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Posted at 12:21 PM ET, 01/ 7/2011

Onetime Blackwater affiliate scores U.S. contract

By Jeff Stein

A company closely associated with the security firm once known as Blackwater has won a new State Department contract worth more than $84 million over five years.

The contract was won by International Developments Solutions, a joint venture that includes U.S. Training Center, a company until recently owned by Xe Services, which changed its name from Blackwater following a cascade of legal problems over several years.

The consortium will provide protective security in the Israel-occupied West Bank, “services that are based from the U.S. Consulate in Jerusalem,” State Department spokesman Mark Toner said.

The initial contract, awarded Jan. 3, is for one year, “with the possibility of four, one-year renewable options” with a total value of roughly $84.3 million, Toner said.

International Development Solutions (IDS) is a joint venture between majority partner Kaseman, a McLean, Va., firm whose board is stocked with top former State Department and CIA officials, and U.S. Training Center (USTC), a onetime Blackwater affiliate that former officials say still employs many of its operatives.

A USTC spokesman said the company would have no comment. A State Department official, speaking on condition of anonymity, said the firm no longer had a relationship with Xe. But both are headquartered in tiny Moyock, N.C., formerly headquarters of Blackwater and Xe Services.

The training for the new Jerusalem contract will almost certainly be done in Moyock, close observers said, because U.S. Training Center has no comparable facilities elsewhere.

The company had no comment, a representative said.

Despite its legal troubles, Blackwater-associated companies have continued to score government contracts. Last June Xe Services won a $100 million contract from the CIA to provide protective services in Afghanistan. Then in October, partnering with another company, Xe won a share of a $10 billion State Department contract for worldwide protective services.

“The mere fact that the [State Department] is still throwing millions of dollars their way for work is completely amazing and speaks to their ability to get around things,” said a former Blackwater employee who asked to remain anonymous because he now works for the government.

Last February, Sen. Carl Levin (D-Mich.), chairman of the Armed Services Committee, asked Attorney General Eric H. Holder Jr. to investigate whether Xe Services and Ratheon set up “a shell company” to bid on a U.S. Army contract without “the 'baggage' that the name Blackwater carried.”

Last summer, with his former top managers facing criminal charges, and saying he was weary of "proctology exams" from Congress, Blackwater founder and erstwhile CEO Erik Prince put the company up for sale and moved to Abu Dhabi.

In December Xe Services was acquired by a consortium of investors led by Forte Capital Advisors and Manhattan Partners. The terms of the deal were not disclosed.

Forte’s managing partner, Jason DeYonker, has been close to Prince for years. Between 1998 and 2002 he managed Prince’s personal financial portfolio.

According to associates, Prince is developing protective security and antiterrorism business in Africa, relying on many of the third-country nationals he employed during Backwater’s heyday.

Meanwhile, Xe Services, CIA Director Leon Panetta said last summer, has “cleaned up its act.” The State Department has also set up a special unit to vet its contracts.

By Jeff Stein  | January 7, 2011; 12:21 PM ET
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more of the same.

corruption and business as usual.

Posted by: xxxxxx1 | January 7, 2011 1:36 PM | Report abuse

Wonder how many millions...billions the U.S could shave off the "deficit" by simply having the military perform the duties, as they used to be required (as part of their job and training)...before Congress sold out to the private Corporations bribes and kickbacks.....almost 70% of "Government" has been privatized...private Corporations make millions of dollars...costing taxpayers much more than any of the "public employees" sector jobs (take a good look at the private corporations CEO and Executive pay and bonuses, if you don't believe me)...taxpayers seem to rejoice in paying for fraud, abuse, corruption and waste in the private sector jobs...while screaming about fraud, waste and abuse from Government....remember, 70% of "our" government has been "sub-contracted" (privatized) to the private sector

Posted by: susannelsen | January 7, 2011 3:41 PM | Report abuse

Geeze! With Israel working day and night to keep the Gaza economy from any recovery, we actually TRAIN NRA-Type militia scum to serve for Israel in the Weat Bank?

Hey . . . that's no different from training SS thugs for delivery to Adolph!

Geeze! We are so Corrupt!

Posted by: lufrank1 | January 7, 2011 3:49 PM | Report abuse

Blackwater?....XE?......International Development Solutions??? couldn't make this stuff up if you tried.

United States of Amnesia brought to you by George Orwell and hope and change.

Posted by: leoenya | January 14, 2011 12:14 AM | Report abuse

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