One of the concerns raised by the military intelligence source is that some Blackwater personnel are being given rolling security clearances above their approved clearances. Using Alternative Compartmentalized Control Measures (ACCMs), he said, the Blackwater personnel are granted clearance to a Special Access Program, the bureaucratic term used to describe highly classified “black” operations. “With an ACCM, the security manager can grant access to you to be exposed to and operate within compartmentalized programs far above ’secret’–even though you have no business doing so,” said the source. It allows Blackwater personnel that “do not have the requisite security clearance or do not hold a security clearance whatsoever to participate in classified operations by virtue of trust,” he added. “Think of it as an ultra-exclusive level above top secret. That’s exactly what it is: a circle of love.” Blackwater, therefore, has access to “all source” reports that are culled in part from JSOC units in the field. “That’s how a lot of things over the years have been conducted with contractors,” said the source. “We have contractors that regularly see things that top policy-makers don’t unless they ask.”

One thing Jeremy might have added is that JSOC’s current commander, Adm. William McRaven, has emerged as a serious player in Afghanistan-Pakistan strategymaking.

Senator John Kerry, the Massachusetts Democrat who is chairman of the Foreign Relations Committee, wrote in a letter on Wednesday that his committee was told by a top State Department official that the company had engaged in “broad violations” of export laws and that the unlicensed shipments “went beyond weapons for personal use.”

In the letter, Senator Kerry asked the State Department’s acting inspector general to begin an investigation into the “continued fitness” of Xe Services to carry out contract work for the State Department. The letter cited a report in The New York Times last week that Blackwater executives had approved of a plan to make secret payments to Iraqi officials after Blackwater employees killed 17 Iraqi civilians in Baghdad in September 2007.

But leave aside the State Department’s own questionable judgment for a moment. Now we have some inkling of why the Iraqis allowed the firm to stay:

Four former Blackwater executives said in interviews that Gary Jackson, who was then the company’s president, had approved the bribes, and the money was sent from Amman, Jordan, where Blackwater maintains an operations hub, to a top manager in Iraq. The executives, though, said they did not know whether the cash was delivered to Iraqi officials or the identities of the potential recipients.

Watch this become a major accusation in the upcoming Iraqi parliamentary elections. Jeremy Scahill, the company’s chief journalistic pursuer, comments:

While the Bush administration certainly protected Blackwater after Nisour Square, part of the reason for the alleged or attempted bribes may be this: As the US and Iraq negotiated the Status of Forces Agreement and the Iraqi government attempted to impose more authority over private military companies, the stakes got higher for Blackwater. An official license to operate in Iraq, which Blackwater did not have and long believed was an unnecessary formality, became crucial for Blackwater in order to continue on as the State Department’s prime contractor. To many Iraqis, Blackwater’s continued presence was a stark symbol of the country’s lack of sovereignty. It is an incredible fact that Blackwater has remained as long as it has in the country given the severity and extent of its alleged crimes and the rhetoric from Iraqi political figures about the company. It was not until March 2009 that the Iraqi government announced it would not extend Blackwater an operating license. In May 2009, Blackwater’s prime contract was awarded to competitor Triple Canopy. What is undeniable is that Blackwater has remained in Iraq much longer than most analysts predicted. The Times story may provide hints as to why this was the case.

I also love this section of the Times piece:

Reached by phone, Mr. Jackson, who resigned as president of Blackwater early this year, criticized The New York Times and said, “I don’t care what you write.”

Blackwater: so persecuted by the media! Don’t it turn your brown eyes blue?

Top executives at Blackwater Worldwide authorized secret payments of about $1 million to Iraqi officials that were intended to silence their criticism and buy their support after a September 2007 episode in which Blackwater security guards fatally shot 17 Iraqi civilians in Baghdad, according to former company officials.

Blackwater approved the cash payments in December 2007, the officials said, as protests over the deadly shootings in Nisour Square stoked long-simmering anger inside Iraq about reckless practices by the security company’s employees. American and Iraqi investigators had already concluded that the shootings were unjustified, top Iraqi officials were calling for Blackwater’s ouster from the country and company officials feared that Blackwater might be refused an operating license it would need to retain its contracts with the State Department and private clients, worth hundreds of millions of dollars annually.

