Corpwatch on security contractor USPI

We blogged a couple of months back about United States Protection and Investigations (USPI). Corpwatch has done an excellent report on them. Excerpts:

The Gunmen of Kabul
by Fariba Nawa, Special to CorpWatch
December 21st, 2007

In September, on a tree-lined street in the most expensive neighborhood in Kabul, dozens of men rolled out of armored vehicles in front of a little-known U.S. security company. Backed up by Blackwater guards, Afghan authorities and Americans from the FBI and the U.S. State Department quickly headed for the offices of United States Protection and Investigations (USPI). Once inside, they arrested four of the Texas-based company’s management team and confiscated 15 computers. The two Americans arrested were later released, while the Afghan managers remain in custody.

The September raid was one of the first attempts by President Karzai’s government to crack down on private security contractors in Afghanistan. Afghan police say they plan to shut down about 14 contractors, and so far, have closed 10 Afghan and foreign firms.

What made the USPI raid unusual was the U.S. government’s role. The State Department and FBI spearheaded the operation and accused the company of defrauding the United States, according to USPI guards in Kabul and Afghan officials who did not want to be named because the investigation is classified.

Ironically, the United States used private security guards from Blackwater -- the same company under scrutiny for the September death of 17 Iraqi civilians -- to carry out the USPI raid. ...

One foreign private security contractor, who would only speak off the record, counters that the police crackdown is really a witch-hunt to extort money from Western companies. An Afghan journalist who is researching the issue and cannot publicly comment, points to the fact that many of the companies, such as Afghan-owned Khawar, are back in business. If the right people in the government are bribed, he said, the contractors have no problems re-opening.

According to a high-level contractor who worked for the U.S. embassy in Kabul, the crackdown may be targeting legitimate companies along with rogue and unlicensed operations. Some businesses may have been shut down after high-powered government officials issued false charges arising out of vendettas. ...

There has also been little progress in efforts to control the expense of or to monitor the private security industry. Two years ago, the Afghan government hired a Canadian consulting company to help formulate legislation to regulate the companies, but the effort has not generated effective laws. This December the U.S. Congress passed a bi-partisan bill requiring contractors to provide more information on how they are spending aid money. The legislation creates the post of a special inspector general for Afghanistan reconstruction (SIGAR) to monitor American assistance to Afghanistan. President Bush has yet to sign it. ...

Many of the private security companies, including USPI, have hired Afghan guards who fought in previous wars and were supposed to be disarmed. According to the joint United Nations and Afghan disarmament group, there are still 2,000 private militias in the country employing some 120,000 men, many of whom work for private security contractors. The largest companies are either U.S. or British, and include DynCorp, USPI, Armour Group, Saladin and Global Risk Strategy.

... in 2002, USPI planted itself in Afghanistan and collaborated with former Mujahideen commander Din Mohammed Jorat.

Jorat, a notorious warlord accused of killing the aviation minister in 2002, was head of security in the Ministry of Interior and headed a militia that became part of the Afghan police. His officers were paid a low salary, $70 a month, but offered the opportunity to boost it by working as guards for USPI. They remained Afghan government employees and received a $3 to $5 per diem for USPI’s on-the-job training. By claiming to train, rather than actually employing the moonlighting police, the U.S. contractor was able to provide the cheapest security option for its clients in Afghanistan. The scheme effectively turned a large sector of the Afghan police into a private quasi-militia.

In a matter of months, USPI became USAID’s second biggest security contractor in Afghanistan (after Virginia-based Dyncorp). USAID awarded the company $36 million for four and a half years to protect infrastructure projects, such as a road-building project awarded to Louis Berger, a New Jersey engineering company. USPI also made money from contracts with other foreign companies and NGOs to protect their offices and staff in Kabul and the provinces. At its peak, the company employed some 4,000 Afghans.

By September 2007, according to one USPI Afghan guard in Kabul, the company’s guards no longer worked for the government, and had become direct employees of USPI, which pays their salaries. Jorat, who is no longer head of security at the interior ministry, had opened his own security company, Khawar, and no longer collaborates with USPI, according to the guard. ...

"[USPI managers] made deals with the devil and their guys could do anything they want: shakedowns, drug dealing. [They were] thugs who liked mafia-type operation,” said the U.S. embassy security contractor. He said USAID was not happy with USPI, but it had spent too much money mobilizing the company to let it go. ...

In 2005, a U.S. supervisor for USPI allegedly shot dead his Afghan interpreter and was flown out of the country the next day, according to Afghan officials.

Despite these issues, USPI continued to get contracts because it underbid its competitors for projects and remained the cheapest option, the American contractor said.

Paktiawal, the policeman in charge of criminal investigations in Kabul, was present during the USPI raid and told CorpWatch that the FBI and USAID are both investigating the company. Until the investigation is complete, he said he could not release more details about the charges.

USPI could not be reached for comment, but in October, the Associated Press reported:

“USPI faces accusations of overcharging USAID by billing for employees and vehicles that did not exist, said a U.S. security official with close ties to the company who wasn’t authorized to release the information. The overbilling could run into the millions of dollars … Blackwater held U.S. and Canadian citizens at gunpoint during the raid, said the U.S. official. Blackwater ... helps provide security for the U.S. Embassy.” (link)

**N.B. See also a more extensive report on Afghanistan by Corpwatch here.