Chinese munitions and claiming they were from Hungary, a NATO ally.
    "If there is a seam in our process, then clearly we need to take a look
at it," Lt. Gen. William Mortensen, deputy commanding general of the Army
Materiel Command, told the New York Times.
    AEY won a series of army contracts by underbidding competitors over the
last two years. In May, several House committees were planning to hold
hearings focused on the company and army procurement procedures.
    Mortensen said the army has been examining procedures for ordering
foreign munitions and their quality amid the Iraq Army requirement for
Soviet-origin weapons. He said the effort would also study the selection
process of companies that purchase munitions on the black market in Eastern
Europe.
    U.S. law requires American dealers to report every company or individual
involved in weapons or munitions shipment from abroad. At that point, the
State Department checks the entities against a watch list of suspected
smugglers.