Of course, bribing foreign officials is against U.S. law. Blackwater (which changed its name to Xe earlier this year) has repeatedly found itself at the center of controversies, in addition to the massacre at Nisour Square. The most recent came to light in August, when The Nation’s Jeremy Scahill reported that two former employees alleged in sworn statements that Blackwater owner Erik Prince “may have murdered or facilitated the murder of individuals who were cooperating with federal authorities investigating the company.”

Five Blackwater employees are awaiting trial, scheduled to begin next year in federal court, for manslaughter related to the Nisour Square shooting. In 2007, the Iraqi government revoked the contractor’s license to operate in the country. According to The Times, a company spokeswoman dismissed the payoff allegations as “baseless.”

In a new report, the commission finds a sentence in federal contracting law from 1990 providing a key loophole provides a key stipulation. The law allows requires the State Department to use a “lowest price, technically acceptable” standard for awarding contracts worth over $250,000 for protecting its key installations. And there you have it: minimally competent and cheap is what you expect of the people charged with ensuring no one attacks an embassy, rather than a “best-value” standard. From a prepared statement accompanying the report, commissioners explain what the problem is:

“The lowest‐price, technically acceptable standard may work fine if you’re buying low‐value, non‐critical things like office supplies,” said Commission Co‐Chair Michael Thibault, “but it’s a questionable standard for more complicated purchases like construction projects or embassy security.
Most federal departments can operate on the sensible principle that best value for contract dollars means more than picking the lowest price. Forcing the State Department to make decisions on an artificially narrow basis does not serve the public interest.”

The report concedes that removing the provision wouldn’t prevent State from hiring the worst of the worst for so-called static security. But it would at least remove an incentive for hiring them, and additionally removes an incentive for contractors to deliberately underbid their services to win contracts, resulting in slipshod performance out at the embassies as the companies attempt to match what they told State they’d need to get the job done. All of that happened with ArmorGroup in Afghanistan. Accordingly, it urges Congress to issue a “quick response” to its report, as it’s getting near time for State to award its next round of embassy-security contracts.

Update: This post has been corrected for clarity. It’s not that the provision gives State an out; it gives State a requirement. Mea culpa.

Victoria Toensing, a conservative former lawyer for the Senate Intelligence Committee, makes a lame and unprovable analogy to the Valerie Plame leak:

“Unlike the Valerie Plame matter, where the cocktail circuit knew she worked for the CIA, these people … Blackwater, were covert,” said Victoria Toensing, a former chief counsel to the Senate intelligence committe. “Every fact that I know points to a violation unlike the Valerie Plame matter. The identifier, the exposer, has to know the relationship is covert.”

First of all, no, “the cocktail circuit” didn’t “know” Plame worked for the CIA. That construction makes it seem like Plame’s identity was an open secret, which is a constant meme simply invented by the right out of thin air in 2003 to minimize the impact of the Bush administration’s leaking of Plame’s identity as a covert agent to discredit her war-critic husband Joseph Wilson. There’s also no way of falsifying it, since — well, who’s the “cocktail circuit” anyway? Toensing knows full well what she’s doing — she’s a lawyer — and she discredits herself by her deceit. Second of all, her point about knowing the Blackwater relationship being covert is surely correct. But isn’t there a difference in the fact that the program was never operative? As a different intelligence official acknowledges to Lake and Carter:

“These leaks, unlike others in the past, didnt cost the country a viable collection or counterterrorism capability,” the official said. “There were different concepts considered and tested over the years, but they always ran into problems.They never proved themselves, so its not a big loss.”

Nevertheless, the two reporters quote the top Republican on the Senate Intelligence Committee, Sen. Kit Bond (R-Mo.), as saying:

“They foil our attempts to carry out classified missions,” Sen. Christopher S. Bond said in an interview. “They tell our intelligence community: We don’t have your back; we’re stabbing you in the back. Our allies ask us, ‘How can we trust you to deal in classified matters in private, when the details are leaked to the press?’”

