Academi—previously known as Xe Services LLC, Blackwater USA and Blackwater Worldwide
|Type||Privately held company|
|Industry||Private military and security contractor|
|Headquarters||Arlington County, Virginia, U.S.|
|Products||Law enforcement training, logistics, close quarter training, and security services|
|Services||Security management, full-service risk managementconsulting|
Academi—previously known as Xe Services LLC, Blackwater USA and Blackwater Worldwide—is a private military company founded in 1997 by Erik Prince and Al Clark. Academi is currently the largest of the U.S. State Department's three private security contractors. Academi provided diplomatic security services in Iraq to the United States federal government on a contractual basis. Academi also has a research and development wing that was responsible for developing the Grizzly APC along with other military technology. The company's headquarters is located in Arlington County, Virginia.
Corporate history[edit source]
1997 Blackwater USA[edit source]
Blackwater USA was formed in 1997, by Erik Prince in North Carolina, to provide training support to military and law enforcement organizations. In explaining Blackwater's purpose, Prince stated that ‘‘We are trying to do for the national security apparatus what FedEx did for the Postal Service.’’After serving SEAL and SWAT teams, Blackwater USA received its first government contract after the bombing of the USS Cole off of the coast ofYemen in October 2000. After winning the bid on the contract, Blackwater trained over 100,000 sailors.
Prince purchased about 7,000 acres (28 km2) (from Dow Jones Executive, Sean Trotter) of the Great Dismal Swamp, a vast swamp on the North Carolina/Virginia border, now mostly a National Wildlife Refuge. "We needed 3,000 acres to make it safe," Prince told reporter Robert Young Pelton.There, he created his private training facility and his contracting company, Blackwater, which he named for the peat-colored water of the swamp. The Blackwater Lodge and Training Center officially opened on May 15, 1998 with a 6,000-acre facility and cost $6.5 million.
Blackwater's primary training facility, opened by Jonathan Elliott and Nic Norment in 2001, is located on 7,000 acres (28 km2) in northeastern North Carolina. It comprises several ranges: indoor, outdoor, urban reproductions; an artificial lake; and a driving track in Camden and Currituck counties. The company says that it is the largest training facility in the country. In November 2006 Blackwater USA announced it recently acquired an 80-acre (32 ha) facility 150 miles (240 km) west of Chicago in Mount Carroll, Illinois is called Impact Training Center. This facility is also known as "The Site". This facility has been operational since April 2007 and serves law enforcement agencies throughout the Midwest.
2002 Blackwater Security Consulting[edit source]
Blackwater Security Consulting (BSC) was formed in 2002. Its first assignment was to provide 20 men with top-secret clearances to protect the CIA headquarters and another base that was responsible for hunting Bin Laden. Blackwater was one of several private security firms employed following the U.S. invasion of Afghanistan. BSC is one of over 60 private security firms employed during the Iraq War to guard officials and installations, train Iraq's new army and police, and provide other support for coalition forces. Blackwater was also hired during the aftermath of Hurricane Katrina by theUnited States Department of Homeland Security, as well as by private clients, including communications, petrochemical and insurance companies.Overall, the company has received over US$1 billion in U.S. government contracts. The company consisted of nine divisions, and a subsidiary, Blackwater Vehicles.
At the time it was a privately held company and published limited information about internal affairs. Its founder and former CEO at the time, Erik Prince, a former Navy SEAL, attended the Naval Academy and graduated from Hillsdale College.
Cofer Black, the company's vice-chairman from 2006 through 2008, was director of the CIA's Counterterrorist Center (CTC) at the time of the September 11 attacks in 2001. He was the United States Department of State coordinator for counterterrorism with the rank of ambassador at large from December 2002 to November 2004. After leaving public service, Black became chairman of the privately owned intelligence gathering company Total Intelligence Solutions, Inc., as well as vice chairman of Blackwater. Robert Richer was vice president of intelligence until January 2007, when he formed Total Intelligence Solutions. He was formerly the head of the CIA's Near East Division.
