David Phinney: June 2005 Archives

June 27, 2005

Halliburton Iraq Oil Deal Leads to Rumsfeld?

The Army Corps of Engineers' top contracting official delivered explosive testimonty today with claims that the controversial, no-bid $7-billion contract to restore Iraq's oil infrastructure was under control of the Office of the Secretary of Defense.

We're talking about "every aspect" of the contract awarded to Houston-based Halliburton subsidiary KBR, Bunny Greenhouse said at a Capitol Hill hearing sponsored by Democrats. Halliburton was once headed by Vice President Dick Cheney.

"I observed, first hand, that essentially every aspect of the RIO (Restore Iraqi Oil) contract remained under the control of the Office of the Secretary of Defense," said Greenhouse, who has worked in military contracting for more than two decades. "This troubled me and was wrong."

KBR's contracts worth well over $14 billion have been the constant target of audits finding a lack of documentation and possible padding valued at hundreds of millions of dollars. The RIO contract has been especially controversial because of the astronomically expensive costs the company charged for trucking oil and fuel from Kuwait into Iraq.

KBR racked up $2.5 billion in billings under the secretly awarded oil contract before it was replaced with a new $1.2 billion contract following an outcry of criticism over the original award.

Much of the original contract was paid for with seized Iraqi assets and oil revenues. That may make it a sticky issue in recovering any overcharges and could be clarified in a case now pending in Federal Court against another contractor, Custer Battles, which was also paid with Iraqi assets.

"I can unequivocally state that the abuse related to contracts awarded to KBR (Kellogg Brown and Root) represents the most blatant and improper contract abuse I have witnessed during the course of my professional career," Greenhouse said.

Reuters aptly outlines just how Greenhouse believes the original RIO was railroaded by Pentagon officials:

What concerned Greenhouse most was that the oil contract, which had a top value of $7 billion, was given to KBR without competitive bidding.

She irked her bosses by handwriting her concerns in official documents for the oil deal but said these were overlooked, she said.

In one instance, she said Army Corps officials bypassed getting her signature to grant a waiver for KBR to be relieved of its obligation to provide cost and pricing data for bringing fuel into Iraq.

That waiver was granted after a draft Army audit said KBR may have overcharged the military by at least $61 million to bring in fuel to Iraq to ease a shortage of refined oil.

Greenhouse agreed she had become a thorn in the side of the Army Corps and said she had been advised not to attend the hearing because of its partisan nature.

Interestingly enough, Sheryl Tappan, a former contract proposal writer and consultant for Bechtel, found that the follow-on RIO contract was just as fishy and "rigged from the beginning."

Democrats said they were holding the hearing because the Republican-led Congress has been unresponsive to the claims of Greenhouse and others about the billions of dollars spent in Iraq on contracts to support military and reconstruction efforts.

"This testimony doesn't just call for Congressional oversight -- it screams for it," said Sen. Byron Dorgan, a Democrat from North Dakota.

Posted by davidphinney at 11:41 PM | Comments (0)

Private Security Contract Gone Sour

The genesis of the strike by Global Security that shut down Baghdad International Airport for two days likely can be found in a contract originally inked by the Coalition Provisional Authority.

The idea was that it would be paid for by revenues from Iraqi oil revenues (the Development Fund for Iraq) under control of the CPA, but when that short-lived provisional government disbanded, the contract was then forked over to the Iraqi's for payment, and presumably, management of the deal.

Iraqis soon began complaining about the CPA's handiwork, echoing similar problems that have been extensively noted by investigations of other CPA contracts -- lack of documentation, sloppy record-keeping, etc., etc.

Payment disputes between the Iraqis and Global Security began early this year. Other contractors also found themselves between Iraq and a hard place when it came to getting paid as laid out in this April story I penned.

For the sake of history, here's the March 15 US Embassy's statement on the Global Risk dispute and other contract quarrels already coming to a boil and which the embassy was actively struggling to resolve -- apparently, unsuccessfully:

STATEMENT BY THE U.S. EMBASSY IN BAGHDAD RELEASED MARCH 15: As the Iraqi people create a government structure out of the ruins of Saddam Hussein's regime, it is not unexpected that there would be payment delays and occasional disagreements about who in the Iraqi government is responsible for, and has the funds to pay, particular contracts, many of which predate Iraqi sovereignty. The fact is that patient firms have been rewarded in Iraq; contract obligations are honored. The United States Embassy has been coordinating closely with other coalition partners, the involved Iraqi ministries, and the companies themselves to amicably resolve contract payments that are in arrears. Just in the last four days an Embassy representative has personally spoken to representatives of A.P. Moeller Maersk, Global Security, Olive Security and Raytheon, among other companies, on these matters. In January, and again in March our assistance helped secure a back payment for Global Security. We have also worked with several Iraqi ministries to secure a Letter of Credit for payments the Transportation Ministry agrees are owed to Raytheon, and we will remain involved until the monies are paid. The original contracts of Maersk, Olive Security and Global Security expire shortly. All three firms are bidding for long-term contracts directly with the sovereign Iraqi government. Through these bids these firms have demonstrated an interest in continuing to work in Iraq; their bids express a vote of confidence in the commitment and capability of the Iraqi government to deal fairly with international companies which are helping Iraqis rebuild their country. This statement is attributable to a U.S. Embassy spokeswoman.

Posted by davidphinney at 06:30 AM | Comments (0)

June 23, 2005

Iraq a Training Ground for Urban Terrorists

From the downfall of the Soviet Union to the notable absense of WMD in Iraq, the CIA has missed the mark on accurate assessments in the past, but this prognosis is truly scary:

WASHINGTON, June 21 - A new classified assessment by the Central Intelligence Agency says Iraq may prove to be an even more effective training ground for Islamic extremists than Afghanistan was in Al Qaeda's early days, because it is serving as a real-world laboratory for urban combat. The New York Times

Hmmmmm....If true, then maybe there is something of value by looking at the reverse: coaltion forces and their security contractors may be learning how to counter any newly-skilled terrorists in the schoolyard of Iraq that they have come to call the "Sandbox."

