Blackwater accused of bribery

WASHINGTON - Executives at Blackwater Worldwide authorized secret payments of about $1 million to Iraqi officials that were intended to silence their criticism and buy their support after a September 2007 episode in which Blackwater security guards fatally shot 17 Iraqi civilians in Baghdad, according to former company officials.

Blackwater approved the payments in December 2007, the officials said, as protests over the shootings stoked long-simmering anger inside Iraq about reckless practices by the company's employees.

U.S. and Iraqi investigators had already concluded that the shootings were unjustified, top Iraqi officials were calling for Blackwater's ouster from the country and company officials feared that Blackwater might be refused a license it would need to retain contracts worth hundreds of millions of dollars annually with the State Department and private clients.

Four former Blackwater executives said in interviews that Gary Jackson, who was then the company's president, had approved the bribes and that the money was sent from Amman, Jordan, where Blackwater maintains an operations hub, to a manager in Iraq. The executives, though, said they did not know whether the cash was delivered to Iraqi officials and did not know the identities of the potential recipients.

Blackwater's strategy of buying off the government officials, which would have been illegal under U.S. law, created a deep rift inside the company, according to the former executives. They said that Cofer Black, who was then the company's vice chairman and a former top CIA 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 with U.S. Embassy officials.

Alarmed about the secret payments, Black cut short his talks and left Iraq. Soon after returning 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 executive familiar with the meeting. Black resigned the following year.

Allegations dismissed

Stacy DeLuke, a company spokeswoman, dismissed the allegations as "baseless" and said the company would not comment about former employees. Black did not respond to messages seeking comment.

Reached by phone, Jackson, who resigned as president of Blackwater early this year, criticized the New York Times and said, "I don't care what you write."

The four former Blackwater executives would speak only on condition of anonymity. Two of them said they took part in talks about the payments; the two others said they had been told by several Blackwater officials about the discussions. In agreeing to describe those conversations, the four officials said that they were troubled by a pattern of questionable conduct by Blackwater that led them to leave the company.

A senior State Department official said that U.S. diplomats were not aware of any payoffs to Iraqi officials.

Blackwater continued operating as the prime contractor providing security for the U.S. Embassy in Baghdad until last spring, when the Iraqi government said it would deny the company an operating license. The State Department replaced Blackwater with a rival company in May, but Blackwater still does some work for the department in Iraq.

A long investigation

Five Blackwater guards involved in the shooting are facing federal manslaughter charges, and their trial is scheduled to start in February in Washington. A sixth guard pleaded guilty in December.

Blackwater, now known as Xe Services, has never faced criminal charges in the case, although the Iraqi victims brought a civil suit in federal court against the company and Prince.

Separately, a federal grand jury in North Carolina, where Blackwater has its headquarters, has been conducting a lengthy investigation into the company. One of the former executives said that he had told federal prosecutors there about the plan to pay Iraqi officials to drop their inquiries about the shootings. If Blackwater followed through with the payments, the company or its officials could face charges of obstruction of justice and violating the Foreign Corrupt Practices Act, which bans bribes to foreign officials.

Officials at the U.S. attorney's office in Raleigh declined to comment on their investigation, 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 Blackwater employees about a variety of issues, including allegations of weapons smuggling, according to several former Blackwater workers who say they have testified before the grand jury or have been interviewed by prosecutors. Two former employees have pleaded guilty to weapons charges and are believed to be cooperating with prosecutors.