Blackwater tried to open an 824-acre (3.33 km2) training facility three miles north of Potrero, a small town in rural east San Diego County, California located 45 miles (72 km) east of San Diego, for military and law enforcement training. The opening has faced heavy opposition from local residents, residents of nearby San Diego, local Congressmember Bob Filner, and environmentalist and anti-war organizations. Opposition focused on a potential for wildfire increases, the proposed facility's proximity to the Cleveland National Forest, noise pollution, and opposition to the actions of Blackwater in Iraq. In response, Brian Bonfiglio, project manager for Blackwater West, said "There will be no explosives training and no tracer ammunition. Lead bullets don't start fires." In October 2007, when wildfires swept through the area, Blackwater made at least three deliveries of food, water, personal hygiene products and generator fuel to 300 residents near the proposed training site, many of whom had been trapped for days without supplies. They also set up a "tent city" for evacuees. On March 7, 2008, Blackwater withdrew its application to set up a facility in San Diego County.
2007 Blackwater Worldwide[edit source]
In October 2007, Blackwater USA began the process of changing its name to Blackwater Worldwide, and also unveiled a new logo. The change deemphasized the "cross hair" reticle theme, simplifying it slightly.
On July 21, 2008, Blackwater Worldwide stated that it would shift resources away from security contracting because of the extensive risks in that sector. "The experience we've had would certainly be a disincentive to any other companies that want to step in and put their entire business at risk," company founder and CEO Erik Prince told The Associated Press during a daylong visit to Blackwater's North Carolina compound.
2009 XE Services LLC[edit source]
In February 2009, Blackwater announced that it would change its name again, to "Xe Services LLC", as part of a company-wide restructuring plan. Subsequently, it reorganized its business units, added a corporate governance and ethics program, and established an independent committee of outside experts to supervise compliance structures.
Prince announced his resignation as CEO on March 2, 2009. He remained as chairman of the board but was no longer involved in day-to-day operations.Joseph Yorio was named as the new president and CEO, replacing Gary Jackson as president and Prince as CEO. Danielle Esposito was named the new chief operating officer and executive vice president.
In 2009, Prince announced that he would relinquish involvement in the company's day-to-day business in December, along with some of his ownership rights. He also said he considered becoming a teacher. In late 2010, Prince moved to Abu Dhabi, where he subsequently started another security services company, Reflex Responses.
In 2011, former NSA head and CIA executive Bobby Ray Inman became the head of Xe's board of directors. In May 2011, Xe named Ted Wright as CEO. Wright hired a new governance chief to oversee ethical and legal compliance and established a new board composed of former government officials, including Jack Quinn, former Clinton adviser, and John Ashcroft. In June, 2011 the company named Suzanne Folsom its chief regulatory and compliance officer and deputy general counsel. In July, Jack Quinn, former White House Counsel to President Bill Clinton and former Chief of Staff to Vice President Al Gore, was named as an Independent Director of the company.
2011 Academi[edit source]
In December 2011, Xe changed its name again, to "Academi". The name refers to Plato's Academy and is meant, according to Ted Wright, to reflect a more "boring" image.
Board of directors[edit source]
- Red McCombs (chairman)
- John Ashcroft
- Dean Bosacki
- Jason DeYonker
- Bobby Ray Inman
- Jack Quinn
- Russ Robinson
Services and products[edit source]
Academi has a variety of services and product offerings:
United States Training Center[edit source]
United States Training Center (USTC, formerly Blackwater Training Center) offers tactics and weapons training to military, government, and law enforcement agencies. USTC also offers several open-enrollment courses periodically throughout the year, from hand to hand combat (executive course) to precision rifle marksmanship. They also offer courses in tactical and off-road driving.
USTC's primary training facility, located on 7,000 acres (28 km2) in northeastern North Carolina, comprises several ranges, indoor, outdoor, urban reproductions, a man-made lake, and a driving track in Camden and Currituck counties. Company literature says that it is the largest training facility in the country. In November 2006 Blackwater USA announced it acquired an 80-acre (32 ha) facility 150 miles (240 km) west of Chicago, in Mount Carroll, Illinois to be called Blackwater North. That facility has been operational since April 2007 and serves law enforcement agencies throughout the Midwest. The training facility has since been renamed Impact Training Center. and once again has been renamed Hollow Training Center
In 2011, the Pentagon contracted USTC to provide "intelligence analyst support and material procurement" for NATO in the ongoing Afghan drug war.
Maritime security service[edit source]
Academi offers tactical training for maritime force protection units. In the past, it has trained Greek security forces for the 2004 Olympics, Azerbaijan Naval Sea Commandos, and Afghanistan's Ministry of Interior. Academi's facilities include a man made lake, with stacked containers simulating the hull and deck of a ship for maritime assaults. Blackwater received a contract to train United States Navy sailors following the attack on the USS Cole.
