Is Blackwater's Erik Prince Moving to the United Arab Emirates?

With Blackwater's top deputies indicted on federal charges and the
company up for sale, rumors are swirling that Prince is preparing to
bolt to a country with no extradition treaty with the US.

Sources close to Blackwater and its secretive owner Erik Prince claim
that the embattled head of the world's most infamous mercenary firm is
planning to move to the United Arab Emirates (UAE). The Middle Eastern
nation, a major hub for the US war industry, has no extradition treaty
with the United States. In April, five of Prince's top deputies were hit
with a 15-count
indictment by a federal Grand Jury on conspiracy, weapons and
obstruction of justice charges. Among those indicted were Prince's
longtime number two man, former Blackwater president Gary Jackson,
former vice presidents William Matthews and Ana Bundy, and Prince's
former legal counsel Andrew Howell.

The Blackwater/Erik Prince saga took yet another dramatic turn last
week, when Prince abruptly announced that
he was putting his company up for sale.

While Prince has not personally been charged with any crimes, federal
investigators and several Congressional committees clearly have his
company and inner circle in their sights. The Nation learned of
Prince's alleged plans to move to the UAE from three separate sources.
One Blackwater source told The Nation that Prince intends to
sell his company quickly, saying the "sale is going to be a fast move
within a couple of months."

Mark Corallo, a trusted Prince advisor and Blackwater spokesperson
would neither confirm nor deny the allegation that Prince is planning to
move to the United Arab Emirates. "I have a policy on not discussing my
client's personal lives -- especially when that client is a private
citizen," Corallo, who runs his own crisis management and PR firm, said in an email to The
Nation. "It is nobody's business where Mr. Prince (or anyone else)
chooses to live. So I'm afraid I will not be able to confirm any
rumors."

A source with knowledge of the federal criminal probe into
Blackwater's activities told The Nation that none of Prince's
indicted colleagues have flipped on Prince since being formally charged,
but rumors abound in Blackwater and legal circles that Prince may one
day find himself in legal trouble. Former Blackwater employees claim
they have provided federal prosecutors with testimony about what they
allege is Prince's involvement in illegal activity.

If Prince's rumored future move is linked to concerns over possible
indictment, the United Arab Emirates would be an interesting choice for a
new home--particularly because it does not have an extradition treaty
with the US. "If Prince were not living in the US, it would be far more
complicated for US prosecutors to commence an action against him," says Scott Horton, a
Columbia University Law lecturer and international law expert who has
long tracked Blackwater. "There is a long history of people thwarting
prosecutors simply by living overseas." The UAE, Horton says, is
"definitely a jurisdiction where Prince could count on it not being
simple for the US to pursue him legally."

The UAE is made up of seven states, the most powerful among them
being Dubai and Abu Dhabi. Since 9/11, they have emerged as hubs for the
US war industry. "Global service providers" account for some
three-quarters of Dubai's GDP, while oil represents only 3 percent.
"They have established themselves as the premiere location in the Middle
East for off-shore banking and professional services," says Horton, who
has legal experience in the UAE. "If you have connections to the royal
families, then the law doesn't really apply to you. I would be very
surprised if Erik Prince does not have those kinds of connections
there."

As a matter of policy the Justice Department will not discuss
possible investigations of people who have not yet been charged with a
crime.

Two former employees made serious allegations against Prince last
August in sworn
declarations filed as part of a civil lawsuit against Prince and
Blackwater. One former employee alleged that Prince turned a profit by
transporting "illegal" or "unlawful" weapons into Iraq on his private
planes. A four-year employee of Blackwater, identified in his
declaration as "John Doe #2," stated that "it appears that Mr. Prince
and his employees murdered, or had murdered, one or more persons who
have provided information, or who were planning to provide information,
to the federal authorities about the ongoing criminal conduct." He also
stated that "Mr. Prince feared, and continues to fear, that the federal
authorities will detect and prosecute his various criminal deeds,"
adding: "On more than one occasion, Mr. Prince and his top managers gave
orders to destroy emails and other documents. Many incriminating
videotapes, documents and emails have been shredded and destroyed."

