Kuwaiti Food Supplier to the Military Indicted on Six Counts of Fraud
Posted: Wednesday, December 2nd, 2009 at 10:36 am
Atlanta, GA—A supplier to the United States military troops stationed in the Middle East has been indicted on federal charges of fraud.
The company, Public Warehousing Company KSC, aka Agility, is a Kuwaiti firm. They have been charged with conspiracy to defraud the United States, committing major fraud against the United States, wire fraud, making false statements and submitting false claims, according to the six-count indictment.
Federal officials joined a whistle-blower suit that was brought in 2005 by Kamal Mustafa al-Sultan, the owner of another Kuwaiti company that had been partners with Public Warehousing in order to submit a proposal on food supply contracts to the United States military. The Justice Department said that the case would remain under seal, so that federal officials could investigate the claims and decide whether or not the United States government would join the lawsuit.
Public Warehousing Company had obtained contracts to supply food and additional personal items to the United States troops who were stationed in Iraq, Kuwait and Jordan. According to the United States attorney’s office for the Northern District of Georgia, where the charges were filed, the company had obtained contracts in May 2003 and February 2005, and again in July 2005 to provide food to the troops.
Said F. Gentry Shelnutt, who is serving as acting U.S. attorney on the case, “This indictment is the result of a multi-year probe into abuses in vendor contracts in the Middle East involving the illegal inflation of prices in contracts to feed our troops.”
Public Warehousing Company is accused of submitting false claims for information, overcharging for for locally grown fresh vegetable and fruit items, and failing to pass along to the United States government some rebates and discounts it had obtained. Suppliers to the military are required by their contracts to pass on any savings or discounts they receive to the government.
The investigation into the matter continues, and authorities could not name an amount by which the United States was allegedly defrauded.
A team composed of members from the Defense Criminal Investigative Service, the Federal Bureau of Investigations, the Army Criminal Investigation Command, and auditors from both the Department of Defense and the Defense Contract Audit Agency will conduct the investigation.
“The defendants, tempted by monetary gain, betrayed the trust invested in them by the U.S. Army and now they must face the consequences,” said Brig. Gen. Rodney Johnson, who is the commander of the Army Criminal Investigation Command.
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