Kellogg, Brown & Root has a long and storied history as an integral part of the American Military Industrial Complex. With legendary support from President Lyndon Johnson, KBR (then simply Brown & Root) assisted in the construction of nearly 85% of the Army’s infrastructure needs during the Vietnam War. During the first Iraq War, KBR was contracted by then Defense Secretary Dick Cheney, who subsequently became the CEO of KBR’s parent company Halliburton. With Dick Cheney now occupying the office of Vice President, KBR easily landed over $16 billion in contracts for the current Iraq War.

With 21,000 employees in Iraq, KBR is the largest Defense contractor in Iraq. Thanks to a Cayman Islands tax shelter, it isn’t paying payroll taxes. From the Boston Globe :

Kellogg Brown & Root, the nation’s top Iraq war contractor and until last year a subsidiary of Halliburton Corp., has avoided paying hundreds of millions of dollars in federal Medicare and Social Security taxes by hiring workers through shell companies based in this tropical tax haven.

More than 21,000 people working for KBR in Iraq - including about 10,500 Americans - are listed as employees of two companies that exist in a computer file on the fourth floor of a building on a palm-studded boulevard here in the Caribbean. Neither company has an office or phone number in the Cayman Islands.

The Defense Department has known since at least 2004 that KBR was avoiding taxes by declaring its American workers as employees of Cayman Islands shell companies…

Other top Iraq war contractors - including Bechtel, Parsons, Washington Group International, L-3 Communications, Perini, and Fluor - told the Globe that they pay Social Security and Medicare taxes for their American workers.

KBR has become infamous for their graft, incompetence, fraud and even the gang rape of employees . Cheney’s old company not only defrauds the US Government through their contracting methods, they simply refuse to pay taxes as well.

In a bid to disassociate itself from the constant stream of bad press surrounding KBR, Halliburton arranged an IPO and sold off a minority stake . Declaring itself no longer tied to KBR, Halliburton neglected to mention that only 20% of KBR was for sale.

Halliburton has long used shell companies in the Cayman Islands to allow them to do work for countries otherwise unavailable to them. As 60 Minutes uncovered, they funnel contracts for work in Iran, Libya, Burma, Azerbaijan and Nigeria through their offshore offices. Contracts that would result in federal charges had they not been stamped with a Cayman Islands postal code.

Halliburton Products and Services, Ltd., is wholly owned by the U.S.-based Halliburton and is registered in a building in the capital of the Cayman Islands – a building owned by the local Calidonian Bank. Halliburton and other companies set up in this Caribbean Island, because of tax and secrecy laws that are corporate friendly.

Halliburton is the company that Vice President Dick Cheney used to run. He was CEO from 1995 to 2000, during which time Halliburton Products and Services set up shop in Iran. Today, it sells about $40 million a year worth of oil field services to the Iranian government.

Defrauding the government, trading with the enemy and abusing it’s employees. These would be grounds to launch criminal proceedings against any company, let alone the single largest U.S. military contractor. Incredibly that has yet to happen. From CBS News :

According to Cheney’s 2001 financial disclosure report, the vice president’s Halliburton benefits include three batches of stock options comprising 433,333 shares.

After leading the country in two wars, Cheney’s stock options are now worth over $16,800,000.

I suppose that’s one way to avoid prosecution.