WASHINGTON — The Obama administration's dilemma in deciding how to punish contractors for contract violations and other infractions isn't confined to the Louis Berger Group or to Afghanistan.

The administration decided last month not to bring criminal charges against the security contractor formerly known as Blackwater, now named Xe Services, after a nearly four-year investigation found sanctions violations, illegal exports and bribery, as McClatchy first reported in June.

In May, Houston-based KBR, formerly a subsidiary of contracting giant Halliburton, received a more than $500 million no-bid contract from the Army for work in Iraq. The Army awarded the contract on the same day that the Justice Department joined a whistleblower lawsuit alleging that KBR employees had received kickbacks.

Recent court documents have revealed that KBR is asserting that the U.S. government pledged it would assume liability on behalf of the company in Iraq. U.S. soldiers who guarded KBR employees now allege that the company didn't properly warn them about exposure to a toxic chemical and have sued the company.

From the outset, congressional critics have alleged that the company got favorable treatment from USAID because of its ties to former Vice President Dick Cheney, Halliburton's former chief.

"The fact that a company like KBR can still win new contracts after repeatedly engaging in negligent behavior that harms our troops sends the wrong message about accountability," said Rep. Earl Blumenauer, D-Ore., who's pressed the Army for an explanation. "Contractors like KBR should not be rewarded for negligence, especially when that negligence costs lives."

(Tish Wells contributed to this article.)

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