Foreign Military Sales

NSIAD-96-50R: Published: Dec 12, 1995. Publicly Released: Dec 12, 1995.

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Pursuant to a congressional request, GAO reviewed allegations that the Defense Security Assistance Agency (DSAA) violated applicable laws and regulations incident to two foreign military sales (FMS) of multiple launch rocket systems (MLRS) and improperly allowed administrative offset costs in the second MLRS sale. GAO noted that: (1) DSAA did not violate any applicable laws or regulations when it cancelled the original sale to Saudi Arabia at that country's request and made a subsequent sale of those items to Greece; (2) the transaction was further complicated when the Army filled an unprogrammed requirement for MLRS in South Korea with the actual MLRS that Saudi Arabia had title to; and (3) Army officials disallowed the payment of administrative offset costs when the sale to Greece was redesignated as an out-of-stock sale for which such costs are prohibited.

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