The civil settlement reached Friday over a former food supply contract to the Defense Department will allow Agility to move forward on future U.S. government business, the third-party logistics provider said in a statement.
Agility Logistics has reached a final settlement with the U.S. government over a former food supply contract it held with the Defense Department from 2003 to 2010.
The contract involved nearly 200,000 invoices to the U.S. government, with a value of $8.6 billion. The U.S. government alleged that Agility over-billed the Defense Department for its services under the contract, resulting in both criminal and civil investigations.
In the criminal portion of the case, Agility announced during the middle of last week it had agreed to plead to a misdemeanor in connection with a single invoice valued at $551.
In the parallel civil proceedings, the company has agreed to pay $95 million in cash. In addition, Agility and the U.S. government have agreed to mutual releases of all outstanding contract claims related to the food-supply contracts. The terms of the settlement are subject to final court approval.
“This extremely complex investigation required DCIS agents and our partners to tenaciously sort through and piece together an unprecedented volume of information and documents, and persevere through many years of exhaustive work, to bring this case to a resolution,” John F. Khin, special agent for the Defense Department’s Defense Criminal Investigative Service (DCIS), said in a statement.
The Kuwait-based company has denied any wrongdoing throughout the U.S. government’s investigation.
With the civil settlement concluded, Agility will be able to resume its engagement in new U.S. government contracts. Specifically, the U.S. government has agreed to remove Agility and all of its subsidiaries and affiliates from the list of suspended companies on its System for Award Management (SAM) database, formerly known as the Excluded Parties List System (EPLS), within 60 days.
Agility CEO Tarek Sultan said in a statement the settlement “removes uncertainty for investors and lenders, ends costly litigation, and opens a pipeline of potential government and commercial contracting opportunities.”
“Agility has a healthy balance sheet and low net debt,” he added. “The company can meet its obligations under the settlement without jeopardizing its current investments or its future growth.”
“Although Agility’s suspension will be lifted, it will be required to use an independent monitor,” the Justice Department said of the settlement. “Moreover, the agreement requires Agility to maintain an ethics and compliance program with a number of detailed requirements.”
Agility reaches final settlement with U.S. government