John Doe #2's identity was concealed in the sworn declaration because
he "fear[s] violence against me in retaliation for submitting this
Declaration." He also alleged, "On several occasions after my departure
from Mr. Prince's employ, Mr. Prince's management has personally
threatened me with death and violence." Doe #2 stated in his declaration
that he provided the information contained in his statement "in grand
jury proceedings convened by the United States Department of Justice."

Prince is also facing civil lawsuits brought by Iraqi victims of
Blackwater. Among these is a suit filed in North Carolina by the family
of nine-year-old Ali
Kinani. Kinani's family alleges he was shot in the head and killed
by Blackwater operatives in the infamous Nisour Square massacre in
Baghdad in 2007. Earlier this year, Prince claimed
he was spending $2 million a month in legal fees and on what he
described as a "giant proctological exam" by nearly a dozen federal
agencies.

Even if prosecutors believed they had enough evidence to charge
Prince with a crime, because of the classified nature of some of
Blackwater and Prince's work for the CIA and other agencies of the US
government, prosecuting him could prove challenging. Prince has deep
knowledge of covert US actions that the US government or military may
not want public, which could be revealed as part of a potential defense
Prince could offer. Blackwater--and Prince specifically--long worked on
the CIA's assassination program.

Some observers believe that Prince has already engaged in "graymail"
by revealing some details of his classified work for the CIA and
military, specifically in a January 2010 article
in Vanity Fair, written by a former CIA lawyer. Graymail is a
legal tactic that has been used for years by intelligence operatives or
assets who are facing prosecution or fear they soon will be. In short,
these operatives or assets threaten to reveal details of sensitive or
classified operations in order to ward off indictments or criminal
charges, based on the belief that the government would not want these
details revealed.

After Jackson and the other former Blackwater executives were
indicted, their lawyers claimed
that the US government approved of their conduct. "All of this was with
the knowledge of, the request of, for the convenience of, an agency of
the U.S. government," Jackson's lawyer Ken Bell told the judge during a
bond hearing in April. Bell did not reveal which agency he was referring
to and did not answer questions from reporters.

The latest developments in the Blackwater story come after a two-year
campaign by Blackwater to rebrand itself
as "Xe Services" and the "US Training Center." In March 2009, Prince announced
he was stepping down as CEO of the company, though he has remained its
sole owner. While Blackwater continues to be a significant player in US
operations in Afghanistan under the Obama administration--working for
the State Department, Defense Department and CIA--it is facing increased
scrutiny
on Capitol Hill and continued pressure from the Justice Department.

On June 11, federal prosecutors filed a massive brief in their appeal
of last year's dismissal
by a federal judge of manslaughter charges against the Blackwater
operatives alleged to be the "shooters" at Nisour Square. In the brief,
prosecutors asked that the indictment of the Blackwater men be
reinstated. Meanwhile, two other Blackwater operatives were indicted
in January on murder
charges stemming from a shooting in Afghanistan in May 2008. Sen.
Carl Levin, chair of the Senate Armed Services Committee has called on
the Justice Department to investigate Blackwater's use of a shell
company, Paravant, to win training contracts in Afghanistan.

Blackwater has been spending heavily this year on
lobbyists--particularly Democratic ones. In the first quarter of 2010,
the company spent
more than $500,000 for the services of Stuart Eizenstat, a
well-connected Democratic lobbyist who served in the Clinton and Carter
Administrations. Eizenstat heads the international practice for the
powerhouse law and lobbying firm Covington and Burling.

Prince sold
Blackwater's aviation division earlier this year for $200 million. In
announcing last week that the rest of Blackwater was up for sale, the
company said in a statement
that Blackwater's "new management team has made significant changes and
improvements to the company over the last 15 months, which have enabled
the company to better serve the US government and other customers, and
will deliver additional value to a purchaser." While Blackwater has
tried to shed the Blackwater name in many aspects of its business, the
company has recently opened a series of Blackwater "Pro-Shop" retail
stores, offering merchandise bearing the Blackwater name and
original logo. Among the items for sale: pink Blackwater baby
onesies, Blackwater pint
glasses, Blackwater beach
towels, and, of course, rifles.

In a speech
in January, obtained by The Nation, Prince said that he
intends to publish a book this fall. He was originally slated to
come out with a book in June 2008 with the title "We Are Blackwater."