House Panel Critical of Iraq Contractors

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WASHINGTON — Rep. Henry Waxman, chairman of the House oversight committee, said Thursday that Iraqi Prime Minister Nouri al-Maliki has issued an order requiring his approval of any corruption investigations of himself or senior ministry officials.

Waxman, D-Calif., said the order essentially grants immunity to al-Maliki and his ministry at a time when fraud and abuse is rampant and hurting reconstruction efforts.

"These are not unfounded allegations," Waxman said. "This is Nouri al-Maliki's edict that no one will be referred to court unless he approves it."

In testimony before the panel, Secretary of State Condoleezza Rice said she was not aware of the specific order, but that the U.S. would oppose any policy shielding senior officials from criminal prosecution or investigation.

"It would not be the intention of the United States of America that any official of Iraq ... would be immune from investigations of corruption," she said. If the prime minister were to demand immunity from corruption charges, "that would not be an acceptable policy from the view of the United States."

The issue prompted a tense exchange between Rice and Democrats on the Oversight and Government Reform Committee, who demanded that Rice publicly denounce the al-Maliki order they described. At one point, the usually unflappable Rice became visibly frustrated when Rep. Peter Welch, D-Vt., cut short her answers and repeatedly asked whether President Bush would call on Iraq to repeal the order.

"To assault the prime minister of Iraq, or anyone else in Iraq" with unsubstantiated allegations would be "deeply damaging, and frankly I think it would be wrong," she said.

Rep. Tom Davis, the top Republican on the committee, said he thought the order was not as sinister as suggested and only meant to consolidate corruption investigations. Democrats seemed to be trying "to drill enough small holes in the bottom of the boat to sink the entire Iraqi enterprise, while still claiming undying support for the crew about to drown," Davis, R-Va., said.

Al-Maliki has said the Integrity Commission, the country's top oversight agency, does seek his approval before it investigates a Cabinet member or senior members of his staff. But the Iraqi Parliament can open an investigation into the prime minister or any non-elected official without approval. Parliament members have immunity from prosecution, as in most countries.

The hearing comes after several weeks of wrangling between Waxman and the State Department. Waxman says the State Department has made gross missteps in its management of the war, including lax oversight of contractors and not doing enough to curb government fraud and abuse.

One particular issue has been the classification of specific corruption investigations by the United States. The State Department says such information should be classified because it could expose sources and hurt U.S.-Iraqi relations.

"I think there are a lot of things that ought to be made public," including whether money siphoned from corruption has funded attacks on U.S. troops, Waxman said. "We ought to know that information."

Rice said militias are being funded by multiple sources, including possibly corruption. But, she added, a bigger problem was money from Iran.

On a separate matter, Congress is moving to put all armed contractors operating in combat zones under military control, acting on a Pentagon recommendation that could run into resistance at the State Department.

The Senate this month included such a requirement in its 2008 defense authorization bill. Sen. Carl Levin, chairman of the Senate Armed Services Committee, told reporters Wednesday he is confident the House will go along with the idea and include it in a final bill sent to President Bush.

Rice has ordered new rules for the private guards who are hired to protect U.S. diplomats. They include increased monitoring and explicit rules on when and how they can use deadly force. The steps were recommended by a review panel that Rice created after a deadly Sept. 16 shooting involving Blackwater USA guards.

Rice also called for better coordination with the military, but did not explicitly act on a suggestion by Defense Secretary Robert Gates that combatant commanders have control over the contractors.

Levin, D-Mich., said he was not sure if Rice expressly opposed the idea. "Whether she likes it or not, we expect to get this language" to emerge in the compromise with the House.

"It's not slapdash" and "is something we've been working on a long time," Levin said.

In her testimony Thursday, Rice said she and Gates have asked their No. 2 officials to study the issue further and make additional recommendations, if necessary. She also said legislation is needed to ensure "appropriation action" can be taken against any armed contractors involved in killings.

In more fallout from the Blackwater shooting, the State Department's security chief resigned Wednesday. Rice accepted the resignation, which is effective Nov. 1, State Department spokesman Sean McCormack said. Richard Griffin will be replaced on an acting basis by one of his deputies, Gregory Starr.

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