One Down: Obscenely Decadent War Profiteer Hauled Off in Handcuffs

By Sarah Anderson, AlterNet. Posted October 26, 2007.

America's most ostentatious war profiteer is no longer a free man. In a long-anticipated move, FBI agents arrested bulletproof vest maker David H. Brooks in his Manhattan apartment at dawn on Thursday. In the tradition of Al Capone, Brooks was nabbed on allegations of financial shenanigans, despite strong suspicions that the defense contractor has much more serious crimes on his hands.

Brooks emerged as the poster boy for shameless war profiteering in November of 2005 when he blew some $10 million in profits from military contracts on a celebrity-studded party for his daughter. Leaked details of the bash drew national attention, including a description of Brooks' pink suede suit and photos of his daughter on stage with the rapper 50 Cent. A New York Times editorial compared Brooks to the ill-fated Marie Antoinette.

And indeed, while Brooks won't face a guillotine for his greed, he could spend up to 70 years in prison if convicted of all charges. The 71-page indictment (PDF) alleges that while Brooks was chief executive of DHB Industries, a leading provider of military body armor, he pocketed more than $185 million from insider trading, fraud and tax evasion. He is also charged with using millions of dollars in DHB funds for personal expenses.

A sampling of the charges authorities say Brooks concealed from shareholders and the IRS:

• $7,900 for a facelift for Brooks' wife
• more than $1 million for expenses related to his 100 trotting and breeding horses
• $101,190 for a belt buckle studded with diamonds, rubies and sapphires
• $101,500 for an armored vehicle for his family's use
• more than $1 million for numerous family vacations, including frequent stays at the Bellagio in Las Vegas and various Caribbean and European villas
• $31,802 to transport one of his daughters and her college friends to Halloween parties in Madison, Wisconsin, using a private jet
• hundreds of thousands of dollars in bonus checks drawn on a DHB bank account handed out by Brooks at a company Christmas party to non-DHB personnel, including his horse trainer
• and of course the predictable $10,000 here, $5,000 there for purchases at Luis Vuitton, Gucci, Gianni Versace, and Prada boutiques around the world

What makes Brooks' greed particularly obscene is that the bullet-proof vests that boosted his fortunes in the first place turned out to be not so bulletproof after all. In May 2005, the U.S. Marines recalled more than 5,000 DHB armored vests after they failed ballistics tests for stopping 9 mm bullets. As reported in a previous story for AlterNet, the Marine Corps Times revealed that Pentagon officials had dismissed repeated warnings by inspectors about deficiencies in DHB's vests.

Brooks responded to the news that his company's products were potentially endangering the lives of U.S. soldiers by taking his family on a Caribbean vacation. According to the indictment, he billed the company more than $100,000 in June 2005 for Learjet transportation and a two-week stay at a St. Johns villa.

In November 2005, the Marines and Army announced a recall of an additional 18,000 DHB vests. But even this news didn't dampen the mood at Brooks' infamous $10 million party a few weeks later. While ostensibly in honor of his 13-year-old daughter, the event was packed with 80s nostalgia acts Steven Tyler of Aerosmith, Tom Petty, the Eagles' Don Henley and Joe Walsh, Fleetwood Mac's Stevie Nicks, and Kenny G. According to the indictment, Brooks billed the company $122,000 for video iPods and digital cameras given as party favors.

Whether U.S. soldiers have been injured or killed as a result of the quality control problems with DHB vests is not known. The Pentagon has not even been forthcoming about whether there's been an investigation. However, according to Jim Magee, a retired Marine colonel and former head of DHB's Point Blank subsidiary, DHB did play a role in delaying the provision of state-of-the-art body armor to the troops. A June 2006 Washington Post story quotes Magee explaining that in the lead-up to the Iraq War, Brooks successfully lobbied for an exclusive contract to make the vests for the body armor now issued to every U.S. soldier in Iraq. Magee claims that DHB's monopoly prevented many troops in Iraq from having proper body armor until nine months after the war began.

A debate continues to rage over whether the type of body armor produced by DHB, called Interceptor, is the most effective. According to a special report by NewsHour in September, some experts argue that a newer technology, called Dragon Skin, is safer (but more expensive). Magee told the NewsHour that given this controversy and all the other problems with DHB, it's "bewildering" to see the company continue to get military contracts, including one in June for another $50 million.

Seeing David H. Brooks hauled off by the authorities will give some satisfaction to the military veterans and soldiers who were outraged by the sight of a defense contractor flaunting his war wealth so grotesquely. And yet the almost cartoonish behavior of this one man shouldn't distract from the larger problems of war profiteering.

Congressional oversight has increased dramatically under Democratic leadership. Rep. Henry Waxman (D-CA) has led the charge to hold contractors accountable for the most outrageous abuses, and hopefully his committee can get to the bottom of the unanswered questions about body armor.

But defense executives continue to rake in obscene levels of compensation - without even having to come up with illicit schemes of the sort that Brooks is accused of pulling off. According to a study by the Institute for Policy Studies (PDF), the CEOs of the top six defense contractors each pulled in between $12 million and $24 million last year. That's more in a week than what a four-star general earns in a year.

And while these guys may not be breaking the law, their massive war windfalls are damaging to our democracy. We need to put reasonable limits on the executive compensation of contractors. No one should have a personal financial stake in continuing this war - or in starting new ones.

              

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Sarah Anderson, a Fellow of the Institute for Policy Studies, first exposed David H. Brooks' extraordinarily high compensation in the August 2005 report Executive Excess 2005: Defense Contractors Get More Bucks for the Bang, with a follow-up in the 2006 Executive Excess report.

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