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The Nation

Blackwater Indictments Are Like Al Capone Going Down for Tax Evasion

Jeremy Scahill

From the first days of the launch of the so-called "war on terror,"
Blackwater has been at the epicenter of some of the most secretive
operations conducted by US forces globally. It has worked on government
assassination programs and drone bombings, operated covertly in Pakistan
for both the CIA and the Joint Special Operations Command, assisted
secret raids inside of Syria, trained foreign militaries and continues
to bodyguard senior US officials in Afghanistan. The company also has a
bloody track record of killing civilians in Iraq and Afghanistan. Many
seasoned observers believe that the extent of the dark acts committed by
Blackwater have yet to come to light.

While Congressional committees, the IRS, the FBI and lawyers
representing foreign victims of the company have fought for years to
hold Blackwater and its forces accountable for their alleged crimes, the
company has proved to be Teflon. Not a single case against the company
has resulted in any significant action. Following last December's
dismissal of the high-profile criminal case against the Blackwater
operatives allegedly responsible for the 2007 Nisour Square shootings
that left seventeen Iraqis dead and more than twenty others wounded,
federal prosecutors have now launched another salvo.

Last week, the Justice Department announced that a federal grand jury
had returned a fifteen-count indictment against five current and former
Blackwater officials, charging them with conspiracy to violate a series
of federal gun laws, obstruction of justice and making false statements
to the Bureau of Alcohol, Tobacco and Firearms. Among those indicted
were Blackwater owner Erik Prince's longtime right-hand man, former
company president Gary Jackson, Blackwater's former legal counsel Andrew
Howell and two former company vice presidents. Given Blackwater's track
record and the severity of other allegations against the
company--including killing unarmed civilians--if the charges in this
case stick, it would be somewhat akin to Al Capone going down for tax
evasion. The one major difference being, the number-one man at
Blackwater, Erik Prince, is evading prosecution and jail. Prince, who
remains the Blackwater empire's sole owner, was not indicted.

The weapons charges stem from Blackwater's purchase of 227 "short
barrels" for use with the company's government-issued M4 rifles in Iraq
and Afghanistan, a violation of State Department weapons guidelines for
contractors. Former Blackwater employees have alleged in sworn
affidavits that Prince had used his personal planes to smuggle banned
weapons into Iraq, sometimes wrapping them in large shipments of dog
food for the company's K-9 teams in Iraq. Prince, however, is not named
in the indictment.

The indictment also charges that the Blackwater officials "arranged
straw purchases" of Romanian AK-47s and fully automatic M-4 rifles for
use inside the United States. According to the indictment, the local
sheriff's department in Blackwater's home base of Moyock, North
Carolina, provided Blackwater with blank stationery that "was used to
prepare letters claiming the sheriff's office wanted" the weapons. "The
weapons were paid for by Blackwater, were immediately delivered to
Blackwater upon their arrival, and were locked in Blackwater's armory to
which the sheriff's office had no direct access," according to federal

In March 2009, the ATF informed Blackwater that it would be coming to
the company's compound for an inspection of the armory of Blackwater
subsidiary XPG. Former Blackwater officials told The Nation that
XPG was created in part as a successor to Blackwater SELECT and
Blackwater PTC, the divisions of the company that did sensitive covert
work for the CIA and JSOC.

When Blackwater was informed of the impending ATF investigation, according to the Justice Department:


Allegedly, [Blackwater lawyer Andrew] Howell did not want any more SBRs
[Short Barrel Rifles] to be found and told a subordinate that disclosing
the SBRs was "not an option." He and [Blackwater vice president Ana]
Bundy subsequently ordered the short-barreled guns in XPG's armory to be
moved to Blackwater's armory where the barrels could be switched out.
Only the long-barreled guns were returned to XPG. Howell then prepared a
letter for the company president's signature and attached it to an
e-mail. The letter was intended to be back-dated and would have given a
false impression that the President had ordered the alteration of the
guns--which had already been accomplished by direction of Howell and

The Justice Department also alleges that Blackwater officials, in an
attempt to win a lucrative contract with the Kingdom of Jordan,
presented several guns as gifts to Jordanian officials who came to tour
Blackwater's private military base in North Carolina. According to the
indictment, "the officials were presented with one M4, three Glocks, and
a Remington shotgun. Each was inscribed with the Blackwater logo and
presented in a case. Subsequently, the company realized it could not
account for the guns in its required records." Blackwater president Gary
Jackson, prosecutors allege, "then organized the false completion" of
federal documents that "were designed to give the appearance that
employees had bought the guns for their own use."