It also purchased a 183-foot (56 m) vessel, McArthur, which has been outfitted for disaster response and training. According to Blackwater USA, it features "state of the art navigation systems, full GMDSS communications, SEATEL Broadband, dedicated command and control bays, helicopter decks, hospital and multiple support vessel capabilities." McArthur was built in 1966 by the Norfolk Shipbuilding and Drydock Company and served as the survey ship USC&GS McArthur (MSS 22) for the United States Coast and Geodetic Survey from 1966 to 1970 and as NOAASMcArthur (S 330) for the National Oceanic and Atmospheric Administration from 1970 until her decommissioning in 2003. The ship is home-ported in Norfolk, Virginia.
K-9 training[edit source]
Training canines to work in patrol capacities as war dogs, explosives and drug detection, and various other roles for military and law enforcement duties.
Security consulting[edit source]
Blackwater Security Consulting (BSC) was formed in 2001, and based in Moyock, North Carolina. The company is one of the private security firms employed during the Iraq War to guard officials and installations, train Iraq's new Army and Police, and provide other support for Coalition Forces.
The company was started to help train SEALS for combat. However, in the aftermath of 9/11, civilian security teams were needed by the United States Military.
Before 2001, tier-one contractors, or former members of elite, special forces units, were hired from a small pool of applicants. After the September 11 attacks, Cofer Black, the former head of counter terrorism at the CIA requested that the federal government hire more contractors to operate overseas. Eventually, the CIA realized that large numbers of civilian contractors would be needed overseas to accomplish its broad goals. The federal government turned to Blackwater for assistance.
By 2003, the ground war in Iraq changed into a diplomatic mission, demanding hundreds of diplomats and State Department employees. The government traditionally handles its own security, but it lacked the staff for high-risk protection details. Therefore a different type of protection was needed, and Blackwater would provide the solution. Blackwater's founder, Erik Prince, says that "not one State Department employee was killed while we were protecting them."
Academi's primary public contract is from the U.S. State Department under the Bureau of Diplomatic Security's Worldwide Personal Protective Services (WPPS) and WPPS II umbrella contracts, along with DynCorp International and Triple Canopy, Inc. for protective services in Iraq, Afghanistan, Bosnia, and Israel.
Target systems[edit source]
Academi provides and maintains a "shoot house" system and patented the BEAR multi-target training system that was designed and developed by the company.
Grizzly armored vehicle[edit source]
Former corporate units[edit source]
Aviation Worldwide Services[edit source]
Aviation Worldwide Services (AWS) was founded by Richard Pere and Tim Childrey, and was based at Melbourne, Florida, USA. It owned and operated three subsidiaries: STI Aviation, Inc. Air Quest, Inc. and Presidential Airways, Inc. In April 2003 it was acquired by Blackwater USA.
Presidential Airways (PAW) is a Federal Aviation Administration (FAA) Regulations Part 135 charter cargo and passenger airline based at Melbourne International Airport. It operates aircraft owned by AWS. Presidential Airways holds a Secret Facility Clearance from the U.S. Department of Defense. It operates several CASA 212 aircraft in addition to a Boeing 767. Several of the MD-530 helicopters used by Blackwater Security Consulting in Iraq are also operated through AWS.
A CASA 212 aircraft, tail number N960BW, operated by Presidential Airways crashed on November 27, 2004, in Afghanistan; it had been a contract flight for the United States Air Force en route from Bagram to Farah. All aboard, three soldiers and three civilian crew members, were killed. Several of their surviving kin filed a wrongful death lawsuit against Presidential in October 2005.
In late September 2007, Presidential Airways received a $92m contract from the Department of Defense for air transportation in Afghanistan, Kyrgyzstan, Pakistan and Uzbekistan.
STI Aviation focuses on aircraft maintenance, and is a FAA/Joint Aviation Authorities 145 repair station. They specialize in Short 360, EMB 120, Saab 340, and CASA 212 maintenance. As of January 2008, STI Aviation appears to have been folded into AWS, along with Air Quest.
Many of Blackwater's tactical and training aircraft are registered to Blackwater affiliate EP Aviation LLC, named for Blackwater's owner, Erik Prince. These aircraft include fourteen Bell 412helicopters, three Hughes/MD 369 "Little Bird" helicopters, four Bell 214ST medium-lift helicopters, three Fairchild Swearingen Merlin IIIC turboprop airliners, nine Aérospatiale Puma utility helicopters, a Maule Air MT-7-235 STOL aircraft, an Embraer EMB 314 Super Tucano counterinsurgency aircraft, and a Mooney M20E fixed wing aircraft.
