Rebuilding Iraq: DOD and State Department Have Improved Oversight and Coordination of Private Security Contractors in Iraq, but Further Actions Are Needed to Sustain Improvements
Published: 2008-07-31T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The U.S. government relies extensively on private security contractors (PSC) for a variety of security services. However, incidents involving PSCs have raised concerns about oversight and legal accountability. Under the authority of the Comptroller General and in response to continuing congressional interest, GAO performed this review to examine the extent to which the Department of Defense (DOD) and Department of State have strengthened (1) oversight and (2) coordination of private security contractors in Iraq. GAO is also providing information on the legal framework used to hold private security contractor employees legally accountable for their actions in Iraq. GAO reviewed DOD and State Department policies and guidance, and their memorandum of agreement on PSCs; observed operations in Iraq and met with DOD officials there and in the U.S.; and met with officials from the Departments of Justice and State, and private security contractors.
section_title: What GAO Found
paragraphs: Both DOD and the State Department have taken steps to strengthen oversight of private security contractors in Iraq since September 2007. However, staffing and training challenges remain for DOD. DOD has increased the number of personnel in Iraq assigned to provide oversight for DOD's PSCs but has not developed plans or a strategy to sustain this increase. An Army-commissioned report has specifically raised concerns about the lack of personnel available to provide sufficient contracting support to either expeditionary or peacetime missions. In the short term, DOD has increased the number of oversight personnel in Iraq by shifting existing oversight personnel from other locations into Iraq. However, without developing and implementing a strategy for providing and sustaining an increased number of personnel dedicated to oversight of PSCs, it is not clear whether DOD can sustain this increase because of the limited number of oversight personnel in the workforce. Moreover, while DOD has provided some training on PSCs for units deploying, the training has not been updated to reflect the changes made by DOD since September 2007 to increase oversight. As a result, military units may be unaware of their expanded oversight and investigative responsibilities. The State Department has implemented 11 of 18 actions recommended in October 2007 by a panel tasked by the Secretary of State with reviewing that agency's use of private security contractors in Iraq. For example, the State Department has increased the number of diplomatic security personnel stationed in Iraq to provide oversight of contractor activities and has requested and received funding to hire and train 100 additional agents to replace those who were transferred from other State Department programs in the United States to Iraq. According to State Department officials, the additional personnel will help sustain the increased number of agents in Iraq. In addition, as of June 2008, the State Department has equipped 140 of its security vehicles with video recording equipment and plans to equip an additional 93 vehicles. Coordination among DOD, the State Department, and the government of Iraq has significantly improved since September 2007. The State Department coordinates its PSC movements with DOD through liaison officers, and by providing a daily briefing to Multi-National Forces-Iraq (MNF-I) on upcoming PSC activities. MNF-I 's Armed Contractor Oversight Division facilitates coordination for PSC matters among DOD, State Department, the government of Iraq, and the PSC community. Further, DOD and the State Department signed a memorandum of agreement detailing coordination activities to be undertaken. Various laws hold PSC employees accountable for their actions in Iraq, including U.S. criminal laws that may be applied extraterritorially, the Military Extraterritorial Jurisdiction Act, and the Uniform Code of Military Justice. The applicability of these laws depends on the circumstances--e.g., the nature and location of the alleged crime and the nationality of the accused--of any specific incident. The legal framework for holding PSCs accountable also includes Iraqi and international law and contract provisions.

section_title: Letter
paragraphs: Since military operations began in Iraq in 2003, the United States  government has relied extensively upon the services of private security  contractors (PSC). For the Department of Defense (DOD) these services  include providing security for senior military officials such as the  Commanding General of the Multi-National Force-Iraq and for personnel  from the Army Corps of Engineers, protecting military facilities, and  protecting more than 19,000 supply convoys traveling throughout Iraq.  For the Department of State, PSCs provide security for the ambassador,  other U.S. government officials working in Iraq as well as visiting Members  of Congress and visiting officials of the executive branch. PSCs also  provide site security of the embassy and other State Department facilities  in Iraq. The number of PSCs in Iraq is also substantial. DOD and the  Department of State estimate that about 11,000 private security employees  (9,952 with DOD, 1,400 with the State Department) are working in Iraq  under direct contracts with the U.S. government. DOD has estimated that  it would need to create nine new Army brigades to replace the current  number of PSC employees working in Iraq.
Because of incidents involving PSCs in Iraq, concern regarding the level of  oversight and the legal accountability over these firms and their employees  has increased. Incidents occurring between PSCs and Iraqis and between  PSCs and U.S. forces have been reported since 2004. In July 2005, we  issued a report that examined how the U.S. government and  reconstruction contractors used PSCs. In that report we made a number  of recommendations including one addressed to DOD to develop a training  package for military units deploying to Iraq that included information on  (1) the role of PSCs in Iraq, (2) typical PSC operating procedures, (3)  guidance related to PSCs, and (4) the military’s responsibilities to PSCs. In  2006, we testified that coordination between the U.S. military and the PSCs  needed improvement and that further action needed to be taken by DOD  to implement the pre-deployment training recommendation from 2005.  According to the report of the Secretary of State’s Panel on Personal  Protective Services in Iraq, on September 16, 2007, an incident involving a  PSC firm working for the Department of State resulted in the deaths of 17  Iraqi civilians in Baghdad. In the wake of this incident, which U.S.  government officials describe as a watershed event, both DOD and the  State Department began to examine their efforts to provide oversight,  improve coordination between DOD, the State Department and the  government of Iraq, and enhance accountability for the PSCs they employ  in Iraq.
Because of continuing congressional interest in the use of PSCs in Iraq, we  began in August 2007, under the authority of the Comptroller General to  conduct evaluations on his own initiative, a review to update our work on  the U.S. government’s use of PSC. This report examines the extent to  which DOD and the Department of State have strengthened (1) oversight  and (2) coordination of private security contractors in Iraq. In addition, we  are providing information on the legal framework in place to hold private  security contractor employees legally accountable for their actions in Iraq.  Later this year, we plan to issue a report on other PSC issues related to  selection, training, and weapons accountability as well as DOD’s  implementation of provisions of Section 862 of the 2008 National Defense  Authorization Act which requires DOD to prescribe regulations for the use  of private security contractors in contingency operations.