(Are we talking chicken and the egg here? Does this mean the global business market for private security contractors is ensured for decades to come because the war in Iraq cultivated a new spawning ground for terrorists? )

Osama bin Laden picked up his terrorist chops on the battlefields of Afghanistan and was emboldend after helping to defeat one of the world's leading superpowers, the Soviet Union.

Iraq could spawn an even worse nightmare, according to the news reports, including the NYT:

The officials said the report spelled out how the urban nature of the war in Iraq was helping combatants learn how to carry out assassinations, kidnappings, car bombings and other kinds of attacks that were never a staple of the fighting in Afghanistan during the anti-Soviet campaigns of the 1980's. It was during that conflict, primarily rural and conventional, that the United States provided arms to Osama bin Laden and other militants, who later formed Al Qaeda.

As Australian reporter Edmond Roy notes:

Two decades ago Afghanistan became the magnet for Islamic militants, who later on became the al-Qaeda network operating under the protection of the Taliban. While the Afghan operation was largely fought on a rural battlefield, the CIA report says that Iraq is now providing extremists with more comprehensive skills, including training in operations devised for populated urban areas. Thus bombings, assassinations and conventional military attacks on police and military targets have increased with deadly effect, but the White House isn't quite ready to admit to anything just yet. Australian Broacasting Corporation

Posted by davidphinney at 06:58 PM | Comments (0)

June 17, 2005

Fair and Balanced

There's a working theory that survival in modern corporate culture demands advanced skills in butt-kissing just as much as the usual skills normally advertised -- perhaps even more.

Transfer that working theory to media conglomerates and it may explain the news gathering of many modern-day corporate journalists looking for the competitive edge over their colleagues. Like well-behaved lap dogs begging for their treats, they pant for access and the latest press releases and fawn over the butts of their sources.

Hence, the easy post-9/11 pass for the Bush administration, and hence, The New York Times headline: "Antiwar Group Says Leaked British Memo Shows Bush Misled Public on His War Plans."

WASHINGTON, June 16 - Opponents of the war in Iraq held an unofficial hearing on Capitol Hill on Thursday to draw attention to a leaked British government document that they say proves their case that President Bush misled the public about his war plans in 2002 and distorted intelligence to support his policy.

Is that the kind of lead you learn to write after spending $100,000 on a journalism degree from Columbia University?

These "opponents of the war" may be Red Sox fans, too.

Aren't they just Democrats opposed to Republicans? Don't they have a valid point beyond politics? Does The New York Times expect the Bush Administration or the Republican-controlled Congress to investigate?

Timid, timid, timid.

Whatever happened to the words "critics" and "skeptics"?

Anyway, boys and girls, the clock is ticking on the Bush Administration. No matter what your personal feelings, W can't run for another term. It may be time to hedge bets and invest in the future because the next couple of elections could swing left. One's corporate survival instincts should trigger a little butt kissing of those who could soon have control of the car keys.

It's all about access, right?

Posted by davidphinney at 09:44 PM | Comments (0)

June 15, 2005

Pentagon's Insurance Problem

The Pentagon is shocked, just shocked, to discover that it is paying ten times the going rate for insurance on Iraq contracts. Once it gets over the taxpayer outrage, maybe the powers-that-be will get around to pressuring the same insurers -- especially AIG, the mother-of-all underwriters for contractors in Iraq, including Halliburton's KBR -- to pay up on the backlog of claims from workers injured in Iraq.

According to several reports, the U.S. Labor Department credits AIG subsidiary Insurance Co. of Pennsylvania as being the processor for 80 percent of the total claims and 68 percent of all death-benefit applications pouring out of Iraq.

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Adding Insult to Injury
Halliburton Contractors Denied Insurance Benefits
by David Phinney
Special to CorpWatch
May 24th, 2005

Mark Baltazar was between jobs operating heavy construction equipment when he heard he could make $84,000 doing the same work in Iraq. When he took the job, his plan was to save up the tax-free money and then buy a new home for his family back in Texas.

A suicide bomber near Mosul changed all that last December, just one month and three weeks after Baltazar started work with Halliburton subsidiary, Kellogg, Brown & Root (KBR), the largest military contractor in Iraq.

On Dec. 21, 2004, the 32-year-old father of five, who was raised in Odessa, Texas and moved to Houston 14 years ago, had just finished lunch when it happened. He was in the sprawling KBR mess tent at Camp Merez where hundreds of U.S. troops, Iraqi security forces and U.S. civilian contractors were eating. The bomber then launched one of the bloodiest attacks on U.S. forces since the invasion began. The explosion swept through the tent, hurled Baltazar into the air and sent him crashing down over the back of a chair.

A total of 69 people were wounded, including Balthazar and 24 other civilian contractors. Seven of the 22 left dead were KBR employees and subcontractors. One was a co-worker of Baltazar's who had just left the table to get some ice cream. It was the last time Baltazar saw him alive.

Six months later, like many civilian workers injured in Iraq, Baltazar is still battling with KBR's insurance adjusters. If he wins, he hopes to be paid the disability benefits he needs to support himself and his family.

Instead of saving for a new home, Baltazar finds himself worse off then he was when he left for Iraq; he's jobless because of his injuries, living in a Houston apartment, and relying on a $368 disability check every two weeks.

"You make more money working at McDonald's," he says dejectedly.

Because he worked for Halliburton's KBR, which uses Cayman Island subsidiaries to employ 70 percent of it's workers, Baltazar is not eligible for state unemployment insurance.