Aviation Worldwide Services was purchased for $200 million in 2010 by AAR Corp., an Illinois company. In a letter released on February 8, 2011, the new owners informed state officials that they are shutting down the Moyock, North Carolina, operation and moving some employees to a new business location in Melbourne, Florida. Some 260 staff are affected with about 50 losing their jobs, beginning at the end of February. The company views the aviation division as a growth opportunity.
Greystone Limited[edit source]
In 2010, Greystone was acquired by current management. Greystone now operates as a standalone, management owned provider of protective support services and training.
A private security service, Greystone is registered in Barbados, and employs soldiers for off-shore security work through its affiliate Satelles Solutions, Inc. Their web site advertises their ability to provide "personnel from the best militaries throughout the world" for worldwide deployment. Tasks can be from very small scale up major operations to "facilitate large scale stability operations requiring large numbers of people to assist in securing a region".
Erik Prince intended Greystone to be used for peacekeeping missions in areas like Darfur where military operations would need to take place to establish peace.
Greystone had planned to open a training facility on the former grounds of the Subic Bay U.S. Naval Base, but those plans were later abandoned.
Iraq War involvement[edit source]
Blackwater Worldwide has played a substantial role during the Iraq War as a contractor for the United States government. In 2003, Blackwater attained its first high-profile contract when it received a $27.7 million no-bid contract for guarding the head of the Coalition Provisional Authority, L. Paul Bremer.
Since June 2004, Blackwater has been paid more than $320 million out of a $1 billion, five-year State Department budget for the Worldwide Personal Protective Service, which protects U.S. officials and some foreign officials in conflict zones.
On April 21, 2005, six Blackwater USA independent contractors were killed in Iraq when their Mil Mi-8 Hip helicopter was shot down. Also killed were three Bulgarian crewmembers and two Fijiangunners. Initial reports indicated that the helicopter was shot down by rocket propelled grenades.
In 2006, a car accident occurred in the Baghdad Green Zone when an SUV driven by Blackwater USA contractors crashed into a U.S. Army Humvee.
In 2006, Blackwater was awarded a contract to protect diplomats for the U.S. embassy in Iraq, the largest American embassy in the world. It is estimated by the Pentagon and company representatives that there are 20,000 to 30,000 armed security contractors working in Iraq, and some estimates are as high as 100,000, though no official figures exist. Of the State Department's dependence on private contractors like Blackwater for security purposes, U.S. ambassador to Iraq Ryan Crocker told the U.S. Senate: "There is simply no way at all that the State Department's Bureau of Diplomatic Security could ever have enough full-time personnel to staff the security function in Iraq. There is no alternative except through contracts."
For work in Iraq, the company has drawn contractors from their international pool of professionals, a database containing "21,000 former Special Forces operatives, soldiers, and retired law enforcement agents," overall. For instance, Gary Jackson, the firm's president, has confirmed that Bosnians, Filipinos, and Chileans "have been hired for tasks ranging from airport security to protecting Paul Bremer, the head of the Coalition Provisional Authority." Between 2005 and September 2007, Blackwater security staff were involved in 195 shooting incidents; in 163 of those cases, Blackwater personnel fired first. Erik Prince points out that the company followed the orders of United States government officials, who frequently put his men in harm's way. Many of the shootings occurred after drivers in vehicles failed to stop when ordered by Blackwater guards.
In 2007, the U.S. government investigated whether Blackwater employees smuggled weapons into Iraq. No charges were filed.
Fallujah and An Najaf[edit source]
On March 31, 2004, Iraqi insurgents in Fallujah ambushed two SUVs, killing the four armed Blackwater contractors inside. Local residents hung the charred bodies above a bridge across the Euphrates. In response, U.S. Marines attacked the city in Operation Vigilant Resolve, which became the first Battle of Fallujah. In the fall of 2007, a congressional report by the House Oversight Committee found that Blackwater intentionally "delayed and impeded" investigations into the contractors' deaths. The report also acknowledges that members of the now-defunct Iraqi Civil Defense Corps "led the team into the ambush, facilitated blocking positions to prevent the team's escape, and then disappeared."
