Blackwater firm partners with State Dept., CIA insiders
Nothing like a new suit of clothes -- and a good tailor -- for a fresh start.
So it seems for the firm formerly known as Blackwater, which has won yet another government security contract, despite its long and continuing trail of legal problems.
Bidding under a new name, Xe Services won a share this week of a $10 billion State Department deal to provide protective services for American embassies abroad.
Two months ago a Xe affiliate, U.S. Training Center, won a $100 million security contract from the CIA. But at least it used its own name for that.
In its latest score, Xe employed a new business vehicle, International Development Solutions, “a blandly named cut-out,” in the description of Danger Room’s Spencer Ackerman, who first reported the deal on Friday.
“No one who looks at the official announcement of the contract award would have any idea that firm is connected to Blackwater,” Ackerman wrote.
But the State Department confirmed that U.S. Training Center, which it described as "part of International Development Solutions (IDS)," won the contract "in a joint venture with Kaseman,” a McLean, Va., security services firm, whose board is stocked with top former State Department and CIA officials.
Kaseman’s board of directors includes Henry A. Crumpton, a former coordinator for counterterrorism at the State Department, and Kara L. Bue, a former deputy assistant secretary of state for regional stability who had previously served as special assistant to Deputy Secretary of State Richard L. Armitage during the George W. Bush administration.
Other board members include former NSA and CIA director Michael V. Hayden; Donald M. Kerr, a longtime former CIA official who also served as principal deputy to the director of national intelligence; and former Sen. Chuck Hagel (R-Neb.), who sat on the Senate Select Committee on Intelligence.
A number of top former military officials also serve on the board, including retired Marine Corps general and U.S Central Command chief Anthony Zinni, and retired Navy Adm. Stephen F. Loftus, a former chief financial officer at the powerhouse D.C. firm Carlyle Management Group.
On Tuesday, Sept. 28, the day before the State Department deal was announced, Kaseman added Herbert J. Lanese, a former president of security giant DynCorp, to its board. DynCorp is one of the eight firms sharing in the new security contract.
Spokesmen for Kaseman declined to answer questions about its partnership with Xe and what role, if any, it played in securing the State Department contract.
For its part, the State Department said, “This joint venture was determined by the Department’s source selection authority to be eligible for award.”
In August Xe, which is up for sale, negotiated a $42 million fine with the federal government related to illegal weapons exports to Afghanistan, as well as to other accusations.
In addition, former Blackwater executives have been targeted in a half dozen civil suits and prosecutions, including one against five former Blackwater guards in connection with the death of 17 Iraqis during a Baghdad shootout in September 2007. Two company-affiliated guards are also being prosecuted on murder charges stemming from a 2009 shooting in Afghanistan.
In the meantime, two former Blackwater employees have filed a suit alleging that the firm's founder, Erik Prince, and his companies defrauded the departments of State and Homeland Security. Xe has denied wrongdoing.
“The Department of State has supported the Department of Justice’s investigation and prosecution every step of the way,” a spokeswoman there told SpyTalk Friday on condition of anonymity. “We fully respect the independence and integrity of the U.S. judicial system and support holding legally accountable any contractor personnel who have committed crimes.”
| October 1, 2010; 5:41 PM ET
Categories: Financial/business, Intelligence, Lawandcourts | Tags: Erik Prince, International Development Solutions, U.S. Training Center
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