A Kuwaiti logistics company inflated prices and defrauded the U.S. government for contracts to feed American troops based in Iraq, Kuwait and Jordan, federal prosecutors said Monday.

Public Warehousing Co. has been charged with making false statements, submitting false claims and committing wire fraud, said acting U.S. Attorney Gentry Shelnutt.

The company, also known as Agility, has received more than $8.5 billion in food supply contracts. Federal prosecutors say its contract with the government is scheduled to expire in December 2010. Agility did not immediately return phone calls seeking comment.

The six-count federal indictment claimed the company manipulated a complex funding formula to defraud the U.S. government of at least $68 million, said Assistant U.S. Attorney Barbara Nelan.

The indictment said the company provided false invoices and statements to a logistics center, bought high-priced food items and then knowingly inflated prices. And it said the company received rebates and discounts from vendors that it did not pass to the government as required by the contract.

The company also inflated fees by asking vendors to manipulate the way the products were packed, enabling it to bill the government twice as much as it should have, prosecutors said. And they said the firm encouraged a vendor in Conyers, Ga., to conceal fees that should have been paid to the company, leading to inflated prices.

"The defendants, tempted by monetary gain, betrayed the trust invested in them by the U.S. Army," said Brig. Gen. Rodney Johnson, the commander of the U.S. Army Criminal Investigation Division. "And now they must face the consequences."

The alleged scheme was first outlined in a civil whistleblower filing that was filed in 2005 and unsealed this week. It was filed by Kamal Mustafa Al-Sultan, general manager of a contracting firm that partnered with Public Warehousing Co. in 2002.

The company, which is scheduled to make a first court appearance Friday, could face probation and a fine of up to twice the company's illegal gains or twice the loss to the U.S. Prosecutors also stressed that more charges could be filed because the investigation is ongoing.

"Others who have engaged in similar conduct should beware," said Shelnutt. "This indictment is only the first step."