U.S. contractor ArmorGroup pays feds $7.5 million to resolve false payment allegations

There is new fallout from the turmoil surrounding the U.S. State Department's contract with a company providing guards for its Embassy in Kabul, Afghanistan --- a story exposed by CBS News in 2009.

The Department of Justice announced today that ArmorGroup North America has paid a $7.5 million settlement stemming from claims that "in 2007 and 2008, [ArmorGroup] guards violated the Trafficking Victims Protection Act (TVPA) by visiting brothels in Kabul, and that [ArmorGroup's] management knew about the guards' activities."

The settlement also resolves allegations that ArmorGroup misrepresented the prior work experience of 38 foreign nationals it hired to guard the Embassy.

"Americans deserve to know that their tax dollars are being spent wisely and consistent with our values," said U.S. Attorney Ronald C. Machen Jr. in a press release.

In 2009, guards provided dozens of graphic photos and videosdepicting shocking scenes of hazing and humiliation by superiors to CBS News. Some guards who refused to participate told investigative correspondent Sharyl Attkisson they were retaliated against, or even fired.