To assess the U.S. government’s efforts to improve oversight and  coordination of PSCs it employs in Iraq, we reviewed recent DOD, United  States Central Command (CENTCOM), Multi-National Force-Iraq (MNF-I),  and State Department policies and guidance addressing the requirements,  procedures, and responsibilities for the oversight and coordination of  PSCs. These documents include new MNF-I PSC guidance and policies on  incident reporting, investigation requirements, coordination, and contract  oversight. In addition, we reviewed the memorandum of agreement  between DOD and the State Department on PSCs working for the U.S.  government in Iraq. We reviewed these policies to determine the U.S.  government’s authority and responsibility for the oversight and  coordination of PSCs in Iraq that have contracts with the U.S. government.  In February 2008, we traveled to Iraq to examine what, if any,  improvements had been made after the Nisour Square incident. In Iraq we  met with officials from DOD, including officials from MNF-I, the Joint  Contracting Command-Iraq/Afghanistan (JCC-I/A), and the Defense  Contract Management Agency (DCMA), as well as officials from the State  Department, including officials from the U.S. Embassy-Baghdad and its  Regional Security Office, to discuss issues related to oversight,  coordination, and accountability over PSCs in Iraq. While in Iraq, we  observed operations at DOD’s Contractor Operations Cell and at the State  Department’s Tactical Operations Center, witnessing the planning,  oversight and coordination, and tracking of PSC movements throughout  Iraq. We also met with the Executive Secretary of the Secretary of State’s  panel established to review the State Department’s security practices in  Iraq. We also interviewed officials from ten selected private security firms  who currently provide or have recently provided private security functions  in Iraq, as well as representatives from an Iraq-based private security  association.
To describe the legal framework in place to hold PSC employees  accountable we reviewed various laws including the Uniform Code of  Military Justice and the Military Extraterritorial Jurisdiction Act. We also  interviewed officials from DOD’s Office of the General Counsel, the State  Department’s Office of the Legal Adviser and from the Department of  Justice to gain an understanding of the process used to hold PSCs  accountable. Moreover, we also reviewed applicable U.S. government PSC  contract clauses that outline and regulate contractor behavior.
Our work focused on PSCs who have a direct contractual relationship with  the United States government and we did not assess the use of PSCs by  reconstruction contractors, non-governmental organizations or other  coalition nations. We reviewed processes used to provide oversight and  coordination over PSCs in Iraq but did not evaluate how effectively they  were being implemented because the processes reviewed are new. We also  did not evaluate how laws were being used to hold contractors  accountable. Appendix I contains a more detailed presentation of our  scope and methodology. We conducted this performance audit from  February 2008 to June 2008, in accordance with generally accepted  government auditing standards. Those standards require that we plan and  perform the audit to obtain sufficient, appropriate evidence to provide a  reasonable basis for our findings and conclusions based on audit  objectives. We believe that the evidence obtained provides a reasonable  basis for our findings and conclusions based on our audit objectives.
subsections: section_title: Background
paragraphs: PSCs are defined as private companies, and/or personnel, that provide  physical security for persons, places, buildings, facilities, supplies, or  means of transportation. These contractors provide security services for a  variety of U.S. government agencies in Iraq; however, they principally are  hired by DOD and the State Department. Given the security concerns in  Iraq, the U.S. government has relied upon PSCs to fulfill a variety of  important security functions throughout the country in support of the  DOD military mission and the State Department’s diplomatic mission.
The mission of PSCs hired by the U.S. government in Iraq is to protect  government agency officials as they perform their duties in the unstable  security environment currently present. These contractors may be U.S. or  foreign-based and their employees are recruited and hired from a wide  variety of countries, including the United States, the United Kingdom,  South Africa, Nepal, Sri Lanka, and Fiji. They also include Kurds and Arabs  from Iraq. These firms may provide a variety of security related services  including:    static security – security for housing areas and work sites, including    personal security details – security for high-ranking U.S. officials and  Chief of Mission personnel;    security escorts – security for U.S. government employees, contractor  employees, or others as they move through Iraq;    convoy security – security for vehicles and their occupants as they  make their way into Iraq or within Iraq; and    security advice and planning.
In Iraq, two distinct authorities are responsible for the security of U.S.  government employees and contractors. The U.S. military, under the  authority of the Secretary of Defense and the Combatant Commander, is  responsible for the security of all personnel who are under direct control  of the Combatant Commander. The State Department, under the authority  of the Secretary of State, is responsible for the security of all other U.S.  government personnel on official duty abroad. In Iraq, that responsibility  is delegated to the U.S. Ambassador as Chief of Mission and to the U.S.  Embassy’s Regional Security Officer who is the Chief of Mission’s focal  point for security issues and as such establishes specific security policies  and procedures. While these two agencies also are responsible for  providing oversight, coordination and accountability for U.S. government  PSCs, the government of Iraq also plays a role. Figure 1 depicts the  organizations that play a key role in the oversight and coordination of  PSCs operating in Iraq.
Multi-National Force – Iraq  (MNF–I)
Multi-National Corp – Iraq  (MNC–I)
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subsections: section_title: A Bureau
paragraphs: Joint Contractin Command –  Iraq/Afhanitan (JCC–I/A)
Defene Contract Manaement  Aency (DCMA)
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section_title: DOD and the State Department Have Increased Oversight Efforts Regarding PSCs, but Staffing and Training Challenges Remain for DOD
paragraphs: DOD and the State Department have both taken action to increase their  oversight efforts over PSCs in Iraq, however, staffing and training  challenges remain for DOD. In Iraq, MNF-I has established an office to  provide PSC oversight and MNF-I has published comprehensive  mandatory guidance related to the oversight of DOD PSCs and has made  military units more responsible for providing oversight to PSCs in terms of  incident reporting and investigating. However, senior military staff as well  as units may not be aware of their increased responsibilities because DOD  has not incorporated information on the revised guidance and increased  responsibilities in its training program. Further, while DOD has increased  the number of personnel in Iraq devoted to providing contract oversight  and management over private security contracts it is not clear based on  our current and past work whether DOD can sustain the increased number  of contract oversight and management personnel it has sent to Iraq since  late 2007. In addition, the State Department has implemented 11 of the 18  recommendations made by a panel appointed by the Secretary of State to  review the agency’s oversight of PSCs in Iraq. Among the  recommendations implemented or being implemented are  recommendations to increase the number of agents in Iraq to provide  oversight over its PSC contractors, install audio and video recording  equipment in security vehicles, and a recommendation to place a  diplomatic security agent in each PSC motorcade.
subsections: section_title: Multi-National Force-Iraq Has established an Office to Provide Oversight over DOD PSCs in Iraq
paragraphs: Prior to the incident in Baghdad in September 2007, the U.S. military  lacked a single structure for managing its PSCs in Iraq. In November 2007,  MNF-I, established a new organization, the Armed Contractor Oversight  Division, to serve as MNF-I’s overall point of contact for policy issues  relating to PSCs hired by DOD as well as to provide broad oversight over  these contractors. According to MNF-I officials, the office’s goals include  (1) working to reduce the number of incidents of PSCs discharging  weapons or behaving in a manner that undermines the credibility of U.S.  efforts; (2) developing a mechanism for holding PSCs accountable for their  actions; (3) reducing the time that elapses between the occurrence of an  incident and the reporting of that incident; and (4) minimizing the impact  of an incident on the credibility of U.S. efforts in Iraq. The office is  currently staffed with 7 full time employees comprised of 3 military  personnel and 4 contractors. Figure 2 depicts the Armed Contractor  Oversight Division’s organizational structure and the responsibilities of  each staff member.
