Citing a former employee of the Lincoln Group, a Washington-based public relations firm, the newspaper reported on Monday that the Pentagon directed the company early in 2005 to identify religious leaders who could help produce messages that would persuade Iraqis in the al-Anbar province to participate in national elections and reject fighting against the US-led forces.
The company then retained three or four Sunni scholars to offer advice and write reports for military commanders on the content of propaganda campaigns, the Times said, citing the former employee.
In addition, the Times reported that documents and Lincoln executives said the company's ties to religious leaders and other prominent Iraqis were also directed at exerting influence within Iraqi communities on behalf of clients, which included the US military.
The newspaper quoted Paige Craig, a Lincoln executive vice-president, as saying: "We do reach out to clerics.
"We meet with local government officials and with local businessmen.
"We need to have relationships that are broad enough and deep enough that we can touch all the various aspects of society," he said.
Craig declined to discuss specific projects the company had with the military or commercial clients, the Times said.
He added: "Most of the people we meet with overseas don't want or need compensation, they want a dialogue."
The Times said internal company financial records showed that Lincoln had spent about $144,000 on the programme from May to September, but it was unclear how much of that went to the religious scholars, whose identities were not disclosed.
That amount is a small fraction of the tens of millions worth of contracts Lincoln received from the military for "information operations".
"We do reach out to clerics"
Lincoln executive vice-president
The former Lincoln employee, who spoke on condition of anonymity, said the scholars underwent a review process before joining the programme to ensure they were not involved in the fighting.
A spokesman for the US military in Baghdad declined to comment to the newspaper.
The Pentagon ordered an investigation after it was disclosed in November that the military used Lincoln to plant articles written by US troops in Iraqi newspapers.
Payments to the scholars were originally part of Lincoln's contract to aid the military with information warfare in al-Anbar, the Times said.
Known as the Western Missions contract, it also called for producing radio and television advertisements, websites and posters, and placing advertisements and opinion articles in Iraqi publications.
In October, Lincoln was awarded a new contract by the Pentagon for work in Iraq, including continued contact with Muslim scholars.
Records also showed that Lincoln had turned to US scholars and political consultants for advice on the content of the propaganda campaign in Iraq, the Times said.