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US security firm 'to pay $42m fine'
Xe, formally known as Blackwater, reaches deal over hundreds of violations of US export rules.
Last Modified: 21 Aug 2010 06:56 GMT
By agreeing to pay the fines, Xe avoids criminal charges over violations of US export rules [AFP]

The private security contractor previously known as Blackwater, has agreed to pay $42m in fines for hundreds of violations of US export rules, according to the New York Times.

The violations included illegal weapons exports to Afghanistan, making unauthorised proposals to train troops in southern Sudan, and providing sniper training for police in Taiwan, the newspaper said on Friday.

The New York Times reported that by reaching the agreement with the US state department to pay the fines, the company avoids criminal charges over the violations of US export control regulations.

Name change

Blackwater, which provided guards and services to the US government in Iraq, Afghanistan and elsewhere, changed its name to Xe in 2009.

Paying the fines will allow Xe to continue to compete for government contracts, the New York Times said.

US export rules mandate government approval for the export of certain types of US military technology or knowledge.

But Xe "began to seek training contracts from foreign governments and other foreign organisations without adhering closely to American regulations", the newspaper reported.

It "also shipped automatic weapons and other military equipment for use by its personnel in Iraq and Afghanistan in violation of export controls, and in some cases sought to hide its actions", the New York Times said.

Black market

According to the daily, investigators were also looking at whether weapons shipped to Iraq were sold on the black market, ending up in the hands of the Kurdistan Workers' Party (PKK) that is fighting for independence from Turkey, a group considered by the US to be a terrorist organisation.

However, the settlement does not resolve other legal troubles still facing the company and its former executives and other personnel, the newspaper said.

Those issues include the indictments of five former executives on weapons and obstruction charges, a federal probe into whether company officials tried to bribe Iraqi officials, while at least two former employees face murder charges after two Afghans died in Kabul in May 2009.

A US court dismissed charges against former Blackwater guards accused of killing 14 Iraqi civilians in Baghdad in 2007.

Guilty pleas

A federal investigation into the company's weapons shipments to Iraq brought guilty pleas from two former Blackwater employees.

By paying fines instead of facing criminal charges on the export violations, the company will be able to continue to receive government contracts, according to the New York Times.

The newspaper quoted a company spokeswoman confirming the settlement but a state department spokesman declined to comment.

The New York Times noted that the company lost its largest federal contract last year, providing diplomatic security for US embassy personnel in Baghdad.

But it still has contracts to provide security for the state department and CIA in Afghanistan, the daily said.

Source:
Agencies
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