One of the key efforts of the Armed Contractor Oversight Division is to  monitor, review, and report all PSC incidents. These incidents include  those involving injuries; deaths; negative reports in the media; weapons  discharges; complaints from U.S. military commanders, local Iraqi citizens  or the government of Iraq; and other allegations of PSC misconduct. PSCs  are required to report these incidents in writing to the MNC-I CONOC. The  office then reviews each incident report to determine whether the incident  requires additional investigation. After an investigation is completed by  the appropriate unit commander, the Armed Contractor Oversight Division  tracks corrective or disciplinary actions initiated by the commander or the  PSC. The Armed Contractor Oversight Division also conducts a trend  analysis of incident reporting data. According to officials, since the office  began oversight over PSCs in October 2007, weapons discharges by PSCs  have decreased approximately 60 percent. Figure 3 depicts how the  Armed Contractor Oversight Division monitors and reports PSC incidents.
section_title: DOD Has Consolidated and Strengthened Its PSC Oversight Guidance by Requiring Further Incident Investigation
paragraphs: According to MNF-I officials, prior to December 2007 there were between  40 and 50 separate fragmentary orders relating to regulations applicable to  PSCs in Iraq. As such, contracting officers as well as military commanders  rotating into Iraq may not have been aware of all of the regulations  covering PSCs. In December 2007, MNF-I issued Fragmentary Order 07- 428, to consolidate the previous fragmentary orders and establish  authorities, responsibilities and coordination requirements for MNC-I to  provide oversight for all armed DOD contractors and civilians in Iraq  including PSCs. The establishment of the consolidating fragmentary order  creates a single source for CENTCOM mandated orders, regulations and  mandatory contract clauses relating to requirements, procedures, and  responsibilities for control, coordination, management, and oversight of  PSCs in Iraq. Specifically, the order addresses PSC requirements including  arming procedures and responsibilities, rules for the use of force and  mandates strengthened serious incident reporting procedures and  responsibilities. For example, under the new order when a PSC observes,  suspects, or participates in a serious incident such as a weapons  discharge, PSCs are required to submit an immediate incident report at the  earliest opportunity via the most secure means available to MNC-I and  then submit an initial written report of the incident not later than 4 hours  after the incident in contrast to the previous 48 hour reporting  requirement. The order requires the initial report to contain a highlighted  version of the incident, including critical information such as who was  involved and when and where the incident occurred. PSCs are required to  file a final report with 96 hours of the incident.
Additionally, the fragmentary order increases the oversight responsibilities  for military units by requiring the military to investigate serious incidents  involving a DOD PSC. Previous orders only directed the military to  investigate incidents related to contractors firing weapons. According to  the December 2007 order, the military unit that receives the contracted  security services is required to conduct a preliminary inquiry if contractors  are involved in a serious incident. The order also stipulates that at a  minimum, a commander’s inquiry will be conducted and documented.  Previously, there was no requirement that commanders’ investigations be  documented. Incidents that involve death, serious injury, or property  damage in excess of $10,000 must be investigated by the appropriate level  commander. Previous investigative requirements did not include this  requirement. The order directs commanders to involve criminal  investigative authorities if the preliminary investigations suggest either  criminal misconduct, a violation of the rules for the use of force, or an  inappropriate graduated force response. Finally, the order requires that  any military unit observing or becoming aware of a serious incident  provide an investigative report to the unit’s operational chain of command  and to include photographs and names if possible. In reviewing  investigative reports to determine whether PSC misconduct was involved,  commanders are to use the same standards as they would for their own  units’ actions. Investigations or inquiries completed by the military are  forwarded to the Armed Contractor Oversight Division and the MNC-I  Staff Judge Advocate for review. Moreover, according to an Armed  Contractor Oversight Division official, if a military investigation is deemed  to have been inadequate, MNF-I or MNC-I can direct another investigation.  Prior to the establishment of the Armed Contractor Oversight Division  there was no MNF-I level review of incident reports.
The fragmentary order also requires that PSCs report all weapons  discharges on a monthly basis to the contracting officer’s representative or  sponsoring activity. The monthly report, which includes information on  the type of discharge, is to be annotated to include information on the type  and status of the investigation and who conducted it. In addition, if an  action such as a fine or termination was taken against a contractor  employee, this information also is to be included in the report. The reports  are provided to the MNC-I office responsible for authorizing individual  contractor employees to carry weapons and may be considered when  MNC-I determines whether an individual will be allowed to carry a  weapon. The monthly reports are also provided to the Armed Contractor  Oversight Division, which analyzes the data for trends. Previous guidance  did not require the monthly weapons discharge report.
The fragmentary order also addresses the contracting officer  representative’s (COR) critical role in contract support and provides  information to properly designate, train, and support the COR in  government oversight and administration of security contracts. A DOD  guidance memo assigning contract administration functions lists oversight  over a contractor’s compliance with CENTCOM policies and directives  among contract administration responsibilities. The order states that  organizations supported by security services shall insure a COR is  nominated to perform contract oversight. The order further states that  contracting officers are responsible for monitoring PSC performance and  ensuring PSC compliance with contractual requirements. According to the  order, contracting officer representatives should be selected at a rank  commensurate with the contract’s oversight responsibilities and that  contract oversight should be their primary function. The contracting  officer’s representative should also be at a location to allow sufficient  direct oversight of contractor operations. Prior to the fragmentary order  there was not a comprehensive document describing these responsibilities  and how they relate to providing oversight over PSCs.
section_title: DOD Has Increased the Number of Personnel Devoted to Contract Management and Oversight, but It Is Unclear Whether the Increase Can Be Sustained
paragraphs: DOD contract oversight efforts in Iraq have also been strengthened  through actions taken by the Undersecretary of Defense, Acquisition  Technology and Logistics and the Defense Contract Management Agency  (DCMA). However the Department may be challenged to continue to  provide the increased number of personnel needed to sustain the  additional oversight. In October 2007, the Undersecretary issued  memoranda giving JCC-I/A new authorities and responsibilities for PSCs  contracting in Iraq. Specifically, JCC-I/A is responsible for all contract  administration for DOD’s security contracts in Iraq. In Iraq, JCC-I/A has  delegated to DCMA the responsibility to provide contract administration  over private security contracts. This newly delegated authority enables  DCMA, with its presence in Iraq, to implement a systematic approach  toward oversight of PSCs contracts. DCMA officials told us that this  approach, which did not exist prior to DCMA receiving this authority,  includes developing a quality assurance framework, a key component of  which is the agency’s development of a series of quality assurance  checklists for PSCs. DCMA officials stated that the checklists have been  developed by incorporating requirements from the statements of work in  PSC contracts and current MNF-I guidance and fragmentary orders and  translating these requirements into objective measurable standards  intended to enable the agency to conduct regular and unbiased inspections  of contracting personnel, known as surveillance audits. According to  DCMA officials, these checklists are intended to ensure that PSCs are  meeting contract requirements and that DOD is providing appropriate  oversight over the contracts. The checklists translate security contract  requirements into an audit document. According to DCMA officials, the  agency coordinates with the Armed Contractor Oversight Division to  ensure that the checklists reflect current MNF-I guidance and fragmentary  orders related to PSCs.
