Blackwater: The Rise And Fall Of An Empire

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Running head: BLACKWATER: THE RISE AND FALL OF AN EMPIRE 1

Blackwater:

The Rise and Fall of an Empire

Jennifer Rossin

American Military University

BUSN623 Legal and Ethical Issues in Management

June 19, 2015

BLACKWATER

Abstract

One of the most well-known private security firms in the world, Blackwater USA is no stranger

to the media. The company has made headlines from their assistance to the military in the

Middle East, to the more infamous ones regarding illegal operations. This paper gives a brief

background of the company, to include the ethical problems it has faced, what part

whistleblowers played in the exposure to the company and how employment-at-will affected the

employees and the company. It will also determine if the measures the company took following

its fallout were successful, or whether the company Blackwater will have a black mark forever.

BLACKWATER

A Little Prince

In 1997, just months after being discharged from the military, Erik Prince, a former

United States Navy Seal developed a private firearms and security training center in North

Carolina. Have bought over 5,000 acres in pursuit of his venture, Prince’s vision was to fulfill

growing demand of the government to outsource security and firearms training. By 1998, Prince

opened Blackwater USA for business.

Named for the black water caused by the peat in the area, it was slow moving at first.

But the company quickly rose to be one of the best training facilities of its kind, with over 50,000

military and civilian personnel having trained at the Blackwater Training Center since it first

opened. Prince had the ability to take situations all over the globe and then create training

programs to meet perceived needs. Following the Columbine High School shooting, Blackwater

created a training facility or building on the property that was used to train law enforcement

personnel tactics needed for active shooter situations.

It was September 11, 2001 that ultimately led to the rise and uber-success of Blackwater,

though. Following the attacks, the company sent civilian contractors first into Afghanistan and

then Iraq when it was invaded 2003. Employees of Blackwater were familiar with the terrain, as

they were primarily former military and more often than not former special operations personnel.

Green berets, Navy Seals, and Delta Force troops were attracted to the pay, the adventure and the

familiarity of the military posture without the heavy regime. By 2002, Blackwater had signed a

$5.4 million dollar contract with the CIA, another classified contract with the CIA in

Afghanistan, and a major Naval contract to boot (Blackwater USA, 2015).

BLACKWATER

The Rise of an Empire

After the attack on the USS Cole in 2000, Blackwater expanded and began offering itself

up to the military for training services. It is then that the company was awarded a major Naval

contract. Following that, Blackwater signed multiple contracts with the Central Intelligence

Agency (CIA) and other government entities. As more and more private security operators were

sent into the Middle East, the cost of life insurance-which private military companies are

required to pay for their employees-rose nearly 500%. This in turn forced some companies out

of the market, paving the way for Blackwater to grab up more contracts (Weiner, 2006). And yet

the company was still not very well known to the public.

When Blackwater first truly took over the mainstream media, it was due largely to the

death of four operatives who were killed in Fallujah, Iraq. On March 31, 2004, four employees

of the company were killed by small arms fire, then mutilated and hung from a bridge. Families

of the slain men then filed a lawsuit against Blackwater, claiming security costs such as personal

armor and the need for a rear gunner in the vehicle they were riding in were cut in order to garner

a higher profit. Additionally, there were claims that a proper risk assessment wasn’t completed

prior to the men’s mission that would have advised them to take a much safer route (Profile:

Blackwater USA, 2015). Yet despite the bad press the company received for cutting costs,

employment applications for Blackwater spiked, partially due to a sense of revenge by the

applicants for what had occurred and partially due to the press the private military company was

receiving in general. Prior to the incident, little was known about the presence of these

companies all over the world.

Following the attack on the operators, Blackwater quickly rose to the top to become the

poster child for private military companies. Due to budgetary restraints and thinning forces, the

BLACKWATER

military as well as the government relied on firms like Blackwater. By November of 2004

Blackwater reported a 600% growth in its employees. While not under the same regime as the

military, and not accountable as military men and women were/are, the company went on to

expand its training center, set up a consulting firm within the business, establish a canine division

and explosives training division in a fashion that was similar to the military (Blackwater USA,

2015). Erik Prince once said of his original vision for Blackwater, “We are trying to do for the

national security apparatus what FedEx did for the Postal Service” (as cited in Wilson, 2014).

By 2007, Blackwater accounted for roughly 80% of all the private military personnel that the

State Department had employed (Dunning, n.d.). The company was quickly becoming

legendary.