Sen. Robert Byrd said some of the money and weapons have wound up in the hands of insurgents in the war-torn countries, CNN reported.

The West Virginia Democrat is calling for contractors accused of bilking the U.S. and Iraqi governments to be arrested and put on trial.

"As a result of this lack of oversight, billions of dollars have been lost or wasted, bad contractors have been rewarded, and shoddy workmanship -- some of which has resulted in the deaths of our soldiers -- has gone uncorrected," Byrd said at committee hearing.

Although Byrd said the Bush administration is partly to blame for the situation, he said culpability extends far beyond the White House.

"Army commanders, as well as those in the other services, also deserve serious criticism for failing to grasp the strategic situation in Iraq and for not properly planning to implement the massive logistical requirements associated with sustained combat and post-combat operations," Byrd said.

A lack of oversight and too few investigators to probe allegations of fraud and abuse have allowed billions of dollars to be stolen from the U.S. government, he said.