To assist in its greater role in Iraq to provide contract award,  administration and oversight, JCC-I/A plans to add additional personnel in  Iraq while DCMA has increased its number of oversight personnel in Iraq  and hopes to add additional personnel. DCMA has approximately doubled  the number of oversight personnel in the CENTCOM area of responsibility  by shifting personnel from other areas. Of the personnel in theater in  March 2008, somewhat more than half were deployed to Iraq to provide  greater oversight of contracts in Iraq including private security contracts.  Furthermore, DCMA plans to increase the number of staff deployed to the  theater to 348 by the end of 2008. While the contracting command and  DCMA both hope to be able to increase the number of personnel available  in Iraq to provide additional oversight of DOD’s PSC contracts, our current  and past work suggests that the agencies may not be able to fill all of the  positions or sustain this increase. For example, during our visit to Iraq  officials from JCC-I/A stated that while they had a joint manning document  that authorizes 39 additional staff, the positions would not be immediately  filled and thus they continued to work with the individual services to fill  the positions. As of June 2008, JCC-I/A officials reported that 32 of the 39  positions listed in the joint manning document had been created and  should be filled by the services soon. DCMA also developed a joint  manning document and is asking the services to provide the additional  oversight and management personnel needed in part because DCMA lacks  the personnel to meet the additional requirements. During our visit to Iraq,  DCMA officials expressed concerns about maintaining the increase in the  number of oversight personnel in Iraq over the long-term. In 2007 the  report of the Commission on Army Acquisition and Program Management  in Expeditionary Operations stated that the Army lacks the leadership and  military and civilian personnel to provide sufficient contracting support to  either expeditionary or peacetime missions. According to the  commission, Army contracting personnel experienced a 600 percent  increase in their workload and are performing increasingly complex tasks,  but the number of Army civilians and military in the contracting workforce  has either remained static or declined because of congressional direction  to DOD and the Army to make significant cuts in the acquisition  workforce. According to a May 2008 Congressional Research Service  report, the earlier reductions in the contracting workforce reflected  Congress’ view that the workforce had not been reduced enough in  proportion with the overall defense budget, particularly the acquisition  portion of the defense budget. However, concomitant to the workforce  reduction was the department’s decision to increase its reliance on  contractors to provide services previously provided by DOD civilians or  service members. As a result, the actual workload of contracting personnel  (the people charged with writing, negotiating, monitoring, and enforcing  performance of the contracts) was substantially increasing in complexity  and volume. Furthermore, in a June 2008 report to Congress, the Air Force  commented that in the current conflict it was strained to cover its own  contracting requirements and provide 67 percent of the contracting  personnel to support joint contracting requirements. These comments cast  doubt on the Air Force’s ability as well as the Army’s ability to fully  support either JCC-I/A or DCMA. As we noted in our January 2008  testimony, without adequate contract oversight personnel in place to  monitor DOD’s many contracts in deployed locations such as Iraq, DOD  may not be able to reasonably assure that contractors are meeting their  contract requirements efficiently and effectively.
section_title: Units Continue to Deploy to Iraq without Training on Increased PSC Oversight Responsibilities
paragraphs: In July 2005, we reported that units deploying to Iraq received no training  on working with PSCs and were unclear as to their responsibilities  towards PSCs. At that time we recommended that DOD establish and  incorporate a training program into the mission-rehearsal exercises and  predeployment training for units deploying to Iraq. In response to the  recommendation, DOD has incorporated training on PSCs into various  predeployment training programs and exercises. For example, the Joint  Forces Command has developed training on the role of PSCs in the  battlespace for senior military staff in Iraq. The Army has a pilot program  to incorporate PSC scenarios into its Battle Command Training Program,  which trains Corps, division and brigade staff. The Army and the Marine  Corps also incorporated scenarios on the rules of engagement and  escalation of force involving PSCs into unit predeployment training.  Additionally, according to DOD officials, PSC scenarios have been  incorporated into two recent training exercises for senior staff. However,  this training does not include all of the topics we recommended in 2005  such as information on PSC standard operating procedures nor does it  reflect the increased PSC oversight responsibilities and organizational  structures established since the September 2007 incident, such as training  on the role of the Armed Contractor Oversight Division. When we made  our recommendation, DOD’s use of PSCs was limited to a few contracts  that provided support to the Army Corps of Engineers and to static  security for work areas within military installations. Since then DOD’s use  of PSCs has increased significantly and military units at all levels have  been given more oversight responsibility for PSCs as well as more  responsibilities for coordination as we discuss below. Without training  that reflects current policies, practices and procedures, military units  deploying to Iraq may not conduct the independent incident investigations  required to ensure contractor accountability.
section_title: The State Department Has Begun to Increase Its Oversight Efforts in Iraq
paragraphs: After the Nisour Square incident, the Secretary of State assembled a panel  of experts to review the agency’s security practices in Iraq and make  recommendations to reduce the likelihood of future incidents that could  adversely affect the overall U.S. mission in Iraq. The panel found that  while the State Department’s security operations had been highly effective  in ensuring that mission personnel were safe, improvements were needed  to address deficiencies in oversight and coordination. To address these  deficiencies, the panel made 18 recommendations to improve oversight of  PSCs contracted by the State Department in Iraq. The State Department  has implemented 11of the recommendations and is in the process of  implementing the remaining recommendations.  Appendix II provides  additional information on all of the panel’s recommendations, their  implementation status, and our comments on the implementation status.
When we met with State Department officials at the U.S. Embassy in  Baghdad, officials told us that the department had made progress in  implementing some of these recommendations. For example, one of the  panel’s principal recommendations was to increase the number of  Diplomatic Security Special Agents in Iraq in order to expand oversight of  the department’s PSCs. State Department officials told us that the agency  is increasing the number of agents in Iraq from 36 to 81 permanent and 7  temporary duty personnel to provide additional oversight of the  department’s PSCs, such as accompanying the PSC contractors on each  personal protection mission. According to the State Department, these  positions are expected to be filled by September 2008. The State  Department has acknowledged that it does not have sufficient numbers of  diplomatic security agents to meet the agency’s security requirements and  as a result relies on and will continue to rely on private security  contractors to provide additional capacity. According to the State  Department, in order to provide enough Diplomatic Security Special  Agents in Iraq, the department had to move agents from other programs,  and those moves have negatively affected the agency’s ability to perform  other missions including providing security for visiting dignitaries and  visa, passport, and identity fraud investigations. For example, the official  stated that the agency had to borrow personnel from another federal law  enforcement agency in order to provide security at the Middle East Peace  Summit held in Annapolis, Maryland. According to the State Department,  100 new agents are needed in order to sustain this increase and will  continue to be needed after the hostilities in Iraq are over. The State  Department received funding for the new agents in the 2008 supplemental  appropriations act signed by the President of the United States on June 30,  2008, which covers the 4th quarter of fiscal year 2008 and all of fiscal year  2009. According to the State Department, these positions will be included  in the agency’s fiscal year 2010 budget request.
