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Cargo company keeps defense contract Orchard Park business continues to deliver goods while case goes on

The Orchard Park company that admitted overbilling the U.S. Defense Department by millions of dollars will continue doing business for the federal government, at least for now.

The Defense Department will not begin to research possible debarment against National Air Cargo until after all legal proceedings are over in the company's fraud case, a department spokesman said. National Air Cargo took a felony corporate guilty plea last week in federal court in Buffalo.

"No decisions can be made until all the legal procedures are over," said Air Force Capt. Tom Wenz.

The government also is not releasing how many millions of dollars it paid to National Air Cargo to move military equipment throughout the continental United States and overseas. That information may be released at a later date, Wenz said.

The company is one of the main cargo companies used to ship food, medicine, military equipment and other essentials to soldiers in Iraq and Afghanistan, authorities said.

But the company's plea deal last week only involved fraudulent billing on shipments within the continental United States. The company has never cheated the government on shipments to the Middle East war zones, said Paul J. Cambria, an attorney for the cargo firm.

In Cambria's view, there is "no question" that the Defense Department should continue to entrust the company with shipments to Iraq and Afghanistan.

"Nobody has ever claimed that any of these overseas deliveries were not made," Cambria said. "They have made thousands upon thousands of deliveries into the war zone."

Cambria said the company has served the Defense Department for at least 10 years, but he declined to say how much the government has paid to National Air Cargo.

"I don't think it's relevant, and I don't see any purpose in finding out," said Cambria, who has been designated by National Air Cargo to respond to reporters' questions about the plea deal.

Cambria said last week's guilty plea does not mean that the company is untrustworthy, or that it should be debarred from future government contracts.

"There are many, many, many companies that have done that in the past and are still providing good service to the U.S. government," Cambria said.

National Air Cargo admitted that it overbilled the government by millions of dollars for military shipments in the years 1999 to 2005. The company maintains that it stopped cheating the government in 2005.

Under the terms of its corporate plea deal, none of the officers involved in the fraud committed by National Air Cargo will go to jail.

Instead, the company will pay more than $28 million in fines, restitution and forfeitures. But the plea deal also allows the company to withdraw its plea if U.S. District Judge William M. Skretny decides the $28 million is insufficient.

According to Wenz, the Defense Department is aware of the guilty plea and is "monitoring the situation."

email: dherbeck@buffnews.com

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