Baltazar's lawyer says he is also being denied full insurance coverage worth more than $1,000 a week as outlined in the Defense Base Act (DBA). The DBA requires businesses working overseas under U.S. funded contracts to provide insurance coverage for injuries and disabilities of all employees. Subcontractors are responsible for providing similar coverage to their workers. Baltazar's projected DBA amount is a sum based on the comparative annual income he would be making if he hadn't been injured.

Immediately after the bombing, KBR medics x-rayed Baltazar's back. They gave him morphine and said he was fine. But after spending two days resting in his trailer, Balthazar recalls, he told his supervisors he wanted medical leave to go back to the United States and see a doctor of his choice.

"I wanted to return to work after some medical leave," Baltazar explains. "They said my injuries weren't severe enough to send me home, so I either had to stay in Iraq or quit."

Since January, he has been getting spinal injections and visiting a physical therapist three times a week to help ease the pain of the back injury he sustained when he landed on the chair. He also suffers from hearing loss and blurry eyesight because of the blast and receives psychological counseling for post-traumatic stress disorder.

PTSD

Commonly known as PTSD, post-traumatic stress disorder often appears as a temporary psychological condition, but it can also last a lifetime. Symptoms include major depression and anxiety that can lead to suicidal behavior. The disorder haunts an estimated 15 to 17 percent of soldiers returning from Iraq, according to a study published by the New England Journal of Medicine in their summer 2004 issue. The condition is also currently affecting an unknown number of contractors who witnessed the horrors of war firsthand.

Little data is available on just how widespread the problem may be among civilian workers. According to Dr. Charles Figley, Director of the Psychological Stress Research Program at Florida State University and one of the country's most prominent PTSD experts, the number of contractors suffering from the disorder will likely remain an estimate.

"No one is counting, no one is noticing and no one cares," said Figley, a former Marine and Vietnam veteran who believes that the risks contractors face are the main reason that many of them earn high salaries.

Figley predicts that a PTSD study would document the danger to contractors and force wages up even higher because fewer skilled Americans would be willing to work in Iraq.

"These people are non-combatants in a combat environment, but I am sure there are no studies about them." Figley adds. "Besides, it would be bad for business."

PTSD is bad for Baltazar as well.

"I wake up with nightmares, sometimes four times a night, sweating and yelling," he says.

It takes enormous courage to admit psychological baggage brought home from war, but for contractors back in the US it is necessary for recovery.

Taken for dead

Like Baltazar, another KBR employee, Samuel Walker, says KBR denied him medical leave after he was injured in the Camp Merez bombing. His only options at that point were to quit or stay in Iraq. Walker, who now lives in Augusta, Georgia, worked for over a year in Iraq as a fitness and recreation supervisor at the camp. An Army veteran of 24 years, Walker joined KBR one month after retiring as a Combat Communications Specialist. He recalls that he was eating French fries when the explosion blasted through the mess tent.

"Body parts were flying all over and pieces of flesh flying in my face," Walker says.

When it was over, the former contractor was drenched in the blood of the victims around him and rescue workers took him for dead. "I was so close to the bomber," he adds. "There was copper wire from the bomb embedded in my jacket."

Walker took a full blast to the side of his head and shrapnel pitted his body. But when KBR medics treated him following the bombing, he says they merely rubbed Vaseline on his burns and gave him Motrin for pain.

"For two days I told them my side was hurting but they said I would be okay, and wouldn't give me medical leave," Walker says.

A week and a half later, like Baltazar, Walker quit and headed home to Houston. Now he complains of ringing in his ears and migraine headaches. He's in physical therapy for his neck, back and right knee. Walker also believes suffers from PTSD. Questions about his work in Iraq, scenes from the TV news, even French fries, all bring back the moment when the bomb flashed before him.

"I can't even walk into a restaurant without remembering the screaming, the hollering, the yelling and everyone thinking I was dead," Walker says. With the memories haunting him daily, Walker knows it's unlikely that he'll be able to re-enter the workforce. In the meantime, he's waiting on his claim for disability and medical bills.

"I haven't gotten one red cent from them," Walker says.

KBR responds

KBR insists that it is committed to ensuring its employees receive quality medical treatment.

"KBR employees work side-by-side with the troops, and they do the jobs that, here at home, are routine, such as planning and preparing meals," said KBR spokeswoman Cathy Gist. "In a war zone, however, these jobs require courage, resolve and skill."

When asked if employees had been denied medical leaves after being injured at Camp Merez, Gist answered indirectly. "As KBR's history of contracting for the U.S military in remote environments continues, the company remains committed to ensure[ing] its employees receive quality medical treatment and care, either locally or by means of evacuation to a more advanced medical facility as dictated by the nature of the situation, " she told CorpWatch,

Growing logjam

Like Baltazar and Walker, there are numerous former contractors waiting for insurance companies to resolve claims related to war zones.

"Insurance companies are not used to doing this sort of thing in the numbers they are coming in," says Washington, DC., attorney Mark Schaffer, who also represented a Merez bombing victim who received medical leave, but only after bickering with adjusters for three months. "Everyone is playing catch up."

Insurers are so behind that the pile-up has turned into a serious logjam within the Department of Labor, which is responsible for overseeing all DBA claims. Recently the department's administrative law judges, who preside over the most contentious claims, adopted a policy to expedite cases involving the war in Iraq and to pressure insurers to act more quickly.

"We're starting to get more cases, absolutely," says Richard D. Mills, District Chief Judge for the Louisiana District Office, whose work includes claims from Houston, KBR's headquarters. "We have been asked to finish up on some cases within 45 to 60 days."

As of May 10, death and injury claims related to the war in Iraq total 2,919, according to the U.S. Department of Labor. Of those claims, insurers have disputed 1,538 -- more than half of the total -- and 821 remain unresolved.