Until recently, Blackwater had a partnership with Sig Sauer to
manufacture a Blackwater-brand 9 millimeter pistol. For years the
company has done a multimillion-dollar business with Jordan, training
the company's special-forces helicopter pilots and advising the kingdom
on intelligence matters. Blackwater also has a headquarters in Jordan.
Last year the New York Times reported that Gary Jackson was
involved in a scheme to bribe Iraqi officials to stay quiet on the
company's alleged massacre of seventeen Iraqi civilians in Baghdad's
Nisour Square in September 2007 and to allow Blackwater to continue
operating in the country despite the public outrage in Iraq. That
alleged plot, according to the Times, involved the transfer of $1
million into Jordan for ultimate use in Iraq.

Each of the charges against the Blackwater officials potentially carries
a penalty of three to twenty years in prison and hundreds of thousands
of dollars in fines. Lawyers for the accused have said their clients are
not guilty of the charges and will fight them. There are two other
pending criminal cases against Blackwater. Prosecutors have apealed the
dismissal of the Nisour Square case, and two Blackwater operatives have
been indicted on charges they killed innocent Afghan civilians. In a
recent interview, Prince estimated his monthly legal bills to be between
$2-3 million.

Meanwhile, as Blackwater officials face another round of attempted
criminal prosecutions, the company continues to fight off the remaining
civil lawsuits stemming from the Nisour Square shooting. Last year
Blackwater settled with most of the victims, reportedly for a total of
$5 million. The only remaining suit against the company over Nisour
Square was brought by a small group of Iraqis, most prominent among them
Mohammed Kinani, the father of the youngest known victim of the
shooting. His 9-year-old son, Ali, was shot in the head that day and
died shortly after from his injuries. Kinani originally sued Blackwater
in state court in North Carolina, but last week a federal judge sided
with Blackwater and took control over the case. That judge, Terrence
Boyle, was a former legislative aide to the late Republican Senator
Jesse Helms, who urged President Ronald Reagan to appoint Boyle, which
Reagan did. For more than a decade, Democrats blocked Boyle's nomination
to the appelate court, characterizing him as an ultraconservative who
opposed civil rights and was often over-ruled on appeal. It is hard to
imagine a better judge for Blackwater to draw in this case.

As it has done in other cases, Blackwater has asked the Obama
Justice Department to intervene in Kinani's case and to make the US
government--not Blackwater and the individual shooters in the case--the
defendant. Legal experts have told The Nation
that if the Justice Department did that, the case would be dead in the
water. The Justice Department has not responded to Blackwater's
request. Blackwater, however, is not wasting any time seeking out

On April 7, lawyers for the six alleged shooters and Blackwater asked
Judge Boyle to replace Blackwater and the shooters with the "United
States" in the case, citing the Westfall Act, which was passed in 1988
"to protect federal employees from personal liability for common law
torts committed within the scope of their employment, while providing
persons injured by the common law torts of federal employees with an
appropriate remedy against the United States." If Boyle were to do this,
the case would likely be immediately dismissed.

In its filing, Blackwater's lawyers argued that the actions taken by the
alleged Blackwater shooters at Nisour Square "indisputably fall within
the scope" of their State Department employment. But Kinani's lawyers
and federal prosecutors have alleged that the men disobeyed orders from
their superiors not to proceed to Nisour Square that day, leading to the
shooting. One of the Blackwater guards, Jeremy Ridgeway, pled guilty to
killing an unarmed Iraqi in the square. In his sworn proffer that
accompanied his guilty plea, Ridgeway admitted that he and the other
five accused shooters "opened fire with automatic weapons and grenade
launchers on unarmed civilians...killing at least fourteen people" and
wounding at least twenty others. "None of these victims was an
insurgent, and many were shot while inside of civilian vehicles that
were attempting to flee" the Blackwater forces, the proffer stated.
Ridgeway also admitted that his team had "not been authorized" to leave
the Green Zone and that after they departed, they "had been specifically
ordered" by US Embassy officials to return. "In contravention of that
order," they proceeded to Nisour Square, according to Ridgeway.

The Justice Department could intervene in the Kinani case at any point
and produce evidence showing that Blackwater does not equal the US
government and therefore should not be allowed to shift the burden of
responsibility for the shooting onto the US government. To date, that
has not happened, and it is currently a decision for one man: Judge
Terrence Boyle.

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