Inquiry into interrogation firm

Photos depict abuse of Iraqi detainees (Picture: Washington Post)

A private firm hired by the Pentagon to interrogate prisoners in Iraq's prisons has had its contract frozen as federal officials investigate its involvement.

The probe could cost defence contractor Caci Corporation its right to bid for government work.

Investigators are looking into an army report's accusations that a Caci staffer took part in the abuse of prisoners at Baghdad's Abu Ghraib jail.

The news sent Caci's shares down as much as 13% on Wall Street.

'Satisfactory' service

The firm says it is presently subject to five separate government investigations.

The firm insists customers had said say its work has been "very satisfactory" and "continue to request [its] services".

But among the five inquiries is one by the General Services Administration, which Caci acknowledged would investigate whether it should remain eligible for government contracts.

And another is looking into the fact that the interrogation services appear to have been provided not under a Defense Department contract, but under an otherwise innocuous deal to supply computer services to the Interior Department.

Interior's main responsibilities include national parks and conservation.

The news of the nature of the contract means Interior is now blocking any expansion of the work, although Caci employees currently in Iraq can continue till the contract runs out in August.

Accusations

Caci was one of two US contractors named in a US army dossier on the abuse of inmates held in the Abu Ghraib prison in Baghdad.

Titan Corp was also named.

Recently published photographs showed detainees stripped, forced to wear women's underwear and humiliated in front of each other and American soldiers.

Caci was awarded 11 contracts, worth about $66m (£36m) for operations in Iraq, a company official told Reuters news agency.

The company has so far billed the government for $16m under the contracts.

It says it is co-operating fully with the authorities' investigations.

The firm said on Wednesday it had been awarded a contract worth about $88m to provide systems support to the US Navy.