These figures may not reflect the true number of workers eligible for benefits, because many don't know they may be covered, let alone the full extent of their benefits, says Schaffer.

"People are often stuck in Iraq, unaware of any entitlement," he observes, adding that the prospect of continuing work outside the United States also tempts employees to keep mum about their injuries. "Sometimes people are afraid to go to the doctor because they will get sent home," adds Schaffer. "And if you don't stay 330 days, you lose your tax free salary. Everyone is over there to make money and I haven't seen anyone turn down a paycheck yet."

Even U.S. citizens who have come home and families who have lost a husband or father are often unfamiliar with their insurance coverage, says attorney Gary Pitts. The Houston lawyer represents 35 clients with claims against KBR's insurer, American International Group Inc. (AIG). A New York-based firm, AIG is widely involved with business in Iraq and is presently under investigation by the Securities and Exchange Commission for its accounting practices and for possible stock fraud.

"AIG is dragging its heels and they only have three adjusters working the claims, so they are swamped," says Pitts.

AIG declined comment. "We don't discuss clients with the press," company spokesman Andy Silver told CorpWatch.

Pitts is representing Baltazar and Walker and believes that their stories speak for themselves. "If anyone has a legitimate claim for post-traumatic stress and disability, it's these guys. They were picking flesh off themselves."

Pitts fights to get weekly compensation for as long as an employee is off work, medical bills and two-thirds of one's salary if a person is permanently out of work when everything medically possible has been done. Families that lose their primary income provider are also eligible for lifetime support as long as the surviving spouse does not remarry, leading Pitts to estimate that life-long disability claims for a widow and her family could top out at around $2 million.

"There's a lot of money to be saved by keeping people in the dark if you look at it as a pure numbers game," says Pitts who, in addition to specializing in DBA, is pursuing an ongoing international lawsuit against companies that helped Saddam Hussein produce sarin and mustard gas. Noting that very few attorneys specialize in DBA law because the fees are low and set by the Labor Department, he adds: "I am afraid there are a bunch of widows in the hinterland who don't even know what the DBA is, nor an attorney who practices it."

There are likely many workers around the world without knowledge about their insurance coverage. Tens of thousands of workers from India, Pakistan, Turkey, the Philippines and other countries have been recruited to work on military bases in Iraq to perform blue-collar jobs that include food preparation, sanitation, laundry services and construction work. They are often paid less than $1,000 a month and work largely for subcontractors under other subcontractors working for the prime U.S. funded contractor.

The General Accountability Office (GAO), the lead investigative arm of Congress, recently concluded that it is impossible to accurately estimate the total number of U.S. or foreign nationals working for U.S. government contracts in Iraq. The GAO's investigation was prompted by concerns in Congress about insurance costs that Iraq contractors are obligated to carry, which are then passed on to the government.

"It is difficult to aggregate reliable data on the cost of DBA insurance due in part to the large number of contractors and the multiple levels of subcontractors performing work in Iraq," the GAO reported. "Lacking reliable aggregate data, we were unable to calculate the total cost of DBA insurance to the government or the impact of DBA insurance costs on reconstruction activities in Iraq."

Responding to the GAO's report, Labor Department official Victoria A. Lipnic said that assuring all contracted employees have insurance coverage is an "impossibility" without having someone in Iraq to "actually demand to see proof of coverage for every level of subcontracted work."

In other words, the number of claims yet to come may be unfathomable. "The whole legal and factual situation is just like the wild west," Pitts offers.

Only the personal stories are tangible, but Baltazar and Walker say KBR has never called to find out how they are doing.

"I wanted to go back to work for them when I got well," Walker says. But he has since changed his mind. "I don't like the way I have been treated," he adds.

David Phinney is a journalist and broadcaster based in Washington, DC, whose work has appeared in The Los Angeles Times, New York Times and on ABC and PBS. He can be contacted at: phinneydavid@yahoo.com.

Posted by davidphinney at 04:19 AM | Comments (0)

June 10, 2005

Arrested Security Contractors Make News Around the Globe

More than 350 stories are run by newspapers and broadcast operations around the world following my story. Not bad. Not bad at all for a one-man band.

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June 08, 2005

Los Angeles Times Picks Up Detained Convoy Story

Not bad for a one-man band.

The Los Angeles Times followed my story from yesterday. An editor with the San Francisco Chronicle said the T. Christian Miller's story was on the sked but it never arrived last night. I credit that to my having all the sources. T., bless his talented heart, had to chase them down into the night.

Posted by davidphinney at 04:33 AM | Comments (0)

June 07, 2005

Marines Arrest Private Security Convoy

Well... Here's the breaking story. Security contractors in Iraq accused of shooting at Marines. Strikes me as a fog of war story made all the foggier by mixing up 20,000 security contractors with military forces on the field of battle in Iraq. The names were witheld upon request of the contractors' wives who said they had received anonymous phone calls threatening the welfare of their husbands.

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Marines Jail Contractors in Iraq
Tension and Confusion Grow Amid the "Fog of War"
by David Phinney
Special to CorpWatch
June 7th, 2005

Late one Saturday afternoon in May, a group of armed American private security guards in white Ford trucks and an Excursion sports utility vehicle barreled through the battle-scarred streets of Fallujah, Iraq. The group was a security convoy from Zapata Engineering, a company hired to destroy enemy ammunition, such as shells and bombs, in Iraq. As they swerved through traffic, the men heard gunfire they could not identify.

Snipers still regularly attack civilians and troops patrolling Fallujah, despite the fact that the US bombed the city heavily in April and November 2004 to flush out suspected rebels.

According to the Zapata contractors, one of their vehicles veered left on a road leading to a Marine checkpoint. It ran over the spike strip in the road near the guard house and the tire went flat. The anxious contractors jumped into action and put on a spare. Within minutes, they began rolling again.