Similar to DOD, the State Department has developed directives to  consolidate and establish the agency’s rules, regulations, and policies for  PSCs in Iraq. As of May 2008, the State Department has issued four  directives that provide guidance similar to the fragmentary order issued by  MNF-I. The purpose of these policy directives is to provide PSCs with  rules, regulations, and requirements for operating in Iraq. The topics  covered in these directives cover rules for the use of force, escalation of  force, serious incident reporting, and investigating as well as coordination  with DOD. According to State Department officials, these directives  consolidate previously issued guidance and ensure that all of the State  Department’s PSCs are aware of current department policies.
section_title: Coordination, Including Interagency Coordination, Related to PSCs in Iraq Has Improved
paragraphs: DOD and the State Department have improved coordination related to  PSCs in Iraq. For example, since the Nisour Square incident in late 2007,  the agencies have increased interagency coordination of their PSC  movements in Iraq through liaison officers and other means. In addition,  MNC-I has established several operation centers to track the movement of  DOD PSCs as well as to coordinate the movements of PSCs working for  the State Department. MNF-I’s Armed Contractor Oversight Division has  also been coordinating efforts related to PSC oversight and accountability  among DOD, the State Department, the Government of Iraq, and the PSC  community in Iraq. Moreover, in December 2007, DOD and the State  Department entered a memorandum of agreement that covers a broad  range of management and operational procedures intended to improve the  U.S. government’s management coordination over PSC operations in Iraq.
subsections: section_title: Interagency Coordination Has Improved between DOD and the Department of State and between the U.S. Government and the Government of Iraq
paragraphs: Prior to the Nisour Square incident, DOD and the State Department did not  maintain regular communication or coordination on the departments’  efforts related to PSCs in Iraq, and neither DOD nor the State Department  coordinated on a regular basis with the Government of Iraq on issues  related to PSCs. According to State Department officials, much of the prior  coordination with MNF-I was ad hoc in part because MNF-I lacked a focal  point to coordinate with. During our visit to Iraq, DOD and State  Department officials told us that since the incident, both agencies have  implemented several measures to improve communication and  coordination between the two agencies. For example, the State  Department has a liaison officer stationed at MNC-I’s operations cell, and  MNC-I continues to maintain a liaison officer in the RSO’s operations  center. In addition, representatives from the State Department participate  in daily MNF-I briefings to coordinate with MNF-I regarding planned State  Department personnel movements. Additionally, the agencies have  increased their coordination on the reporting and investigation of serious  incidents involving PSCs. For example, the State Department’s Tactical  Operations Center coordinates with and reports all serious incidents  involving its PSCs to the Armed Contractor Oversight Division. Moreover,  State Department officials in Iraq stated that they are now sharing  additional information and have enhanced coordination on PSC  movements with DOD, requesting route intelligence from DOD, and  providing DOD feedback on route security. While the State Department  provided MNF-I with route information and scheduled personnel  movements prior to the Nisour Square incident, MNF-I did not know that  the information was being provided by the State Department. The State  Department uses a data tracking system to provide DOD tactical units with  situational awareness of State Department PSC movements. According to  DOD and State Department officials, these improvements were driven in  part by recommendations made by the State Department panel reviewing  PSC operations and by the signing of a memorandum of agreement  between the two agencies stating that they agree to work together on PSC  matters in Iraq.
Additionally, the director of the Armed Contractor Oversight Division  coordinates with the State Department by co-chairing an incident review  board with the Regional Security Officer. This board meets quarterly to  examine incidents involving U.S. government PSCs in order to identify  trends and make recommendations to improve U.S. Government oversight  of PSCs in Iraq. The board also identifies best practices and communicates  these practices with PSCs. Furthermore, Armed Contractor Oversight  Division officials told us that the office has increased its coordination  efforts with the government of Iraq. For example, the division and the  State Department’s Regional Security Officer regularly meet with the  Ministry of the Interior to coordinate on managing PSCs, and listen to  concerns, resolve issues, and generate joint solutions. This process did not  occur prior to the establishment of the oversight division. Furthermore,  the division ensures that the Ministry is immediately notified when  incidents occur involving PSCs and Iraqi civilians.
section_title: Multi-National Corps-Iraq Has Created a Group of Operations Centers to Coordinate Movement of DOD and State PSCS
paragraphs: Prior to the issuance of the fragmentary order, DOD tracked the  movement of its PSCs through the Reconstruction Operations Center,  which was run by a U.S. Army Corps of Engineers contractor. As directed  by the fragmentary order, MNC-I has established six Contractor  Operations Cells to assume the responsibility to provide battlefield  coordination, previously handled by the Reconstruction Operations  Center, control of PSC movement throughout Iraq, and facilitate the  expedient reporting of incidents involving PSCs. The central Contractor  Operations Cell is located at MNC-I headquarters at Camp Victory, while  the others are located at the tactical operations centers of each of the five  divisions that control the corresponding battle space in Iraq. According to  MNF-I and MNC-I officials, the Contractor Operations Cells provide a  better mechanism for coordination than did the Reconstruction  Operations Center, for several reasons. First, as we noted above, the  Contractor Operations Cells are co-located with the tactical units  responsible for the battle space, making coordination easier. Second,  commanders have improved situational awareness because information  related to PSCs is now viewed in context with other battle space activities.  For example, the State Department provides the Contractor Operations  Cells with U.S. Embassy PSC movement information that can be tracked  by battlefield commanders using the same system as is used to track  military vehicles. This movement information was never provided to the  Reconstruction Operations Center when it was responsible for tracking  DOD’s PSC movements. Third, battle space commanders now control the  movement of DOD PSCs in Iraq. According to the MNF-I order establishing  the Contractor Operations Cells, the tactical unit responsible for the battle  space must approve or deny the movement request submitted by DOD  PSCs. Previously, the battlespace commanders may have been made  aware of the PSCs’ planned movements, but they were not required to  approve the movement. Additionally, MNF-I developed common standards  for communications between PSCs and government personnel. MNF-I  secured funding from U.S. Army Central Command for radios and satellite  phones for all DOD PSCs in Iraq in order to standardize communication  standards between PSCs and government personnel. Additionally, the  Defense Contract Management Agency is currently modifying all PSC  contracts in Iraq to incorporate these common standards, and the PSCs  will be acquiring standardized radios and satellite phones as contractor  furnished equipment in order to meet these new requirements. Figure 4  depicts how the Contractor Operations Cells coordinates U.S. government  PSC movements in Iraq.
