The U.S. Transportation Security Administration will remove from U.S. airports its remaining body-scanning machines that privacy advocates likened to strip searches for showing almost-naked images of passengers.

TSA will end a $5 million contract with OSI Systems Inc.’s Rapiscan unit after Administrator John Pistole concluded the company couldn’t meet a congressional deadline to deliver software that would produce generic images of passengers, agency officials said in interviews.

TSA will remove 174 Rapiscan machines from U.S. airports, with the company absorbing the cost, Karen Shelton Waters, the agency’s assistant administrator for acquisitions, said. The agency will replace the Rapiscan machines with 60 units manufactured by L-3 Communications Holdings Inc., the agency’s other body-scanner supplier.

"It became clear to TSA they would be unable to meet our timeline," Waters said. "As a result of that, we terminated the contract for the convenience of the government."

The decision to cancel the Rapiscan contract and remove its scanners wasn’t related to an agency investigation into whether the company faked testing data on the software fix, Waters said.

In November, Rep. Mike Rogers, R-Ala., then chairman of the House Transportation Security subcommittee, said in a letter to Pistole that the company "may have attempted to defraud the government by knowingly manipulating an operational test."

Rogers said his committee received a tip about the faked tests.

Rapiscan denied falsifying data or information related to the tests.

OSI Systems is "pleased to reach a mutually satisfactory agreement with the TSA" that will involve moving the machines to other government agencies, Chief Executive Officer Deepak Chopra said in a statement. The company, based in Hawthorne, Calif., said it expects to report a $2.7 million one-time charge during the quarter that ended Dec. 31.

L-3 scanning machines employ millimeter-wave technology, which uses radio frequencies that can find both metallic and nonmetallic items. Rapiscan’s machines are based on backscatter technology, which uses low-dose X-ray radiation to detect objects under a passenger’s clothes.

The TSA accelerated its use of advanced scanners in 2010 following the failed Dec. 25, 2009, attempt by Umar Farouk Abdulmutallab to blow up a Northwest Airlines flight by igniting explosives in his underpants.

TSA officials review images produced by the machines in a room separated from the screening line, and alert agents at the line if they see a possible risk.

The agency responded to complaints by privacy advocates and some members of Congress about the machines’ graphic images by moving security officers looking at the images to a back room.

The agency put out a contract in August 2010 asking L-3 and Rapiscan to develop the software to make images less revealing. L-3 developed its product in 2011, said John Sanders, TSA’s assistant administrator for security capabilities.

Rapiscan recently indicated to agency officials that it could not deliver its software until 2014, Sanders said in an interview. It couldn’t come up with an algorithm that met the agency’s standards for accurately detecting objects without generating false alarms, Sanders said.

"You can have a high probability of detection but a great deal of alarm," Sanders said. "Everybody’s alarming. That doesn’t work from an operational perspective."