Govt. Uses Contractors to Probe Iraq Contractors

Oct. 3, 2008 — -- In an apparent violation of federal regulations, the State Department has outsourced to private contractors the responsibility to investigate possible crimes committed by security contractors in Iraq.

Earlier this year, the State Department's Bureau of Diplomatic Security hired the private firm U.S. Investigations Services (USIS) to fill positions in the newly created Force Investigation Unit (FIU) that investigates potential misuses of force against civilians by U.S. security contractors. The contract investigators have been in Iraq since this summer.

The FIU was created in the wake of last year's deadly shooting in Baghdad's Nisoor Square, when 17 Iraqi civilians allegedly were killed by security personnel employed by Blackwater Worldwide who were guarding a State Department convoy. The case sparked widespread outrage and prompted calls for greater oversight of security contractors in Iraq.

According to a contract obtained by ABC News, the company was hired to supplement Diplomatic Security personnel. However, the eight USIS contractors hired for the team represent the majority of the full-time team, an apparent violation of federal regulations that prohibit such work by contractors.

According to Federal Acquisition Regulation part 7.5, it is not permissible to hire contractors for jobs "considered to be inherently governmental functions" including "the direct conduct of criminal investigations."

The State Department did not respond to a list of questions submitted seeking comment, including the status of the contract and whether such a contract might possibly be illegal.

"We received a contract [and] we've staffed it," USIS spokesman Michael John said. "Since it's a contract with the Department of State, we serve at the Department of State's request.

"If it's determined that we can't hold a contract, we obviously won't be doing work on that contract," he added.

After the Nisoor Square shooting, much of the forensic evidence was cleaned up before an investigation could take place, making it difficult to build a case against any individuals who might have been accused of wrongdoing.