effectively without

widespread corruption because it is embedded in the culture.

I guess I want your reaction on what gives you some hope that

in that land, with limited access and extraordinary dangers and a

culture of corruption, we should have any faith at all that, despite

your best efforts, we are putting our folks at risk and wasting billions of dollars? Anyone.

Mr. HEDDELL. Well, I think that the—I certainly think you have

every reason to make that statement. And there is a tremendous

amount on the line here. A tremendous amount of America’s

wealth is in Southwest Asia. And I think that people here at this

table and other members of the inspector general and oversight

community who are in departments, who oversee programs and operations and budgets that are related to Southwest Asia—and particularly now Afghanistan and Pakistan—are concerned.

But I would also say that we have come a long ways in the oversight community since 2003. I think we have learned a lot. I think

the Department of Defense has learned a lot. And there have been

some great lessons to be learned. We have taken issues that were

identified in Iraq and we have transferred—identified the solutions

and transferred those to the operations in Afghanistan. And I can

give you examples of that. So I think there is reason for optimism.

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The second thing is, in 2007, the oversight community, established by the leadership pretty much at this table, established the

Southwest Asia Joint Planning Group. It is chaired by the Inspector General, Department of Defense, and includes over 25 members

of the oversight community. It is a tremendous example of working

together, identifying joint problems, reducing redundancy, identifying the gaps, areas that ought to be looked at that are not being

looked at, and identifying new issues.

We have people every day in Southwest Asia on the ground—

auditors, investigators—meeting regularly with the commanders.

So now a commander doesn’t have to wait for 3 or 6 months, or

even a year, to get a report. He or she finds out right away what

is happening and they can make corrective action almost immediately.

So we are very proactive here. We’ve made some significant steps

forward in the last several years. The Department of Defense OIG,

for instance, alone we have doubled our audit investigative staff

over the last 12 months.

Now the numbers aren’t great. We have gone from 6 to 14. But

that is significant. We have almost doubled our entire Southwest

Asia audit and investigative work force, and in the next 12 months

we are going to do more. We are going to increase that even significantly more.

The point is that we’re all trying to get ahead of the curve here;

and if you look at it in terms of 2003, we’ve come a long way. But

what we did yesterday is not good enough for today. And what

we’re going to do tomorrow is going to have to be a heck of a lot

better than what we’ve done.

Mr. QUIGLEY. Mr. Chairman, if I can interrupt. I recognize your

best-faith effort. All I’m suggesting is, because it affects the decisions we’re going to have to make on the President’s recommendations, that it sounds like what you’re telling us today is that you’re

making improvements on what you’re doing. And I think the response—and I don’t see an answer that tells me otherwise—is as

long as you’re going through Afghanistan’s government, there is no

reason anyone should have faith that money won’t be wasted and

lives won’t be put at risk.

Mr. GEISEL. I’d like to take a shot at it, if I might.

In a way, we’re luckier than you are because we don’t make policy, we do oversight, and that means, as far as I’m concerned, we

have to continue to inspect and audit what are very important programs without saying whether it’s a good idea, whether the policy

is a good idea or not. We leave that to the President and to the

Congress.

There are very important programs that we want to give our best

to, for instance, the rule of law and anti-corruption efforts, which

I think are arguably the most important efforts we at State OIG

are looking at. Now, regardless of whether these programs are

going to succeed or not, we’re going to give it our best efforts as

long as you tell us to be in Afghanistan.

Ms. WILLIAMS-BRIDGERS. Mr. Chairman, I’d also like to respond

to Mr. Quigley’s question and comments. A couple of things.

One, I think, is that we here at the U.S. accountability community, if you will, can’t do it alone. There is a global accountability

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community with whom we must also engage. GAO does this regularly by having consultations and creating working groups with

other national audit offices. We are engaged now in a capacity

building exercise with the Iraqi national audit office, and we look

to do this on a more regional basis. So we have to look to share

the knowledge that we have in order to create partnerships with

other accountability partners. Afghanistan’s national audit office is

in its nascent stages, but we have seen significant growth in other

national audit offices as well.

Mr. TIERNEY. I think the frustration may be, as I say, like a day

late and a dollar short. This thing has been going on since 2002,

2001, and now we’re starting to talk about what we’re going to do,

finally, and I think that’s maybe indicative of some of the frustration here.

Mr. Duncan, you’re recognized.

Mr. DUNCAN. Well, thank you very much, Mr. Chairman.

I appreciate the fact that you and Ranking Member Flake are

continuing to try to oversee all the really unbelievable spending

that is going on in this part of the world, because we so flippantly

talk about trillions now, where we were talking about billions. I

think we really lose sight, and can’t really comprehend, the astounding amount of spending that’s going on in this area. And, in

fact, General Fields mentioned that we’ll be up to $50 billion in rebuilding Afghanistan by the end of 2010; and in yesterday’s Washington Post it says that the pending 2010 budget has $129 billion

budgeted for spending in Afghanistan, Pakistan, and Iraq, and for

the first time we will be spending over half of that or more in the

Afghanistan-Pakistan region—$68 billion as opposed to $61 billion.

No one can really humanly comprehend how much even $1 billion is. So these are amazing amounts of money that we’re talking

about, and I certainly have no criticism of any of the witnesses

here, because if we’re going to be spending that kind of money, we

need to have people like this making sure that it is being spent in

an honest and not a wasteful way.

But the point I would like to make is that we shouldn’t be spending all this money in the first place. We’re spending money that we

don’t have. Our national debt is reaching $12 trillion now. Nobody

can even comprehend that kind of figure. But now they’re going to

have to come to the Congress once again to raise the debt limit

once again. It’s just unbelievable what we’re doing.

I’m saddened that it seems that criticism of these efforts has

been limited primarily to liberals, until a few days ago. George Will

finally started to question some of this. Because I have said many

times and I still believe that the fiscal conservatives should be the

people most upset, most concerned about all of this amazing spending. It’s just mind-boggling, in a way.

General Petraeus said, a couple of months ago, that we need to

remember that Afghanistan has been known through the centuries

as the graveyard of empires. Now I’m sure, being the good bureaucrat that he is, that he’s never really opposed any spending by the

Department of Defense and that’s one thing that I think fiscal conservatives are going to have to realize at some point, that the Defense Department is, first and foremost, a gigantic bureaucracy,

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and like any gigantic bureaucracy it always wants to expand its

mission and always wants to get increased funding.

