Building Blackwater

Blackwater is only one of dozens of security firms from around the world operating in the region. The estimated 160,000 contractors of all stripes working in Iraq equal the number of war fighters. Security contractors number about 48,000.

Still, Blackwater stood out. Retired Marine Col. Thomas X. Hammes, who served in Iraq in 2004, said the Blackwater contractors were no-nonsense guards who did whatever necessary to protect Bremer. In contrast to other security guards in the Green Zone, he said, they were "remarkably professional."

But that was part of the problem. They didn't seem to care how abusive they could be to regular Iraqis, and they didn't seem to be under the control of U.S. authorities, Hammes said. In addition, when Bremer left his post, he signed an order exempting U.S. contractors such as Blackwater from being prosecuted under Iraqi law.

As a consequence of the contractors' aggressive behavior, Hammes said, Blackwater undermined the counterinsurgency efforts that depend so heavily on winning over civilians. "They're greatly disliked," he said.

That animosity boiled over on March 31, 2004, when four Blackwater contractors driving in the battered city of Fallujah were ambushed by three insurgents in a large truck. The attackers shot and killed all four contractors and fled. A crowd of onlookers took two of the bodies, burned them and hung them on a bridge crossing the Euphrates River. The company's striking name and its bear-paw logo suddenly became, for some, horrific symbols of everything wrong with the war in Iraq.

And Blackwater's performance became a high-profile issue. In November of that year, a plane owned by Blackwater subsidiary Presidential Airways crashed into a mountain in Afghanistan, killing three soldiers and three Blackwater contractors on a mission under a $35 million Air Force contract.

Families of the victims in both incidents have filed lawsuits against the company, claiming Blackwater failed to prepare the men to go into those areas.

More questions arose from the inspector general at the State Department, who said in 2005 that Blackwater had failed to keep track of contractors' hours, appeared to double-bill for drivers and vehicles that weren't used and allegedly charged more than double the proper amount for overhead expenses.

On Dec. 24, 2006, a Blackwater contractor got drunk and shot dead a bodyguard for Iraqi Vice President Adel Abdul Mahdi. Blackwater worked with the State Department to fly the contractor back to the United States and fired him. Five months later, Blackwater guards shot and killed an Iraqi driver outside the Interior Ministry in Baghdad, prompting an armed standoff between ministry commandos and the guards.

On Sept. 16 of this year, during a chaotic confrontation in downtown Baghdad, Blackwater contractors allegedly shot and killed 17 Iraqis in a crowded square.

As such incidents mounted, Blackwater hired some of the most politically connected and conservative lawyers and lobbyists in the country. The Alexander Strategy Group -- Jack Abramoff's former lobbying outfit -- provided public relations advice. Former independent counsel Starr is defending Blackwater in the Fallujah case, and Joseph Schmitz, former inspector general for the Pentagon, joined the Prince Group as in-house counsel.

All the while, Blackwater's contracting business continued to grow markedly, according to federal procurement data collected by Eagle Eye, a database marketing company.

In early 2004, the State Department announced a need for a contractor to protect the new U.S. Embassy in Baghdad. DynCorp had a contract to protect U.S. embassies worldwide but was unable to do the work in Baghdad, according to a document provided by Blackwater. So the State Department turned to a company already in position through its work for the Coalition Provisional Authority: Blackwater.

In June 2005, Blackwater's revenue stream took another leap. After a competition, the State Department awarded Blackwater, DynCorp and Triple Canopy work worth $2.5 billion in the coming years to provide security in Afghanistan, Bosnia, Israel and Iraq.

Democrats in Congress could not have been clearer how they view Blackwater during a packed oversight hearing last week. The company, lawmakers said, operates as an out-of-control, mercenary force.

As Prince drove around the grounds of his property Monday, six days after the hearing, he still fumed at the accusations.

Acting as a proud tour guide in a black Suburban, he seemed to want the facilities to prove that Congress and other critics are wrong and that he has nothing to hide.

In his hangar, he looked on as technicians took meticulous care of $4.5 million helicopters, the gray painted floor gleaming beneath them. Prince noted that Blackwater has lost $10 million in aviation equipment in action in Iraq and Afghanistan. He said Blackwater helicopters have repeatedly helped save the lives of U.S. soldiers.

At the center's original lodge, he proudly pointed out a stuffed bobcat, a wild turkey and a beaver that he recalled killing. The lobby of the Blackwater headquarters resembles a ski lodge with a twist: The front doors feature barrels from .50-caliber machine guns. Inside, a glass showcase displays replicas of guns used to assassinate presidents.

Prince visits the complex once or twice a week. He wrapped up his tour and prepared to go home to McLean. He hopped in a waiting helicopter that shuttled him to another airstrip, where he boarded a small Presidential Airways prop plane normally used to fly government and corporate VIPs.

Prince had become more voluble about his business, but he grew frustrated when pressed about exactly who can hold his growing Blackwater empire accountable. When it comes to his contractors, he said, there's only so much he can do. It's up to the Justice Department and the Pentagon to enforce criminal infractions.

In the end, he said, Blackwater is always ultimately answerable as a business to its government customers.

"We're open honest Americans trying to do a good job," he said. "If they don't like what we're doing then" -- he snapped his fingers -- "cut off that revenue steam right now."

Staff researcher Julie Tate contributed to this report.