I suppose in a general sense the point is arguable, but in this particular case, there was never an operational program, so the damage can’t be as bad as Bond portrays. But still: it’s possible the law was broken by this leak, and an investigation into whether that was in fact the case is most certainly appropriate.

Well, except…

QUESTION: Just the discrepancy between what I think some folks from OIG were saying that they were only notified yesterday. You said that they were notified ten days ago. Can you just clarify that? I mean, are you sure it was ten days ago that OIG was first – that they –
MR. KELLY: Oh, you might be right. You might be right on that.
QUESTION: Well, can you –
QUESTION: Can you –
QUESTION: — get that for sure?
MR. KELLY: Yeah, sorry. Yeah, I may have misspoke on that one.

But even that discrepancy is relatively minor. Kelly said that the State Department sent ArmorGroup nine letters since 2007 complaining about its fulfillment of contract responsibilities. And he meant this as an exculpation, not a concession that State has faced systemic problems in exercising oversight of its security contractors. For instance:

MR. KELLY: Starting in June 2007, all the way through April 30, 2008, and then actually there was a ninth [letter to ArmorGroup from State], and this was the most serious one. It’s called a show cause notice. A decision to issue a show cause notice is a serious matter and was not taken lightly. The issuance of a show cause notice was necessary due to repeated staffing shortages, which had been brought to the attention of the contracting officer. The show cause notice was the first step towards considering termination of the contract and was carefully considered by all concerned parties. … This was September 21^st, 2008.

But according to Project on Government Oversight Executive Director Danielle Brian, that “most serious” show-cause notice may have been first issued on Sept. 21, 2008, but it had a rather serious predecessor:

[I]n July 2007, State issued a “cure notice,” a formal advisory that AGNA’s deficiencies were endangering the performance of the contract. In the cure notice, State identified 14 performance deficiencies, including the failure of AGNA to provide an adequate number of guards, relief personnel, and armored vehicles. The contracting official stated “I consider the contract deficiencies addressed below to endanger performance of the contract to such a degree that the security of the US Embassy in Kabul is in jeopardy….”

A follow-on cure notice was issued in April 2008, for, among other things, “failing to correct many of the deficiencies identified in the July 2007 cure notice.” And then State re-awarded ArmorGroup its $189 million contract the following July.

–

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Blackwater Security guards U.S. State Department employees in Baghdad. (Flickr: jamesdale10)

It remains one of the great ironies of the past eight years of war: while the government’s use of private security contractors has garnered no end of criticism, few realize that the highest-profile blunders and abuses have come from companies that work not for the Pentagon, but for the State Department.

Blackwater, now known as Xe Services, whose employees drunkenly shot a bodyguard for an Iraqi vice president and killed 17 Iraqi civilians in September 2007. It remains one of the recipients of State’s Worldwide Personal Protective Services contract.

Illustration by: Matt Mahurin

ArmorGroup, the company that hired employees who sexually harassed their Afghan colleagues and engaged in a series of hazing rituals, is still entrusted by State to guard the U.S. embassy in Kabul.

The Defense Department’s contracting branch is hardly without flaws, as years of revelations about diverted funds or missing weapons shipments in Iraq have demonstrated. But many of those revelations came from Stuart Bowen, the special inspector general for Iraq reconstruction, who focused a harsh eye on the Defense Department for credible allegations of waste, fraud and abuse. “DOD is very proactive in addressing the problems,” said one defense-contracting insider who declined to speak for the record.

The State Department, though, has come under comparatively less scrutiny.  “There’s certainly a different perception in the quality of State and Defense security contractors in particular,” said Steve Aftergood, a contracting expert with the Federation of American Scientists. “DOD on the whole seems a little bit more disciplined. The more egregious cases, including the latest, seem to involve State Department contractors.”

This latest case comes in the form of a letter from the Project on Government Oversight to Secretary of State Hillary Rodham Clinton about ArmorGroup, which holds what’s called a “static security” contract estimated to be worth $180 million to $200 million to guard the perimeter of the U.S. embassy in Kabul. (A separate State contract, to guard diplomats as they move throughout a given area, is currently split between three other security companies: Xe, Triple Canopy and DynCorp.) After receiving numerous anonymous complaints from ArmorGroup employees, POGO executive director Danielle Brian wrote to Clinton on Tuesday to warn of “a pattern of blatant, longstanding violations of the security contract, and of a pervasive breakdown in the chain of command and guard force discipline and morale.” Numerous incidents of physical and sexual harassment were reported to have occurred.