Now I have the greatest respect for those in the military; and I

believe that national defense is probably the most important, most

legitimate function of a national government. But I also don’t think

that means that we just automatically should approve every huge

increase and every military adventure that the Defense Department or any other department requests. Because I will go back to

what I said a few minutes ago: We are spending money that we

don’t have and we’re really putting in great jeopardy the future—

I used to say of our children and grandchildren, but now I say of

ourselves. Because I don’t believe it’s going to be 10 or 15 years before—if that long—before we’re not able to pay all of our Social Security and veterans’ pensions and all the other things we’ve promised our own people.

So I wish all these witnesses well; and I commend you, Mr.

Chairman, for holding this hearing. But I think we need to realize

that we can’t afford to keep doing what we’re doing in Afghanistan

and Pakistan and keep expanding our mission and increasing our

spending over there. We’re going to increase our troops by the end

of the year to 68,000, and in all of these areas we’re having as

many, or more, civilian contractors than we have military troops.

At some point, we’ve got to come to our senses and realize that we

just simply can no longer afford this.

Thank you.

Mr. TIERNEY. Thank you, Mr. Duncan.

I think the concern here is that, obviously, we’re all looking at

yet another strategy for Afghanistan, obviously there’s a military

component to it, and some troops are probably going to be recommended by General McChrystal, but there’s this whole development piece as well. There’s supposed to be an investment that people are going to make on the rule of law, training of police and

other security forces.

But I want to take a quote from Inspector General Fields’ written

testimony: ‘‘The current security situation is neither conducive to

building and repairing, nor to developing Afghan capacity to hold

elections, provide justice, or meet the basic needs of the Afghan

people.’’

The efforts haven’t been effective, and they are replete with accountability problems. That’s is the crux of this. That why you’re

all here. Because I think we all acknowledge that very statement,

that this has been a mess. Whatever you want to attribute the

problem to, we’ve had a situation that hasn’t gotton the attention

it should get since 2001. How deep are we into this thing, with a

culture of corruption, but also a practice of corruption and corruption being embedded in the official representatives that are being

put in the government of Afghanistan, and we have other situations over in Pakistan.

So how are you going to proceed? How are we going to proceed,

and what are the resources we’re going to apply to that?

And I would expect that we’re going to do something about trying

to put in place standards and processes before we start spending

the money, hopefully, particularly in areas like FATA, Northwest

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Frontier Province, and other really difficult areas in both areas in

both countries to go into.

So has there been consideration about not just spending the

money before processes are in place? And if there are those kind

of considerations, would you tell us what they are and how they’re

expecting to implement them?

I know that Mr. Heddell mentioned a lot of this is educational

preventatives. So I’m hoping that you’re out there on the ground

ahead of time saying to all of the people that are going to get the

money: Here’s some advice from us ahead of time. Before we come

in and audit you and investigate you and go at it at that end,

here’s what you can do to avoid a bad audit and a bad investigation, and here’s what we’re going to do to have in place systems

and processes. And then, hopefully, we’re not going to start spreading out the money until we are satisfied from reports of all you people those things are in place.

Would somebody like to respond to that? Mr. Heddell, do you

want to start?

Mr. HEDDELL. Yes. I actually would, Mr. Chairman.

The oversight community is not the one spending the money, but

we’re trying to identify where it’s going and whether it’s going

properly and being spent——

Mr. TIERNEY. That’s clear.

Mr. HEDDELL. In 2008, we issued what we call a summary report. We included 302 reports and testimonies of not only the DOD

Inspector General but the military audit services—the Navy, the

Air Force, the Army—and Special Inspector General for Iraq, and

GAO. In these 302 reports, we issued over 970 recommendations.

So we’re following up on every one of those.

Mr. TIERNEY. I was just going to ask you that. That’s a lot of recommendations that are not doing anybody a hill of beans unless

somebody is drilling down and making sure they’re happening.

Mr. HEDDELL. Yes, sir. I apologize for interrupting you. I can tell

you right now that we’re tracking this. Seventy to 80 percent of

those 900-plus recommendations are being addressed by the Department of Defense, and many of them have been resolved. So

there is action. But action only occurs when there’s followup. And

that’s one of our most important programs, is to followup. And I

would give this for the record.

Mr. TIERNEY. We have a copy. Most of us have read it.

That’s the idea of following up on recommendations made, and

I think that’s essential. But I’m also talking here about a little bit

of preventive action or trying to get people to know what’s the right

course before you get down the path.

Mr. HEDDELL. I would offer another one, preventive. We learned

in Iraq that electrical systems—this may sound fundamental, but

electrical systems are deficient. Americans died needlessly. And

those lessons are learned and being transferred to Afghanistan.

Mr. TIERNEY. I understand, and that’s great, but I’m really talking about a broader strategic path here. We’re going to have people

spending development money in FATA, in the Northwest Frontier

Province, and remote areas of Afghanistan. So the first problem is:

Do they have in place processes or standards that they know they

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have to meet? And the second thing is, if we can’t physically get

there ourselves, what do we have in place to do that?

Ambassador, do you want to take a stab at that, or Ms. WilliamsBridgers?

Mr. GEISEL. I will let my colleague from USAID do most of the

talking, but there’s two points I’d like to make. The first is: My

staff has been kind enough to explain to me how Af-Pak became

Pak-Af, and the answer is it was Ambassador Holbrooke who started using Pak-Af.

Actually, the point that you made about trying to get ahead of

the curve is exactly what I think this community is trying to do

in Pakistan and, for that matter, why I think you’re holding this

hearing, if I may be so bold.

Mr. TIERNEY. It’s a large part of it. That’s why I wanted to get

to it.

Mr. GEISEL. We are working with the embassy. Our inspectors

will work with them, our auditors will work with them, raising

these various points.

For instance, as you mentioned, and as we all know all too well,

it is going to be very, very difficult to work in the FATA, the federally Administered Tribal Areas. It’s really dangerous. We are working together with the embassy in what I think are some rather

imaginative ways to consider how we are going to perform oversight in what is a very challenging area, and at least we have the

sad experiences in Iraq and in Afghanistan to guide us.

Mr. TIERNEY. Now we’re talking about $1.5 billion over 5 years,

a serious amount of money. I think this committee should want

some comfort that, before that money is dispersed, that these

things are in place. And so I ask again, is there some mechanism

or a trust account, somewhere that money is going to reside until

we are secure in the notion that it’s not going to be distributed

until there’s something in place that gives us reasonable comfort

that it’s going to be spent wisely?

Ms. Williams-Bridgers.

Mr. GEISEL. If my colleague will let him, since he’s got most of

the money——

Mr. TIERNEY. He’s got most of the money, but not enough staff,

I will tell you that. We will get to that, too.

