Nine food vendors were charged yesterday with helping inflate the earnings of an American subsidiary of Dutch grocery giant Royal Ahold by signing false audit confirmation reports.

The charges come six months after prosecutors accused four executives of the subsidiary, U.S. Foodservice Incorporated, of inflating earnings by $800 million by reporting fake rebates from the vendors.

Manhattan U.S. Attorney David Kelley said the new charges came as a result of “looking upstream and downstream for other participants in the scheme,” adding: “We continue to swim in both directions.”

Most of the nine men are expected to plead guilty, Mr. Kelley said.

Netherlands-based Ahold’s American properties include the Stop & Shop and Giant supermarket chains. U.S. Foodservice is one of the largest distributors of food products in the country, selling to restaurants and cafeterias; it also distributes products under the McCormick, Heinz, and Nestle brands.

Ahold said in 2003 that it had overstated its earnings by more than $1 billion, mostly because of the alleged fraud at U.S. Foodservice, and its stock lost 60% of its value.

In the new charges, the nine men worked for vendor companies that sold food and food products to U.S. Foodservice.

Among those charged were John Nettle, former account manager for General Mills, and Michael Rogers, former vice president of sales for Tyson Foods.

Each of the nine is charged with signing false audit confirmation letters that overstated the amount of money owed to U.S. Foodservice through “promotional allowance” agreements.

U.S. Foodservice routinely buys products from suppliers at full price, and the suppliers refund some of the price in rebates known as promotional allowances.

The falsified confirmation letters, submitted in 2001 and 2002, allowed the fraud at U.S. Foodservice to continue for perhaps a year, Kelley told reporters at a press conference.

In a statement, U.S. Foodservice said it was cooperating with prosecutors and “has made sweeping changes in its accounting and control systems and has worked hard to establish an internal culture of ethics and integrity.”

Mr. Kelley said it was the largest known prosecution of suppliers who had committed fraud to maintain a positive business relationship.

“We strive to foster an environment in which insiders cannot turn to third parties for help in manipulating financial results,” he said.

Bill Michael, a lawyer for Mr. Nettle, said his client was “extremely sorry for his actions and intends to work with the Department of Justice and the SEC to resolve these matters as quickly as possible.”

In a statement, a spokeswoman for Mr. Rogers said he had been pressured by a U.S. Foodservice representative to sign the audit letters, and that he did not intentionally participate in the alleged fraud. “He and his family have paid a very heavy price, and he wants very much to end this matter and move forward with his life,” the statement said.

Asked about possible charges against those and other vendor companies, Mr. Kelley said the companies have been cooperative, but stressed the investigation is continuing.

The nine were charged with taking part in a scheme to falsify books and records. Two of the nine were also charged with conspiring to trade on inside information relating to a 2000 Ahold stock offering.

All nine voluntarily surrendered to authorities yesterday morning.

Separately, the Securities and Exchange Commission filed civil charges against the nine, charging them with aiding “a massive financial fraud” by signing the false audit reports.

In July 2004, prosecutors charged four former executives of U.S. Foodservice with conspiring to inflate earnings by $800 million.

Two of them – the former chief financial officer, Michael Resnick, and the former chief marketing officer, Mark Kaiser – are awaiting trial. Two other former vice presidents, Timothy Lee and William Carter, pleaded guilty.

U.S. Foodservice employs nearly 30,000 people and claims to distribute food and food products to 250,000 customers, including cafeterias, schools, colleges, and health care facilities.