Military police are investigating claims Britain and its Nato allies were overcharged hundreds of millions of pounds for fuel by a defence contractor during the Afghan war.
A Nato audit of vast contracts to supply fuel to front line troops during the campaign has found the military alliance could have been overcharged by as much as £460 million ($700 million) by Supreme Group, sources said.
Sources said Britain is believed to have had put in around 10 per cent of the money, to provide troops in Helmand with fuel, meaning the UK had potentially been overcharged up to £46 million.
The disclosure comes months after the Amsterdam-based group’s food business pleaded guilty and paid hundreds of millions in penalties for “major fraud” for overcharging the American military for food and water during the war.
The Ministry of Defence in London last night (Sun) confirmed that allegations of fuel overcharging were being looked at by its criminal investigation department.
Nato spent vast sums keeping buildings and vehicles fuelled during the 14-year-long campaign against the Taliban. The lack of ports in landlocked Afghanistan, poor roads and the need to take fuel through Taliban-held territory left it hugely expensive to supply forward bases.
At the height of the campaign, Nato was spending around £1.5 billion a year on fuel.
Nato sources said the audit had been delivered to alliance headquarters late last month. One source said: “Nato tends to look at overcharging with a lot of cynicism”.
Supreme won lucrative logistics contracts with the American and British forces during the wars in Iraq and Afghanistan and currently provides fuel for the RAF and holds the MoD’s worldwide food supply contract. Outsourcing logistics and supplies has been a cornerstone of the MoD’s cost-cutting defence shake-up in recent years.
A spokesman for the MoD said: “We are committed to getting the maximum value for money for the taxpayer and will always seek to recover any overpayments. We are aware of the allegations of overcharging by Supreme and we have referred the matter to the Ministry of Defence Police Criminal Investigation Department”.
Nato said a review of fuel contracts had found “weaknesses” with the way contractors were managed and “shortcomings” had been identified with the managing and costing of the fuel contracts.
A Nato spokesman said: “The issue continues to be addressed by Nato through follow-on reviews and investigations into the matter by Allied Command Operations. Part of unduly paid costs have already been recovered. The recovery process continues. This however remains a complex and lengthy process, whose specific details cannot be revealed until its completion.”
Supreme last night said it was in routine negotiations with Nato over the end of fuel contracts and whether adjustments “some in favour of Nato and others in favour of Supreme, need to be made based on final cost data”.
Michael Schwartz, a lawyer for the company, said: “In that process, no one has suggested any criminal conduct or need for involvement of law enforcement authorities.”
He said Nato, Supreme and the US Defence Logistics Agency were in “a constructive exchange of information and dialogue”.