FEBRUARY 20, 2007
A Department of Defense official has admitted accepting illegal bribes from a company that has made millions in Iraq reconstruction contracts and whose owner has been convicted of bribery and conspiracy to commit money laundering.
Steven Merkes, who served as a logistics planner in Germany for the Pentagon, pleaded guilty to taking cash and gifts from the construction company’s owner, Philip Bloom, in exchange for helping it obtain lucrative government contracts. Merkes got at least $24,000 in cash and a job offer.
At the time Merkes served as an operational support planner in the Future Operations Division of the United States Army Headquarters, Special Operations Command-Europe. He had served in the U.S. Air Force and got a coveted job with the Pentagon once he left active duty.
Federal prosecutors say Merkes used his position and influence to benefit Bloom’s construction and service companies in Romania and Iraq as they bid for hefty contracts with the U.S. government. Last March Bloom was sentenced to 46 months in prison for the conspiracy, bribery and money laundering charges. Merkes has not been sentenced but faces up to two years in prison and a fine of a quarter million dollars.
This case marks the eighth in only a few months involving U.S. government or military officials caught participating in the widespread fraud and corruption that for years has plagued the Iraq reconstruction contract process.
Earlier this month three U.S. military officers were indicted on bribery, money-laundering and conspiracy charges for running a scam that steered millions of dollars in Iraq reconstruction projects to a contractor in exchange for expensive cars, cash and jewelry.
The others involve an Army translator sentenced to prison for offering bribes to an Iraqi police official, two separate cases of Army officers jailed for accepting $50,000 in bribes from a contractor and a National Guard officer who pleaded guilty to conspiracy charges for embezzlement.
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