Mr. GAMBATESA. Earlier I mentioned that, basically, in the audit

world, we follow the money. In our investigations, although primarily reactive, we do a lot of fraud awareness training around the

world. I don’t have the stats, but we do hundreds of these training

programs where we provide training to not only USAID personnel,

but representatives of contractors, subcontractors, and grantees.

We actually get out and show them what to look for in fraud. So

I think in that proactive way we do some of what you’re looking

for.

Mr. TIERNEY. But then we’re left with the problem of overseeing

the contractors and subcontractors because we’ve lost so much of

our in-house capacity. We sometimes don’t even have enough in

your department alone to manage and oversee those contracts.

Mr. GAMBATESA. Well, I’m not speaking for USAID, but historically, and many of our audits have shown that, many of the problems that they face, especially in conflicts areas, is lack of staff,

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lack of trained staff and lack of people willing to go to those places

to work.

Now the agency is in the process of building their staff, and

hopefully that will help. But certainly in the past they’ve had a

problem in that area.

Ms. WILLIAMS-BRIDGERS. Thank you, Mr. Chairman.

There are a couple of things I believe that can be done in a preventive mode to ensure that our money is well spent, and in large

part it requires the help of the Congress. There was mention early

on of Ambassador Eikenberry’s discussions of looking at alternatives such as direct budgetary support, I believe, for Afghanistan. I have not seen his letter, but I look forward to reading it.

But what we have clearly learned in the past, that while these

type of efforts, direct cash transfers or direct budgetary support,

are good in intention and often result in very good outcomes because presumably they are consistent, they allow there to be some

consistency and anticipation and planning for what the needs are

of the country we are looking to serve. Oftentimes in the past we’ve

found that the moneys that we’ve spent have not been consistent

with the national needs or priorities, and therefore there has been

a lost opportunity to really make big gains.

But any direct budgetary support must come with the ability of

the accountability community to access the records and the backup

documentation that is kept there so that we can exercise some control and oversight, as well as the host country government having

some accountable system, some data that they can rely upon to ensure that the moneys are accounted for and well spent.

We’ve learned well in the past in our other investment efforts—

in countries where there is no such access—that we have no ability

to track and account for our investment made there.

Second, I would also ask the Congress’ assistance and support in

ensuring that when agencies respond to our recommendations,

GAO’s recommendations in particular, there is a requirement in

the law that the agencies respond within 60 days to the Congress,

informing them how they intend to act on the recommendations

that they’ve often agreed with before we have issued our reports.

We incorporate whether or not the agencies agree or disagree.

As is often the case in transitions in government, the agencies

aren’t aware of this requirement. And so, most recently, in dealing

with some of our agencies that we are dealing with at this table,

we have found that those letters are just piling up in someone’s

room and not knowing where they should go or they haven’t been

prepared at all.

So we would be glad to work with the Congress to try and reinforce some of these mechanisms to assure not only responsiveness

to past recommendations that will prevent misspending and fraud

and abuse in the future, but also to ensure that there is access and

accountability over any new investment that is made, given any

new direction that might be pursued.

Mr. TIERNEY. I’ll get back to this. I want to give Mr. Flake an

opportunity.

Mr. Flake, thank you.

Mr. FLAKE. Just to followup on that, quickly. Obviously, the government of Afghanistan wants budgetary support. All of the govVerDate 11-MAY-2000 13:32 May 09, 2011 Jkt 000000 PO 00000 Frm 00148 Fmt 6633 Sfmt 6633 C:\KATIES\DOCS\64916.TXT KATIE PsN: KATIE
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ernments do. You’re telling us that you’ll make the recommendations or you have made the recommendation that not be the case

until we can access records that we clearly can’t access right now.

Is that the case? It’s your contention that we wouldn’t be able to

have access to how the money is being spent, even though we pretty much know that’s not a direction that certainly I want to go

here.

Ms. WILLIAMS-BRIDGERS. We’ve not made the recommendations

because I have not yet seen this proposal and I don’t know what

stage this proposal is in. But given our past experience with direct

budgetary support provisions——

Mr. FLAKE. Right. Thank you.

Mr. Gambatesa, you testified that you made 84 recommendations

for operational improvement to USAID programs. How many of

these recommendations have been implemented?

Mr. GAMBATESA. I don’t have the exact number, but generally we

get management decision on the majority of them. I’d have to get

back to you on the exact number. I don’t have that here. I don’t

have that number right here with me.

Mr. FLAKE. You said generally you get——

Mr. GAMBATESA. Generally, we get management concurrence on

the recommendations we make. They don’t object. I’m not aware of

any of these where we’ve had an objection where we’re not going

to do what we recommend. Whether they’ve actually gone through

and completed the recommendation, I’d have to get back to you on

that. I don’t have that right here.

Mr. FLAKE. When were the recommendations made? How long

ago?

Mr. GAMBATESA. The information I was giving was over a 4- or

5-year period. So it’s over that span.

Mr. FLAKE. OK, over that span. So your anticipation is that most

of them have been implemented.

Mr. GAMBATESA. I would hope they have been, but I can check

and get back to you.

Mr. FLAKE. Can you get back to us on that?

Mr. GAMBATESA. Sure.

Mr. FLAKE. Typically, if they don’t follow through and make the

recommendations, what happens? Who do you then go to and say,

hey, you’re not making the improvements, not following our recommendations, and at what point is Congress informed? Is it

through this regular process or is there a trigger that forces you

to come back to us and say, hey, these programs ought to be

shelved because they aren’t following our recommendations?

Mr. GAMBATESA. There is in fact a process within the Inspector

General’s Act that requires us to notify Congress if recommendations aren’t acted upon within a 6-month period.

Mr. FLAKE. When was the last time that you notified Congress?

Mr. GAMBATESA. We have never had to. Well, in my tenure, we

have not had to.

Mr. FLAKE. Is that the goal for everyone here, for the other agencies?

State, Ambassador Geisel, have you had the experience where

you’ve had to come to Congress?

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Mr. GEISEL. I’m informed that we actually had to report two instances of noncompliance to the Congress.

Mr. FLAKE. That was with regard to Afghanistan?

Mr. GEISEL. No, sir.

Mr. FLAKE. So what we’re hearing so far is every recommendation made with regard to Afghanistan has been implemented. Does

that go also for Defense?

Mr. HEDDELL. Mr. Flake, I’ve been at the Department of Defense

for about 14 months now. During my time I don’t know of any instance where we’ve exercised that requirement. However, we do

issue semiannual reports to the Congress. In these reports are a

list of recommendations in a broad sense. So we do keep the Congress fully apprised of what we have found, what we are doing, and

what we are monitoring.