section_title: The Department of Defense and Department of State Have Developed a Memorandum of Agreement to Improve Coordination of PSCs in Iraq
paragraphs: After the Nisour Square incident, DOD and the Department of State  recognized the need for a more unified approach toward the oversight and  coordination of U.S. government PSCs in Iraq and began to develop,  implement, and follow standards, policies, and procedures for the  coordination of PSCs in Iraq. On December 5, 2007, DOD and the State  Department signed a memorandum of agreement with the purpose to  clearly define the authority and responsibility for the accountability and  operations of U.S. government PSCs in Iraq. The memorandum of  agreement lays an important groundwork and, as we have discussed, many  of its provisions are being implemented. For example, the memorandum of  agreement directs the two agencies to  improve the effectiveness of incident management, response, and  follow-up for investigations;    assure transparent, timely reporting and investigation of incidents  between U.S. Embassy in Baghdad and MNF-I, with timely reporting of  same to the government of Iraq; and    synchronize PSC operations between the battle space commander and  Regional Security Officer in order to establish real-time oversight,  visibility, and coordination of PSC convoy movements outside secure  bases.
The memorandum of agreement also directs DOD and the State  Department to ensure that their respective PSC contracts and  subcontracts contain common language, through contract modifications if  necessary, implementing relevant provisions of the memorandum of  agreement.
On July 10, 2008, pursuant to Section 861 of the 2008 National Defense  Authorization Act, DOD, the State Department and U.S. Agency for  International Development (USAID) signed a memorandum of  understanding which covers, among other things, contracting and  contracting personnel in Iraq, including PSCs. The matters addressed  include: identifying each agency’s roles and responsibilities pertaining to  procedures and coordination for the movement of contractor personnel in  Iraq; identifying and maintaining a common database to serve as a  repository of information on contracts in Iraq; and collecting data on, and  appropriately referring, cases of contractor criminal misconduct.
section_title: An Overview of the Legal Framework for Holding Private Security Contractor Employees Accountable for Their Actions in Iraq
paragraphs: Various laws exist to hold PSC employees accountable for criminal acts  committed in a wartime environment beyond the borders of the United  States. These laws include U.S. criminal laws that may be applied  extraterritorially, the Military Extraterritorial Jurisdiction Act (MEJA),  the Uniform Code of Military Justice (UCMJ), international law, as well  as Iraqi laws. Whether a particular law provides extra-territorial  jurisdiction over a criminal act by a PSC employee depends on the specific  facts of the incident, such as the time, nature and location of the alleged  crime, the nature of the contractor’s employment and the nationality of the  accused. For example, an employee of a DOD contractor, whether a U.S.  citizen or Third Country National, who commits a felony while  accompanying the Armed Forces in Iraq during a contingency operation  may be charged under the UCMJ or MEJA. With regard to other than DOD  contractor employees, a panel of State Department representatives  reporting on protective services in Iraq concluded in October 2007 that the  legal framework for holding non-Department of Defense contractor  employees accountable under U.S. law is inadequate. Congress is  presently considering legislation that would clarify and extend U.S.  criminal jurisdiction over individuals employed under a contract awarded  by any U.S. department or agency where contract performance is located  in the area of a contingency operation. In addition to U.S. law, the legal  framework for holding PSCs accountable includes applicable international  law, including the law of war, and Iraqi law. Also, contract provisions  serve to regulate contractor behavior.
subsections: section_title: U.S. Laws May Be Applied Extraterritorially in Certain Instances
paragraphs: Congress has the authority to enact laws that have effect beyond the  territorial boundaries of the United States. However, it is a long standing  principle that a law of the United States is meant to apply only within the  territorial jurisdiction of the United States, unless there is a clear  expression of congressional intent to the contrary. Certain federal  statutes prescribe criminal sanctions for offenses committed by or against  U.S. nationals overseas, such as the War Crimes Act of 1996, which makes  murder, rape, torture, and other grave breaches punishable during an  armed conflict. The United States also has jurisdiction over U.S. nationals  for crimes committed outside U.S. territory through special maritime and  territorial provisions for certain offenses clearly identified in the U.S.  Code, such as maiming, assault, kidnapping, murder, and manslaughter. In  the U.S. Code, the definition of ”special maritime and territorial  jurisdiction” includes any lands reserved or acquired for use of the United  States or any place acquired by the United States for the erection of a  building.   In addition, effective October 26, 2001, the definition of the  “special maritime and territorial jurisdiction” was expanded to include  U.S. diplomatic, consular, military or other U.S. missions or entities in  foreign states including leased buildings or residences with respect to  offenses committed by or against a U.S. national, except where the offense  is committed by a person employed by or accompanying the Armed Forces  or a member of the Armed Forces, as defined in MEJA.  Therefore, the  statute essentially exempts people who are already subject to MEJA (in  other words, giving preference to MEJA as the source of jurisdiction).
section_title: MEJA Applies to Contractors Supporting DOD’s Mission Overseas
paragraphs: In 2000, Congress enacted MEJA in part due to a disagreement among  federal courts interpreting the breadth of special maritime and territorial  jurisdiction.  MEJA extended U.S. criminal jurisdiction over civilians  employed by or accompanying the Armed Forces outside the United States  who commit offenses outside the United States that would have been  punishable by imprisonment for more than 1 year had the offense  occurred within the special maritime and territorial jurisdiction of the  United States. The statute is applicable to DOD contractors, including  subcontractors at any tier, and, beginning in 2004, to contractors of any  other U.S. agency to the extent that the contractor employee’s  employment relates to supporting the mission of the DOD overseas. The  law is not applicable to individuals who are nationals of or ordinarily  resident in the host nation. DOD has issued regulations and an instruction  implementing policies and procedures under MEJA. Among other things,  the regulation states that the DOD General Counsel shall provide initial  coordination and liaison with the departments of Justice and State, on  behalf of the military departments, regarding a case for which  investigation and/or federal criminal prosecution under MEJA is  contemplated. The regulation further states that the DOD Inspector  General shall report to the Attorney General whenever the Inspector  General has reasonable grounds to believe that a violation of federal  criminal law has occurred and to ensure that DOD criminal investigative  organizations fulfill their responsibilities outlined in the memorandum of  understanding between the Department of Justice and DOD. The  regulation also notes that a question remains as to whether MEJA  jurisdiction should be applied to persons who are Third Country Nationals  but have a tenuous nexus to the United States.
