Federal fraud case against Kuwaiti company (Agility/PWC) postponed
Atlanta Business Chronicle – by Dave Williams -  January 29, 2010
The challenges of serving a federal court summons on a foreign business have led to several delays in the arraignment of a Kuwait-based logistics company charged with defrauding the U.S. military.

U.S. Magistrate Judge Christopher Hagy of Atlanta agreed Friday to the latest request for a postponement by lawyers representing The Public Warehousing Co. K.S.C. (PWC) and rescheduled the arraignment for Feb. 8.

PWC is accused of submitting false information to win three contracts to supply food to American troops in Iraq, Kuwait and Jordan, and then overbilling the government for the items it delivered.

U.S. attorneys unveiled the indictment last November in Atlanta.

Federal prosecutors have opposed delaying the case. According to court papers, federal agents attempting to serve copies of the indictment and summons at the offices of PWC’s Atlanta lawyers were rebuffed.

However, officials with CT Corp. of Wilmington, Del., the registered agent of record for PWC’s U.S. subsidiary, did accept the papers.

“It is our hope that it goes forward,” Assistant U.S. Attorney Barbara Nelan told Hagy on Friday.

According to a civil complaint related to the federal case, the Defense Department lost more than $1 billion through PWC’s alleged fraud. The government is seeking to recover more than $3 billion.  (Click HERE to read full article)
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According to this article in the Atlanta Journal Constitution this delay is due to a possible settlement between PWC/Agility and the US Government:

Settlement possible in military contractor fraud case

By Bill Rankin -The Atlanta Journal-Constitution – January 29, 2010

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.

By 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.  (Click HERE to read full article)
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Other Noteworthy Happenings:

Former Army Staff Sergeant Pleads Guilty to Money Laundering
Thursday, January 28, 2010

WASHINGTON — A former staff sergeant in the U.S. Army pleaded guilty today to a one-count criminal information charging her with money laundering arising from a scheme involving the fraudulent awarding and administration of U.S. government contracts in Iraq, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division.

Theresa Russell, 40, of Pleasanton, Texas, pleaded guilty in federal court in San Antonio. According to court documents, from January 2004 through October 2004, Russell was deployed to Logistical Support Area (LSA) Anaconda, a U.S. military installation near Balad, Iraq. As part of the plea, Russell admitted that from April 2004 to February 2005, she received more than $30,000 in cash from John Rivard, a former major in the U.S. Army Reserves. Russell admitted that she knew the money she received from Rivard was the proceeds of bribery. (Click HERE to read full article)
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The Sting Part II: Foreign Bribery Investigation Claims Another Contractor Scalp

Neil Gordon – Project On Government Oversight – Jan 27, 2010

This is an update to last week’s post about the massive FBI sting operation that led to the arrest of 22 defense contractor employees on charges of violating the Foreign Corrupt Practices Act (FCPA). We noted that the investigation was ongoing, which might explain why the Department of Justice didn’t name the companies for which those individuals worked. Fortunately, with Google and the help of our readers, we were able to identify most of the companies, none of which are among the top federal contractors featured in our Federal Contractor Misconduct Database.

This week, however, we discovered at least one connection to a contractor our database. It turns out that one of the main “actors” who took part in the sting operation and helped the FBI nab the 22 individuals is a former executive at Armor Holdings who is facing FCPA charges in a different matter. Richard Bistrong, a former vice president for international sales at Armor Holdings (acquired by BAE Systems in 2007), is accused of paying bribes from 2001 to 2006 to get contracts to supply law enforcement equipment to United Nations peacekeeping forces and government agencies in the Netherlands and Nigeria. Bistrong’s assistance in the sting operation probably guarantees him a lenient sentence. (Click HERE to read full article)
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DHB Industries Ex-Chief David Brooks Looted Company, Jury Told

Jan. 26 (Bloomberg) — David Brooks, a founder and former chief executive officer of military contractor DHB Industries Inc., committed a $185 million fraud and looted the company to pay for personal expenses, a prosecutor told jurors at a trial.

Brooks and former Chief Operating Officer Sandra Hatfield are accused of insider trading as well as securities fraud and tax, wire and mail fraud for manipulating financial records to increase DHB’s reported earnings and profits. DHB, based in Pompano Beach, Florida, and now called Point Blank Solutions Inc., makes body armor for the military and police.

Brooks and Hatfield allegedly lied about inventory of “Interceptor” combat vests that were shipped to the U.S. armed forces and falsely inflated the company’s value and their own stock, prosecutors said. The trial in federal court in Central Islip, New York, will last several months, the U.S. said.  (Click HERE to read full article)
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Oklahoma Man Pleads Guilty to Aiding and Abetting the Solicitation of a Kickback in Connection with a Government Contract in Afghanistan
Tuesday, January 26, 2010

WASHINGTON — An Oklahoma man pleaded guilty today for his role in a scheme to solicit a kickback in connection with the award of a private security services subcontract to protect U.S. government personnel and contractors in Afghanistan, announced Assistant Attorney General Lanny A. Breuer of the Criminal Division, Assistant Attorney General Christine Varney of the Antitrust Division and U.S. Attorney Neil H. MacBride for the Eastern District of Virginia.

Ryan Scott McMonigle, 38, of Ponca City, Okla., pleaded guilty today before U.S. District Court Judge T.S. Ellis III, in the Eastern District of Virginia to one count of aiding and abetting the solicitation of a kickback. (Click HERE to read full article)
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U.S. Army Major Charged with Smuggling Cash from Iraq and Making False Statements
Monday, January 11, 2010

U.S. Army Major Charles E. Sublett, 46, of Huntsville, Ala., was arrested today on charges of bulk cash smuggling and making false statements to a federal agency.

Major Sublett was charged in an indictment, returned by a federal grand jury in Memphis, Tenn., on Jan. 5, 2010, and unsealed today following his arrest in Huntsville. According to the indictment, Major Sublett smuggled more than $100,000 in currency, concealed in a shipping package, into the United States from Iraq in January 2005. Major Sublett also allegedly failed to declare that he imported the money.  (Click HERE to read full article)
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DoS Reward’s Incompetence

On Monday the Special Inspector General Iraq Reconstruction (SIGIR) released a 2nd report that outlines “The Long Standing Weaknesses in Department of State’s (DoS) Oversight of DynCorp Contract for Support of the Iraqi Police Training Program.”

On Friday the DoS rewarded DynCorp for their incompentence, by awarding them with a contract worth up to $20 million,  to support the African Peacekeeping Program.

So let me get this straight, billions of taxpayer’s dollars have been identified as ripe for fraud because of DynCorp and the DoS’s lax oversight of them.  What the hell, you screw up and you get caught and the DoD or the DoS writes you a check, worth millions?!
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After reading about all of these dirty deeds,  and you still aren’t running to a shower with a bottle of bleach, you may just need a little more graft and corruption in your life.  The movie “Edge of Darkness” starring Mel Gibson is now in theaters.   This fictional thriller includes conspiracy, a defense contractor with a “sleazeball” CEO.  Gosh this all sounds very familiar, maybe art does imitate life.

Forseti

Other Related Posts From Ms Sparky

1. Rogue jurors, indictments, plea deals etc.. – the news
2. Accountability no, rewards yes and other news
3. DoJ hands down more indictments against 2 DoD contractors & adds 2 soldiers
4. Deal or no deal – Feds up the ante in case against PWC/Agility(with link to indictment)
5. Show me more indictments, damn it!