A Marine captain brought the convoy to a halt. Had anyone in the convoy shot at the guard tower, he asked. Negative, said a convoy member.

But the captain was not convinced. Sixteen American and three Iraqi security contractors in the Zapata convoy were then taken into custody presumably on suspicion of shooting at the Marine tower. They were thrown in jail on the evening of May 28.

Earlier that day, May 28, the soldiers recounted, "receiving small arms fire from gunman in several late-model trucks and sport utility vehicles" at approximately 2 P.M. "Marines also say witnessed passengers in the vehicles firing at and near civilian cars on the street," the Marines' report continues.

According to a Marines press statement, "Three hours later, another Marine observation post was fired on by gunmen from vehicles matching the description of those involved in the earlier attack. Marines saw passengers in the vehicles firing out the windows." This second account coincides with the arrest of the Zapata men.

Today the contractors have been set free and each side tells a different story. Contractors and their families feel they were unfairly arrested and, once in the military prisons, they say they were treated with disrespect.

Was this simply a case of "friendly fire" -- the term used when soldiers of the same flag shoot at one another by mistake? Is the confusion just a product of the "fog of war"? Or does it reflect a larger problem in Iraq, where the uniformed military works side-by-side with an estimated 25,000 armed civilian security guards?

The contractors are either paid by the Pentagon or by reconstruction contractors. Some wear camouflage gear but many dress casually and carry high-tech weaponry in an environment teeming with armed attackers who also eschew military uniforms. Like their enemies, private military contractors also travel in unmarked vehicles.

The contractors are hired to work in cooperation with the military officers but many are paid far more. On top of these differences, the contractors tend follow a very different set of rules than their military counterparts.

"Roughed Up" in Fallujah

All 19 Zapata men were confined to small cells, measuring six feet by eight feet, and dressed in orange prison garb. They were imprisoned for three days without being charged or provided with legal counsel. Night and day, they listened to suspected Iraqi fighters held nearby. The contractors say they ate the same bad food that the Iraqi prisoners were served and were forced to urinate in bottles in their cells.

However, not all accounts of their capture line up. According to some of the contractors and their wives, the Marines also roughed up the security contractors before taking them to jail. They say they slammed the contractors down on the concrete one by one, bruising some pretty badly.

Several wives of the security contractors, back in the United States, waiting for their daily phone calls from their husbands in Iraq, began thinking the worst when the calls stopped coming.

"There were all these families sitting at home not knowing what's going on," says Jana Crowder, who runs the Web site, American Contractors In Iraq.com from her home in Johnson City, Tennessee. Crowder, who started the site as a support network, has heard from a number of concerned wives of the Zapata contractors.

"This worries me about our damn military," Crowder adds. "Here in America, you have the right to a phone call."

Contractors also say they were treated badly in other ways. One man said a Marine put a knee to his neck and applied his full body weight as another cut his boots off and stripped him of his wedding ring and religious ornaments. Twenty or 30 other Marines watched and laughed, he added, as a uniformed woman with a military dog snapped photographs. Taunts were made about the large salaries of private security contractors, which are often more than $100,000 a year -- sometimes more than $200,000, he said.

The Marines tell a different story.

"The contract personnel were treated professionally and appropriately the entire time they were in the custody of military personnel," said Lieutenant Colonel Dave Lapan, a Marines public affairs officer, in an e-mail statement from Camp Fallujah.

"During their detention, the contactors were provided three meals a day and given access to unlimited amounts of bottled water and given access to a chaplain. No phone calls were allowed in accordance with standard procedures."

The suggestion that the contractors were publicly ridiculed is "categorically untrue," said Lapan. "Before they were taken to the detention facility, they were placed on the ground, flex-cuffed and searched per standard practice. They were not thrown to the ground."

The series of events remain under investigation by the Naval Criminal Investigative Service and the contractors' weapons and vehicles were impounded, he added.

The contractors say they were never charged. They maintain their innocence, and believe their treatment was unjust and humiliating. Although released from jail on May 31, several security workers wanting to return to the United States were still waiting to leave five days later.

The contractors and their wives are now lining up lawyers back in the United States. One contractor's wife says her husband lost seven pounds while imprisoned. She believes the Marines were letting off steam over the rising tensions between armed contractors and the military.

"My husband is a former Marine and he loved this job," she said, noting that many of the detained contractors are ex-Marines. "It's killing them knowing that Marines are doing this to them. These guys are putting their lives on the line, too."

Friendly Fire

This would not be the first time that private military guards have been accused of shooting on the streets of Iraq, nor would it be the first time that two groups of heavily armed civilians working for the occupation forces have attacked the military or each other inadvertently.

Four former security contractors and retired military veterans told NBC News in February that they had watched as innocent Iraqi civilians were fired upon, and one was crushed by a truck, by contractors employed by the American company Custer Battles.

In late November 2004 soldiers in a U.S. Humvee also fired ''six or seven rounds'' at the tires of a vehicle was carrying foreign security guards on the road to the Baghdad airport. Just one day earlier, an Iraqi police cruiser opened fire on a white sedan near the Babylon Hotel in central Baghdad. The occupants of the sedan, believed to be British private security guards, fired back killing one police officer and seriously wounding another.

Another company, Triple Canopy, which claims to have more elite ex-military special operations professionals than any other private security company, has also had several friendly fire incidents with military personnel in Iraq, says Joe Mayo, spokesman for the Illinois-based company. He adds that incidents have often been averted in as little as 30 seconds.

To add to the confusion, some private military contractors claim that the Iraqi resistance may be masquerading as private security convoys in their attacks, in part, to inflame hostility toward coalition forces occupying Iraq.

An alert, dated mid-May, distributed by one large security contractor to its employees and clients, notes several recent incidents north of Fallujah where citizens were being shot at from SUVs. These include two occasions of four white "GMC Suburban-type" trucks (of the type commonly driven by contractors) firing "well-aimed shots at vehicles on the side of the road."