The Report of the Secretary of State’s Panel on Personal Protective  Services in Iraq stated among its principal findings that the panel was  unaware of a clear legal basis for holding non-Department of Defense  contractors accountable under U.S. law and recommended the State  Department urgently engage with other administration agencies to  establish a clear legal basis for holding contractors accountable under U.S.  law. A number of bills have been introduced during the 110th Congress,  including one that was passed in the U.S. House of Representatives in  October 2007, to broaden the applicability of MEJA beyond members of  the Armed Forces and individuals employed by or accompanying the  Armed Forces outside the United States, to include individuals employed  under a contract or subcontract awarded by any U.S. department or  agency where the employment is carried out in or near an area where the  Armed Forces are conducting a contingency operation. DOD officials we  interviewed expressed concern that the pending legislation is imprecise  and contains nebulous language that needs refinement. State, Defense and  Justice Department officials we interviewed all confirmed that alternative  language is being jointly prepared in an effort to clarify the jurisdictional  boundaries under MEJA.
section_title: Certain Contractors May Be Subject to Prosecution under the UCMJ
paragraphs: Contractor personnel may be subject to prosecution by court-martial  under the Uniform Code of Military Justice (UCMJ) for conduct that takes  place during a contingency operation in certain circumstances. The John  Warner National Defense Authorization Act for Fiscal Year 2007  broadened the applicability of the UCMJ regarding persons serving with or  accompanying an armed force in the field, from “in time of war” to “in  time of declared war or a contingency operation.” According to DOD  officials we interviewed, the trial of civilian contractors by courts-martial  will likely be challenged on constitutional grounds, particularly in light of  variations between the rules of courts-martial and civilian trials on key  issues such as jury composition and due process. On March 10, 2008, the  Secretary of Defense issued guidance regarding expanded UCMJ  jurisdiction over DOD contractor personnel and other persons serving  with or accompanying the Armed Forces overseas. The memorandum  clarifies the broad scope of command authority to act whenever criminal  activity may relate to or affect the commander’s responsibilities. It  requires that when alleged offenses committed by civilians violate U.S.  federal criminal laws, DOD notify responsible Department of Justice  authorities to afford them the opportunity to pursue prosecution of the  case in federal district court. The memorandum also specifically notes that  the unique nature of extended UCMJ jurisdiction requires sound  management over when, where, and by whom such jurisdiction is  exercised. According to MNF-I officials, on June 22, 2008, the Army for the  first time tried a civilian defense contractor employee by court-martial  under the expanded UCMJ authority. MNF-I officials informed us that an  interpreter with U.S. armed forces in Iraq was originally charged with  aggravated assault for allegedly stabbing another contractor at a combat  outpost, but pleaded guilty to wrongfully taking a soldier’s knife,  obstructing justice, and lying to investigators. After the military judge  accepted the guilty plea, the government dismissed the assault charge and  the contractor employee was found guilty of all remaining charges and  sentenced to 5 months confinement.
section_title: International Law
paragraphs: The part of international law that addresses the conduct of armed  hostilities is referred to as the law of war. The law of war encompasses all  international law for the conduct of hostilities binding on the United States  or its individual citizens, such as treaties and international agreements to  which the United States is a party. According to DOD policy, the law of  war obligations of the United States are observed and enforced by the  DOD components and DOD contractors assigned to or accompanying  deployed Armed Forces. This DOD policy also requires the service  secretaries to develop internal policies and procedures to forward all  reports of suspected or alleged violations of the law of war involving  contractors or subcontractors assigned to or accompanying the Armed  Forces to the DOD General Counsel for review for prosecutorial action  under the criminal jurisdiction of the United States.
section_title: PSCs in Iraq Operate under the Law of the Government of Iraq
paragraphs: PSCs who perform services for U.S. agencies, for any member of the  multinational force, or for diplomatic entities in Iraq operate under the law  of the government of Iraq, which includes orders issued by the Coalition  Provisional Authority (CPA) that have not been rescinded. PSCs, however,  currently enjoy legal protections by virtue of CPA Order 17, which was  revised on June 27, 2004. CPA Order 17 provides that PSCs are not subject  to Iraqi laws or regulations on matters relating to the terms and conditions  of their contracts, as long as they comply with CPA Orders and  instructions governing the activities of PSCs in Iraq. Those orders and  instructions include the registration and licensing of weapons and  firearms. One such instruction, CPA Memorandum17, provides binding  rules for the use of force and a code of conduct that must be followed by  all PSCs. CPA Order 17 further recognizes that the United States shall have  the right to exercise within Iraq any criminal and disciplinary jurisdiction  conferred by U.S. law over persons subject to U.S. military law.
section_title: Contract Provisions Also Regulate Contractor Behavior
paragraphs: Contracts specify the terms of conduct and employment by which  contractors must abide. For example, PSC contracts typically provide that  a contractor is responsible for ensuring that its personnel who are  authorized to carry weapons are adequately trained to carry and use them  safely, adhere to the rules on the use of force, comply with law and  agreements, and are not barred from possession of a firearm.  Inappropriate use of force could subject a contractor, its subcontractors,  or its employees to prosecution or civil liability under the laws of the  United States and the host nation. A Defense Federal Acquisition  Regulation Supplement clause, which is required to be included in  contracts that authorize contractor personnel to accompany U.S. Armed  Forces outside the United States in contingency operations, reminds such  contractor personnel that they must comply with, and ensure that  deployed personnel are familiar with and comply with, all applicable laws,  rules, and regulations, including those of the host country, all treaties and  international agreements, all U.S. regulations, and all orders, directives,  and instructions issued by the combatant commander. A Federal  Acquisition Regulation clause, which is required to be included in  contracts that require contractor personnel to perform outside the United  States in a designated operational area during contingency operations,  creates similar requirements for contractor personnel supporting a  diplomatic or consular mission outside the United States. The  requirements of these clauses apply to subcontractors as well. As  discussed earlier in this report, Fragmentary Order 07-428 also identifies  language that must be incorporated into all DOD contracts where arming  of employees is contemplated in Iraq, including a statement that the  contractors and their subcontractors agree to obey all existing and future  laws, regulations, orders, and directives applicable to the use of private  security personnel in Iraq.
section_title: Conclusions
paragraphs: Given the security situation in Iraq and the shortage of available military  personnel and Department of State diplomatic security personnel to  provide security, private security contractors play an integral role in  providing the security. The September 16, 2007, incident in Nisour Square  demonstrated the importance of having in place a coordinated system of  oversight and coordination over U.S. government-hired private security  contractors. Since that incident, DOD and the State Department have  taken steps to increase oversight and coordination over PSCs, including  establishing the Armed Contractor Oversight Division and Contractor  Operations Cell systems and increasing the number of personnel devoted  to PSC oversight functions in Iraq. The improvements DOD and the State  Department have made may reduce the number of PSC incidents in Iraq.  However, these enhancements may not eliminate incidents. Moreover,  while the increase in the number of DOD personnel devoted to PSC  oversight in Iraq should improve oversight, more efforts are required to  ensure that that these personnel are well-trained and qualified, and that  positions are filled and sustained over time. Furthermore, unless DOD  ensures that military units deploying to Iraq understand both their  expanded oversight and coordination responsibilities problems in  managing and overseeing PSCs may continue. By ensuring that these  efforts are sustained, the U.S. government can strengthen its framework of  PSC oversight and coordination in Iraq and can better prepare to respond  effectively to incidents and to apply this framework to future contingency  operations, should they occur, and overseas diplomatic missions in high  threat areas.
section_title: Recommendations for Executive Action
paragraphs: To ensure that DOD sustains its current efforts to strengthen oversight for  private security contractors in Iraq, we recommend that the Secretary of  Defense develop and implement a strategy to fill authorized positions for  the Joint Contracting Command – Iraq/Afghanistan and DCMA.