Mr. FLAKE. General Fields, did you have a comment there?

General FIELDS. Thank you, sir. I wish to comment on the followup to recommendations.

Our first report in my capacity, given that we are a new organi- zation, was issued several months ago. It was a report on $404 million of Afghanistan Security Forces funds administered by CSTCA. We discovered that there was insufficient oversight of that particular arrangement, the funding, the execution of it. Principally,

the contract oversight person was located in Maryland rather than

in Afghanistan where the money is being executed.

We are pleased to report that as soon as we made this observation to CSTC-A and to U.S. Forces Afghanistan, they began to address it. That included followup work by the Secretary of Defense

and other oversight entities.

So from that standpoint, speaking exclusively for SIGAR, there

has been a response to at least that report. There are several other

reports that we have issued, but it’s too early for immediate response to be reported to this subcommittee today.

Mr. FLAKE. Thank you.

If I could followup with one question. Ms. Williams-Bridgers, you

mentioned—and all of you mentioned—the security situation

makes it difficult for you to carry out your work in Afghanistan.

For a committee like ours, where do we draw the line and say the

security situation is such that we can’t carry out our oversight

functions or the security situation is so bad that perhaps we

shouldn’t be spending this money because we can’t account for all

of it? Where do we draw that line?

I know it’s a difficult situation. All of us have traveled to Afghanistan, and we recognize that you can only have field offices or personnel in certain areas. It’s a real endeavor to go out, particularly

in some of the areas we’ve been talking about. But how are we to

navigate that line, I guess, between a security situation so difficult

that we can’t provide oversight, or perhaps is it so bad that we simply shouldn’t be spending these moneys in these areas because we

can’t account for them?

Ms. WILLIAMS-BRIDGERS. Good question. I’m glad to say that I

don’t believe that we’ve reached that point yet where the security

situation is so bad that we believe that we cannot provide the Congress with meaningful information to help you conduct oversight

over our engagement in country. I think that we would inform you

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if we believed that were a limitation to our ability to answer the

mail, if you will.

I think that we have to take mitigating strategies. We have to

mitigate against the limitations that may be imposed on our ability

to actually make field visits. For example, when I was in Pakistan

a couple of months ago, we wanted to go to the FATA, we wanted

to go to Peshawar to see some of the projects that the U.S. Government has funded. We were not able to. However, we were able to

extract enough data that we felt was sufficiently reliable from the

agencies to be able to conduct our work and to be able to analyze

it to make some reasonable judgments as to whether or not there

was good recordkeeping, whether or not we were on track with

plans that we had made in country.

But there are a couple of lessons that have been learned, and actually these lessons form the basis for military counterinsurgency

doctrine. First is to establish security. First and foremost, establish

security before you proceed with reconstruction. We’ve learned this

from Iraq. We’ve learned the very hard lessons from Iraq of investment that has been destroyed—our investment in infrastructure

that was destroyed because the security was such an unstable situation.

Second, is to create an economic foundation in that country that

they can sustain the investment that we have made in-country.

Again, this goes back to what kinds of strategies do we need to

think about going forward as we look to increase our investment

there.

Third, is to extract the political commitment from the country

that they are going to carry out those priorities that they’ve established, priorities that we join in with the country and create the

basis for our own strategic goals in that country.

So I think that we need to continue to think of that as we move

forward with any future investment, and certainly these are things

that we are going to continue to monitor in our own oversight

strategy to ensure that investment is well made and protected.

Mr. TIERNEY. Thank you.

I guess the trick here is not to put the cart in front of the horse,

which I think, billions of dollars in, is being done. I think most notably of the coalition support funds in Pakistan. When we were

there investigating, whatever, we found $6.7 billion spent, in large

part which was not accounted for at all. Part of what happened

was the money was basically paid to Pakistan, it went into the general treasury, and you were at the mercy of believing or not believing what was going on. But I do know that we looked at about 35

helicopters with money that was paid supposedly to have them repaired, and they’re all sitting on the ramp out there, unable to

move.

So that’s the kind of thing that we’re talking about here, that we

need to get out in front of this on that situation. As the Special Inspector General says, the current situation in Afghanistan is such

that it’s not conducive to building or repairing, nor is it conducive

to developing the Afghan’s capacity to even hold elections, which

we’ve seen, or to provide justice, or to meet the basic needs of the

Afghan people. So are we going to throw money into the development side without resolving those issues first? We seem to be doing

148

it with the right motivations and moving forward, but it’s hard to

do that, in Pakistan in particular.

I know that you were out there, and we’ve been out there as well,

in the FATA and the Northwest Province area. I’d like to know a

little bit about how it is that you have so much faith that we’re

able to do it.

I know the foreign assistance in FATA, according to the special

inspector, is being accomplished with the use of non-U.S. implementers. Basically, we’re contracting it out or we’re going to locals.

When we were there, we couldn’t get much further out of Peshawar, and the people there told us, nongovernmental organizations,

our own consulate told us they couldn’t get anywhere near where

the projects were happening, whether it was an irrigation project,

whether it was a well, whether it was a school. And so they were

trying to use flights, overhead flights. They were trying to use the

word of mouth from other people who had been out there. How reliable is that?

Ms. WILLIAMS-BRIDGERS. Let me clarify. We heard the same

thing when we were on the ground, as we met with local nationals,

as we met with agency officials, we met with the secretary of the

FATA. We are in the course, currently, of evaluating our development assistance efforts in the FATA. We have not reached our conclusions yet. But what I’m saying is that we were able to get data

that we believe that we can rely on from the agencies to be able

to conduct our analysis. So we have not yet reached our conclusions.

Mr. TIERNEY. Having done all the things you’ve done on that, I’m

more skeptical than you are, so I’d like to see a report and the

foundation for your reaching that conclusion because I think it’s an

important matter here. $1.5 million heading in that direction, we

want to make sure it isn’t going in the wrong direction.

The Combined Security Transition Command in Afghanistan,

that is a serious matter, obviously. We had all those weapons, with

the potential they might not be accounted for. Is there followup

being conducted on that?

Mr. HEDDELL. Yes, Mr. Chairman. In fact, we have done several

reviews relative to weapons and explosives accountability in both

Iraq and Afghanistan. We did find that there were concerns. We’ve

also found that there have been corrections made with respect to

those in Iraq.

Mr. TIERNEY. I don’t mean on just the Afghanistan——

Mr. HEDDELL. In fact, we went to Afghanistan last fall. We took

a look at weapons accountability, as well as training and equipment sustainment.

