Nov. 14, 2007  -- In a dramatic turn of events on Capitol Hill today, the State Department inspector general recused himself from all Blackwater-related issues after admitting to Congress that his brother served on the private security contractor's advisory board.

After initially rejecting allegations that his brother, Alvin "Buzzy" Krongard, was a Blackwater board member, Howard Krongard later told lawmakers that his brother was in fact on the board.

The State Department has come under fire in recent months for its oversight of the embattled private security firm, which protects U.S. diplomats in Iraq. Blackwater was involved in a Sept. 16 shooting in Baghdad that left 17 Iraqis dead, an incident the FBI is currently investigating.

Chairman Henry Waxman of California began the House Oversight Committee hearing by stating that "we have now learned that Mr. Krongard's brother, Buzzy Krongard, serves on Blackwater's advisory board."

Inspector General Refutes Allegations

The Inspector General immediately refuted the allegations.

"I can tell you, very frankly, I am not aware of any financial interest or position he has with respect to Blackwater," Howard Krongard said. "When these ugly rumors started recently, I specifically asked him. I do not believe it is true that he is a member of the advisory board that you stated. And that's something I think I need to say."

However, Democrats then produced a July 26 letter in which Erik Prince, Blackwater's founder and CEO, invited Buzzy Krongard, a former top CIA official, to join Blackwater's advisory board, followed by a Sept. 5 letter in which Prince welcomed Krongard to the board. Rep. Elijah Cummings, D-Md., told the inspector general that Buzz Krongard was even scheduled to attend a Blackwater board meeting earlier this week in Williamsburg, Va.. Howard Krongard then promised to recuse himself from Blackwater-related issues if his brother was a board member.

A Surprising Turn of Events

An hour later, after a brief recess, the inspector general did just that.

"During the break, I did contact my brother," Krongard said. "I learned that he had been at the advisory board meeting yesterday. I had not been aware of that. And I want to state on the record right now that I hereby recuse myself from any matters having to do with Blackwater."

Krongard testified that he had spoken to his brother about Blackwater approximately five or six weeks ago, and that their conversation focused on allegations that Buzzy Krongard had a "significant financial interest in Blackwater."

"I'm not my brother's keeper, and we do not discuss our business with each other," Howard Krongard said, adding that "we have gone to great lengths to keep our professional experiences separate because of his position and because of my position."

Rep. Stephen Lynch, D.-Mass., then suggested that "we ought to subpoena Buzzy and get him in here and testify as to his conduct and his conversation with his brother."

Krongard's Republican Defenders Taken Aback

One of Krongard's most vocal supporters, Rep. Chris Shays, R-Conn., who called him "an honorable man" and apologized to him for being "trashed by this committee," said that he would be "one pretty unhappy guy" if he were in Krongard's position.

"To have been in contact with your brother and to have your brother tell you that he was not involved in Blackwater and then to find out at a hearing that he actually attended and then left, and to find out he's connected, is a pretty outrageous thing. He has done you tremendous damage by that," Shays said.

"Wouldn't it make sense, given your position, to have been upfront with your brother, to say, 'Since I investigate everything the State Department does, I need to know any contact that you have, because I need to recuse myself,'" Shays said. "Now, the other argument could be, 'Don't tell me anything you have, because then I'm not in conflict.' But the problem is nobody's going to believe you, frankly."

Krongard was also grilled by lawmakers about other allegations made by seven current and former officials in the IG's office during the course of Waxman's two-month investigation, such as "inadequate oversight of the construction of the Baghdad embassy," "refusal to pursue charges of procurement fraud implicating Dyncorp," and "failure to assist a Justice Department investigation of Blackwater for arms smuggling."

Waxman called Krongard's reign as inspector general is one of "reckless incompetence," but Republicans defended him against what Shays called "salacious allegations," "personal attacks," and "shallow, drive-by assaults." The harshest criticisms that Republicans directed at Krongard were in a staff report that denounced his "extraordinarily abusive management style."

Krongard admitted that he "sometimes clashed with a minority of people in [his office] that were resistant to change" but was adamant that he "never had any political ties whatsoever," has "never met or spoken with the president or any other person in the White House" and has "never impeded any investigation."

Tom Shine contributed to this report.