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This Week in Scandal Watch

Every week, we take stock of how the week unfolded for the five stories we're tracking in Scandal Watch (see the right sidebar). Click here for more information on how we do this and to suggest additions.

1. Detainee Treatment

Last Friday, the alleged 9/11 mastermind, Khalid Sheik Mohammed, testified during the trial of Salim Hamdan that Hamdan was "not fit to plan or execute" terror attacks. The trial -- the first for the Guantanamo Bay military commissions -- closed on Monday, after the defense reminded jurors that Hamdan had provided the U.S. with crucial information about Osama bin Laden's location at the beginning of the war in Afghanistan. 

While the jury deliberated on Tuesday, the judge admitted that he may had given the jury incorrect instructions about the application of the international law of war. This error would be significant, since the classification of Hamdan's crimes as war crimes has been the subject of much scrutiny.

The jury convicted Hamdan of the lesser of the charges brought against him - providing material support to a terrorist group - and sentenced him to five and a half years. Taking into account time served, he should be free to go in about six months. But earlier in the week, the commander at Guantanamo Bay said that Hamdan could be held indefinitely as an enemy combatant.

Aafia Siddiqui was arrested in Afghanistan on July 17 and is seen here in the custody of the Counterterrorism Department of Ghazni province. (Credit: AP Photo)Meanwhile, the U.S. charged an alleged terrorist with murder and assault in a New York court on Tuesday. Aafia Siddiqui, who has been on CIA and FBI wanted lists for five years, was arrested in Afghanistan on July 17 and handed over to U.S. military and intelligence officials the next day. But the U.S. version of events is getting called into question by Siddiqui's family, the Afghan police and the Human Rights Commission of Pakistan. The police claim that after they refused to hand over the detainee, U.S. soldiers held them at gunpoint and took her. Her family claims that Siddiqui, who has been missing for five years, was actually being detained by the U.S. for much of that time.

A number of new allegations of harsh detainee treatment emerged this week. CNN reported that the U.S. military had put unruly Iraqi detainees in wooden boxes not much bigger than a coffin for up to 12 hours at a time. Separately, two U.S. soldiers were charged with the premeditated murder of an Iraq detainee.

The Washington Post reported that the U.S. may have taped meetings between Gitmo detainees and officials from their home country. In a separate article, the Post cited military documents showing that at least 17 Gitmo detainees were subjected to a program that induces "sleep deprivation and disorientation" with repeated cell transfers after it had been banned in March 2004. And U.S. interrogators at Gitmo are now seeking information about the detainees' activity inside the prison because prolonged detention has severed many of their ties to terrorist groups and diminished their usefulness in the "war on terror." This shift in focus has provoked some to say that Gitmo has "outlived any purpose."

And in a week where many allegations of abuse surfaced, several senators introduced a bill that seeks to "end coercive interrogations and secret detentions" by the CIA.

2. Subprime Mortgages and Ratings Agencies

Another chief executive faced criticism in the fallout of the subprime mortgage crisis. The New York Times reported that Freddie Mac CEO Richard Syron ignored warnings from the company's risk officer about backing dubious mortgage loans. Syron defended his loan decisions by saying Freddie needed to meet its federal mandate of providing affordable housing.

The Village Voicetied New York Attorney General Andrew Cuomo to the mortgage mess from his time as Secretary of Housing and Urban Development. Cuomo has pursued alleged subprime misdeeds, including those of mortgage lender Countrywide.

Connecticut joined the growing number of states (New York among them) to file lawsuits against Countrywide over its lending practices. The news wasn't any better for former CEO Angelo Mozilo as the Securities and Exchange Commission reportedly has opened a formal probe into whether he committed insider trading when he sold $145 million of company stock. And the Los Angeles Times reported on a departing Countrywide executive who used the company jet for a family vacation.

Meanwhile, a new report found that mortgages issued in 2007 went bad at a faster pace than in 2006.

And you renters aren't immune from the mortgage meltdown either, because that building you live in could be foreclosed. The Washington Post reported that thousands of renters have had their lives disrupted or even gone homeless because of mortgage failures.  

3. Politicization of Federal Government

Last week, a federal judge ruled that senior White House aides must respond to congressional subpoenas. The ruling was a major blow to President Bush, who had previously tried to assert that executive privilege protected former White House counsel Harriet Miers and White House chief of staff Joshua Bolten from even having to respond. Both were subpoenaed as part of the investigation into the Justice Department's firing of nine U.S. attorneys in 2007.

This week, Bolten and Miers asked the judge to delay enforcement of that ruling pending the administration's appeal.

Prompted by the ruling, House oversight committee Chairman Rep. Henry Waxman (D-CA) asked the Justice Department, the Office of Management and Budget and the EPA to describe the documents that each agency is withholding from the Committee on executive privilege claims. EPA chief Stephen Johnson had previously rebuffed a congressional subpoena to turn over documents relating to its decisions on greenhouse gas emissions regulation. The OMB made a similar claim just days later.

A federal grand jury, meanwhile, has reportedly subpoenaed several  former Justice Department attorneys as part of an investigation into the politicization of the Department's Civil Rights Division.

4. Alaska!

This week, the Anchorage Daily News went in depth inside the renovation of Sen. Ted Stevens' home and revealed that the original idea for the project had come from VECO CEO Bill Allen. Stevens was indicted last week on charges of lying on his financial disclosure forms about gifts and services received from VECO. This week, Stevens requested that his trial be moved from D.C. to Alaska so that he could campaign at night. Stevens is seeking a seventh term. 

5. Military Contractor Abuse

The Pentagon reopened bidding on an aircraft tanker deal to EADS and Boeing this week. The Pentagon admitted in June that its process of awarding the $35 billion contract to EADS had been flawed. And McClatchyreported in July that the leaders of France, Germany and Britain had all lobbied President Bush personally in an effort to secure the contract for European aerospace giants EADS and Northrop Grumman.

But Boeing supporters are now crying foul, saying that the specifications in the new deal favor EADS' tankers. This is despite that fact that the House Defense Appropriations subcommittee introduced language into a defense spending bill last week ordering the Pentagon to seek tankers with specifications remarkably similar to Boeing's model.

Finally, General Petraeus responded to a July letter from Sen. Bob Casey (D-PA) that called into question the oversight of KBR's electrical work in Iraq. Since the beginning of the war, 16 people have been electrocuted there. Petraeus said this week that more than 80,000 buildings in Iraq will be inspected for faulty wiring.


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