The United States suspended forwarder Eagle Global Logistics from eligibility for new government contracts in the wake of an overcharge conviction of a former employee. A corporate official said EGL is in talks with the Army that could soon have the suspension lifted.
Dana Carabin, EGL's general counsel, said the Army named the company as an unapproved contractor in a Web site posting Feb. 27, as a procedural action after former EGL regional vice president Christopher Cahill pleaded guilty last month to fraud related to military cargo shipments to Iraq in 2003.
She said she first became aware of the suspension March 7 when a customer notified EGL, and later that same day EGL received official notice by certified mail of the Army's action.
Other federal Web sites have since spread word of EGL's suspension.
For instance, the State Department's Directorate of Defense Trade Controls this month posted a message reporting the Army's suspension of EGL from future contracting. It said any contract applications submitted to DDTC after March 10 "where EGL is a party to the transaction, will not be approved other than on an exceptional basis."
Carabin told Traffic World that she met in Washington, D.C., on March 20 with Army officials to discuss EGL's efforts to resolve issues stemming from the case. Afterward, she said, Army representatives "called and said they are drafting an agreement for our review that would result in our suspension being lifted."
The two sides then traded drafts of a compliance agreement, Carabin said on March 22, and she was waiting for the government to say if they had a deal in hand.
She said if EGL found the document agreeable and signed, she understood that the Army would immediately lift the suspension.
In the fraud case, authorities said Cahill inflated freight bills with $1.14 million in unapproved war risk surcharges.
EGL previously said it had fired Cahill and another employee in connection with those events, and was working with the government to refund the overcharges as well as pay $2.86 million in penalties.
John D. Boyd
