US army replaces Kuwait supply firm in fraud case

A Kuwaiti firm with 8.5 billion dollars in contracts to supply food to US troops in the Middle East has been indicted on charges of defrauding the Pentagon, US authorities said.A grand jury indicted Public Warehousing Company on multiple counts related to overcharging the US Department of Defense for food supplies to troops in Iraq, Kuwait and Jordan, the Federal Bureau of Investigation said.

Kuwait's Public Warehousing Co, which is embroiled in a fraud case with the US Army, on Thursday said its net profit for the second quarter of 2010 dived 52.4 percent compared to last year.The company said in a statement on the Kuwait bourse website that it posted a net profit of 63.3 million dollars in the April to June period, compared to 132.9 million dollars a year earlier.In the first half, the company posted a net profit of 125 million dollars, down 52.4 percent from 262.2 million dollars in the first half of 2009.

The chief executive officer of Kuwait's Zain telecom giant, Saad al-Barrak, has resigned, the company said in a statement posted on the Kuwait Stock Exchange website on Wednesday.The statement said Barrak has submitted his resignation to the board of directors, which will meet to consider it. No reason was given for the surprising move.Barrak, who is also deputy chairman of Kuwait's largest listed company, has been with Zain since 2002 and has been the main driving force behind the firm's massive expansions and acquisitions.

Kuwait's Zain telecom said on Wednesday it has posted an unaudited net profit of 2.7 billion dollars from the sale of its African units to India's Bharti Airtel for 10.7 billion dollars.The profit is from the amount the firm has received so far and it expects to achieve more profit when it receives the rest, Zain said in a statement posted on the Kuwait Stock Exchange website.The Kuwaiti firm announced on Tuesday it has completed the deal to sell its operations in 15 African nations to Bharti Airtel following months of negotiations.

The alleged fraud by Public Warehousing Co., also known as Agility, may have cost the U.S. government more than $1 billion. No employees or officers of the firm have been arrested. A federal grand jury has indicted a Kuwait-based company for an alleged series of schemes that U.S. officials say amounted to a "massive overcharging" of the U.S. government for food the company provided to soldiers stationed overseas.

Kuwait's Zain telecom on Sunday confirmed it has received an offer for its operations in 15 African nations but did not reveal the identity of the bidder.The company said in a statement posted on the Kuwait Stock Exchange website that its board of directors will meet on Sunday to study the offer, also without revealing its value.The KSE immediately suspended trading in the shares of its largest listed firm until it receives notification of the outcome of the meeting.

Standard and Poor's rating agency on Thursday placed Kuwait's biggest diversified holding firm on credit watch, with negative implications due to the high-risk profile of its two largest holdings."The credit watch placement reflects our view on Kuwait Projects Company (KIPCO)'s portfolio characteristics, which we believe have weakened and which may have negative implications on our assessment of the company's stand-alone credit profile," the rating agency said.

KUWAIT (Reuters) - The U.S.