In April 2004, at the U.S. government's headquarters in Najaf, hundreds of Shiite militia forces barraged Blackwater commandos, four MPs and a Marine gunner with rocket-propelled grenades and AK-47 fired for hours before U.S. Special Forces troops arrived. As supplies and ammunition ran low, a team of Blackwater contractors 70 miles (113 km) away flew to the compound to resupply and bring an injured U.S. Marine back to safety outside of the city.
On February 16, 2005, four Blackwater guards escorting a U.S. State Department convoy in Iraq fired 70 rounds into a car. The guards stated that they felt threatened when the driver ignored orders to stop as he approached the convoy. The fate of the car's driver was unknown because the convoy did not stop after the shooting. An investigation by the State Department's Diplomatic Security Service concluded that the shooting was not justified and that the Blackwater employees provided false statements to investigators. The statements claimed that one of the Blackwater vehicles had been hit by insurgent gunfire, but the investigation concluded that one of the Blackwater guards had actually fired into his own vehicle by accident. John Frese, the U.S. embassy in Iraq's top security official, declined to punish Blackwater or the security guards because he believed any disciplinary actions would lower the morale of the Blackwater contractors.
On Christmas Eve 2006, a security guard of the Iraqi vice president, Adel Abdul Mahdi, was shot and killed while on duty outside the Iraqi prime minister's compound. The Iraqi government has accused Andrew J. Moonen, a Blackwater employee at the time, of killing him while drunk. Moonen was subsequently fired by Blackwater for "violating alcohol and firearm policy", and travelled from Iraq to the United States days after the incident. United States Attorneys investigated and announced in 2010 that they were declining to prosecute Moonen, citing a likely affirmative defense of self-defense and high standards for initiating such a prosecution. The United States State Department and Blackwater USA had attempted to keep his identity secret for security reasons.
Five Blackwater contractors were killed on January 23, 2007, in Iraq when their Hughes H-6 helicopter was shot down on Baghdad's Haifa Street. The crash site was secured by a personal security detail, callsign "Jester" from 1/26 Infantry, 1st Infantry Division. Three insurgencies claimed to be responsible for shooting down the helicopter, although such has not been confirmed by the United States. A U.S. defense official has confirmed that four of the five killed were shot execution style in the back of the head, but did not know whether the four had survived the crash.
In late May 2007, Blackwater contractors opened fire on the streets of Baghdad twice in two days, one of the incidents provoking a standoff between the security contractors and Iraqi Interior Ministry commandos, according to U.S. and Iraqi officials. The first incident occurred when a Blackwater-protected convoy was ambushed in downtown Baghdad. The following incident occurred when an Iraqi vehicle drove too close to a convoy. However, according to incident testimony, the Blackwater guards tried to wave off the driver, shouted, fired a warning shot into the car's radiator, finally shooting into the car's windshield. On May 30, 2007, Blackwater employees shot an Iraqi civilian said to have been "driving too close" to a State Department convoy that was being escorted by Blackwater contractors. Following the incident, the Iraqi government allowed Blackwater to provide security by operating within the streets of Iraq.
A sniper employed by Blackwater Worldwide opened fire from the roof of the Iraqi Justice Ministry, killing three guards working for the state-funded Iraqi Media Network on February 6, 2006. Many Iraqis at the scene said that the guards had not fired on the Justice Ministry. The U.S. State Department said, however, that their actions "fell within approved rules governing the use of force" based on information obtained from Blackwater guards.
Documents obtained from the Iraq War documents leak of 2010 argue that Blackwater employees committed serious abuses in Iraq, including killing civilians.
International services[edit source]
According to a company press release, Blackwater provided airlift, security, logistics, and transportation services, as well as humanitarian support. It was reported that the company also acted as law enforcement in the disaster-stricken areas, for example securing neighborhoods and confronting criminals. Blackwater moved about 200 personnel into the area hit by Hurricane Katrina, most of whom (164 employees) were working under a contract with the Department of Homeland Security to protect government facilities, but the company held contracts with private clients as well. Overall, Blackwater had a "visible, and financially lucrative, presence in the immediate aftermath of Hurricane Katrina as the use of the company contractors cost U.S. taxpayers $240,000 a day."
