A Kuwaiti firm indicted here for overcharging the Army on an $8.5
billion contract is negotiating a possible settlement of the case with
the Justice Department.
For the fifth time on Friday, Public
Warehousing Co. was granted a continuance of its criminal arraignment.
At a brief hearing, U.S. Magistrate Christopher Hagy said he was told
by one of the company's lawyers that a reason the company requested the
delay is because of ongoing negotiations.
But Hagy, who
rescheduled the arraignment until Feb. 8, expressed impatience with the
company's continued requests to postpone the hearing.
"There's a point at which this stops," Hagy said.
"It is our hope that it goes forward," Assistant U.S. Attorney Barbara Nelan replied.
agreement, Public Warehousing's attorneys did not have to attend the
hearing. Contacted later, Atlanta lawyer Richard Deane, one of the
company's attorneys, declined to comment.
In Nov. 9, a federal
grand jury in Atlanta indicted the Kuwaiti firm on charges it gouged
the U.S. government by overcharging on its contract to supply food to
American troops in Iraq.
Public Warehousing now does business as
Agility and has been the prinicpal provider of food to the U.S.
military in Iraq and Kuwait since 2003.
The company "grossly
overcharged" the Defense Department for the delivery of food and other
goods, Nelan said during a press conference announcing the indictment.
This included inflated charges for delivery and the company keeping
rebates from food supplies that should have been given to the Defense
Department, she said.
The government became aware of the alleged
fraud through a whistleblower, Kamal Mustfa Al-Sultan. He filed a
lawsuit against the company in 2005, saying Public Warehousing and
other companies illegally inflated bills to the government by up to 70
percent. The lawsuit contended the government had been defrauded out of
at least $1 billion.
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