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Blackwater Founder Steps Aside

POSTED: 01:56 PM ET, 03/ 2/2009 by Derek Kravitz

Erik Prince, the reclusive car-parts scion who founded the Blackwater security firm, announced today he was stepping down as the company's chief executive. He will retain his role as chairman of the board, while day to day operations will be managed by Joseph Yorio, a former Army special forces officer.

With his blond crew cut and media-shy demeanor, the 39-year-old Prince, an ex-Navy SEAL, built Blackwater in July 1996 in Myock, N.C., using $900,000 from his share of selling his father's auto-parts business. The name "Blackwater" came from the dark water found on 7,000 acres where Prince built his company, near the Great Dismal Swamp.

"This started as a field of dreams: Build it, and they will come," Prince told The Post two years ago. "It was a little success that led to another success to another success."

Blackwater's operations in Iraq have generated much controversy. In March 2004, four Blackwater contractors driving in the battered city of Fallujah were ambushed by three insurgents in a large truck. The attackers shot and killed all four contractors and fled. The following November, a plane owned by Blackwater subsidiary Presidential Airways crashed into a mountain in Afghanistan, killing three soldiers and three Blackwater contractors on a mission under a $35 million Air Force contract.

In December 2006, a Blackwater contractor got drunk and shot dead a bodyguard for Iraqi Vice President Adel Abdul Mahdi. Blackwater worked with the State Department to fly the contractor back to the United States and fired him. Five months later, Blackwater guards shot and killed an Iraqi driver outside the Interior Ministry in Baghdad, prompting an armed standoff between ministry commandos and the guards.

In September 2007, during a chaotic confrontation in downtown Baghdad, Blackwater contractors allegedly shot and killed 17 Iraqis in a crowded square. Charges against some of the Blackwater guards involved were filed last year. Critics argued that Blackwater was essentially a private army that acted outside traditional military and civilian jurisdictions. Others blatantly called Prince a "war profiteer."

As The Post's Robert O'Harrow Jr. and Dana Hedgpeth noted in 2007, Blackwater rose from a small fish -- making less than $100,000 per year in federal government contracts -- to an industry giant, with its government-linked revenue estimated at nearly $600 million in 2006. In August 2007, the company won its biggest deal ever, a five-year counter-narcotics training contract worth up to $15 billion shared with four other companies.

Prince's political credentials also appeared to help the company win large contracts; An intern under former President George H.W. Bush, Prince has given hundreds of thousands of dollars to politicians, including Pat Buchanan, Oliver North, Rep. Ron Paul (R-Tex.) and former Sen. Rick Santorum (R-Pa.), among others.

And Prince hired a stable of former officials from the Navy, State Department, CIA, FBI and other agencies, while maintaining a database of 40,000 contractor candidates, mostly former military and law enforcement officials, and their particular military, language, mechanical and other skills.

But, in a sign of the changing times, the firm last month changed its controversial name to Xe (pronounced "Z") as to define "what it is today and not what it used to be," as a company spokeswoman put it.

When Rep. Danny Davis (D-Ill.) asked him during a House Oversight and Government Reform Committee hearing in October 2007 to concede that Blackwater had killed innocent civilians, Prince replied: "No, sir. I disagree with that. . . . There could be ricochets. There are traffic accidents, yes. This is war."

By Derek Kravitz |  March 2, 2009; 1:56 PM ET
Previous: $30 Billion More for AIG; Report: UBS Cuts Bonuses, Gives Raises; Car Seat Tests Reveal 'Flaws' | Next: The Case of the 92 Destroyed Videotapes


Please email us to report offensive comments.

Mr. Prince and Blackwater should be praised for his/their service to this country. They do jobs the government bureaucracy and DoD can't do and they do it better. If my life was on the line these are the guys I want protecting me. Shame on those who attack these brave American patriots.

Posted by: DaMan2 | March 2, 2009 2:58 PM

The Bushies are gone and the Iraqis stopped the party there so it must be time to change the name and the public face of the company. Just in time to supply guards and overseers for the upcoming tent cities of the unemployed and foreclosed.

Posted by: hairguy01 | March 2, 2009 3:43 PM

The headline is soooo misleading. He's still in control he just won't have to answer the hard questions.

