U.K. Firm Awarded Largest Iraq Security Contract

At a time when intense scrutiny has fallen on Blackwater USA, the U.S.-contracted security firm in Iraq, new questions are being raised about another firm — British-based Aegis Defense Services — with a checkered past.

Aegis has been granted a two-year $475 million contract, the largest-single security contract in Iraq. The deal is raising concern among some members of Congress — in part, because of the reputation of the company's CEO, Lt. Col. Tim Spicer.

In Britain, and in the private security contracting world, Spicer has a larger-than-life reputation for his involvement in several controversial incidents. In the mid 1990s, he helped launch a company called Sandline, which provided armed military services to sovereign nations.

Peter W. Singer, the author of the book Corporate Warriors, said the company became embroiled in two international scandals under Spicer's watch, the first became known as the "Sandline Affair."

"The company was hired to help put down a rebellion in Papau New Guinea, and the local army certainly wasn't happy to find out that a company had been brought in, paid more than their overall budget. So [the army] ... basically launched a coup," Singer said.

The government in Papau New Guinea was overthrown.

Sarah Percy teaches international relations at Oxford and has written a book on the history of private security companies. She said in the late 1990s, Spicer and Sandline were also at the center of what became known as the "Arms to Africa" scandal.

"Sandline was hired to assist the legally elected president of Sierra Leone who had been deposed in a coup and was living in exile," Percy said. "One of their first tasks was to bring in weapons. And it later transpired that the bringing in of weapons may have violated a U.N. arms embargo."

Spicer said Sandline did nothing wrong in either country because the company was working at the request of democratically elected governments. After the incident in Sierra Leone, Spicer distanced himself from Sandline and kept a low profile until 2004, when his new company, Aegis Defenses Services, was awarded its first contract with the U.S. government — a 3-year, $293 million deal.

Percy said Spicer is charming and impressive, but that even if you accept that he was just unlucky and didn't do anything wrong in either Papau New Guinea or Sierra Leone, "you do have to wonder why the United States would award such a large contract to someone whose been involved in not one, but two international scandals."

That is what members of Congress want to know. In 2004, several senators, focusing on Spicer's background, demanded the Pentagon investigate the contract. But Singer, with the Washington-based think tank The Brooking Institution, said Spicer did not raise any red flags with the military's contract office.

"They actually referred to him as 'that British guy,' why are you calling about him," Singer said. "And if you Googled his name, a lot of stuff would have popped up. But they didn't do that kind of check," Singer said.

The Government Accountability Office subsequently investigated Aegis and faulted the company for not performing adequate background checks on its employees. Rep. Marcy Kaptur (D-OH), said there are yet more concerns.

"In November 2005, there was an Internet video that surfaced that showed an Aegis contractor firing wildly at civilian cars on an Iraqi highway to the tune of Mystery Train by Elvis Presley," she said.

"It was incumbent, I thought, that we look at who this company was, who they were hiring, what kind of impact they were having in Iraq, were they the face of America, or not," Kaptur said.

The Aegis contract was just renewed by the U.S. Army Corp of Engineers for another two years. In a written statement, the Army said the $475 million contract was given to the company whose proposal represented the best value to the U.S. government.

Aegis will oversee coordination of all other contractors in Iraq, and provide intelligence services and security for the Army Corp of Engineers.

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