Mr. TIERNEY. So we had several reports on that, which is why

I raised the question. We went out there and visited as well, and

we were not satisfied, at the time we went out there, that enough

was being done. So you’re answering me now that you are looking

up and following up.

Mr. HEDDELL. We have followup work planned, several things

that will be in motion between now and next spring. Yes, sir.

Mr. TIERNEY. Thank you.

Now, the Special Inspector, I have a question about your part of

the report indicating that, obviously, we’re aware of salaries going

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to ghost employees in the security divisions of Afghanistan. I think

you’re following up on that. But we also have a report in your written remarks about some private firms that are spending international moneys hiring security people that may, in fact, be connected to the Taliban.

Now my question to you is, which flavor of Taliban are they hiring? Who are they, that particular group of Taliban? And is that

a dangerous thing for them to be doing that? Is there something

being done about it, if it is? Could you elucidate on that?

General FIELDS. Thank you, Mr. Chairman.

Our work in this particular area is not complete at this time, but

this is a serious matter, at least to look at in terms of determining

if there is wrongdoing and if, in fact, the allegations that we have

seen especially over the past few days are, in fact, valid. But I’m

not prepared, Mr. Chairman, at this time to report any of the results. But I just wish, though, to inform that these are matters

that we are looking into.

Mr. TIERNEY. When do you think that you’ll have some results

on that particular inquiry?

General FIELDS. Sir, I would suggest perhaps within the next

month.

Mr. TIERNEY. Well, I think the sooner, the better. It’s a rather

alarming concept that could be looked at here. If it’s Taliban that

are then turning around and focusing on our troops, international

troops, and against the Afghan government, certainly we’ve got a

major problem. If they’re a different breed of Taliban, then we have

to know about that as well. So I urge you to move on that as quickly as you can.

General FIELDS. Thank you, Mr. Chairman.

Mr. TIERNEY. I’m particularly concerned about the police training

and the army training as well, but even more so about the police

training there. And I would hope that is something that somebody

in this group is going to look at in-depth. Here we are, 2009, nearing the end, and the police training, there’s corruption rampant

there.

I know there’s a great plan the Department of State has about

training some people and switching them in. I think if we go on

that basis, by the year 2030 we ought to have covered the country

and be ready to start again. So that’s the difficulty there. Who’s

taking the lead on determining what the status of training the police in Afghanistan is?

Ms. WILLIAMS-BRIDGERS. We will be following up on our past

work looking at the training and capabilities of the Afghan National Police. Right now, we are focusing our attention on the army,

but in the course of our followup work and in future work we will

definitely pay attention to the security capabilities.

Mr. TIERNEY. We have had a number of substantial witnesses before this committee who are quite knowledgeable about

counterinsurgency and tell us that the police are every bit as important or more important than the military for that. So I would

hope that we could at least do them simultaneously, as opposed to

stacking the military first and then the other. We’ve seen on our

own visits and talks with people over there that it’s critical that

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be done. If the local population doesn’t have any confidence in the

legitimacy of their police force, we’re in a terrible state of affairs.

So, other than the Government Accountability Office, is SIGAR

looking into that?

General FIELDS. Thank you, Mr. Chairman.

We know too well that of the $30 billion to which I made earlier

reference, that the United States has invested in the reconstruction

in Afghanistan, over half or about half of that money—about $18

billion, really—has gone toward the Afghanistan National Security

Forces. A large body of our work has been done, is ongoing, and

will be done to address the significance of that element of funding

for the reconstruction.

Mr. TIERNEY. The fear is this: There’s a large amount of money

that’s gone toward that. That portion that was designated to secure

the police may not be an investment. It may have been wasted on

that. When you look at the state of affairs of the police in Afghanistan, it’s hard-pressed to call that an investment to date. So the

idea would be to get a report as quickly as possible on that as to

what would turn that into an investment that would have some

positive results. Because we don’t do that. All the people that we

have over there, not just military people but all the people that

work for you, all the people that are working in development and

whatever, there is a serious risk regarding that. So I appreciate

that, if you would do that.

Mr. GEISEL. Mr. Chairman, actually, State OIG and DOD OIG

are undertaking a joint study of police training right now. Our report should be ready, I believe, in December.

Mr. TIERNEY. Well, thank you for that.

Should the SIGAR’s role be extended to cover Pakistan as well,

or how are we going to address all of our oversight issues in Pakistan?

General FIELDS. Sir, we have looked at this question, of course,

well before this announced testimony. We have dialogd with Ambassador Holbrooke on this, and he made certain references to this

issue during his testimony in June.

We, from the SIGAR standpoint, support the idea of extending

our mandate to assist in covering Pakistan—for one reason, the inextricable linkage between Afghanistan and Pakistan, the fact that

if the extension of our mandate is similar to that which we currently have, which allows us to look across agencies, we think that

is a considerable benefit.

We believe also that, in spite of our relatively meager numbers

right now, we could almost immediately commence some degree of

oversight of spending in Pakistan, and over a period of time, with

increased funding, leading to increased numbers of auditors, inspectors, and investigators, build to a more substantial effort to address this matter.

We underscore the significance of oversight, which in the case of

Afghanistan may have started before SIGAR, but not at the time

at which we began to invest significantly in the reconstruction of

Afghanistan. So we would not like to see this happen in Pakistan

as well.

151

Mr. TIERNEY. I say this not to be a wise guy, but you’re aware

of some criticisms of the Special Inspector General’s Office in Afghanistan.

General FIELDS. Yes, sir.

Mr. TIERNEY. Address that for me, if you will.

I think basically the criticism involved around a paucity of reports, and they were comparing it to the number of reports that

have come out of Iraq, in the comparable period, at the outset of

those offices. You had five reports I think over the course of your

first year; and I guess there were many, many more in the Iraq office during their first year. But given that criticism, if you would

address that and address whether there be enough personnel and

enough capacity in the Special Inspector General’s Office in Afghanistan to actually go over into Pakistan and we might not be

better off focusing on other agencies or another special inspector.

General FIELDS. Yes, sir.

First, let me address the criticism of this office. The criticism,

frankly, Mr. Chairman, is not unexpected. We were late in getting

funding to support our effort, but this Congress has now provided

the funding, particularly as a part of the $7.2 million we received,

which complemented the $16 million that we had previously been

provided. That really has rounded us to hire the people that we informed the Congress last year about this time that we wanted to

hire to get our work done. So we are hiring the right folks to do

the job.

We are not suggesting that we have excess capacity, but we are

suggesting that it would be advantageous to the oversight community if we were to link the oversight of Pakistan with that of Afghanistan; and given our now almost full year of funded oversight

work, we feel that perspective is a valid one.

