Monday, January 10, 2011

Iraqi Logistics Contract Case Continues Mired In Controversy

Agility Deny Change of Legal Status as Shares Fall
Shipping News Feature

US – KUWAIT – IRAQ – DUBAI – The lawsuit outstanding against Agility, the Kuwait based logistics contractor, seems destined to continue its controversial way toward the Courts after what appears to be yet another piece of disinformation. The shipping of supplies to the US military machine in Iraq, the previous misinformed press coverage and Agility’s replacement by Dubai listed Anham FZCo has already been liberally covered in these pages.

Although Agility have a published a specialist website to cover their legal wrangle with the US Defense Department which dates back to an FBI announcement in November 2009 there is no mention of this latest development. On Friday Reuters apparently published an article stating US prosecutors had filed a civil suit against Agility containing an accusation that fraud had been involved in the execution of the food logistics contract which was worth close to $10 billion.

Agility shares then apparently fell by around 5% despite Agility having argued all along that they wanted to fight the case as a civil, not a criminal matter. The outcome of the case is of critical importance to Agility which is banned from further US Government tenders until the matter is resolved, penalties could reach double the amount proved to be embezzled.

Reuters now report that a statement from Agility last night saying the allegations of a new lawsuit were untrue saying:

"The new civil case it spoke about is not a new lawsuit against Agility, but a procedural amendment to the case that was announced in November 2009."

It is not known at this stage the fate of other US freight contracts obtained by the Agility Defense & Government Services (DGS) which predate the scandal, in some cases by only a week or so, for shipping supplies to numerous countries including Afghanistan. Also questions remain over the employment of senior US military officials, including some from the U.S. Defense Logistics Agency (DLA) and responsible for procurement, who latterly became Agility staff members.