Critics allege State broke acquisition rules in Baghdad contract

A government watchdog group and a Democratic senator allege that the State Department broke federal acquisition rules when it hired a Falls Church, Va., company to investigate possible crimes by American private security contractors in Iraq.

The allegations center on the May hiring of U.S. Investigations Services to supplement the staff of the State Department's Force Investigation Unit, created in the wake of the deadly September 2007 shooting by Blackwater Worldwide guards in Baghdad's Nisoor Square. The unit is charged with pursuing accusations of misuse of force by other war zone contractors.

According to a copy of the contract obtained by the nonprofit Project on Government Oversight, USIS supplied the unit with eight "security specialists to serve as fully qualified investigators." The $4.4 million agreement also called for the hiring of two Arabic translators and a senior police adviser/liaison who would work with local security officials at potential crime scenes.

This deal, first reported by ABC News, might run afoul of the Federal Acquisition Regulation, which prevents the outsourcing of inherently governmental tasks, POGO claims. The FAR lists "the direct conduct of criminal investigations" as a job that can be performed only by government employees.

"It doesn't make sense that we would have a contractor investigating another contractor," said Beverley Lumpkin, an investigator with the watchdog group. "They share the exact same ideas about how things should be done. It's like a sister investigating a brother."

The use of contractors could jeopardize the integrity and impartiality of the Force Investigation Unit, according to Sen. Russ Feingold, D-Wis. In September, Feingold, who sits on the Senate Foreign Relations Committee, wrote to Secretary of State Condoleezza Rice urging her to cancel the contract and transfer the work to government personnel.

"These investigators will apparently be charged with collecting evidence and talking to witnesses," Feingold wrote. "This must be done by law enforcement personnel trained in the preservation of evidence or else the evidence may not be admissible in court."

The State Department did not respond to requests for comment.

USIS spokesman Michael John declined to discuss the specifics of the complaints. "We are performing the contract per the terms of the contract," John wrote in an e-mail.

The contract appears to be an about-face for the State Department, which initially indicated that the investigative units, known as Go Teams, would be staffed by government employees.

During an October 2007 press conference, Ambassador Patrick Kennedy, undersecretary of State for management, was asked whether contractors would be used on the teams. "No, no," he said. "The Go Teams are composed of State Department employees from the Regional Security Office."

According to the contract, USIS investigators would work with State's Bureau of Diplomatic Security in providing "specialized investigative assistance and administrative support for extremely complex and sensitive investigations conducted in high threat environments."

The Go Teams visit incident scenes, interview witnesses, collect and analyze evidence, prepare reports, and testify at judicial proceedings, the contract said.

While USIS employees are obliged to follow standards of personal conduct -- no fighting, drug use or drinking; neat appearance and close attention to personal hygiene -- the contract makes no mention of potential conflicts of interest or how they should be handled.

"We feel strongly that taxpayers should not have to worry about the integrity of investigations being conducted," Lumpkin said.

The USIS contract expires on Feb. 28, 2009. The State Department can exercise four one-year options through 2013.