Federal grand jury investigating contractor that vetted Snowden

WASHINGTON (Reuters) - The company that conducted the most recent security review of former U.S. spy agency contractor Edward Snowden is the subject of a federal grand jury investigation into its background check processes, the Wall Street Journal reported on Saturday, citing people involved with the probe.

Federal prosecutors and the Federal Bureau of Investigation are investigating whether USIS, a U.S. government contractor, rushed its cases without doing a proper review, which would be a violation of the False Claims Act, the Journal said.

The grand jury has issued subpoenas to former USIS officials in recent days, the paper reported.

US Investigations Services, LLC said the company does not comment on specific issues related to investigations or litigation.

"With respect to this matter, the company has been cooperating fully with the government throughout its investigation and continues to do so," USIS said in a statement.

An FBI spokeswoman declined to comment on the issue, while a spokeswoman for the Justice Department had no immediate response to an inquiry about the grand jury probe.

Snowden, who as a U.S. National Security Agency contractor had undergone a USIS security review in 2011, is facing U.S. espionage charges after disclosing details of secret U.S. surveillance programs.

After leaving the country and spending weeks holed up in the transit area of a Moscow airport, he was granted temporary asylum in Russia this week.

USIS, a Falls Church, Virginia-based company that is the largest private provider of federal government background checks, has been under investigation by the inspector general for the U.S. Office of Personnel Management.

While that probe predates the Snowden scandal, concerns have been raised about whether the company's background check into Snowden was carried out in an appropriate manner.

(Reporting by Ayesha Rascoe and David Ingram; Editing by Sandra Maler and Vicki Allen)

[Image via Agence France-Presse]