Iraqi probed in rigging of cell-phone pacts

[seemslikeadream]

According to the defense official, "significant and credible evidence" reveals "a conspiracy was organized by Auchi to offer bribes to 'fix' the awarding of cellular-licensing contracts covering three geographic areas of Iraq."
The contracts were won by Asia Cell Telecommunications Co. Ltd., Orascom Telecom Iraq Corp. and Atheer Telecom Iraq.
Officials believe that the contracts-award process was arranged so that companies linked financially to Auchi won the bids and that the common European cell-phone standard, known as GSM, would be the only standard used under the contracts.
As a result, Auchi succeeded in taking over the entire postwar cellular-phone system in Iraq by using contacts and front companies to design the architecture for the phone network in three sectors in Iraq, and to make sure that he owned or controlled the components.
Several American, British and Iraqi nationals are under investigation in addition to Auchi for the reputed cell-phone bid rigging, U.S. officials said.
Two American officials working within the Iraqi Communications Ministry resigned last month and accused a Pentagon official of improperly influencing another contracting process in Iraq. The matter involving all three officials is under investigation by the Pentagon's inspector general.
"The implications of having fixed the tender for the entire Iraqi cellular-telephone system go beyond mere corruption and technological empire building," the defense official said. "It put in control of Iraqi telecommunications a man with an anti-American, anticoalition mind-set and a history of illegal international arms traffic. That control could allow him to compromise the entire Iraqi telecommunications system and undermine the Iraqi security system on an ongoing basis."
One problem for investigators is the June 30 deadline for turning over sovereignty of Iraq to a new government in Baghdad. After July 1, it will be very difficult to figure out how the licensing process for telecommunications contracts was carried out.
The investigation by the Pentagon's Directorate of International Armament and Technology Trade, a special unit set up to track arms and technology transfers, is under way on the telecommunications-contracting improprieties.

more
http://washingtontimes.com/national/20040509-125033-9185r.htm

[htuttle]

1. The cell phone business in Iraq has been...interesting to say the least

Jump in the Wayback machine with me, Sherman:

Very shortly after Baghdad fell, a Bahraini cellular company moved into Iraq and had a working cellular network going within a week. It used GSM, the cellular standard common in the region, and would work with most Iraqi's existing cell phones.

The US Proconsul forced them to dismantle this working network, since they didn't have permission to set it up. They'd already awarded the cellular contract to a US company -- unfortunately for Iraqis, this US company was planning on using CDMA, the US cellular standard, so that pretty much only US cell phones worked -- the ones normally used in the Middle East and Europe were incompatible by design.


Bailing Out WorldCom
Can You Hear Me Now, Baghdad?
August 5th, 2003 12:00 PM
http://www.villagevoice.com/issues/0332/mondo2.php

Soon after Bush announced the liberation of Iraq and the end of the war, private entrepreneurs sprang into action by setting up cell phone service in Baghdad. (Saddam had banned cell phones.) Prime among them was Batelco, partly owned by the government of Bahrain. It invested $5 million to get a system up and running and promised to put in a total of $50 million. MTC Vodaphone, 25 percent owned by the Kuwait government and a franchisee of Britain's big Vodaphone company, rushed into the Baghdad market to set up its roaming service there.

But this notable example of spontaneous free-market capitalism was shut down by the U.S.'s Coalition Provisional Authority.

Who stands to gain from the authority's ban? Currently, the U.S. military and others use a Baghdad network built by WorldCom, the corrupt and bankrupt American telecommunications firm that is trying to revive itself by returning to the name MCI after defrauding the U.S. government. Of course, the Iraqi public isn't allowed to use that system.

(more)

(I originally posted this in a related thread in April. Just some more dots to connect...)

[seemslikeadream]

2. Just a thought

wasn't there someone in the news recently that was involved in the cell phone tower business?

[gratuitous]

3. Can't imagine why the Pentagon would be upset by this

After all, it shows that at least some Iraqis are adapting quickly to Western business practices and methods. Adam Smith would be so proud!