"There is speculation that foreign fighters are disguising themselves," the alert says. "Insurgent involvement is entirely possible. This situation is of great concern."

Tension bubbles up

Placing armed private security forces alongside military personnel has led to growing confusion and tension as the two groups follow different rules and lack clear lines of communication.

"When you multiply the kinds of forces, you complicate the chains of command and the relationships among them," notes Peter Singer, a defense expert and senior fellow at the Brookings Institution, who has written a book on private military companies. "The decisions that contractors make on their own can lead to friction and sometimes can make the military's job harder, particularly in the battle to win hearts and minds among the civilian population. You also have complications of differing pay, differing expectations, and differing rights and responsibilities. All that tension is now bubbling to the surface."

Hoping to better coordinate these private security companies operating in Iraq, the U.S. Army awarded a $293 million security contract to a controversial British firm, Aegis Defence Services Ltd. last May. Responsible for directing security efforts for ten prime contractors in Iraq, the company has met with mixed reviews.

"There is no assurance that Aegis is providing the best possible safety and security for government and reconstruction contractor personnel and facilities," the Office of the Special Inspector General for Iraq Reconstruction asserted in an audit released this April.

Legal Confusion

Journalist and author, Robert Young Pelton, who has spent months with private military contractors in Iraq and who is writing a book on the use of contractors in the war on terror, says that the military's choice to detain the Zapata group strikes him as the "first blatant example of contractors being treated as criminals."

"Animosity seems to be building between Bush's contractors and Bush's war," he observed.

Pelton believes that the treatment of Zapata's people has no legal basis since security contractors operate with very little legal jurisdiction hanging over them. "Contractors have carte blanche over there," he said. "The Marines knew who those people were. There's no reason to hold them for 72 hours."

But even those actively engaged with the operations of private security companies in Iraq seem to be in disagreement over legal jurisdiction.

In the final days of the Coalition Provisional Authority, CPA administrator Paul Bremer issued an order, known as Memorandum 17, requiring all private security companies to register with Iraq's Ministries of Trade and Interior. The order mandated that contractors be licensed, subject to audits and that weapons be registered and licensed. Contractors were also expected to engage in force only in self-defense and the defense of civilians.

Lawrence Peter, the director of the Private Security Company Association of Iraq, says that if a private security company is not registered, then it operates illegally.

"I can say without a shadow of a doubt that there is no company named Zapata that is a licensed Private Security Company under the terms of CPA Memorandum 17," he said. "I do not know under what legal authority those men thought they were operating, but it was not in keeping with the law of Iraq nor consistent with what professional, responsible and law-abiding private security companies are doing here."

The Army Corps of Engineers, which has awarded multi-million-dollar contracts to Zapata Engineering to dispose of seized enemy munitions and explosives, has a more nuanced view. "They are not a security contractor," said Corps spokeswoman Kim Gillespie, but "under the provisions of their task order, they can subcontract or direct hire qualified security personnel as needed."

Posted by davidphinney at 04:26 AM | Comments (0)

June 06, 2005

UPDATE: Rough Draft on Detained Contractors in Iraq

The word is that at least some of the security contractors detained by Marines under suspicion of shooting at guard tower in Fallujah are returning to the United States as early as Tuesday.

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The private security convoy barreling through the battle-scarred streets of Fallujah may not have had a clue that the U.S. Marines holding the city were especially jumpy and on edge. Insurgency attacks had reached a new peak in Iraq and three hours earlier, leathernecks of Regimental Combat Team-8 reported taking small arms fire in the city from gunman riding in several late-model trucks and sport utility vehicles. Marines had also witnessed passengers in vehicles firing at and near civilian cars on the street.

Unaware of these incidents, the security convoy working for Army contractor Zapata Engineering also heard gun blasts from unknown locations after swerving through traffic on their destination route. Then the convoy of white Ford trucks and an Excursion SUV veered left on the way leading to a Marine checkpoint. The convoy crossed over the spike strip in the road near the guard house and a tire went flat. The anxious contractors jumped into action, put on a spare. Within minutes, they began rolling again.

A Marine captain brought the convoy to a halt. Had anyone in the convoy shot at the guard tower? Negative, said a convoy member.

The captain was unconvinced.

Here is where the fog of war takes over and details get sketchy. The military has always had to cope with friendly fire incidents where soldiers of the same flag find themselves in confused conflict or friendly fire, but wartime conditions become even blurrier with an estimated 20,000 armed civilian security contractors cruising around a country teeming with non-uniformed insurgents. Not only does the legal status of private security forces remain uncertain, the chains of commands and rules between private companies and the military have multiplied -- as has the confusion.

What is known is that the 16 American and three Iraq security workers in the convoy were suspected of shooting at the Marine tower and thrown in jail on the evening of May 28. All 19 sat there in small, 6 ft. by 8 ft. cells dressed in orange prison garb for three days without charges or legal counsel. Night and day, several sources said they listened to suspected Iraqi insurgents through the walls held nearby. The detained gunslingers under Army contract urinated in bottles in their cells and they say the food they were first served – Arab meals for the prisoners -- was poor.

Stories then diverge. The Marines roughed up the security contractors before taking them to jail, according to some. They slammed the contractors one by one on the concrete. Some may have been bruised pretty badly.

One contractor said a Marine put a knee on his neck with his full body weight as another cut his boots off and stripped him of his wedding ring and religious ornaments. Twenty or 30 other Marines watched on, laughing as a uniformed woman with a military dog at her side snapped photographs, and taunts were made about the large salaries of private security contractors, often more than $100,000 a year – sometimes more than $200,000, he said.

The gathering crowd of Marines was saying things like “how is that contractor money now,” he said.

The Marines tell a different story.