Posted by: rlj1 | March 2, 2009 3:44 PM

These SOBs with connections, their conservative republican perverse ideology of inequality, rights only of their kind, malignant narcissism, all wrapped up in the flag and farting patriotism, are not but war profiteers. Service to the country my A**, all that matters is no bid contracts, indiscriminate bullying, drunk former military etc double triple dippers making over 100 times more money from entities like State Department, CIA, NSA and other Govt. Agencies.

Posted by: goldengate | March 2, 2009 3:48 PM

Praise those who work for Blackwater all you would like, but let's call them what they are: Mercenaries. Guns for hire. Their patriotism starts and stops with the GOP running the show. Quite honestly, I am not sure how we allowed a private military to become so large, but in the current political climate, I fear they represent a danger to National Security and as such, I certainly hope they are under close watch from the NSA and Pentagon.

Posted by: SteadyState | March 2, 2009 4:18 PM

He made his billion's in war profit's and now he's walking away. He will never be held accoutable and those who enabled this and enriched themselves will never answer for what they have done. Blackwater, in league with the Bush administration, privitised the Iraq war. Rather than use the resources available that had already been paid for, the military. The Bush administration overpaid their cronies, pocketed the profit's, put it on our collect5ive tab and are now walking away fat and happy. All the money that was spent was stolen from us, the people. It was used to pay people we didn't need to do jobs we didn't need them to do so that they could enrich themselve's at our collective expense. These people will now walk off into the sunset as everything around us crumles, and out of the ruines they will lend us thier ill begotton gains to rebuild what they destroyed. This man, those who enabled them and many of those who worked for him should be relieved of their wealth and put on trial. The Bush administration was a criminal corporatist regime, gangsters who robbed the American people blind. WAKE UP!

Posted by: mightytightywhity | March 2, 2009 4:19 PM

If you journey down to Lafayette Square in Washington, DC, you'll see that mercenaries (not my term) have a long, proud and distinguished history in the USA. We should be proud of BW.

Posted by: dashingdwl | March 2, 2009 5:17 PM


I am going to take a stab in the dark here, but I doubt that if Blackwater were started by a Democrat or "liberal" you would be singing the same tune.

Posted by: SteadyState | March 2, 2009 5:24 PM

OK..So a wealthy religious conservative, heir to a fortune with a background in military activity procures some land so that he and other like minded pals can get together, shoot alot of live ammunition, train, "play army",talk religion, blow stuff up, talk politics, blow some more stuff up, and plan the development of a private Christian (mostly) mercinary army that can travel anywhere in the world to fight for other like minded people. "Warrior priests" anyone?
Hmmm.......Seems to remind me of somebody else.
We make them better in the USA though.

Posted by: jhuether | March 2, 2009 7:11 PM

Blackwater was a GOP money laundering operation and that's all. They were to be a key player in the Permanent Republican Majority, cycling taxpayer dollars into conservative coffers through secret military contracts. Over 90% of their income came from the US government, yet BW and Prince were major contributors to the GOP and other conservative political groups like Focus on the Family. Everything they did could have been done better and cheaper by the USMC (the traditional guards of US Embassies), but for some reason we had to pay these guys hundreds of thousands per employee. And we got yahoos.

Posted by: dj333 | March 2, 2009 7:43 PM

Money before country, a true patriot.
Good-bye Mr Prince.

Posted by: samellison | March 2, 2009 8:33 PM

I've read a few comments and it is remarkable how little some of these readers understand that an unregulated army is exactly what Hitler required to take over..the Brownshirts. Later came the Nuremberg trials and the Geneva conventions, names I'm sure these same readers are tired of hearing. I am not tired of their meaning to us today, nor should you be if you are an American.

They are not done with us.
Question to those who love Eric Prince: If your cause is a noble one, in keeping with American principles, why wouldn't you stand up unafraid of serving in a legitimate army that represents American values, instead of being lured by the sex, drugs and wild shooting that is your enticemnt at Blackwater? Xe, no matter what it is renamed, is treason against our country.

Posted by: hrayovac | March 2, 2009 11:08 PM

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