The Proof That Greed Is A Disease

This August 16, 2007 Bloomberg news story about a defense contractor that charged the Pentagon $998,798 to ship two 19 cent washers:

Aug. 16 (Bloomberg) -- A small South Carolina parts supplier collected about $20.5 million over six years from the Pentagon for fraudulent shipping costs, including $998,798 for sending two 19-cent washers to an Army base in Texas, U.S. officials said.

The company also billed and was paid $455,009 to ship three machine screws costing $1.31 each to Marines in Habbaniyah, Iraq, and $293,451 to ship an 89-cent split washer to Patrick Air Force Base in Cape Canaveral, Florida, Pentagon records show.

The owners of C&D Distributors in Lexington, South Carolina -- twin sisters -- exploited a flaw in an automated Defense Department purchasing system: bills for shipping to combat areas or U.S. bases that were labeled ``priority'' were usually paid automatically, said Cynthia Stroot, a Pentagon investigator.

C&D and two of its officials were barred in December from receiving federal contracts. Today, a federal judge in Columbia, South Carolina, accepted the guilty plea of the company and one sister, Charlene Corley, to one count of conspiracy to commit wire fraud and one count of conspiracy to launder money, Assistant U.S. Attorney Kevin McDonald said.

Corley, 46, was fined $750,000. She faces a maximum prison sentence of 20 years on each count and will be sentenced soon, McDonald said in a telephone interview from Columbia. Stroot said her sibling died last year.

The news story goes on to explain that they started out small, but apparently figured out that no one was actually looking at the bills, and kept ramping up the shipping charges to this absurd level.

If they had been content with charging say, $100 to ship 38 cents worth of parts, how long might they have gotten away with this? Even to our government, almost a million dollars is a significant item, and is going to cause someone to ask, "What's going on here?" But greed is a disease--you can never make enough money when greed is running your life.