Mr. TIERNEY. The capacity of all of your offices somewhat concerns me. Government Accountability Office, they seem to be getting people around pretty well, but I’m not sure—most distressing,

I think, is USAID, the in-house capacity that your office used to

have.

You have 210 Foreign Service officers and Civil Service employees, Mr. Gambatesa. What’s the breakdown of that? How many of

those are Civil Service employees and how many are Foreign Service officers?

Mr. GAMBATESA. About 125, ball park, are Foreign Service. The

rest are Civil Service.

Mr. TIERNEY. So they’re covering a hundred countries, billions of

dollars. Now there was a day when your capacity was substantially

higher than that, am I right?

Mr. GAMBATESA. I don’t have that knowledge. I don’t know personally. I can ask one of my staff.

We are in the process of staffing up. I mean, our budgets have

been increased. We are getting the funding, I believe. We are in the

process of trying to hire another 20 auditors.

Mr. TIERNEY. Foreign officers?

Mr. GAMBATESA. Mainly Foreign Service.

Mr. TIERNEY. Have you had difficulty finding people that are

qualified?

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Mr. GAMBATESA. Not really. We’ve hired probably 20 in the last

6 months. Many of them are very highly qualified.

Mr. TIERNEY. Are you having difficulty finding people willing to

go to Afghanistan or Pakistan?

Mr. GAMBATESA. That’s the issue, whether they want to serve in

those countries. I think that’s the limiting factor, more so than

their qualifications as auditors.

Mr. TIERNEY. Of those 20, what percentage of those people were

willing to go to Afghanistan?

Mr. GAMBATESA. They have to be. If they’re Foreign Service officers, they have to be actually cleared medically, for example, to go

to anywhere we have offices or where we work.

Mr. TIERNEY. If it weren’t for the fact that you are inviting them

to go to Afghanistan and Pakistan, how many of those 20 slots

would you have filled, do you think?

Mr. GAMBATESA. I don’t think it would be much different. I think

we’re doing quite well, but we certainly need to staff up. I did mention in my written statement that if the funding proposed for Pakistan is actually appropriated we will be asking to put an office

there, a significant number of employees.

Mr. TIERNEY. Right now, you’re relying on a substantial number

of Pakistani and Afghanistan accounting firms. You’re training

their people and moving forward. How confident are you that those

people not only have the requisite skills but the will to do the job,

and what about a corruption factor there?

Mr. GAMBATESA. When we are dealing with private accounting

firms it’s difficult to tell from the corruption standpoint. We provide them training and contract with them to go places, for example, in the FATA, where we can’t go. Both for financial audits and

we are actually asking them to go and look at programs from a performance standpoint to see if the building is built and that sort of

thing.

Mr. TIERNEY. Because we are not doing it in-house, we are then

at the mercy of doing that, because we don’t have people to go out

and watch their work. If we do, we are certainly redoing the wheel

here. We have people go out and do the work; then we have people

to see if they did the work.

Mr. GAMBATESA. That’s true. But as we have all discussed——

Mr. TIERNEY. It sounds like a tough state of affairs.

Mr. GAMBATESA. As we’ve all discussed, the security situation is

such that if we can’t get out at all, this is better than doing nothing, I guess. At least it’s an effort at trying to get some eyes on

the programs.

Mr. TIERNEY. Now our trips out there indicated to us that in fact

those folks weren’t having that much of an easier time getting out

there as well. Isn’t that true?

Mr. GAMBATESA. I don’t know that. We’re just beginning this program.

Mr. TIERNEY. Ms. Williams-Bridgers, you can probably answer

that. The indications are that there’s people that live in FATA and

people that don’t. When people that don’t live in FATA get out

there, they’re not well-received all the time. Same with the provinces. Is that correct?

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Ms. WILLIAMS-BRIDGERS. That is correct. In fact, when we were

there in June, the U.S. Embassy retracted its personnel from the

consulate in Peshawar because of the security situation.

Mr. TIERNEY. So I think we’re going to have a difficult time, no

matter what.

Mr. FLAKE. Just to followup a bit on the first question I asked,

Af-Pak versus Pak-Af. That comes, we understand now, from Ambassador Holbrooke. It does, if that is the source, signal kind of a

shift in focus, and we are hearing—well, according to George Will,

Pakistan is the country that actually matters, as he put it. I think

we have seen sort of a shift that, as Pakistan goes, so goes Afghanistan. That’s the source. That’s where the Taliban actually is. That’s

where we’re going to be expending a lot of resources coming up.

My concern—and it may be shared with the chairman and others—the chairman mentioned that we seem to be behind the curve

ball all the time. We are into this 8 years, and we seem to always

be having recommendations that are now going to be implemented

8 years later, instead of putting the resources in place initially before we ramp up the flow of resources to these areas.

My concern now is, if there is a real shift in focus now, if it’s

Pak-Af, and our resources are flowing mainly through Pakistan,

that we’re going to be in a situation a couple of years from now

where we only put your resources in place where the money has

gone before and we are just chasing the tail all the time and we

never seem to be putting structures in place to make sure these resources are expended properly after they are already in place.

Ms. Williams-Bridgers, you mentioned that you would let us

know if the security situation was such that we couldn’t conduct

oversight. But if the focus is Pak-Af now, we already know, as the

chairman said, there’s certain areas where we really aren’t getting

good information. I guess some of us are a little skeptical that will

be the case, that we will be informed here where we need to make

oversight decisions and funding decisions, that the situation is such

where we simply can’t account, rather than hearing a few years

later, well, we’re now catching up, or trying to catch up, to put

these—this framework in place where we can extend.

Can anybody give me any confidence that if the shift now is PakAf, are we going to put the right framework in place in Pakistan

in the areas that are concerning to us before we expend the money,

not after?

Ambassador Geisel.

Mr. GEISEL. I don’t know that I’m ready to assure you that everything is going to be fine. In fact, I know I’m not. But what I can

tell you is, at the request of Ambassador Anne Patterson, who was

one of my successors the first time that I was acting IG—she followed Jackie—our Middle East regional office is going to conduct

a review this fall of the current management control environment

at Embassy Islamabad, in anticipation, just as you said, of the significant increase in funding and program implementation during

the next 5 years. And, as I told you, we have moved up a full inspection of the embassy in Pakistan just for that reason, to try and

get ahead of the curve.

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Mr. FLAKE. The first concerning thing there is we’re still talking

about a Middle East office when we’re talking about Central Asia

here. It’s a little concerning.

