Kuwait-based military contractor accused of inflating food prices

By Walter Pincus The Washington Post

Indictment against Public Warehousing follows multiyear probe

A major Kuwait-based military contractor was indicted Monday for allegedly defrauding the U.S. government by submitting inflated bills and false claims under contracts through which it has supplied $8.5 billion in food and other products to the American military in Iraq, Kuwait and Jordan over the past six years.

The criminal indictment, against Public Warehousing Co. KSC, was brought in Atlanta and resulted from a multiyear investigation of inflated prices for billions of dollars in frozen and fresh food shipped each year under contracts to feed U.S. and coalition troops in Iraq and Kuwait, according to acting U.S. Attorney F. Gentry Shelnutt.

"This indictment is only the first step," Shelnutt said in a statement. "Our investigation of entities and persons who have defrauded the United States and our military is ongoing."

Public Warehousing denied the accusations in a statement, saying it "is confident that once these allegations are examined in court, they will be found to be without merit." The company, also known as Agility, has subsidiaries in countries around the world, some of which also hold U.S. government contracts.

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