New defendants in Kuwaiti military contractor indictment
Federal prosecutors have obtained a new indictment charging a Kuwaiti firm and two of its affiliates of defrauding the U.S. military on billion-dollar supply contracts.
The indictment, which remains under seal, was disclosed during a hearing Monday in U.S. District Court in Atlanta. Public Warehousing Co., now known as Agility, had previously been indicted on charges it gouged the Defense Department by overcharging food supplies being delivered to U.S. troops in Iraq, Kuwait and Jordan. The new indictment also names Agility DGS Logistics Services Co. KSCC and Agility DGS Holdings Inc.
Lawyers for the companies asked U.S. Magistrate Alan Baverman to keep the new indictment sealed for seven days, saying it might help settlement negotiations. Assistant U.S. Attorney Barbara Nelan disagreed, saying that unsealing the new charges "may be helpful" to the parties' attempts to reach a settlement.
The Atlanta Journal-Constitution previously reported that parties in the case had been negotiating a possible settlement that could reach $750 million. Since the indictment, the Defense Logistics Agency, which provides supplies to U.S. armed forces worldwide, has barred Agility and 100 of its affiliates from receiving new contracts from the government pending the outcome of the Atlanta case.
Agility has long maintained federal prosecutors did not properly serve the company with the indictment. At Monday's hearing, only a lawyer for Agility DGS Holdings entered a not guilty plea. Lawyers for Agility and Agility DGS Logistics Services declined, so Baverman entered not guilty pleas for them.
"The decision by the U.S. Attorney’s office in Atlanta is regrettable," the company said in a statement issued after Monday's hearing. "This move serves only to taint PWC subsidiaries that have a strong record of on-the-job performance and compliance with U.S. law and federal acquisition regulations."
About the Author
Bill Rankin has been an AJC reporter for more than 30 years. His father, Jim Rankin, worked as an editor for the newspaper for 26 years, retiring in 1986. Bill has primarily covered the state’s court system, doing all he can do to keep the scales of justice on an even keel. Since 2015, he has been the host of the newspaper’s Breakdown podcast.