Academi (then Blackwater USA) was one of five companies picked in September 2007 by the Department of Defense Counter-Narcotics Technology Program Office in a five-year contract for equipment, material and services in support of counter-narcotics activities. The contract is worth up to $15 billion. The other companies picked are Raytheon, Lockheed Martin, Northrop Grumman, OHI, and Arinc Inc.  Blackwater USA has also been contracted by various foreign governments. The DEA and DoD counternarcotics program is supported by Blackwater Worldwide in Afghanistan as well. “Blackwater is involved on DoD side” of the counter-narcotics program in Afghanistan says Jeff Gibson, vice president for international training at Blackwater. “We interdict. The NIU surgically goes after shipments going to Iran or Pakistan. We provide training to set up roadblocks, identify where drug lords are, and act so as not to impact the community.” In 2008, about 16 Blackwater personnel were in Afghanistan at any given time to support DoD and DEA efforts at training facilities around the country. Blackwater is also involved in mentoring Afghan officials in drug interdiction and counter narcotics. As Richard Douglas, a deputy assistant secretary of defense, explained, "The fact is, we use Blackwater to do a lot of our training of counternarcotics police in Afghanistan. I have to say that Blackwater has done a very good job." The Obama administration awarded Academi a $250 million contract to work for the U.S. State Department and the Central Intelligence Agency in Afghanistan.
In 2005, Blackwater worked to train the Naval Sea Commando regiment of Azerbaijan, enhancing their interdiction capabilities on the Caspian Sea. In Asia, Blackwater had contracts in Japan guarding AN/TPY-2 radar systems.
In March 2006, Cofer Black, vice chairman of Blackwater USA, allegedly suggested at an international conference in Amman, Jordan, that the company was ready to move towards providing security professionals up to brigade size (3,000–5,000) for humanitarian efforts and low-intensity conflicts. The company denies making this claim.
Mark Manzetti, writing in the New York Times on August 19, 2009, reported that the CIA had hired Blackwater "as part of a secret program to locate and assassinate top operatives of Al Qaeda." Newly appointed CIA director Leon Panetta had recently acknowledged a planned secret targeted killing program, one withheld from Congressional oversight. Manzetti's sources, which tied the program to Blackwater, declined to have their names made public. The CIA was acting on a 2001 presidential legal pronouncement, known as a finding, which authorized the CIA to pursue such efforts. Several million dollars were spent on planning and training, but it was never put into operation and no militants were caught or captured. Manzanettie notes that it was unknown "whether the C.I.A. had planned to use the contractors to actually capture or kill Qaeda operatives, or just to help with training and surveillance in the program." Jeremy Scahillreported in The Nation in November 2009 that Blackwater operated alongside the CIA in Pakistan in "snatch and grab" operations targeting senior members of the Taliban and Al Qaeda. The report cited an unnamed source who has worked on covert US military programs, who revealed that senior members of the Obama administration may not be aware that Blackwater is operating under a US contract in Pakistan. A spokesman for Blackwater denied the claims, stating that they have "only one employee in Pakistan."
Legal status and oversight[edit source]
The Iraqi Government revoked Blackwater's license to operate in Iraq on September 17, 2007 after shootings in which Blackwater contractors may have killed seventeen Iraqi civilians. The deaths occurred while a Blackwater Private Security Detail (PSD) was escorting a convoy of U.S. State Department vehicles en route to a meeting in western Baghdad with United States Agency for International Development officials. The license was reinstated by the American government in April 2008, but in early 2009 the Iraqis announced that they had refused to extend that license. In 2009, FBI investigators were unable to match the bullets from the shooting to those guns carried by Blackwater contractors, leaving open the possibility that insurgents also fired at the victims. In a 2010 interview, Erik Prince, the company's founder, said the government is looking for dirt to support what he dismissed as "baseless" accusations that run the gamut from negligence, racial discrimination, prostitution, wrongful death, murder, and the smuggling of weapons into Iraq in dog-food containers. He pointed out that current and former executive have been regularly deposed by federal agencies.
Prince argued in September 2007 that there was a “rush to judgment” about Blackwater, due to "inaccurate information".
U.S. Congress[edit source]
On October 2, 2007, Erik Prince attended a congressional hearing conducted by the Committee on Oversight and Government Reform following the controversy related to Blackwater's conduct in Iraq and Afghanistan. Blackwater hired the public relations firm BKSH & Associates Worldwide, a subsidiary of Burson-Marsteller, to help Prince prepare for his testimony at the hearing. Robert Tappan, a former U.S. State Department official who worked for the Coalition Provisional Authority in Baghdad, was one of the executives handling the account. Burson-Marsteller was brought aboard by the Washington law firms representing Blackwater – McDermott Will & Emery and Crowell & Moring. BKSH, a self-described "bipartisan" firm (Hillary Rodham Clinton, when pursuing the Democratic presidential nomination, was also a client), is headed by Charlie Black, a prominent Republican political strategist and former chief spokesman for the Republican National Committee, and Scott Pastrick, former treasurer of the Democratic National Committee.
