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IRAQ: U.S. Contractor Bloom Pleads Guilty

Contractor pleads guilty to conspiracy, bribery and money laundering in connection with a bid-rigging of Iraq reconstruction contracts.

by Robert Schmidtbloomberg
April 18th, 2006

April 18 -- Philip Bloom, a U.S. businessman, pleaded guilty to conspiracy, bribery and money laundering in connection with a bid-rigging investigation of Iraq reconstruction contracts.

The Justice Department unsealed the March 10 plea agreement today in federal court in Washington. Bloom admitted paying a former comptroller for the disbanded Coalition Provisional Authority and other officials more than $2 million in money and gifts to win $8.6 million in contracts.

The case arose from audits and an investigation by Special Inspector General Stuart Bowen, whose office was established by Congress in late 2003 to oversee the spending of almost $30 billion in appropriated U.S. tax dollars. Robert Stein, a former comptroller for the provisional authority, pleaded guilty in February to taking part in the scheme. Two Army reservists have also been charged.

``Philip Bloom admits offering millions in bribes so that he and his companies could receive contracts for the vital task of rebuilding Iraq,'' Alice Fisher, the head of the Justice Department's Criminal Division, said in a statement. ``The reconstruction effort in Iraq must be free from the taint of corruption.''

The bid-rigging scheme took place between December 2003 and December 2005, according to court papers. Bloom, according to court papers filed in the case, gave contracting officials business-class airline seats, new cars, watches, alcohol, cigars and sexual favors provided by women at his villa in Baghdad.


In one e-mail included in court papers, an unnamed officials asked Bloom for a GMC Yukon Denali sport utility vehicle with ``sandstone leather'' interior and all-wheel drive. The car ``is loaded'' and ``has to meet California emissions'' standards, the official wrote.

Another unidentified official requested a blue Nissan 350Z sports car that cost $35,990. An employee trying to find the car told Bloom in an e-mail it was a ``very desirable, hard-to-find color'' and only two were available in the Western U.S.

Bloom's bids were for less than $500,000 -- the limit of Stein's authority to award a contract, prosecutors said. The contracts included demolition of a police academy, construction of a ``democracy center'' and renovation of a library.

Bloom faces up to 40 years in prison and a $750,000 fine. Under the plea agreement, he also must pay $3.6 million in restitution and forfeit $3.6 million in assets to the U.S., the Justice Department said.

Bloom has been in U.S. custody since his arrest in November.

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