Opportunity Knocks: Dream Team Skims the Cream of Conquest

This is a version of a column that originally ran in the Oct. 12, 2004 edition of The Moscow Times.

It's another story of the American Dream come true, the kind you see every day in George Bush's blessed realm. All the usual inspiring elements are there: a couple of plucky kids starting a business with nothing but hustle and a whole lotta heart; a few lucky breaks crowned with big-time success; a duffel bag stuffed with millions in cash from a war-zone slush fund; a father and son held hostage at gunpoint to block a corruption probe, then dumped in hostile territory with no papers, no money, no protection.

Yes, it's the story of Custer Battles LLC., a mercenary firm run by two former covert operators and Bushist Party bagmen who sharked up more than $40 million in the usual no-bid conquistador contracts from the rape of Iraq – and may have skimmed an extra $50 million in fraudulent cream, the Los Angeles Times reports.

Custer Battles is not, as you might think, named for that earlier undermanned, overconfident military incursion which ended in disaster at Little Big Horn. No, the ill-omened moniker comes from the company's founders: ex-Army Ranger and "Special Operations" vet Scott Custer and his partner, fellow Special Opnik Mike Battles, who also brings his experience as a clandestine CIA officer, FOX News commentator and failed Republican congressional candidate to the mix.

Although Custer Battles had no previous security experience, the plucky firm somehow won a $16.8 million no-bid contract to provide security for the Baghdad airport. This was followed by $24.4 million to take part in the gargantuan porkfest surrounding the replacement of Iraqi currency, along with sundry other hired-gun work – including a sideline in supplying military dogs for raids on Iraqi homes, which the company called a "beneficial interaction with civilians, lessening the cultural divide."

But the Custer Battles gravy train hit a roadblock last week, when the firm was suspended from further government pork gobbling. The Pentagon and FBI were forced to launch investigations after former company executives – including ex-FBI man Robert Isakson – filed a "whistleblower" lawsuit against the firm citing what the Pentagon itself called "adequate evidence of…fraud, antitrust violations, embezzlement, theft, forgery, bribery, false statements" and other offenses "indicating a lack of business integrity." Actually, that sounds like a dream resume for a top post in the Bush Administration, but with a pesky civilian court making noise, the Pentagon pets are in the doghouse – for now.

Custer Battles' alleged shortcomings in business integrity include setting up off-shore front companies and sham sub-contractors to inflate costs in its lucrative, Halliburtonish "cost-plus" contracts, where the government covers all expenses and guarantees a set profit for favored cronies. The company's own documents also detailed "forged leases and inflated invoices" and an outrageous $6 million overcharge on its expenses in the currency-exchange racket. When Isakson objected to the scams, two unnamed "top company officials" burst into his office with machine guns, held him and his 13-year-old son at gunpoint for hours, then stripped Isakson of his ID, money and gun and told them find their own way out of Iraq, the Times reports. Father and son finally made their way through the hellhole of Fallujah to safety in Jordan.

The Little Big Horners still have friends in high places, however. In what legal experts say is a "highly unusual move," the Justice Department is refusing to join in the case, which could recoup tens of millions of defrauded taxpayer dollars. The reason given for this coyness is the usual cartload of cowflop from Attorney General John "Jesus is King of America" Ashcroft. His office says the federal government has no jurisdiction in the matter because Custer Battles' contracts were not with the federal government but with the "Coalition Provisional Authority" – i.e., the occupation authority appointed, led and funded by, er, the federal government. Such logical contortions are beyond the ken of mere mortals, of course – but then the Lord works in mysterious ways, His cronies to reward.

Ashcroft's divine non-intervention effectively puts the kibosh on the case: as Knight-Ridder notes, whistleblowers – and taxpayers – win 95 percent of such fraud-recovery suits when the Justice Department joins in, but only 25 percent when the feds stay on the sidelines. Thus it's a good bet that the smooth Operators will get to keep every drop of blood money they've squeezed from the aggression in Iraq. And why not? Plucky little guys with plenty of moxie always win out in the American Dream.

But just how little are these pluckers? Their website offers a suitably Lincolnesque tale of humble origins: how they had to scrape and borrow money just to get to Iraq, where their unknown company was magically chosen by an unnamed Bush honcho who gave them the no-bid airport contract – along with a duffel bag stuffed with $2 million in small bills, just to get the ball rolling. Plucky Mike promptly deposited this swag in a Lebanese bank, far from the prying eyes of American regulators. From this potent seed sprang a mercenary/consulting outfit now worth $100 million.

Yet this pretty tale of cash-strapped kids chasin' the dream is rather belied by the partners' hard-wired connections into the military-corporate power grid that now rules the former American republic – and by Mike's other career as well. He's a top executive in the Camelot Group, a heavy player on the international "private equity" scene – a corporate colleague of the Carlyle Group, that deep well of war profiteering and backroom deals where Bushes and bin Ladens once watered together.

Could it be our plucky lads were actually playing with loaded dice? That merit and moxie aren't all you need to make it big in Bushland and its various vassal states? No doubt everything will be made clear when Mike finally finishes the book he's been touting on the company website – a title that captures the very pith and marrow of the whole Bushist enterprise: "Blood in the Streets: Seizing Opportunity in Crises."