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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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