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November 2nd, 2011 COREY PEIN | Cover Story
 

War Bribes

An Oregon businessman wanted to get “filthy stinking rich.” Now he’s linked to a bribery case and risks losing his biggest customer: the U.S. Military.

lede_3752WAR BRIBES - ILLUSTRATION: Diane Rios
Many successful business owners can’t resist showing off. They get their name in the newspaper, they donate to local politicians, or they put a big shiny sign on their offices to build a sense of identity.

One of Oregon’s most successful manufacturers does none of these things. It has a signless white building in an office park in Tualatin. Barbed wire rings the gate that surrounds its parking lot.

This company is famous only to the highly trained specialists who use its primary product, an emergency stretcher that has carried countless wounded soldiers from battlefields around the world. 

The high quality of this company’s products have made it an industry leader and its owner, a 74-year-old former U.S. Army medic and denturist, a wealthy man.

But the actions of this company, Skedco, and its owner, Carston “Bud” Calkin, have threatened to unravel this success. 

Court documents show Skedco paid $365,000 to a U.S. Defense Department official “in return for increasing the amount of federal contracts” it received.

Neither Calkin nor Skedco has been charged with any crime. But a Defense official is doing time in a federal prison in Englewood, Colo., after a jury convicted him of 35 counts of bribery, extortion and accepting illegal gratuities. Evidence presented in the case, and in a related civil case in Oregon, reveals that Skedco was the source of those payments.

Now Skedco, which has received more than $8 million in federal contracts over the past decade, faces losing access to its biggest customer, the U.S. Army. Nine weeks ago, the Army put Calkin and others who did business with the now-imprisoned official on a list of “excluded parties”—as in, excluded from selling to the federal government.

As WW went to press, the Army’s Suspension and Debarment Officer had yet to decide whether to ban Skedco, Calkin and his wife and business partner, Catherine Calkin, from government contracting.


CALKIN

Whatever the Army’s decision, the case illustrates the vanishing line between the public and private sectors throughout the U.S. military, a trend that makes the $703 billion Defense budget a potential bonanza of corruption.

Conflicts of interest span the ranks. Some 80 percent of retiring three- and four-star generals and admirals went on to work as consultants or executives for Defense contractors, a Boston Globe investigation found last year. In the Beltway, they’re known as “Rent-A-Generals.”

Calls to the Defense Department’s waste, fraud and abuse hotline have nearly doubled since October 2002—totaling more than 11,000 in the most recent six-month reporting period. 

But the congressionally chartered Commission on Wartime Contracting said in its final report this year that the Pentagon remains far too lenient with companies accused of wrongdoing. The Army debarred or suspended 281 companies and individuals in the last fiscal year.

Skedco is the first Oregon company to face an Army debarment since 9/11. This state has remained largely untainted by contracting scandals in the “war on terror,” if only because Oregon gets relatively little Defense spending. 

This unseemly chapter of Skedco’s story might have been as obscure as its rise to success had another company not drawn a line. The other company, facing similar threats of extortion, refused to pay bribes and instead blew the whistle. 

Much remains unclear. Some key court records remain sealed. Few people are talking. Calkin, reached on his cell phone, referred questions to his attorney. An attorney for the imprisoned Defense official did not return messages. 

But an intimate look into the case is possible because of two brothers: one, the ex-Defense official in prison for bribery; the other, a police officer who witnessed his brother’s slide to ruin. What the police officer has since disclosed about his brother’s crimes offers a rare insight into the greed, anger and remorse built into the business of war.

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