Guilty plea in Iraq bid scam

Fayetteville man to admit to bribery

Back in November, former Airborne soldier Robert J. Stein Jr. was a very rich man -- owner of a Porsche, a Lexus, a pair of trucks, his own plane, dozens of bejeweled trinkets, wads of cash and grenade launchers that were tucked inside his rural North Carolina garage.

This morning, Stein will plead guilty in federal court to getting it all with money taken from the people of Iraq, according to documents filed in the U.S. District Court for the District of Columbia.

Stein, 50, will admit to leading a wide-ranging bribery, gun-buying and money laundering scheme while he was responsible for the rebuilding effort in the city of Hillah, Iraq, the documents say.

He is charged with five counts of conspiracy, bribery, money laundering conspiracy, felony firearm possession and felony machine gun possession.

Sentencing will come another day, but Stein could get up to 60 years in prison and pay a $1.5 million fine. He has agreed to give information and testimony to the government, court documents say.

Stein is a former soldier with the Fort Bragg-based 82nd Airborne Division and has lived in the Fayetteville area at least since the early 1980s, according to North Carolina criminal records.

He had control of $82 million while he worked as a regional controller and funding officer at the Coalition Provisional Authority after the invasion of Iraq, court documents say. The money was a combination of U.S. tax dollars and Iraqi funds. It was meant to go to contractors for rebuilding projects such as a new police station.

$8.6 million business

But Stein steered more than $8.6 million in contracts to an unidentified businessman, court documents say. That person has been identified elsewhere by prosecutors as Philip H. Bloom, a New Jersey man recently living in Romania.

Bloom faces federal conspiracy and money laundering charges and is in federal custody.

Stein kept the contracts under $500,000 because that was the limit of his funding authority, court documents say. He had Bloom vary the company names on bidding contracts to avert suspicion.

In return for steering contracts, Stein got cash, first-class plane tickets, watches and other jewelry, alcohol, cigars and sexual favors from women provided at the businessman's Baghdad villa, according to the plea agreement and the statement signed by Stein.

Stein directly stole an additional $2 million, the document says.

The document also lists five unidentified officers in the U.S. Army Reserve as co-conspirators. The document indicates they were paid off with items such as cash and luxury cars.

Quite a cache

With the money, Stein bought an RV, a $160,000 Porsche, land in Hope Mills and jewelry.

He also bought firearms in four states, including a stash of machine guns, submachine guns and grenade launchers from a Sterling, Va., company. The weapons were sent to Fort Bragg and transferred to Stein's Hope Mills garage on or about Nov. 13, 2005.

The court documents use e-mail messages among the conspirators to paint a picture of Stein trying to keep control of a small group of individuals clamoring for their shares of the take.

In one e-mail message, one of the Army Reserve officers lists her requirements for a 2004 GMC Yukon Denali with sandstone leather seats and a "summit white" exterior.

Another e-mail message describes co-conspirators trying to come up with another officer's wish: an elusive Nissan 350Z with a color - electric blue - so hard to find that there were only two in the western United States.

First criminal charges

Stein, who was arrested in Fayetteville in November, was the first current or former U.S. official to face criminal charges in connection with the multibillion-dollar rebuilding of Iraq.

The documents give indications that Stein knew he was under scrutiny. In June 2004, an e-mail message from Stein to one of the officers said, "I am doing my best to keep a formal investigation from happening. ... I would like to know if you are going to stand behind me or not!"

And in September 2004, one of the officers sent e-mail to the businessman to thank him for the truck and reassure him about oversight: "The truck is Great!!! I needed a new truck. ... Don't worry about the State Dept jerks. If there were any smoking guns, they would have been found months ago."

The U.S.-controlled Coalition Provisional Authority ran Iraq from shortly after the March 2003 invasion until June 2004. It had final say over spending from the Development Fund for Iraq, made up mainly of Iraqi oil revenue.

The case against Stein has its roots in audits performed by Inspector General Stuart W. Bowen Jr., who is looking into Iraqi reconstruction contracts.

(The Associated Press contributed to this report.)