False Claims Act and Anti-Terrorism Act Lawsuits Target Military Contractors Who Allegedly Funded Al Qaeda and The Taliban

Between 2007 and 2014, the U.S. spent $89 billion on Department of Defense contracts in Afghanistan alone. Our government paid local contractors to transport goods and drive trucks, primarily because it was too dangerous to move around on the ground. But while taxpayer dollars were used to hire people to do risky jobs, they may have also ended in the pockets of anti-American terrorists.

Funding Afghanistan's 'Warlords'

Several Department of Defense whistleblower lawsuits recently alleged that military contracts in Afghanistan not only involved corruption but also helped fund our country's enemies. Calling this state of things ironic is an understatement. According to numerous plaintiffs, while our military hired contractors to wage war against the Taliban, the money paid to those contractors was being funneled directly to the Taliban.

A House Committee report once described Afghanistan´s trucking contractors as “a vast protection racket run by a shadowy network of warlords, strongmen, commanders, corrupt Afghan officials, and perhaps others.” The document also stated that “protection payments for safe passage [were] a significant potential source of funding for the Taliban.” 

Thus, even well-meaning local contractors may have used the money they received from our government to bribe the Taliban to allow safe passage for trucks transporting U.S. military cargo. According to several whistleblowers, this has also happened in Iraq and Pakistan.

Suing Department of Defense Contractors Under The False Claims Act

The False Claims Act allows whistleblowers with information about this type of corrupt practices to sue fraudsters and obtain awards up to 30 percent of the government's total recoveries.

Any payment made in the context of a Department of Defense contract has to adhere to strict rules, and one of them is that the money cannot end up in the enemy's hands. Suppose a contractor bribes a U.S. official to secure a contract or bribes a terrorist to secure safe passage in a dangerous area. 

In that case, their DoD contract becomes tainted, and any claims for payment they submit to our government as part of that arrangement are considered "false claims." Each false claim triggers civil penalties, and in the event of a successful settlement or verdict, whistleblowers can receive multimillion-dollar awards.

Afghanistan Contractor Linked to Suicide Bomber Attack Agrees to $25 Million Settlement

If our government indirectly funds terrorists, this funding can potentially be linked to terrorist attacks that has resulted in the loss of American lives. In fact, one of our country´s biggest contractors in Afghanistan allegedly transferred funds to a Taliban terrorist who funded a suicide bomber attack. 

The contractor in that story, Hikmatullah Shadman, was sued by the federal government and agreed to a $25 million settlement in 2019. Between 2007 and 2012, Shadman earned $160 million from his multiple contracts with the U.S. military. 

According to the False Claims Act lawsuit filed against Shadman, his companies systematically inflated prices  “well above the average rate of his competitors.” He was in the habit of bribing decision-makers to secure a large number of contracts for the provision of transport and logistics services in Afghanistan. Prosecutors claimed Shadman was neither the cheapest nor the best, but he seemed to always land the most lucrative contracts. 

According to a government report, by 2010, out of $31 billion paid to local contractors in Afghanistan, $360 million had ended up in the pockets of either terrorists or criminals. As one competitor of Shadman put it, “The American money was benefitting everybody—the government and the Taliban.”  

Pharmaceutical Companies Allegedly Funded Iraqi Terrorists

According to a lawsuit filed by 200 veterans and relatives of deceased veterans, military contracts are not the only way the U.S. may be funding terrorists. The complaint, filed in 2017, alleged that several pharma companies knowingly made deals in Iraq that benefitted terrorists.

The defendants, AstraZeneca, General Electric, Johnson & Johnson, Pfizer, and Roche Holding, allegedly bribed local officials to secure lucrative Iraqi Health Ministry contracts. The lawsuit states that the companies knew that individuals and organizations affiliated with the Ministry participated in terrorist attacks against Americans.

According to the complaint, one terrorist group was nicknamed ´The Pill Army´ because its commanders "were notorious for paying their terrorist fighters in diverted pharmaceuticals, rather than cash.” The plaintiffs claim that the pharmaceutical companies "abetted terrorism in 

Iraq by directly financing an Iran-backed, Hezbollah-trained militia that killed or injured thousands of Americans."  

