State Department Says Blackwater Broke Laws, But Company Not Barred From Receiving Government Contracts

(TRUTHOUT)   The company formerly known as Blackwater violated U.S. export control laws nearly 300 times, ranging from attempts to do business in Sudan while that country was under U.S. sanctions to training an Afghan border patrol official who was a native of Iran, the State Department said Monday.

The alleged violations were spelled out in documents released Monday by the State Department as part of a $42 million settlement with Blackwater that will allow the company, now known as Xe Services LLC, to continue receiving U.S. government contracts.

The agreement appears to spell the end of a three-and-a-half-year, multi-agency federal probe into Xe Services’ unauthorized exports of defense technologies and services. While elements of the case were presented to a federal grand jury, the company and its currently serving officers have avoided criminal prosecution.

The State Department said Monday that Xe Services’ alleged violations, while widespread, “did not involve sensitive technologies or cause a known harm to national security.” Additionally, it said, they took place while Xe “was providing services in support of U.S. government programs and military operations abroad.”

Under the agreement with the U.S. government, the Moyock, N.C., company was levied a $42 million fine, but Xe is allowed to use $12 million of that to strengthen the company’s export control compliance programs. Xe won’t be barred from further U.S. government contracts, and a government policy of denying most of the firm’s export control applications, in place since December 2008, will be lifted.

Mark Corallo, a spokesman for Blackwater founder Erik Prince, didn’t immediately return a phone call seeking comment. Prince recently moved to the United Arab Emirates, and has put Xe Services up for sale.

McClatchy first reported in June that Xe Services and the U.S. government were negotiating a multimillion-dollar fine to settle allegations that it violated laws regulating the export of defense equipment and know-how overseas. The article detailed Blackwater’s extensive efforts to secure business in southern Sudan at a time when the country was under U.S. sanctions for its sponsorship of terrorism.

A 41-page State Department document released Monday provides some new details about Blackwater’s Sudan plans and provides a peek into the secretive company’s training of foreign military personnel around the globe.

For example, an October 2006 Blackwater proposal to the south Sudanese government called for the company to provide military training to individuals who held citizenship in both Sudan and neighboring Uganda, but “would be deemed Ugandans for training purposes.” Blackwater obtained Ugandan passports for the prospective trainees from the south Sudanese government.

At the time, Sudan was under U.S. sanctions, but Uganda wasn’t.

Most of the 288 violations of export control laws cited in the document involve Blackwater providing unauthorized military or security training to foreign nationals or failing to vet adequately the backgrounds of those it was training. The concern is that U.S. enemies could benefit inadvertently from such training.

Persons trained by Blackwater under a U.S. government contract to train the Afghan Border Police included “one (who) was born in Pakistan and the other in Iran, a proscribed country,” the document says.

Blackwater provided military training to security forces in almost every corner of the globe, often without proper authorization from the U.S. government, the documents show. Countries that received those services included Azerbaijan, Canada, Japan, Jordan, Kuwait, Niger, the Philippines and Taiwan.

Blackwater also violated firearms regulations on numerous occasions, the documents allege. In one case, it diverted weapons intended for use in supporting U.S. military operations in Iraq to the company’s private contracts in that country.

The company “did not fully cooperate” during the first 18 months of the State Department investigation, which began in February 2007, and made several false statements to the government that it later revised, the documents said.

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