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Did Blackwater Graymail Lead to a Whitewash?

Whitewashed Fence
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Last week saw a rather surprising conclusion to the federal government’s nearly six-year criminal probe of the weapons practices of controversial private security contractor Blackwater (now called Academi).

In 2010, the Department of Justice (DOJ) charged five former Blackwater employees—former executives Gary Jackson, Andrew Howell (who once took serious exception to Blackwater’s profile in POGO’s Federal Contractor Misconduct Database), William Mathews, Jr., and Ana Bundy, and former armorer Ronald Slezak—with violating federal firearms laws, filing false statements, and obstructing justice. The government had already nabbed former employees Kenneth Cashwell and William Grumiaux, both of whom pleaded guilty in 2008 to possessing stolen firearms and helped the DOJ build its case against the higher-ups.

But last Thursday, the government dropped all charges against Howell, Bundy, and Slezak, and announced that Jackson and Mathews pleaded guilty to a single misdemeanor weapons recordkeeping charge. They were sentenced to three years of probation, four months of house arrest, and a $5,000 fine. Under the original indictment, both men were facing decades in prison on numerous felony charges. The plea deal happened very quickly, outside of public scrutiny, and with no explanation from the DOJ.

Academi took last week’s news in stride, reacting as if the case involved another company. “The court decision involves former Blackwater executives, none of whom have ever worked for ACADEMI or the current ownership,” the company told POGO. “ACADEMI is an independent company with no affiliation to the former owner, management or these employees.

It was an odd outcome for such a major misconduct probe with serious national security implications. In addition to the 2008 guilty pleas, Blackwater paid the State Department $42 million in 2010 to settle hundreds of alleged weapons export violations under the Arms Export Control Act (AECA) and the International Traffic in Arms Regulations (ITAR). Last year, Blackwater also entered into a deferred prosecution agreement with the DOJ and paid $7.5 million to resolve a total of 17 criminal charges relating to the possession and exportation of firearms and other defense articles.

Blackwater’s special status as an important contractor to the military, the State Department, and the intelligence agencies has led to speculation that the government was a victim of “graymail,” or a legal gambit to force prosecutors to back off by threatening to reveal sensitive national security information. The defendants had long maintained that the actions for which they were being prosecuted were done at the behest of, and with the full knowledge of, the government. They introduced statements from ex-CIA officials claiming that they knew that Blackwater had been acting at the CIA’s direction and filed motions seeking evidence of the CIA’s role in specific weapons transactions. According to the New York Times, the DOJ denied that the CIA had played any role in Blackwater’s activities, a somewhat unconvincing denial in light of what has been reported over the years about the shadowy relationship between the CIA and Blackwater.

Whether or not the graymail allegation is true, this case offers another example of the downside of the government’s reliance on contractors. Some contractors are too big to debar; others, like Blackwater, may be too deeply entrenched in our country’s national security apparatus to face the full brunt of the criminal justice system.

Image by Flickr user CoolValley.

By: Neil Gordon
Investigator, POGO

Neil Gordon, Investigator Neil Gordon is an investigator for the Project On Government Oversight. Neil investigates and maintains POGO's Federal Contractor Misconduct Database.

Topics: Contract Oversight

Related Content: Contractor Accountability, Defense, Government Privatization, Private Security Contractors

Authors: Neil Gordon

Submitted by RadioGal at: March 11, 2013
"Blackwater provided a very badly needed service to the USA. Jackson and the rest are very good and very Patriotic individuals. You can not fault Blackwater and Prince for the "system." " Oh jeez this Prince guy can't get enough of himself, making sure to shill every blackwater post he can find. BLACKWATER STINKS & is run by blood lusting neocons that everyone hates. Take that in your pipe n smoke it, Prince
Submitted by Lynn at: March 4, 2013
Thanks Neil for following up on this important issue. Blackwater "Inc.", their employees, and their sleazy lawyers were symptoms of severe government dysfunction. You have shed light on what would be considered a miscarriage of justice.
Submitted by LCJinRoslyn PA at: March 2, 2013
The Roman Empire began to spin out of control when it complemented its home-grown military forces with men who lacked any loyalty to the empire and worked strictly for profit. We are on the same dire path. Blackwater is an example of how "outsourcing" military functions to private for-profit interests undermines the objective: aside from providing shoddy work that electrocuted servicemen, and creating untold animosity through their errant murder of civilians, they have been given so much access they now can face down the DOJ. Meanwhile, Bradley Manning, a true patriot, is rotting in jail for trying to expose the truth. I'm betting on the barbarians this time.
Submitted by ivanczar at: March 2, 2013
Another "Racket Of War " ,General Smedley Butler ,example .
Submitted by bobcobit at: March 2, 2013
So, what can be done about the three main issues: 1) private contractors doing the work of the military; 2) holding government official who collude with private contractors to the detriment of our nation; and 3) lack of ability to prosecute those involved in bilking the government of funds and/or engagement in treasonous acts?
Submitted by Justina at: March 2, 2013
"Blackwater (now called Academi)" how many times are they going to change their name? After every scandal?
Submitted by LB at: March 2, 2013
Blackwater provided a very badly needed service to the USA. Jackson and the rest are very good and very Patriotic individuals. You can not fault Blackwater and Prince for the "system."
Submitted by UR2dmb4wds at: March 2, 2013
Blackwater/Xe/ACADEMI and all other names they've switched to since the Iraq war involvement has been in bed with the U.S. military since the beginning. Their ops, as I've read, aren't restricted to wars but they occupy plenty of space right here at home and their future "uses" will be numerous against the American people. It isn't surprising they are a "protected" group (run by alleged religious people who are in the business of guns and war, mercenaries and survivalists). It would seem they are a part of the "privatization" and the degradation of America with Martial Law in mind for the not too distant future and these guys being our "big brother". Part of the ugly future the radicals have in mind for all the unsuspecting Americans. What a SAD and scary thing for our country.
Submitted by Barclay at: March 2, 2013
This is another example of poor oversight and over reaching by our intelligence agency. A better decision Analysis/criteria for using contractors needs to be formulated if for nothing else, public education.
Submitted by Angry One at: March 2, 2013
so, the gov will hound little Pogo for 14 years after it helped in securing tens of millions more in oil royalities but it lets the big bad BW off with a wink and a kiss behind closed doors. life is good for the dirty..
Submitted by Academiwatch at: March 2, 2013
Of course it was a whitewash job thanks to the revolving door that sees bought-off criminals routinely moving between mercenaries/private armies like ACADEMI and the U.S. government. For more information visit

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