Prosecutors Pursuing New Charges Against Suspended Defense Contractor

By NEIL GORDON

This week, it was reported that federal prosecutors are investigating potential new criminal charges against Agility, the Kuwaiti logistics company under indictment for overcharging the U.S. military on food supply contracts.

Agility (formerly Public Warehousing Company KSC and PWC Logistics), has been suspended from federal contracting since being indicted in November 2009. (The suspension record can be found on the Excluded Parties List System website.) Agility is also facing a civil False Claims Act lawsuit in the matter. The criminal charges also prompted DynCorp International to fire Agility as its main subcontractor in Afghanistan. This is what happens when you get caught “Playing With Uncle Sam’s Food,” as POGO wrote when we first heard about the case.

According to a court order, prosecutors subpoenaed an Agility executive, retired U.S. Army General Dan Mongeon, to testify before a grand jury in order to explore possible new charges. Agility is accused of overcharging the Department of Defense by inflating food prices and submitting false information on food supply contracts awarded between 2003 and 2005. It is not clear what General Mongeon’s testimony will add to the case, which seemed on the verge of settling last year.

In the meantime, check out this interview General Mongeon did with a business publication in April 2009, seven months before Agility’s legal woes set in. This part in particular caught my eye:

Acting on trends inevitably entails risk. How have some of Agility’s risks paid off?

Dan Mongeon: Agility took risks —really big risks — at an early stage.  It put a lot of money behind those risks in order to get into the game in the first place. So there is a culture of getting everybody in a room and figuring out, “Is there a risk worth taking here for us?”  That [risk-taking] has been a hallmark of the company’s success.  There are some expensive, world-class Agility warehouses and food facilities in Kuwait that were built entirely on spec, for example. They have paid off. We accepted the risk, put our own skin in the game, and made it all work for our customers and our shareholders.

Yikes! Do you think those unspecified “really big risks” will play a role in breaking the Agility prosecution wide open?

Neil Gordon is a POGO Investigator.

Photo: U.S. Army Gen. George W. Casey Jr., Multinational Force Iraq commander, talks with Task Force Baghdad soldiers during the evening Thanksgiving meal at the Rock of the Marne Sports Oasis Dining Facility at Forward Operating Base Prosperity, Iraq, Nov. 24, 2005. U.S. Army photo by Sgt. Andrew Miller.

Comments

[JAMS]

Many of the Agility garbage then jumped from Agility to a company called Inchcape Shipping Services and now corruption them.

[Um Qasr HR]

What about those that "represented" PWC at DynCorp, then became part of the formation of TAOS. TAOS was formed, partly, because PWC wanted to do base maintenance in the U.S. but had to be a U.S. company.
That notwithstanding, I was in Iraq for PWC for a loooonnggg time. I got in more and more trouble for asking about improper use of food, money and facilities. So, I got fired and screwed out of my $17K bonus.
HOWEVER, I have a full image file of my computer, but never have been contacted by DOJ. I'd be glad to hand it off.
The really funny part is that one of the upper level PWC people in Iraq now has a consulting firm that "guides" companies on how to procure, handle and execute military contracts. LMFAO!! The first time I met him was the three times he had to create (not correct--CREATE) his time sheets for the prior three months.

[Graft]

There are plenty of LOGCAP Alum that bounced from KBR to Agility & beyond:

LTG (RET) Joe Cosumano, KBR to Agility DGS (TAOS)
LTG (RET) Paul Cerjan, KBR to L-3 to Agility (GCC) to Agility DGS
MG (RET) Perry Dalby, KBR to Agility (GCC) to Tamimi
Steve Gulyas, KBR to Agility DGS to L-3

To name a few