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Army drops suspension of contractor in criminal probe

The Army reversed the suspension Nov. 15, allowing Camille Chidiac to bid for new federal contracts, including an extension of the propaganda contract in January.

Photo Leonie Industries’ Website

Tom Vanden Brook – (USA Today) – WASHINGTON — December 30, 2012 – The Army has lifted its suspension of the owner of its top propaganda contractor in Afghanistan, despite the Pentagon’s ongoing criminal investigation against him for late tax payments, treatment of his Afghan employees and an online smear campaign he launched against USA TODAY.

The Army had suspended Camille Chidiac, co-owner of Leonie Industries, in May after he admitted to setting up disparaging social media and web sites against two journalists from the newspaper. At the time, Defense Secretary Leon Panetta ordered “appropriate action” taken against Chidiac, according Pentagon press secretary George Little, who called his actions “intolerable.”

The Army reversed the suspension Nov. 15, allowing Chidiac to bid for new federal contracts, including an extension of the propaganda contract in January. The Army, in a statement from spokesman Matthew Bourke, decided that Chidiac should be reinstated because the Army concluded that he conducted the smear campaign on his own time without Leonie’s resources. Chidiac put his ownership stake in a trust in an agreement reached with the Army. That prompted the Army to lift its suspension of Chidiac, according to Bourke.

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Pentagon probes Leonie’s taxes, treatment of Afghan workers

Photo from Leonie Industries' Website

Tom Vanden Brook –  (USA TODAY) –  WASHINGTON – June 11, 2012 –  Pentagon criminal investigators have launched a full probe into the military’s top propaganda contractor in Afghanistan regarding taxes paid by its owners and treatment of its Afghan employees, according to a letter obtained by USA TODAY.

The paper revealed in February that the owners of Leonie Industries had owed more than $4 million in back taxes to the federal government. That debt was settled in March, federal records show. The company has received at least $120 million in Pentagon contracts since 2009.

Rep. John Tierney, a Massachusetts Democrat and a senior member of the oversight committee, requested the Pentagon Inspector General investigation of Leonie in March. He praised the Defense Criminal Investigative Service’s decision to move beyond its initial inquiry and to launch a more formal investigation.

“It is critical that we hold the Pentagon, and companies working with our government, to the highest standards,” Tierney said Monday. “Claims of ongoing lack of accountability in war zone contracting cannot be ignored. We are talking about hundreds of millions of dollars, and I welcome the news that the Defense Criminal Investigative Service will be closely examining the Leonie contract.”

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Audit free zones and other news

GSA Employees Who Work from Home Racked Up $750,000 in Travel Expenses
Matt Bewig – (AllGov) - June 03, 2012 – The Public Buildings Service (PBS) of the General Services Administration (GSA) has yet another scandal on its hands. PBS has been plagued by a series of scandals since April 2008, when GSA Administrator Lurita Doan was asked by the Bush White House to resign because of serious allegations of conflicts of interest and use of federal properties managed by PBS for partisan purposes, which is prohibited by the Hatch Act. Her successor, Martha Johnson, was brought in by President Obama to clean things up, but she had to resign in April 2012 after the release of an inspector general’s report that bluntly detailed wasteful spending for a PBS training conference for 300 people in Henderson, Nevada, which cost $822,751, or $2,742.50 per person. (Click HERE for article)

Virginia-based Defense Contractor Calnet to Pay $18.1 Million to Resolve False Claims Act Lawsuit
(DoJ) – June 1, 2012 – Calnet Inc. has agreed to pay the United States $18.1 million to resolve allegations that the company submitted false claims to the Department of Defense, the Justice Department announced today. Calnet Inc., an intelligence analysis, information technology and language services company, is headquartered in Reston, Virginia.

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