The controversial award of a key Iraqi oil contract to US giant Halliburton is now being investigated by the FBI, it has been claimed.
A lawyer for a US army official has said the FBI has asked to speak to his client about how the army gave the firm a key deal to restore Iraqi oil.
The FBI claims come as a US government inquiry continues to look at why the deal was not put open to competition.
Halliburton, once run by vice president Dick Cheney, dismissed the FBI claim.
Mr Cheney led Halliburton between 1995 and 2000.
Wendy Hall, a Halliburton spokeswoman, dismissed the allegation as election politics.
“The old allegations have once again been recycled, this time one week before the election,” she said.
Ms Hall added that while the company was co-operating with various investigations, the auditing arm of the US Congress – the Government Accountability Office – had found that Halliburton’s no-bid work in Iraq was legal.
She said the multibillion-dollar contract to restore Iraqi oil facilities was rightly given to Halliburton because it was the only company that could have carried out the work.
The FBI has declined to comment on the allegations that it is now investigating the matter.
Bunnatine Greenhouse, the Army Corps of Engineers’ chief contracting officer, went public last weekend with allegations that her agency unfairly awarded Halliburton subsidiary KBR no-bid contracts.
Her lawyer, Michael Kohn, said the involvement of the FBI “underscores the seriousness of the misconduct, and it also demonstrates how courageous Ms Greenhouse was for stepping forward”.
Mr Kohn added: “The initiation of an FBI investigation into criminal misconduct will help restore public confidence.
“The army must aggressively protect Ms Greenhouse from the retaliation she will encounter as a result of blowing the whistle on this misconduct,” he told the Associated Press.