In which the US teaches Iraq about corruption done the American way

In the first corporate whistle-blower case to emerge from Iraq, a federal jury in Virginia yesterday found a contractor, Custer Battles L.L.C., guilty of defrauding the United States by filing grossly inflated invoices for work in the chaotic year after the Iraqi invasion.

The civil case is expected to be the first of dozens under the Federal False Claims Act, which allows company insiders to bring suit on behalf of the government and share in damages awarded.

Two former associates accused Custer Battles of faking invoices from shell companies to overcharge the coalition authority, then governing Iraq, by tens of millions of dollars. But the current trial concerned billing of just $3 million under one of several contracts the company garnered in the post-invasion scramble.

After a three-week trial, the jury found that the entire $3 million was gained by fraud. According to the law, the company, which is based in McLean, Va., and its two owners and a former executive must now repay the government triple damages and also pay fines for 37 fraudulent acts.

Of more than $10 million in damages and penalties, most will go to the federal treasury while the whistle-blowers will receive from 25 percent to 30 percent.

Let it be noted for the record that the winners here are American, the losers Iraqi. The losers go unmentioned. Iraq is one giant casino.