USAID contracts with firms headed by Abbas's sons

Wed Apr 22, 2009 2:52pm BST

(Adds details on Sky Advertising in paragraphs 3 and 6)

April 22 (Reuters) - Among the business dealings of companies headed by Palestinian President Mahmoud Abbas's sons are previously undisclosed U.S. government-funded contracts to repair America's image and the West Bank's roads.

Here are the details about the contacts:



PUBLIC RELATIONS

Records show USAID's prime contract with Sky Advertising, which lists Tarek Abbas as general manager, took effect on May 5, 2006, following Hamas's victory in a Palestinian parliamentary election that January.

Kareem Shehadeh, a lawyer for Tarek and his brother, said bidding on the contract began before the election.

The Sky contract was supposed to total $659,600. But Sky received $998,495 through September 2008, records show.

Sky, which Tarek established in 1996, was hired as part of a campaign to bolster the U.S. government's image and "reduce the negative attitudes and scepticism held by many Palestinians towards economic assistance from the American people", according to the USAID contract.

"The purpose of this activity is to increase the Palestinian people's awareness of the contributions of the American people to their well-being. The contractor will build and execute a strategy that effectively targets and reaches USAID's audience in the West Bank and Gaza," the contract states.

To that end, Sky Advertising was asked to book USAID officials on Palestinian TV and radio shows, help find a "female Goodwill Ambassador" to promote the agency's work with women and girls, set up a USAID outreach programme at West Bank and Gaza schools, and organise training workshops for the media.

USAID said other Palestinian firms competed for the contract that Sky won. "The proposal submitted by Sky Advertising was evaluated to be the highest, considering both technical quality and costs," a spokesman for the agency said.

The agency confirmed at least nine small subcontracts with Sky between October 2007 and July 2008 totalling $28,144. They ranged from as little as $86 to as much as $18,291.

USAID said it does not keep such records prior to late 2006.



CONSTRUCTION:

Yasser Mahmoud Abbas's Falcon Electro Mechanical Contracting Company signed a $1.89 million contract with the U.S. Agency for International Development (USAID) in May 2005, five months after his father became president, to build a sewage treatment facility for the southern West Bank city of Hebron.

Kareem Shehadeh, a lawyer for Yasser, said bidding on the contract began before Abbas became president.

A total of $872,578 was paid out to the firm, according to USAID documents and officials.

USAID said the contract won by Falcon was competitively bid.

In addition to Falcon, First Option Project Construction Management Co., another construction firm headed by Yasser Abbas, was awarded $296,933 in subcontracts by one of the agency's largest prime contractors in the West Bank, Colorado-based engineering giant CH2M HILL, USAID said.

CH2M HILL spokesman John Corsi refused to discuss the company's relationship with First Option, referring questions to USAID. In an email to Reuters, USAID said it was told by CH2M HILL that its five subcontracts with First Option were awarded through competitive bidding between May 2005 and September 2008.

CH2M HILL received USAID approval to hire First Option for engineering design work on U.S.-funded road rehabilitation projects in the Israeli-occupied West Bank, the agency said.

His lawyer, Shehadeh, confirmed the subawards with First Option, saying the total topped $200,000. (Reporting by Adam Entous; Editing by Dominic Evans) (For copies of contracts and other supporting documents about this series, go to blogs.reuters.com/axismundi)



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