Shortly after a 2007 shooting incident in a Baghdad traffic square that left 17 Iraqi civilians dead, Blackwater contractors allegedly transferred a number of machine guns to another contractor who is now charged with trying to smuggle them out of Iraq.
The Blackwater contractors wanted to dispose of the weapons before an investigation of the bloody incident began, according to two confidential government informants.
John Houston, the contractor charged in the case, allegedly told one of the informants that after Blackwater "got into trouble," the guards had to get rid of the firearms so they wouldn't be caught with them.
The Sept. 16, 2007, shooting incident in Nisoor Square enraged Iraqis and led to the loss of Blackwater's lucrative diplomatic security contract in Iraq.
The Moyock, N.C.-based private military company has since renamed itself Xe.
Six Blackwater contractors face manslaughter and weapons charges stemming from the incident.
Houston, a retired Special Forces soldier, is charged separately with trying to smuggle eight machine guns and a semi automatic pistol from Iraq into the United States. The indictment was handed down last week by a federal grand jury in Maryland.
Houston, 43, served with the Army Special Operations Command, headquartered at Fort Bragg, N.C., until his retirement as a sergeant major in 2006. At the time of the Nisoor Square shootings, he was working in Iraq for SOS International, a New York-based military contractor.
In a sworn statement, Christopher Trainor, a special agent with the Bureau of Alcohol, Tobacco, Firearms and Explosives, quoted the two confidential informants as saying Houston told them he obtained machine guns from Blackwater contractors after the Nisoor Square incident.
According to the agent, Houston told the informants that Blackwater employees had a large shipping container filled with firearms that they had seized from Iraqi insurgents.
After the Baghdad shootings, Houston allegedly told one informant, the Blackwater personnel passed some of the firearms to him "because they wanted to dispose of the weapons before an investigation ensued."
Houston's attorney declined to comment on the allegations.
Anne Tyrrell, a Xe spokeswoman, said in a brief e-mail statement that "possession of unauthorized firearms is in violation of the company's strict policies."
Apart from the Houston case, Xe has been the subject of several government investigations of alleged improper arms shipments related to its security work in Iraq.