Rep. John Tierney is asking the agencies to reevaluate the $7.5 million settlement. Tierney eyes former-Blackwater ban

A Massachusetts congressman is pressuring the State and Defense departments to consider suspending and disbarring Academi, the defense contractor formerly known as Blackwater.

Democratic Rep. John Tierney is asking the agencies to reevaluate last month’s $7.5 million settlement by the North Carolina company over alleged weapons export violations, claiming the fine isn’t severe enough and expressing concern over Academi’s continued eligibility for government contracts.


“This has been a repeated problem that’s gone on — this isn’t a one-off situation, and it’s not just Blackwater,” Tierney said in an interview with POLITICO. “We’ve had companies taking millions of dollars from taxpayers, repeatedly making questionable decisions. … If we don’t hold them accountable, then it’s going to keep happening.”

Tierney, the top Democrat on the House Oversight and Government Reform Subcommittee on National Security, Homeland Defense and Foreign Operations, has criticized Academi before, introducing legislation aimed at stopping waste and practices he says put national security at risk.

The accusations covered by the settlement include exporting ammunition and body armor to Iraq and Afghanistan without authorization, shipping encrypted satellite phones to the government of South Sudan through Kenya and possibly exporting armed helicopters without approval.

Academi, formerly called Blackwater and then Xe Services, also reached a $42 million agreement in 2010 with the State Department after similar arms charges.

“If you look at the magnitude of the problem that was there, it doesn’t seem to be much more than a slap on the wrist,” Tierney said. “This was not their first time having this kind of a problem.”

Responding, an Academi spokesman said the incidents Tierney refers to happened under the company’s previous ownership and management, saying the settlements are an example of its forward-looking posture.

“While Academi has been charged to resolve those inherited issues, we have nothing in common, culturally or operationally, with that legacy company,” the spokesman told POLITICO. “Today, Academi is working to become the industry leader in governance, compliance and regulatory matters. It is fair to say – and important to note – that the company that was once known as Blackwater simply does not exist anymore in the company that is now Academi.”

The use of contractors in Iraq and Afghanistan has been controversial — Afghan president Hamid Karzai has repeatedly tried to ban them from operating in his country. Still, contractors will continue to play a significant role in Afghanistan as U.S. troops withdraw, much as they have in Iraq.

“It’s going to be a continuing issue, and a lot of that has to do with how many troops remain and what the security picture is going to look like in the long run, and what the United States vs. national community is going to have as a role,” Tierney said.

On Aug. 7, Tierney introduced a bill that would tighten oversight over military contractors, limiting non-competitive contracts to one year and contracts bid on by multiple organizations to three years.

Called the Oversight and Accountability in Wartime Contracting Act of 2012, Tierney’s legislation would also require justifications for sole-source contracts to be submitted to Congress. The Pentagon, State Department and Agency for International Development would also create positions to monitor contractors more closely.

In a move aimed at groups like Blackwater-turned-Academi, the bill would also require information on contractors’ “parent, subsidiary or successor entities” to be included in reports, to give a sense of their past performance and “integrity.”

“We want to know the history of contractors … and make sure that they can’t get away just by changing a name and moving forward,” Tierney said. “There has to be some consistency, so who were you before you were Academi and who were you before you were Blackwater or Xe?”