The U.S. military acted legally when it hired a contractor to pay Iraqi news organizations to run pro-American stories, the Pentagon's inspector general has found.

An unclassified summary of results of the inspector general's probe, released on Thursday, said:

"We concluded that the Multi-National Force-Iraq and Multi-National Corps-Iraq complied with applicable laws and regulations in their use of a contractor to conduct Psychological Operations and their use of newspapers as a way to disseminate information."

The controversial propaganda program was made public in a Los Angeles Times report in November.

Early this year, the Pentagon confirmed that troops in an "information operations" task force were writing articles with positive messages about the mission in Iraq that were translated into Arabic and given to Iraqi newspapers to print in return for money.

The stories were planted with the help of Washington-based Lincoln group.

The inspector general, the Pentagon's internal watchdog agency, reviewed three Lincoln Group contracts.

In one of those cases, it found that a military contracting office did not maintain enough documentation to verify expenditures under the program. Because of that, the inspector could not determine if the contract was awarded properly or if payments made were appropriate, the summary results stated.

"This Department of Defense report shows that the Pentagon cannot account for millions paid to the Lincoln Group for their propaganda program and that basic contracting rules were not followed," said U.S. Sen. Edward Kennedy (news, bio, voting record), the Massachusetts Democrat who sought the inspector general's review.

"Broader policy questions remain about whether the administration's manipulation of the news in Iraq contradicts our goal of a free and independent press there," Kennedy said.