'Blood Money' Deal Frees CIA Contractor Raymond Davis From Pakistan

March 16, 2011— -- Raymond Davis, a CIA contractor held in Pakistan after a deadly shooting incident in January, was freed today and is on his way home, U.S. and Pakistani officials said.

Davis was released from detention after $2.4 million was paid to the families of the two men allegedly shot and killed by Davis, according to court documents.

In her first public statements since his arrest in January, Davis' wife Rebecca said her husband was "not a killer" but had been highly trained and she believed he was defending himself when the shooting occurred.

"I knew that he did what he had to do because he had to do it. It was kill or be killed," Rebecca Davis told CBS News' Denver affiliate CBS4. Davis' military record includes experience with the U.S. Special Forces and he was formerly employed by the private security firm Blackwater.

Officials told ABC News the families of the victims appeared in a Lahore court today to say that they have pardoned Davis. A U.S. official said it was a "Pakistani decision" to release him and he is no longer in the country.

Payment of money to the families of victims in crimes for securing acquittals for the accused has significant legal precedent in Pakistan, a custom loosely translated as paying "blood money."

U.S. Secretary of State Hillary Clinton told reporters the U.S. did not pay any compensation directly to the victims' families, but a senior White House official told ABC News the U.S. government expects to "receive a bill for money paid to the families" and the administration plans on paying that bill.

"The families of the victims of the January 27 incident in Lahore have pardoned Raymond Davis," U.S. Ambassador to Pakistan Cameron Munter said in a statement. "I am grateful for their generosity. I wish to express, once again, my regret for the incident and my sorrow at the suffering it caused."

Davis has been in Pakistani detention since the Jan. 27 incident in which he allegedly shot and killed two men on the streets of Lahore, Pakistan, who he said were attempting to rob him. Since his arrest, U.S. officials including President Barack Obama have repeatedly called for Davis' release, arguing he carried a diplomatic passport and was under the protection of diplomatic immunity.

Davis was identified only as a member of the "technical and administrative" staff of the U.S. Embassy in Islamabad when he was arrested. It was revealed last month he was under contract from the CIA and had worked for Blackwater.

Munter said the U.S. Department of Justice has opened an investigation into the shooting.

U.S. Did Not Deny Possibility of 'Blood Money' Negotiations

When asked about the possibility of paying blood money for Davis' release, former U.S. State Department spokesman P.J. Crowley said in February that officials were working "at every level of the government" to secure Davis' freedom and did not deny discussions about compensation had already taken place. One senior U.S. official told ABC News then that in such situations, payment is certainly a strategic consideration.

Last month family members of the victims told ABC News they would not accept money from the U.S. for Davis' release.

"Even if the U.S. gives us $10 million or $20 million, can my son come back?" the father of one of the victims said then. "This will be selling my son's blood which will be like deceiving the people and government... If we accept money, this will give them a way and they will keep killing people and paying money and thereby Pakistan will be sold and will be finished."

Under a pair of Pakistani statutes known as Qisas and Diyat, those accused of a crime, even major ones, may be set free without trial if they can produce acceptable compensation to the victim or the victim's family, said Pakistani law expert Paula Newberg of the Institute for the Study of Diplomacy at the Edmund A. Walsh School of Foreign Service.

But, Newberg said, those laws are about compensation, not justice.

"In the current instance, it may be a way of removing Mr. Davis from the country," she said. "[But] as a mode of solving this kind of problem, it has the potential to set a very fuzzy precedent that does not meet the standards for justice in Pakistan or in the U.S."

ABC News' Jake Tapper and Clayton Sandell contributed to this report.