Mr. GEISEL. It’s a term of art. It’s going to be the same office,

albeit considerably augmented for Pakistan and Afghanistan, but I

don’t want to have one more bureaucracy. So, no, you can count on

it. It’s going to be the same office that does that, but it’s going to

be a whole lot more people doing it.

Mr. TIERNEY. Ambassador Geisel, you said in your written report: Effective management controls are needed at the initial stage

of assistance implementation. I think you hit it on the head with

that. So are we going to need legislation here—I shouldn’t ask you

a policy question, so I will ask a rhetorical question. Are we going

to need some sort of legislative mandate here that moneys not be

distributed until we’re satisfied with reports back from you folks

that, in fact, effective management controls are in place for this assistance? And that would be something we’d probably want to look

to reports from all of you.

I think it’s great that Ambassador Patterson, who, from what I

can tell, is doing a good job in a difficult situation, that she’s now

going evaluate whether the Pakistan agencies and nongovernmental agencies have the capabilities to ensure that proper management controls are in place and funds used as intended. I wish

her predecessors had done that, starting back at the beginning of

the decade.

But it seems to me that is the key here, that they are doing it,

they have the capacity to do it, that we have some reliability and

trust in them doing that.

I’m reluctant to think we ought to be spending this money—we

ought to put this money, appropriate it perhaps and sit it somewhere until we get some indication from all of you that those

things are in place and ready to go.

And the security issue that Ms. Williams-Bridgers puts in might

be another factor. And talk about that. So I think you’ve given us

great food for thought on a number of different areas today, because I haven’t heard a great deal of comment that gives us confidence that is, in this case, being done.

Mr. HEDDELL. Mr. Chairman, may I interrupt?

Something that might address Mr. Flake’s question is a report,

an assessment that the Department of Defense Inspector General

issued in May of this year. It’s classified, but it was an assessment,

a review of all of the DOD-managed funds and programs that exist

in Pakistan. It’s very revealing, I think.

We’d be more than happy to brief you in a closed session regarding that, but it certainly gets to what Mr. Flake, to some extent,

was asking.

Mr. TIERNEY. We’ll set that up, if Mr. Flake cares to proceed with

it.

Just as long as I have your attention, Mr. Heddell, protective

equipment for our troops, is somebody investigating whether or not

there’s sufficient standards for that equipment and whether or not

our troops are getting the equipment in a timely fashion?

Mr. HEDDELL. You’re asking whether or not the troops are

getting——

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Mr. TIERNEY. Whether or not we have somebody investigating or

looking into whether or not they are getting the necessary protective gear and equipment they need to do their jobs in a timely fashion.

Mr. HEDDELL. Absolutely. We’ve actually done a fair amount of

work in that area, going back to 2006, Mr. Chairman. We did a review in Iraq——

Mr. TIERNEY. That’s what spurs the question. Iraq was not so

much. We want to make sure it’s happening in Afghanistan.

Mr. HEDDELL. We found concerns in Iraq. We believe those have

been addressed by the Department. We found issues not just with

routine equipment but with up-armored vehicles, with armor. We

are continuing to address those issues.

At the same time that we are monitoring, the Department is also

continuing to address those issues. We are hopeful that the lessons

we’ve learned in Iraq are being carried forward into Afghanistan.

But these are complex issues. For instance, up-armored vehicles,

what may have been very effective in Iraq, because of the training

in Afghanistan, may require very different resources. So we are

continuing to follow that. It is a concern of ours, and we can report

in the future on what we find.

Mr. TIERNEY. I appreciate that.

Ms. WILLIAMS-BRIDGERS. Mr. Chairman, may I also offer that

GAO is also currently undertaking a review looking at the supply

and equipping of U.S. forces. We’re looking at what challenges are

presented and to what extent lessons have been learned from Operation Iraqi Freedom. We are also looking at the Army and Marine

Corps training and capacity and what lessons can be learned as

they look to migrate from Iraq to Afghanistan. So we will be reporting out on both of those issues in the near future.

Mr. TIERNEY. Does that hold true as well on medical attention

to troops in the field? Is somebody looking at the capacity we’ve

had to improve that situation as well?

Mr. HEDDELL. Yes, sir.

Mr. TIERNEY. Thank you.

So let me just have a couple of wrap-up questions. We have a

concern about the heavy reliance on contractors in a lot of different

fields. I know you’re all looking at that, but so is the Wartime Contracting Commission. Do all of you feel comfortable in your relationship with the Wartime Contracting Commission, and have they

been sort of included in some of your deliberations? You’re all nodding yes, so I take it they have. Nobody sees a conflict or an impediment anywhere there.

Ms. Williams-Bridgers, let me ask this of you: I see GAO as a

little bit of a different organization than I see the Inspectors General. You’re traditionally known as Congress’s investigatory arm,

and I think it’s great you’re working in concert with them on a lot

of different projects. Are you also maintaining enough independence to be able to stand aside and report something when somebody else may not have gotten to it yet, or may not have done it

in a way or with the depth we think it should have been done because they have capacity issues and training issues or whatever?

Ms. WILLIAMS-BRIDGERS. Yes. I believe yes to all of your questions. You will notice in the quarterly reports of SIGAR and our

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joint subgroup report that GAO in very limited instances has identified planned work. While we have informal discussions with our

colleagues in the IG offices about work that we have planned, because all of our work in Iran, Afghanistan, and Pakistan is undertaken under CGA, Comptroller Generals Authority, we do so because we are addressing the interests and the needs of the myriad

committees who have jurisdiction over the issues of U.S. engagement, and surrounding U.S. engagement, in these countries. And

so we respond not only to your interests, we respond to the congressional mandates, as well as areas in need of followup.

So we maintain some flexibility in planning out our work to be

most responsive and timely in responding to your needs. So we assure our independence in that way from the others who have similar missions but different clients.

Mr. TIERNEY. I’m not asking you again. So the subject matter of

my next question—but can you give me an opinion as to whether

or not you can answer it and will be able to work with us? Will

your office be able to give an opinion as to the best way for us to

effect oversight in Pakistan with respect to whether or not the Special Inspectors Generals Office of Afghanistan ought to be extended

to cover that area or whether some other approach might be advisable?

Ms. WILLIAMS-BRIDGERS. We can provide you some insights

based on congressional history and enacting legislation standing up

IGs.

Mr. TIERNEY. I think we may ask you to do that, and we may

get the other more informal basis on that for an opinion, because

I do think we want to look at Ambassador Holbrooke, his comments

that he made here, and General Fields’ comments as well.

Ms. WILLIAMS-BRIDGERS. We welcome that. Thank you.

Mr. TIERNEY. Thank you.