But only half of Brian’s memo focused on ArmorGroup. The rest of it accused the State Department of lax contractor oversight, an atmosphere contributing, Brian alleged, to the abuses. It noted that State officials had placed ArmorGroup on notice for two years, “but its threats have been empty,” as indicated by State re-awarding the static security contract to the company in June 2008 despite having issued it two official notices that the company’s “deficiencies were endangering the performance of the contract.” One of those notices, from 2007, explicitly stated that ArmorGroup’s laxity put “the security of the US Embassy in Kabul … in jeopardy.” Brian’s recommendation was to take embassy security out of the hands of the State Department entirely and give it over to the military.

In a press briefing yesterday, State Department spokesman Ian Kelly conceded that the department had warned ArmorGroup of lax discipline and disturbing incidents for years. “We have pointed out to them some of the deficiencies,” Kelly said. “And I can’t answer right now from this podium exactly what they have done in response to this letter.” Yet he said Clinton would have “zero tolerance” for the abuses Brian detailed.

Sen. Claire McCaskill (D-Mo.), the chairwoman of the Senate’s subcommittee on contractor oversight, wrote Tuesday to Ambassador Patrick Kennedy, the State Department’s undersecretary for management, urging him to “conduct a thorough review of the performance, management, and oversight of this contract.” A spokeswoman for McCaskill, Maria Speiser, said the senator was “quite disappointed” with State’s oversight of ArmorGroup’s contract.

Additionally, the State Department will soon re-award its contract to protect diplomats in conflict zones, known as the Worldwide Protective Services Contract. Despite having been kicked out of Iraq following the shooting incident at Baghdad’s Nisour Square in 2007, Xe — which is presently the only security company hired by State to protect diplomats in Afghanistan — told The Washington Independent last month that it would seek to retain that contract, estimated to be worth $1.2 billion to the controversial company.

Spokespeople for the State Department’s Bureau of Diplomatic Security have repeatedly delayed answering TWI’s questions about the propriety of letting Xe resubmit its bid. Nor did anyone respond to repeated requests to discuss ArmorGroup. But in a previous email to TWI, spokesman Brian Leventhal said the bureau had “increased its staffing levels in Afghanistan to ensure appropriate oversight” — precisely what Brian’s letter questioned — and had placed Diplomatic Security agents in all diplomatic protective details run by security contractors in Afghanistan, alongside “video and audio equipment” in many of them to deter wrongdoing.

Aftergood could not answer why it was that so many problems have persisted with State’s contractors. “It’s not clear who is dropping the ball, but certainly someone is,” he said, speculating that perhaps the Defense Department has had “more time to establish and enforce expectations of a sort that would preclude the total chaos that seems to prevail with some of the State Department’s contractors.”

Numerous emails, photographs, and videos portray a Lord of the Flies environment. One email from a current guard describes scenes in which guards and supervisors are “peeing on people, eating potato chips out of [buttock] cracks, vodka shots out of [buttock] cracks (there is video of that one), broken doors after drnken [sic] brawls, threats and intimidation from those leaders participating in this activity….” Photograph after photograph shows guards—including supervisors—at parties in various stages of nudity, sometimes fondling each other. These parties take place just a few yards from the housing of other supervisors.

Asked about ArmorGroup at a press briefing today, State Department spokesman Ian Kelly said that Clinton would have “zero tolerance for the type of conduct that is alleged.” But when a reporter challenged Kelly over the fact that State has put ArmorGroup on notice about inappropriate behavior in Kabul since June 2007, this was his response:

We’ve been investigating this organization for some time now. We understand that we have made some – we have pointed out to them some of the deficiencies. And I can’t answer right now from this podium exactly what they have done in response to this letter.

It’s into this sort of oversight environment that Blackwater Xe is looking to re-up its contracts with State to protect diplomats.