“The contract personnel were treated professionally and appropriately the entire time they were in the custody of military personnel,” said Marines public affairs officer, Lt. Col. Dave Lapan, in an e-mail statement from Camp Fallujah. The series of events remain under investigation by the Naval Criminal Investigative Service and the contractors’ weapons and vehicles were impounded, he said.

The suggestion that the contractors were publicly ridiculed is “categorically untrue,” he added. “Before they were taken to the detention facility, they were placed on the ground, flex-cuffed and searched per standard practice. They were not thrown to the ground.”
During their detention, the contactors were provided three meals a day and given access to unlimited amounts of bottled water and given allow visits from a chaplain, he said. No phone calls were allowed and they were detained for approximately 72 hours in accordance with “standard procedures.”

The contractors say they were never charged, they always maintained their innocence, and believe their treatment was unjust and humiliating. Although released from jail on May 31, several security workers wanting to return to the United States were still waiting to leave five days later.

“They were trying to railroad us,” said one, believing that the Marines had mistaken the Zapata convoy for the vehicles reported to have been “shooting up the town” an hour earlier.

Several wives of the security contractors back in the United States waiting for their daily phone calls from their husbands began thinking the worst when the calls stopped ringing from Iraq. They wondered if their loved ones might be dead, helplessly wounded or taken hostage. Zapata, the Charlotte, N.C., employer of the imprisoned contractors, never contacted them until a friend located the company president begging for news, they say.

“There were all these families sitting at home not knowing what’s going on,” says Jana Crowder, who runs the Web site, www.americancontractorsiniraq.com, from her home in Johnson City, Tenn. The Web site is a volunteer support network for wives of American contractors in Iraq.

“This worries me about our damn military. Here in America, you have the right to a phone call.”

The contractors and their wives are now lining up lawyers back in the United States. One wife of a contractor (who asked not to be identified until her husband returns to the United States) says her husband lost seven pounds while imprisoned. She believes the Marines were letting off steam over the rising tensions between armed contractors and the military.

“My husband is a former Marine and he loved this job,” she said, saying that many of the detained contractors also served in the Marine Corps. “It’s killing them knowing that Marines are doing this to them. These guys are putting their lives on the line, too.”

But very few battle lines are clearly drawn in the sand in this war pitting non-uniformed insurgents against civilian Iraqis, the coalition forces and contractors. Attacks occur anywhere. Add in an independently operated and uncoordinated force of heavily armed security guards protecting contractors buzzing around the country as they work on billions of dollars in reconstruction projects and military support and the battle lines become even more elusive.

This is not the first time that private military guards have been accused of shooting on the streets of Iraq, nor would it be the first time that two groups of heavily armed civilians working for the occupation forces have come mistakenly in conflict with the military or at each other.

Four former security contractors and retired military veterans told NBC News in February that they watched as innocent Iraqi civilians were fired upon, and one was crushed by a truck, by their colleagues who were employed by an American company named Custer Battles.

In late November 2004 soldiers in a U.S. Humvee fired ''six or seven rounds'' at the tires of a vehicle was carrying foreign security guards on the road to the Baghdad airport. The day before an Iraqi police cruiser opened fire on a white sedan near the Babylon Hotel in central Baghdad. The occupants of the sedan, who are believed to be British private security guards, fired back killing one police officer and seriously wounding another.

Triple Canopy, which boasts of more elite special operations professionals than any other private security firm, also has had several friendly fire incidents with military in Iraq, said Joe Mayo, spokesman for the Lincolnshire, Ill., company. He says incidents sometimes can only be averted in just 30 to 35 seconds. “They call it the fog of war.”

Some private military contractors claim that the Iraqi resistance may even be masquerading as private security convoys in their attacks, in part, to inflame hostility toward coalition forces occupying Iraq.

An alert, dated mid-May, distributed by a large security contractor to its employees and clients notes several recent incidents north of Fallujah where citizens were being shot at from SUVs including two occasions of four white "GMC Suburban-type" trucks firing "well-aimed shots at vehicles on the side of the road."

"There is speculation that foreign fighters are disguising themselves," says the alert. "Insurgent involvement is entirely possible….This situation is of great concern."

Hoping to better coordinate these private security companies operating in Iraq, The U.S. Army awarded a $293 million security contract last May to a controversial British firm, Aegis Defence Services Ltd. Responsible for directing security efforts for 10 prime contractors in Iraq, the company has met with mixed reviews.

What makes the situation lethal is the fact that neither the private military guards, working for the occupation forces and the reconstruction companies, nor their enemies, wear military uniforms or travel in military vehicles.

Detaining the Zapata contractors only reflects what many say is the growing confusion and tension caused by placing armed private security forces in the same areas of combat as military personnel. The two groups often follow different rules and objectives and lack clear lines of communication.

“When you multiply the kinds of forces, you complicate the chains of command and the relationships among them,” notes Peter Singer, a defense expert and senior fellow at The Brookings Institution, who is a leading critic of private military companies. “The decisions that contractors make on their own, often make the military’s job harder. That tension is now bubbling to the surface.”

Journalist and author, Robert Pelton Young, who has spent months with private military contractors in Iraq and who is writing a book on the use of contractors in the war on terror said that detaining the Zapata contractors strikes him as the “first blatant example of contractors being treated as criminals.”

“Animosity seems to be building between Bush’s contractors and Bush’s war,” he observed.

But the treatment of Zapata’s people has no legal basis since security contractors operate with very little legal jurisdiction hanging over them, he said. “Contractors have carte blanche over there,” he said. “The Marines knew who those people are. There’s no reason to hold them for 72 hours.”

Even those actively engaged with the operations of private security companies in Iraq seem to be in disagreement over legal jurisdiction.
In the final days of the Coalition Provisional Authority, CPA administrator Paul Bremer issued an order, known as Memorandum 17, requiring all private security companies to register with Iraq’s Ministries of Trade and Interior. The order mandated that contractors licensed, subject to audits and that weapons be registered and licensed. Contractors were also expected to follow engage in force only in self-defense and the defense of civilians.

