IF YOU have spent any time in Kabul during this God-forsaken war, chances are that you drank a strawberry daiquiri at Red Hot & Sizzlin’. That gated American-style steakhouse - with its crooning karaoke machines and crowded bar made of bamboo - is a magnet for private contractors who have made a killing in this war. Its owner, Roy Carver, is a symbol of so much that has gone wrong there.
Legend has it that Carver, one of the first US contractors to arrive, was so brilliant at getting military contracts that he could sketch out a successful proposal on a bar napkin. His contracts ran the gamut: from collecting garbage on military bases to renovating houses for the US embassy to driving trucks to Uzbekistan for the CIA. But a year ago, Carver - 76 and partially blind - was arrested by Afghan officials, and accused of owing his Afghan workers and subcontractors hundreds of thousands of dollars. “He owes everyone, everyone, everyone,’’ one electrical supplier told me. Carver’s son-in-law, Dennis Carson, who worked with him for awhile in Afghanistan, blamed corruption for his mountain of debts. “Roy had bid into his contracts the cost of corruption - at 3 percent - but it turned out to be 30,’’ Carson told me. “When he discovered someone stealing money at his company, I’d want to fire him, but Roy would say, ‘Oh let it go. Everybody does it.’ ’’
But corruption and an indulgent attitude toward theft weren’t Carver’s only problems. This wasn’t the first time he had been thrown in the slammer, or owed too many people too much money. It turns out that he is the same Roy Carver who pleaded guilty in federal court in the late 1970s to a major kickback scheme in Saudi Arabia. That scandal - exposed when Saudi spies bugged his apartment - rocked Raytheon, where he had been a senior executive.
Going to jail for fraud might make lesser men feel shy about building a career on military contracting. But not Carver. After his release from prison, Carver got right back in the game. He took over a company called Seair Transport, which had belonged to a co-conspirator still serving time for the Saudi scheme. Carver transferred all the shares to his third wife, Tsdale, an Ethiopian immigrant, before Seair began to receive large military contracts to supply jet fuel and provide helicopter maintenance to US military bases.
For awhile, everything went swimmingly. The business grew, helped along by Carver’s daughter’s company - Four Winds - which subcontracted Seair to supply fuel to a Mississippi military base. (A business rival alleged that Four Winds was simply a front for Carver to receive federal set-asides for women and minorities, but a judge ruled in Carver’s favor.) For years, Seair made big money. Then, all of sudden, it collapsed. Seair stopped paying its bills. Maybe a rogue accountant was to blame. Maybe money disappeared. All I can say for sure is that by the time Seair filed for bankruptcy in 1997, it owed $1,926,995 to the IRS, and more than $100,000 in taxes to the states of Utah, Maryland, and Arizona. (Tsdale, who divorced Carver shortly after the bankruptcy, declined to comment.)
All this might make a less determined man throw in the towel as a military contractor and try his hand at something else. Gardening, perhaps. Or baking.
But not Carver. He got right back in the game. When the war in Afghanistan broke out, he set up Red Sea Engineers & Constructors Inc, which won tens of millions in military contracts. Everything went well, for years. Until, all of a sudden, it collapsed. Last year, workers started walking off the job of a construction contract because they had not been paid. Dyncorp, the prime contractor, said Carver hadn’t been paying his workers or suppliers. Red Sea was terminated and Carver arrested.
Maybe the persistence, chutzpah, and creative accounting of guys like Carver are considered an asset in Afghanistan.
No formal charges were ever filed - not unusual in Afghanistan, where arrests are routinely used as a way to scare debtors into paying up. Carver was eventually released and promised to pay his debts. But he slipped out of the country, in fear of his life - one of at least six American businessmen to flee Afghanistan with huge unpaid debts to Afghans.
It makes you wonder why the Pentagon doesn’t do a better job of weeding crooks out of contracting. Some 30 defense contractors were criminally convicted of fraud between 2006 and 2009, but only half were disbarred from receiving more federal contracts. Disbarments last only three years.
Maybe the persistence, chutzpah, and creative accounting of guys like Carver are considered an asset in Afghanistan. Maybe they are the only ones willing to work in a war zone. As the Land Cruisers drive past armed guards into the parking lot of Red Hot & Sizzlin’, you can count the guys who have no intention of getting out of the game.
When I tracked down Carver via e-mail to ask him his side of the story, he blamed Dyncorp for his financial ruin and claimed that the company demanded kick-backs for subcontracts and lured him into accepting $1 million less than he was owed. (Dyncorp says there is “absolutely no basis’’ for his claim.) Another man might pick this moment to retire. But not Carver. He told me he is on his way back to Afghanistan to resume his business and pay off his debts.
“I want to . . .show the authorities of the corrupt and lawless government of Afghanistan that this old man is not a quitter,’’ he told me. Not a quitter. No indeed.Farah Stockman can be reached at email@example.com. Follow her on Twitter @fstockman.