POGO Identifies Defense Contractors Recently Sanctioned for Human Trafficking Abuses

POGO has identified two companies that were recently sanctioned by the government for violating U.S. restrictions on human trafficking. An official in the Pentagon’s watchdog told POGO that Tamimi Global Company and Texas Gulf Global General Trading & Contracting Company were the two of the companies referred to, although not by name, in a recent State Department report.

The State Department’s Trafficking in Persons Report 2018 released in June reported:

[The Department of Justice] and other federal law enforcement agencies continued to investigate allegations of debt bondage and excessive recruitment fees required of third-country nationals working on certain U.S. government contracts abroad, but no federal criminal prosecutions of employers or labor contractors resulted from these investigations in FY 2017. [The Department of Defense] took action against noncompliant employers or labor contractors from U.S. programs resulting in 22 suspensions, six debarments, one job termination, and one compliance agreement. (emphasis added)

The report does not name these employers and labor contractors or the U.S. contracts and programs on which were they were working. After several weeks of digging and numerous calls and emails to the State Department and the Department of Defense, an official at the Pentagon’s Office of the Inspector General provided some details.

The official told us that Tamimi Global Company and several of its subsidiaries and employees accounted for 15 of the suspensions and the compliance agreement, and Texas Gulf Global General Trading & Contracting Company accounted for one suspension. Both companies were working on U.S. Army contracts. The official would not disclose the rest of the names, claiming they “are related to an open criminal investigation.”

Little is known about Texas Gulf Global. It is a Kuwaiti company that had approximately $500,000 in federal contracts from 2013 to 2015. The System for Award Management database of federal contractor registrations and exclusions indicates that the company was suspended from federal contracting by the Army for about four months—from September 29, 2017 until February 1 this year—but provides no other details.

By contrast, Tamimi Global has a fairly extensive paper trail. This Saudi support services company is a key supplier of food services to U.S. forces in the Middle East. In 2011, Tamimi paid $13 million to settle criminal and civil allegations of paying kickbacks to win contracts supporting Army operations in Iraq and Kuwait in the 2000s. Tamimi vice president Mohammad Shabbir Khan was sent to prison for his role in the scheme, which involved employees of defense contracting giant KBR. KBR and Tamimi were two of the infamous “Flagrant Five”—five companies former Wartime Contracting Commissioner Charles Tiefer called out in 2011 for their poor contract performance and checkered legal histories.

The System for Award Management database shows Tamimi was suspended by the Army from April 5, 2017 until July 28, 2017. The Federal Awardee Performance and Integrity Information System (FAPIIS) shows that, on the day the suspension was lifted, Tamimi entered into a three-year administrative compliance agreement with the Army resolving alleged violations of the Trafficking Victims Protection Act on a $134 million food services contract in Kuwait.

According to the facts set out in the administrative agreement, Tamimi employees recruited in Bangladesh were promised salaries of 100KD (Kuwaiti Dinars) per month, but many were paid only 40KD. (Kuwaiti law requires employers to pay a minimum monthly salary of 60KD.) Employees worked 12-hour shifts for seven days a week, and one employee allegedly received “unacceptable treatment.” Tamimi disputed some of the facts, but agreed there was a “legally sufficient basis” for debarment. The agreement contains no monetary penalties, but it requires Tamimi to hire an independent compliance monitor and to take steps to strengthen its corporate ethics and compliance programs.

When notified of Tamimi’s latest wrongdoing, Charles Tiefer told POGO “Tamimi was one of the worst contractors from the wars in Iraq and Afghanistan.” In particular, he remembers the company’s stonewalling with regard to the KBR kickback affair.

“The Tamimi Group refused to let the Defense Contract Audit Agency look at the company’s books to see where the kickback money came from,” Tiefer said.

Finally, we have a few things to say about the government’s contractor accountability web resources. Both FAPIIS and the System for Award Management are extremely useful resources that help the public delve into the backgrounds of federal contractors and grantees. However, both have flaws that can also confuse or mislead the public. For example, FAPIIS contains three listings for Tamimi (two of which differ by a single punctuation mark) but only one contains a record of the administrative agreement. FAPIIS is supposed include data on human trafficking instances, but the “Information on Trafficking in Persons” section of Tamimi’s and Texas Gulf’s listings contains no records. The System for Award Management keeps active and inactive exclusion records separate, so the suspensions of Tamimi and Texas Gulf do not appear in the initial search of the database. Both databases also suffer from a government-wide identification system that assigns some business entities more than one identifying number, making it even more difficult to track down records for a particular company.

All of this underscores the need for the government to finally adopt a better unique identifier system and create a one-stop public portal for all spending and contractor accountability data, as well as agency watchdog reports and audits. Improving these tools is essential for ensuring the public is aware of companies that commit serious human rights violations.

POGO has long been engaged in the fight against human trafficking involving federal contractors, a worldwide problem our government exacerbates as the single largest purchaser of products and services on the global market. For many years, we have pushed for reforms to ensure contractor involvement in this form of modern slavery is stopped.

We are heartened to hear that there are criminal investigations into the other recent instances of alleged human trafficking by government contractors. These abuses are unacceptable, let alone from companies doing business with the U.S. government. Powerful safeguards, meaningful transparency, and strong punishments are necessary to ensure human trafficking is eradicated.

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