Monday, July 23, 2007
Eagle Global Logistics 2nd guilty plea in Iraq cargo fraud case
Crime
(AP) -- A former executive of a company that shipped military cargo to Iraq has pleaded guilty to lying about a fraud scheme that bilked the government out of more than a million dollars. Kevin Andre Smoot, 43, pleaded guilty Friday to making a false statement and violation of the Anti-Kickback Act in U.S. District Court.
Smoot, who had been the managing director of Eagle Global Logistics's freight forwarding station in Houston, faces up to 15 years in prison and $500,000 in fines.
Another former executive, Christopher Cahill, pleaded guilty in February 2006 to inflating invoices for military shipments to Baghdad through EGL's subcontract with the Haliburton subsidiary Kellogg, Brown and Root. Cahill had been the company's former regional vice president for the Middle East and India.
Smoot admitted that he lied to federal investigators who questioned him about Cahill's scheme to inflate invoices by adding a "war risk surcharge" of 50 cents for each kilogram of freight transported to Baghdad. Smoot said he also gave more than $33,000 worth of entertainment to five Houston-based KBR transportation department employees for favorable treatment in getting subcontracts.
The gratuities included food, drinks, golf outings, tickets to rodeo events, baseball and football games. From Nov. 22, 2003, through July 20, 2004, EGL flew 379 shipments of military goods from Dubai to Baghdad under EGL's subcontract with KBR. The total amount of the EGL invoices was about $13.26 million, including $1.14 million in fraudulent charges.
Smoot, who had been the managing director of Eagle Global Logistics's freight forwarding station in Houston, faces up to 15 years in prison and $500,000 in fines.
Another former executive, Christopher Cahill, pleaded guilty in February 2006 to inflating invoices for military shipments to Baghdad through EGL's subcontract with the Haliburton subsidiary Kellogg, Brown and Root. Cahill had been the company's former regional vice president for the Middle East and India.
Smoot admitted that he lied to federal investigators who questioned him about Cahill's scheme to inflate invoices by adding a "war risk surcharge" of 50 cents for each kilogram of freight transported to Baghdad. Smoot said he also gave more than $33,000 worth of entertainment to five Houston-based KBR transportation department employees for favorable treatment in getting subcontracts.
The gratuities included food, drinks, golf outings, tickets to rodeo events, baseball and football games. From Nov. 22, 2003, through July 20, 2004, EGL flew 379 shipments of military goods from Dubai to Baghdad under EGL's subcontract with KBR. The total amount of the EGL invoices was about $13.26 million, including $1.14 million in fraudulent charges.
Labels: Anti-Kickback Act, cargo, Christopher Cahill, court case, Eagle Global Logistics, EGL, fraud, Halliburton, Iraq, KBR, Kevin Andre Smoot
