Feds: Kuwaiti Company Conspired To Defraud US

GREG BLUESTEIN

ATLANTA (AP) — The chief food supplier for the U.S. military in Kuwait and Iraq inflated prices and defrauded the U.S. government for multibillion-dollar contracts to feed American troops, federal prosecutors said Monday.

Kuwaiti logistics firm Public Warehousing Co. — which the Defense Logistics Agency says is the military's prime food supplier in Kuwait, Iraq and Jordan — has been charged with making false statements, submitting false claims and committing wire fraud, said acting U.S. Attorney Gentry Shelnutt.

The company, also known as Agility, has received more than $8.5 billion in food supply contracts. Federal prosecutors say its contract with the government is still in effect and scheduled to expire in December 2010.

Agility said in a statement it is "surprised and disappointed" by the federal charges and that it has long cooperated with federal reviews and audits designed to ensure taxpayer dollars are being spent appropriately.

It said the government has consistently found the company's prices to be "fair and reasonable" and that supply records show it was more successful in delivering food to the military in a war zone than some contractors working within the U.S.