The lawsuit was filed by veterans who were injured and the families of veterans who were killed in terrorist attacks that were allegedly funded by the pharmaceutical companies.  

Paving The Road for The Taliban

The funding of terrorists through military contracts is nothing new. In 2009, the U.S. Secretary of State told the Senate that money from U.S. government contracts was directly funding the Taliban. 

Fast forward 11 years and very little seems to have changed. According to a recent Anti-Terrorism Act lawsuit, August Cabrera v Black & Veatch, several companies that received $1.7 billion from the U.S. to build roads and dams in Afghanistan also funneled cash to local terrorists. 

The lawsuit, which was originally filed by 139 veteran families in the District of Columbia, was amended in June 2020 to include 100 new plaintiffs. It alleges that the contractors “were all large Western companies with lucrative businesses in post-9/11 Afghanistan, and they all paid the Taliban to refrain from attacking their business interests.” Through their protection payments, the defendants allegedly “aided and abetted terrorism by directly funding al-Qaeda-backed Taliban insurgency that killed and injured thousands of Americans.”

“Defendants paid the Taliban to leave them alone,” the plaintiffs wrote. “The payments saved Defendants money: it was cheaper to buy off the Taliban than it would have been to invest in the security necessary to mitigate the terrorists’ threats.”

The defendants in the amended complaint are 

  • Mtn Group Limited
  • Mtn Afghanistan, Blumont, Inc.
  • Mtn (Dubai) Limited
  • Louis Berger International, Inc.
  • Louis Berger Group, Inc. / Black & Veatch Special Projects Corporation Joint Venture
  • Louis Berger Group, Inc.
  • Janus Global Operations Llc
  • International Relief And Development, Inc.
  • G4s Risk Management Limited
  • G4s Holdings International (Ag) Limited
  • Environmental Chemical Corporation
  • Chemonics International, Inc.
  • Centerra Group, Llc, Dai Global Llc
  • Blumont Global Development, Inc.
  • Black & Veatch Special Projects Corporation

The Anti-Terrorism Act

The Anti-Terrorism Act (“ATA”) allows U.S. nationals who were injured and the families of U.S. nationals who were killed in terrorist attacks to file a lawsuit in federal court. Any individual or company that provided material support to international terrorist organizations involved in a terrorist attack may be liable under ATA. 

The Act states that "Any national of the United States injured in his or her person, property, or business by reason of an act of international terrorism, or his or her estate, survivors, or heirs, may sue therefor in any appropriate district court of the United States and shall recover threefold the damages he or she sustains and the cost of the suit, including attorney’s fees."

Before August Cabrera v Black & Veatch, it was rare for attorneys to sue U.S. military contractors under ATA. But it looks that we are going to see more of these types of lawsuits in the future, especially if the plaintiffs succeed.

How to File a Department of Defense Whistleblower Lawsuit

Even if a terrorist attack did not directly impact your family, if you have information about a Department of Defense contractor who violated any U.S. laws, including the Anti Terrorism Act, you may sue the contractor under the False Claims Act

Whether you are an employee of a military contractor, a veteran who was injured, or a deceased veteran´s relative, our team of Anti-Terrorism Act and False Claims Act attorneys can help. There is a deadline for filing ATA and FCA lawsuits. Contact us online or at 929.290.1266 for a free case evaluation today. 


Steve Halperin

New York trial attorney Steve T. Halperin is a well-known litigator with extensive knowledge of whistleblower laws and the New York False Claims Act. He has 28 years of experience as one of New York’s top tier attorneys. From the Manhattan offices of HalperinBikel, Steve’s whistleblower cases can run the gamut from lawsuits against healthcare. Whistleblowers: A New Yorker’s Step By Step Guide systems and providers cheating on New York Medicaid to private companies providing worthless services, or false billings by government contractors. With hundreds of winning verdicts and favorable settlements in healthcare and corporate cases, attorney Halperin’s meticulous preparation, courtroom acuity, and client-centered professionalism create remarkable outcomes.

To contact Steve: [hidden email] or 929.290.1266
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