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Controversial security firm loses Kabul contract

By Ed O'Keefe

U.S. troops outside the U.S. Embassy in Kabul in Dec. 2001 (REUTERS/Damir Sagolj)

Updated 8:21 p.m. ET

The State Department will not renew the contract of the private security firm that guards the U.S. Embassy in Kabul, follows allegations of sexual misconduct by the company's guards and potential weapons shortages at the embassy.

A senior State Department official confirmed the contract that ArmorGroup North America's contract would not be renewed for a fourth year when the agreement expires in June. The official said the contract might be extended for a few months during competitive bidding for another firm, but did not know for what length of time.

News of the contract's termination first came from the Project on Government Oversight, which obtained an e-mail that was sent on Tuesday by an ArmorGroup manager to company employees stationed at Camp Sullivan in Kabul.

"What this means to the vast majority of personnel here is that you will have right of first refusal, which means for most of you this change from one contractor to another will be mostly transparent -- you will continue your employment but change uniforms," wrote Frank Schaddelee, ArmorGroup's deputy project manager at Camp Sullivan.

"I have been told that the current force on the ground here is doing a great job -- the RSO [Regional Security Officer] here has personally told me this on several occasions," Schaddellee wrote. "But…changing out contractors is primarily a political decision based on the unfortunate and embarrassing events that occurred here several months ago; there are serious consequences when things like that happen."

ArmorGroup earns $180 million annually to protect the roughly 1,000 Americans and Afghan nationals that work at the embassy. The State Department renewed the contract in July, only weeks after a Senate subcommittee on government contracting oversight raised concerns about the company's weapons shortages and the poor English-language skills of Nepalese Gurkhas employed by ArmorGroup.

POGO has investigated allegations of misconduct by ArmorGroup and other private security contractors for years. The independent watchdog group released a scathing report in September that found some ArmorGroup employees in Kabul had engaged in sexual misconduct, posing a "significant threat" to embassy security.

“The State Department seems to be holding this embassy security contractor accountable,” POGO Executive Director Danielle Brian said in a statement. “But State will need a real culture change before it can provide adequate oversight of these complex and challenging contracts.”

“The State Department did the right thing today," said Sen. Claire McCaskill (D-Mo.), who chairs the Senate government contracting oversight committee. "Contractors who have performed the way ArmorGroup has over the last few years should face serious consequences and not be rewarded for poor performance."

News of the Kabul Embassy contract surfaced the same day the Government Accountability Office released a report critical of the State Department's Bureau of Diplomatic Security.

"Although Diplomatic Security's workforce has grown considerably over the last 10 years, staffing shortages in domestic offices and other operational challenges -- such as inadequate facilities, language deficiencies, experience gaps, and balancing security needs with State's diplomatic mission -- further tax its ability to implement all of its missions," the GAO said.

Staff writer Mary Beth Sheridan contributed to this report

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By Ed O'Keefe  | December 8, 2009; 4:19 PM ET
Categories:  Agencies and Departments, Contracting  
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