The US Army may challenge up to $400 million billed by Halliburton’s KBR subsidiary under the company’s “$20 billion” military logistics contract because of unauthorized charges for private security in Iraq.

KBR announced the possibility in its latest Securities and Exchange Commission filing on Wednesday. The news follows on the tail of the Army telling Congress last month that it was withholding $19.6 million for costs that KBR had billed for services rendered by Blackwater Security to a subcontractor. That task resulted in four Blackwater guards being attacked and killed in Fallujah on March 31, 2004.
The Houston Chronicle has the story.
KBR said the Army could withhold 6 percent of all past and current subcontractor costs credited to private security charges that may not have been reported. KBR may dispute this:

The company said that while its contract with the Pentagon is clear that KBR cannot bill the government for private security to protect its workers, it does not prohibit subcontractors from doing so. In addition, because KBR often accepts lump-sum bids from subcontractors, it often doesn’t receive details of costs outlined in the bids.