In his testimony before Congress, Prince said his company has a lack of remedies to deal with employee misdeeds. When asked why Andrew Moonen had been "whisked out of the country" after the shooting death of the vice-presidential guard, he replied, "We can't flog him, we can't incarcerate him." When asked by a member of Congress for financial information about his company, Prince declined to provide documentation, saying "we're a private company, and there's a key word there – private." Later he stated that the company could provide it at a future date if questions were submitted in writing. When the term "mercenaries" was used to describe Blackwater employees, Prince objected, characterizing them as "loyal Americans."
A staff report compiled by the House Committee on Oversight and Government Reform on behalf of Representative Waxman questioned the cost-effectiveness of using Blackwater forces instead of U.S. troops. Blackwater charges the government $1,222 per day per guard, "equivalent to $445,000 per year, or six times more than the cost of an equivalent U.S. soldier," the report alleged.During his testimony on Capitol Hill, Erik Prince disputed this figure, saying that it costs money for the government to train a soldier, to house and feed them, they don't just come prepared to fight. "That sergeant doesn't show up naked and untrained," Prince stated. Moreover, he pointed out that Blackwater's employees are trained in special operations and exceed the capabilities of the average soldier.
In the wake of Prince's testimony before Congress, the US House passed a bill in October 2007 that would make all private contractors working in Iraq and other combat zones subject to prosecution by U.S. courts, and Senate Democratic leaders have said they plan to send similar legislation to President Bush as soon as possible. The legal status of Xe and other security firms in Iraq is a subject of contention. Two days before he left Iraq, L. Paul Bremer signed "Order 17" giving all Americans associated with the CPA and the American government immunity from Iraqi law. A July 2007 report from the American Congressional Research Service indicates that the Iraqi government still has no authority over private security firms contracted by the U.S. government. On October 5, 2007, the State Department announced new rules for Blackwater's armed guards operating in Iraq. Under the new guidelines, State Department security agents will accompany all Blackwater units operating in and around Baghdad. The State Department will also install video surveillance equipment in all Blackwater armored vehicles, and will keep recordings of all radio communications between Blackwater convoys in Iraq and the military and civilian agencies that supervise their activities.
In December 2008 a US State Department panel recommended that Xe should be dropped as the main private security contractor for U.S. diplomats in Iraq.
On January 30, 2009, the State Department told Blackwater Worldwide that it will not renew its contract in Iraq. However, in 2010 it was awarded a $100 million contract from the CIA.
Regardless of these developments, Xe has defended its work in Iraq. A company spokeswoman has said: "When the US government initially asked for our help to assist with an immediate need to protect Americans in Iraq, we answered the call and performed well. "We are proud of our success – no-one under our protection has been killed or even seriously wounded."
In August 2010, the company agreed to pay a $42 million fine to settle allegations that it unlawfully provided armaments and military equipment overseas. However, the company is still allowed to accept government contracts. The settlement and fine conclude a U.S. State Department investigation that began in 2007.
Iraqi courts and legal action[edit source]
On September 23, 2007, the Iraqi government said that it expects to refer criminal charges to its courts in connection with a shooting involving Blackwater guards. However, on October 29, 2007, immunity from prosecution was granted by the U.S. State Department, delaying a criminal inquiry into the September 16 shootings of 17 Iraqi civilians. Immediately afterwards, the Iraqi government approved a draft law to end any and all immunity for foreign military contractors in Iraq, to overturn Order 17. The U.S. Department of Justice also said any immunity deals offered to Blackwater employees were invalid, as the department that issued them had no authority to do so. It is unclear what legal status Blackwater Worldwide operates under in the U.S. and other countries, or what protection the U.S. extends to Blackwater Worldwide's operations globally.
Legal specialists say that the U.S. government is unlikely to allow a trial in the Iraqi courts, because there is little confidence that trials would be fair. Contractors accused of crimes abroad could be tried in the United States under either military or civilian law; however, the applicable military law, the Uniform Code of Military Justice, was changed in 2006, and appears to now exempt State Department contractors that provide security escorts for a civilian agency. Prosecution under civilian law would be through the Military Extraterritorial Jurisdiction Act, which allows the extension of federal law to civilians supporting military operations; however, according to the deputy assistant attorney general in the Justice Department's criminal division, Robert Litt, trying a criminal case in federal court would require a secure chain of evidence, with police securing the crime scene immediately, while evidence gathered by Iraqi investigators would be regarded as suspect.