Despite ambiguous language of the order about those companies under contract with the U.S. military, Lawrence Peter, Director for Private Security Company Association of Iraq, believes if a private security company is not registered, then it operates illegally.

“I can say without a shadow of a doubt that there is no company named Zapata that is a licensed Private Security Company under the terms of CPA Memorandum 17,” he said. “I do not know under what legal authority those men thought they were operating, but whatever it was, it was not in keeping with the law of Iraq nor consistent with what professional, responsible and law-abiding private security companies are doing here.”

The Army Corps of Engineers, which has awarded multi-million-dollar contracts to Zapata Engineering to dispose of seized enemy munitions and explosives, disagrees. “They are not a security contractor,” said Corps spokeswoman Kim Gillespie, but “under the provisions of their task order, they can subcontract or direct hire qualified security personnel as needed.”

Gillespie said it is her understanding that the Marines in Fallujah are in the process of returning any government property to the Corps, but could not comment on what legal grounds the Zapata contractors had been detained. “You will need to check with the Marine Corps,” she said.

Posted by davidphinney at 07:56 PM | Comments (1)

June 03, 2005

Posted by davidphinney at 05:46 PM | Comments (1)

June 02, 2005

U.S. Marines and Zapata Respond

June 1 -- A U.S. Marine spokesman said late today that allegations about the mistreatment of 16 American contract security workers and three Iraqis jailed in Fallujah are untrue.

They were "treated humanely and respectfully," he said in an e-mail.

June 1 -- A U.S. Marine spokesman said late today that allegations about the mistreatment of 16 American contract security workers and three Iraqis jailed in Fallujah are untrue.

They were "treated humanely and respectfully," he said in an e-mail.

That account differs considerably from what several nervous wives of the contractors are hearing. They say their spouses were treated roughly and allowed no phone calls while they were detained for 72 hours by the U.S. Marines in cells adjacent to suspected insurgents.

Ten of the 16 American contractors are former Marines, one wife said. "It just kills them to know that the Marines could do to them what they did."

The contractors were released without charges. The majority of them may return to the United States later this week. An unknown number of the security workers are believed to have made contact with their senators in Washington, DC.

One question I am working on now, is that IF these contractors were roughed up, was that before or after they arrived at the jail?

The Marine spokesman explained that Marines were on the lookout for a convoy similar in appearance to the one the security workers were driving. "Marines saw passengers in the vehicles firing out the windows," he said (see statement below).

All 19 security workers were employees of Zapata Engineering, said Manuel Zapata, president of the Charlotte, NC, firm. The company holds a multimillion contract with the Army Corps of Engineers to supervise the captured enemy ammunition program in Fallujah.

"They didn't fire on the Marines, I can tell you that," Zapata said during a brief phone conversation this evening.

Zapata referred all other questions to the Army Corps of Engineers, but added that everything he read on an unnamed blog is wrong.

"They just provide misinformation," he said, adding that he had no other information.

U.S. Marine Spokesman in Iraq Responds (this afternoon):

"Here are the basic facts -- further details are pending the outcome of the investigation.
At approximately 2 p.m. on May 28, Marines of Regimental Combat Team-8 in Fallujah reported receiving small arms fire from gunman in several late-model trucks and sport utility vehicles. Marines also witnessed passengers in the vehicles firing at and near civilian cars on the street.

Three hours later, another Marine observation post was fired on by
gunmen from vehicles matching the description of those involved in the earlier attack. Marines saw passengers in the vehicles firing out the windows.

The vehicles were stopped without further incident by spike strips
placed on the road at a nearby observation post. No civilians, Marines or contractors were injured in the incidents.

The 16 Americans and three Iraqi citizens were taken into custody and held at the regional detention facility at Camp Fallujah, just outside the city. In accordance with standard operating procedures, the Americans were segregated from the rest of the detainee population and, like all security detainees, were treated humanely and respectfully.

The 19 contractors were released on Tuesday, May 31 and safely
transported to their compound near Baghdad, along with representatives of the company that employed them. Their weapons and vehicles were impounded as part of the investigation.

The incident remains under investigation by the Naval Criminal
Investigative Service.

We are not releasing information about the contract firm pending the
outcome of the investigation."

Posted by davidphinney at 01:35 AM | Comments (1)

June 01, 2005

Marines Detain Security Contractors in Fallujah

No one is talking, except several wives of the 16 U.S. contractors who say that U.S. Marines beat up their husbands after detaining them for 72 hours without food.

The wives liken the incident to the torture and abuse of Abu Ghraib and say it reflects the growing tensions between contractors and military in Iraq.

The contractors were working security for Zapata Engineering in Fallujah. The unconfirmed word is that 16 American security contractors and three Iraqis were jailed in cells adjacent to suspected insurgents and that they were individually beaten in front of dozens of laughing Marines standing by who were snapping photos. A snarling dog was used to intimidate the security contractors, I am told, as they were taunted about their large salaries -- said to be over $100,000 a year. All the American contractors, except two, are said to be returning to the United States as early as Thursday.

I am still awaiting response from Marine press people, but there may be some accusations that the contractors were holding unauthorized weapons and shooting indiscriminately.

Zapata, of Charlotte, NC, refers all inquiries to the Army Corps of Engineers, which awarded the company a multi-million-dollar contract to supervise a munitions depot and dispose of confiscated weapons and ammo.

The wives want to know why the Marines refused to let their husbands phone home while being detained. "Murderers have more rights," says one.

The contractors were detained on Saturday and released on Tuesday without charges.

A spokeswoman for the Army Corps of Engineers says the Marines had security concerns, but offers no further details.