Mr. Murphy? I didn’t even see you there. Mr. Murphy stealthily

came into the room. So maybe we can look to him for some stealth

technology.

He has no questions.

In that case, is there anything else that anybody wants to comment on, that you thought might have been left unsaid? I’ll start

from my left over here. General Fields.

General FIELDS. Thank you for allowing me the opportunity, Mr.

Chairman. I wish to go back maybe about an hour to the white

paper produced by Ambassador Eikenberry which addresses how

he would wish to approach certain matters in regard to the reconstruction effort.

I want to point out to this subcommittee that, during the course

of the past year, making my first trip to Afghanistan in this capacity last September, I have now visited 13 provinces and about as

many PRTs or provincial reconstruction teams. I have met with

about as many Governors of provinces or deputy Governors of provinces. I have met with practically all of the senior ministries of the

Government of Afghanistan, to include three visits with President

Karzai himself. Each time we visit—not just I, but I and my staff

visit, we get—we receive this issue of Afghanistan wanting to be

more involved in the reconstruction of their country.

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So I say this because I applaud, really, what Ambassador

Eikenberry has put forth as what he would like to see as the way

ahead in being more inclusive of the people of Afghanistan. This

matter is resident in no less two documents that I am mandated

in my legislation to oversee: the Afghanistan Compact and the Afghanistan National Development Strategy.

This is a bold move. Yes, oversight will be even more important.

One thing we are doing as a part of SIGAR is to determine the extent to which those controls are in place, those management systems necessary to ensure the American taxpayer that his and her

money will be spent wisely and for the purposes made available by

this very Congress. So we are on top of that, sir, and we will provide that feedback accordingly.

Mr. TIERNEY. We are going to need it because I think Ms. Williams-Bridgers pointed out very clearly that if you go down that

path and you want to pass your money through that government

to enhance its legitimacy, then we darn well better be sure that we

have some safeguards in place of how it is being spent.

Given the current state of Mr. Karzai’s government and the individuals that he has invited in to participate in that—and the reputation for corruption—I think we should be more than a little bit

wary about just forking the money over and hoping for the best.

We are going to need the advice and counsel of all of you to give

us a very firm commitment on that, that we’re going to try and

buttress that government—even some of the provincial and more

district governments. We know who we are dealing with. We

haven’t placed the safeguards on that. And we have a strict monitoring, day by day, so that we can pull the plug on it anytime we

need to if it starts to go south on us, or else I think we are all

going to be the fool for it. We are going to have spent a lot of

money that this country needs, trying to undertake a national security issue that we also need but maybe has been wasted. So I think

that is a critical aspect of your functions and I appreciate it.

But I think that is right up there with some of the priorities if

they—in fact, Ambassador Eikenberry’s theory is going to be borne

out. Then that just raises the ante on all of us, I think.

General FIELDS. Absolutely, sir. Thank you.

Mr. TIERNEY. And at least one last question that I almost forgot

that I had. The CERP funds, the Commanders Emergency Response Fund, is about $1.6 billion since 2004. Are we monitoring

that and updating and monitoring of how that is being spent and

what results we’re getting from it? I know the previous reports

have not really seen a real tight accounting of that.

General FIELDS. I think my colleague wishes to say something

about it, sir. But let me go ahead and say, since the green light

is on for me at the moment, we have just completed an audit of

CERP and we have found certain strengths and, of course, as one

might expect, certain weaknesses in the oversight of that spending.

We will report out on this by the close of business today or within

the next 24 hours. There are some issues to which we are advising

U.S. Forces-Afghanistan to turn their attention to and we are confident that they will, sir.

Mr. TIERNEY. We would appreciate a copy of that report as soon

as it is done. And you can accommodate us on that?

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General FIELDS. Sir?

Mr. TIERNEY. We would appreciate a copy of that report as soon

as you publish it.

General FIELDS. Absolutely, sir. It should be posted on our Web

site within the next 24 hours. Is that correct, Monica? Thank you.

Mr. TIERNEY. I would ask unanimous consent that the record be

held open until that report is filed and it be included in the committee’s report.

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Ms. WILLIAMS-BRIDGERS. Mr. Chairman, GAO has also recently

completed a report on CERP where we found there was a need for

additional oversight, there was a need for additional trained personnel. While the intended effects of the provision of funding for

certain projects was very good, we do believe that there is need for

better coordination between DOD and USAID to make sure that

money is well spent.

Mr. TIERNEY. Who do you recommend do that additional oversight?

Ms. WILLIAMS-BRIDGERS. DOD and USAID. DOD specifically.

Mr. TIERNEY. Gentlemen, are we up to it?

Mr. HEDDELL. Yes. Mr. Chairman, this is a very important area

in terms of our considerations. We did do work and we are—we

have more work planned. But our most recent report I think goes

back to 2007, and we found administrative weaknesses. We had

concerns. In fact, 15 of 16 pay agents did not have adequate storage for cash and other assets. Two pay agents made inappropriate

payments.

So we have found some of what we would consider to be serious

concerns with that, and we are continuing to watch it. The Department knows we are very on top of that, and we will have additional

work to be done in the future.

Mr. TIERNEY. We are going to take a look at the Inspector General’s report and the Government Accountability Office’s reports

and your most recent reports, even though they are a little bit

dated and determine whether or not there is a need for another

hearing or whether or not we will just keep monitoring what it is

you are doing. But I do agree with you, sir, that this is very, very

important.

Do you have anything you want to say, Mr. Gambatesa, because

you’re going to be asked to do some more oversight in this area.

Do you have the capacity to do it?

Mr. GAMBATESA. Yes, I believe we do.

Mr. TIERNEY. Do you have the willingness to do it?

Mr. GAMBATESA. Yes, of course. But I would like to comment,

though, on the question you posed to General Fields about extending his authority into Pakistan. Certainly this is not a reflection—

my opinion is not a reflection on the fine work that General Fields

and his staff do. But I think, in the general sense, that the statutory IGs here present and others that work, or do work in Pakistan, have the ability and the expertise to provide the oversight if

given the resources and the funding to do so. Whether the Congress wants to establish another Inspector General, a Special Inspector General in that area, certainly a political decision will be

made. But I, for one, think that we as a group can actually provide

the oversight that is necessary.

Mr. TIERNEY. Thank you. I want to thank all of you for your testimony here today and your expertise. It has been a tremendous

help to us as we’re trying to perform our job in what gets to be a

complex and growing universe of events on that. So you have our

appreciation. We continue to work with you and look forward to

doing that and wish you all a good rest of your day. Thank you.

[Whereupon, at 11:34 a.m., the subcommittee was adjourned.]

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