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This Copy is for Your Personal, Noncommercial Use Only. You

This Copy is for Your Personal, Noncommercial Use Only. You

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12/07/2009

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This copy is for your personal, noncommercial use only. You can order presentation-ready copies for distribution to your colleagues, clients or customershereor use the "Reprints" tool that appears next to any article. Visitwww.nytreprints.comfor samples and additional information.Order a reprint of thisarticle now.
November 11, 2009
Blackwater Said to Pursue Bribes to Iraq After 17 Died
By MARK MAZZETTIandJAMES RISEN
 WASHINGTON — Top executives atBlackwater Worldwideauthorized secret payments of about $1 million to Iraqi officials that were intended to silence their criticism and buy theirsupport after a September 2007 episode in which Blackwater security guards fatally shot 17Iraqi civilians in Baghdad, according to former company officials.Blackwater approved the cash payments in December 2007, the officials said, as protests overthe deadly shootings in Nisour Square stoked long-simmering anger inside Iraq about recklesspractices 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’souster from the country, and company officials feared that Blackwater might be refused anoperating license it would need to retain its contracts with the State Department and privateclients, worth hundreds of millions of dollars annually.Four former executives said in interviews that Gary Jackson, who was then Blackwater’spresident, had approved the bribes and that the money was sent from Amman, Jordan, wherethe company 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 thepotential recipients.Blackwater’s strategy of buying off the government officials, which would have been illegalunder American law, created a deep rift inside the company, according to the formerexecutives. They said that Cofer Black, who was then the company’s vice chairman and a formertopC.I.A.and State Department official, learned of the plan from another Blackwater manager while he was in Baghdad discussing compensation for families of the shooting victims withUnited States Embassy officials. Alarmed about the secret payments, Mr. Black cut short his talks and left Iraq. Soon afterreturning to the United States, he confronted Erik Prince, the company’s chairman and founder, who did not dispute that there was a bribery plan, according to a former Blackwater executivefamiliar with the meeting. Mr. Black resigned the following year.Stacy DeLuke, a spokeswoman for the company, now called Xe Services, dismissed theallegations as “baseless” and said the company would not comment about former employees.Mr. Black did not respond to telephone calls and e-mail messages seeking comment.
 
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Reached by phone, Mr. Jackson, who resigned as president early this year, criticized The New  York Times and said, “I don’t care what you write.”The four former Blackwater executives, who had held high-ranking posts at the company, wouldspeak only on condition of anonymity. Two of them said they took part in talks about thepayments; the two others said they had been told by several Blackwater officials about thediscussions. In agreeing to describe those conversations, the four officials said that they weretroubled by a pattern of questionable conduct by Blackwater, which had led them to leave thecompany. A senior State Department official said that American diplomats were not aware of any payoffsto Iraqi officials.Blackwater continued operating as the prime contractor providing security for the United StatesEmbassy in Baghdad until spring, when the Iraqi government said it would deny the company an operating license. The State Department replaced Blackwater with a rival in May, but thecompany still does some work for the department in Iraq on a temporary basis.Five Blackwater guards involved in the shooting are facingfederal manslaughter charges,andtheir trial is scheduled to start in February in Washington. A sixth guard pleaded guilty inDecember. The company has never faced criminal charges in the case, although the Iraqi victims brought acivil lawsuitin federal court against Blackwater and Mr. Prince.Separately, a federal grand jury in North Carolina, where the company has its headquarters, has been conducting a lengthy investigation into it. One of the former executives said that he hadtold federal prosecutors there about the plan to pay Iraqi officials to drop their inquiries intothe Nisour Square case. If Blackwater followed through, the company or its officials could facecharges of obstruction of justice and violating the Foreign Corrupt Practices Act, which bans bribes to foreign officials.Officials at the United States Attorney’s Office in Raleigh declined to comment on theirinvestigation, and it is not clear whether the payment scheme is a focus of the grand jury.Federal prosecutors in North Carolina have interviewed a number of former Blackwateremployees about a variety of issues, including allegations of weapons smuggling, according toseveral former employees who say they have testified before the grand jury or been interviewed by prosecutors, as well as lawyers familiar with the matter. Two former employees have pleadedguilty to weapons charges and are believed to be cooperating with prosecutors.Since 2001, Blackwater has undergone explosive growth, not only from security contracts in Iraqand Afghanistan, but also from classified work for the Central Intelligence Agency that includedtaking part in a now defunct program toassassinate leaders of Al Qaedaand toload missiles on Predator drones.The Nisour Square shooting was the bloodiest and most controversial episode involvingBlackwater in the Iraq war. At midday onSept. 16, 2007, a Blackwater convoy opened fire on
 
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Iraqi civilians in the crowded intersection, spraying automatic weapons fire in ways thatinvestigators later claimed was indiscriminate, and even launching grenades into a nearby school. Seventeen Iraqis were killed and dozens more were wounded.The matter set off an international outcry and intense debates in Iraq and the United Statesover the role of private contractors in war zones. Many Iraqis condemned Blackwater, whichthey had long seen as an arrogant rogue operation, and Prime MinisterNuri Kamal al-Malikideclared that the Blackwater shooting was achallenge to his nation’s sovereignty . Hisgovernment opened investigations into the episode and previous fatal shootings by Blackwaterguards, and threatened to bar the company from operating in the country.Those responses deeply worried Blackwater officials. Before the Nisour Square shootings, thecompany had operated in Iraq without a license largely because the Iraqi government hadnever enforced the rules. Being blocked from the country would have been costly — the StateDepartment deal was Blackwater’s single biggest contract. From 2004 through today, thecompany has collected more than $1.5 billion for its work protecting American diplomats andproviding air transportation for them inside Iraq.“It would hurt us,” Mr. Prince, the chairman, said in an interview in January about losing thediplomatic security contract. “It would not be a mortal blow, but it would hurt us.”The former Blackwater executives said it was not clear who proposed paying off Iraqi officials.But after Mr. Jackson, the former company president, approved the plan, the cash for thepayoffs was taken from Amman and given to Rich Garner, then a top manager in Iraq, theformer executives said. One of those executives said that officials in Iraq’s Interior Ministry, which is responsible for operating licenses, were the intended recipients.Mr. Garner, who still works for the company, could not be reached for comment. The formerexecutives said they did not know whether Mr. Garner was involved in decisions about the bribery scheme. At that time, Mr. Black was in a series of discussions with Patricia A. Butenis, the deputy chief of mission at the American Embassy in Baghdad, about compensation payments to the NisourSquare victims. According to former Blackwater officials, Mr. Black was furious when he learnedthat the payoff money was being funneled into Iraq, and he swiftly broke off the talks with Ms.Butenis.“We are out of here,” Mr. Black told a colleague, one former executive said. After returning tothe United States, Mr. Black and Robert Richer, who had also joined Blackwater after a C.I.A.career, separately confronted Mr. Prince with their concerns about the plan, one formerBlackwater executive said.Mr. Richer left Blackwater in February 2008, followed by Mr. Black several months later, amid a battle inside Blackwater between former C.I.A. officers working at the company’s office outside Washington and executives at Blackwater’s headquarters in North Carolina.

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