A number of Iraqi families are taking Blackwater to court over alleged "random killings committed by private Blackwater guards".
On January 31, 2010, three current and former U.S. government officials confirmed the Justice Department is investigating whether officials of Blackwater Worldwide tried to bribe Iraqi government officials in hopes of retaining the firm’s security work in Iraq after the shooting in Nisour Square in Baghdad, which left 17 Iraqis dead and stoked bitter resentment against the United States. The officials said that the Justice Department’s fraud section opened the inquiry late in 2009 to determine whether Blackwater employees violated a federal law banning American corporations from paying bribes to foreign officials. In 2012 the Department of Justice closed the investigation without filing any charges.
Litigation and legal issues[edit source]
Xe was sued by the families of four contractors killed in Fallujah in March 2004. The families said they were suing not for financial damages, but for the details of their sons' and husbands' deaths, saying Xe had refused to supply these details, and that in its "zeal to exploit this unexpected market for private security men," the company "showed a callous disregard for the safety of its employees." On February 7, 2007, four family members testified in front of the House Government Reform Committee. They asked that Xe be held accountable for future negligence of employees' lives, and that federal legislation be drawn up to govern contracts between the Department of Defense and defense contractors. Xe has counter-sued the lawyer representing the empty estates of the deceased for $10 million on the grounds the lawsuit was contractually prohibited from ever being filed. In January 2011, U.S. district judge James C. Fox dismissed the suit after no progress was made in court-ordered arbitration.
On November 27, 2004 an aircraft operated by Presidential Airways and owned by its sister company, Blackwater AWS, crashed in Afghanistan; it had been a contract flight for the United States Air Force en route from Bagram to Farah. All aboard, three soldiers and three civilian crew members, were killed. Several relatives of the victims filed a wrongful death lawsuit against Presidential in October 2005.
Two former employees claimed that Xe Services defrauded the federal government on a security contract given after Hurricane Katrina. However, in May 2011, a judge tossed out that allegation.
In June 2011, a federal judge dismissed Erik Prince from a civil lawsuit alleging that Blackwater defrauded the federal government of money when billing it for work in Iraq and Afghanistan. In August 2011, a jury ruled in favor of the security firm, rejecting two former employees' claims that the company overbilled the State Department for its work in Iraq and Afghanistan.
Litigation over actions in Iraq[edit source]
On October 11, 2007, the Center for Constitutional Rights filed suit against Blackwater under the Alien Tort Claims Act on behalf of an injured Iraqi and the families of three of the 17 Iraqis killed by Blackwater employees during the September 16, 2007, Blackwater Baghdad shootings.
In June 2009, an amended lawsuit was filed in US District Court in Alexandria, Virginia, alleging that Blackwater employees shot and killed three members of an Iraqi family, including a nine-year-old boy, who were traveling from the Baghdad airport to Baghdad on July 1, 2007.
The Justice Department was originally not expected to bring criminal charges against any employees of the corporation; however, in December 2008, the Justice Department announced they were charging five Blackwater employees. On December 31, 2009 Judge Ricardo Urbina threw out the criminal case against the five guards under indictment. In announcing the dismissal, Urbina said that the prosecutors violated the guards' Fifth Amendment rights by using the statements they gave to the State Department as evidence. Urbina said that the guards would have lost their jobs had they not given the statements, thus making the statements inadmissible. The Iraqi government has asked the US Justice Department to appeal the decision, and also plans to sue the five guards accused of killing civilians.
The Iraqi government announced that Xe must leave Iraq as soon as a joint Iraqi–US committee finishes drafting the new guidelines on private contractors under the current Iraqi–US security agreement. On January 31, 2009, the U.S. State Department notified Blackwater that the agency would not renew its security contract with the company. The Washington Times reported on March 17, 2009, that the U.S. State Department had extended its Iraq security contract with Xe's air operations arm, Presidential Airways, to September 3, 2009, for a cost of $22.2 million.
Federal prosecution[edit source]
In August 2012, the company agreed to pay $7.5 million in fines, without admitting guilt, to the US government to settle various charges. Most of the charges were dropped in February 2013 when it was revealed that the employees were acting under the orders of the US government.