To ensure that units and military commanders deploying to Iraq are aware  of their new oversight and coordination responsibilities, we recommend  that the Secretary of Defense direct the service Secretaries to update the  information being provided on PSCs at unit mission-rehearsal exercises  and predeployment training to include information regarding the  operations of the Armed Contractor Oversight Division and the Contractor  Operations Cells along with the role of military units in providing contract  oversight, incident investigation, and PSC coordination procedures.  Further, we recommend that DOD fully implement our 2005  recommendation by including information on PSC typical operating  procedures and the military’s responsibilities to PSCs.
section_title: Agency Comments and Our Evaluations
paragraphs: We provided a draft of this report to DOD and the State Department for  their review and comment. DOD’s response is provided in appendix III,  and the State Department’s response and our comments are provided in  appendix IV. Both departments also provided us with technical comments,  which we incorporated into the report as appropriate.
In commenting on the draft of this report, DOD concurred with our  recommendations. First, DOD concurred with our recommendation to  develop and implement a strategy to fill authorized positions for the JCC- I/A and DCMA. DOD concurred and stated that it has initiated a strategy to  deploy 220 personnel by December 15, 2008.   DOD also concurred with  our second recommendation that the Secretary of Defense direct the  Service Secretaries to update the information being provided on PSCs at  unit mission rehearsal exercises and pre-deployment training to include  information regarding the operation of the Armed Contractor Oversight  Division and the Contractor Operations Cells along with the role of  military units in providing contract oversight, incident investigation, and  PSC coordination procedures.  DOD stated that it is actively incorporating  contractors and contract support into the exercise schedules.  We believe  this is a positive step. However, DOD’s efforts should also ensure that the  training provided is given to a wide audience including senior military  leadership, officers, and enlisted personnel.  Lastly, DOD concurred with  the third recommendation to fully implement our 2005 recommendation by  including information on typical PSC operating procedures and the  military’s responsibilities to PSCs.  DOD stated that it continues to swiftly  improve its procedures through the rapid dissemination of changes to the  MNF-I Fragmentary Order 07-428.
In commenting on our report the State Department noted that in addition  to the oversight improvements discussed in this report, the State  Department and the Bureau of Diplomatic Security have increased and  realigned staff to enhance oversight. According to the State Department,  the duties of the increased and realigned staff include assisting in  administrating contracts, approving invoices, and increasing oversight of  contractor training. In addition, the State Department provided us with  some additional information regarding actions it has taken to improve  contract oversight for private security contractors in Iraq which we have  included in the report. The State Department expressed concern over our  depiction of the status of implementation of the Secretary of State’s Panel  on Personal Protective Services in Iraq in appendix II. In its comments the  State Department stated that it has implemented 16 of the 18  recommendations made by the panel. In our draft report we originally  assessed 9 recommendations as complete. Based on additional  information provided by the State Department we changed our assessment  of the status of two recommendations (recommendation numbers 3 and 11  in appendix II) and now we are reporting that the State Department has  completed 11 of the 18 recommendations. For example, in comments the  State Department noted that it considered the implementation of the  panel’s recommendation that video recording equipment be installed into  each security vehicle, even though to date the equipment has been  installed in 140 of 233 vehicles. Therefore, we disagreed with the State  Department’s assessment and stand by our assertion that the State  Department has implemented 11 of the panel’s recommendations and have  detailed our rationale in appendix II. In addition, the State Department’s  comments and our detailed responses appear in appendix IV.
We are sending copies of this report to other interested congressional  committees, the Secretary of Defense and the Secretary of State. Copies of  this report will also be made available to others upon request. In addition,  this report will be available at no charge on GAO’s Web site at  http://www.gao.gov.
If you or your staff has any questions on the matters discussed in this  report, please contact me at (202) 512-8365. Contact points for our Offices  of Congressional Relations and Public Affairs may be found on the last  page of this report. Key contributors to this report are John Needham,  Director, Acquisition and Sourcing Management; Carole Coffey, Assistant  Director; Vincent Balloon; Laura Czohara; Barbara Hills; Moshe Schwartz;  Karen Thornton; Cheryl Weissman; and Natasha Wilder.
section_title: Appendix I: Scope and Methodology
paragraphs: To assess the U.S. government’s use of PSCs in Iraq as well as to examine  the efforts by DOD and the State Department to provide oversight,  coordination, and accountability over the actions of the PSCs they employ  in Iraq, we took a number of actions.
To determine if the oversight and coordination of PSCs operating in Iraq  strengthened between U.S. government agencies, we reviewed several  DOD, CENTCOM, Multinational Force-Iraq (MNF-I) and State Department  policies and guidance addressing the requirements, procedures and  responsibilities for the control, coordination, management and oversight  of PSCs, as well as policies and guidance on arming requirements and  certification, rules for the use of force, and incident reporting and  investigation requirements. Specifically, we reviewed DOD regulations and  instructions that relate to the management and oversight of PSCs during  contingency operations as well as guidance and fragmentary orders issued  by CENTCOM and headquarters MNF-I, including fragmentary order 07- 428 entitled ‘Armed Contractors/DOD Civilians and PSCs’, and its  appendices, which consolidates several prior MNF-I fragmentary orders.  We analyzed these documents to gain an understanding of the evolution of  oversight roles and responsibilities and the delegation of authority to  increase coordination between the agencies. In addition, we reviewed the  memorandum of agreement, signed in December 2007, between DOD and  the State Department on U.S. Government PSCs in Iraq. We reviewed these  policies and documents to determine the authority and responsibility for  the oversight, coordination, and accountability over PSC operations in  Iraq. We reviewed the National Defense Authorization Act, including Sec.  861 directing the agencies to enter into a Memorandum of Understanding  as well as Sec. 862 which outlines regulations on contractors performing  private security functions in areas of combat operations.
To understand what actions the agencies have or can take to hold PSCs  accountable, we analyzed the legal framework that PSCs hired by the U.S.  government must comply with, including applicable international law,  Iraqi law, and U.S. law. We reviewed the Military Extraterritorial  Jurisdiction Act and the Uniform Code of Military Justice to gain an  understanding of the process of how PSCs are held accountable for  criminal misconduct. We interviewed officials from DOD’s Office of the  General Counsel, the State Department’s Office of the Legal Adviser and  from the Department of Justice to gain an understanding of the process  used and the actions taken against PSC employees accused of misconduct  in Iraq. Moreover, we also reviewed applicable U.S. government PSC  contract provisions that outline and regulate contractor behavior.
Additionally, we met with military officials from the Office of the Under  Secretary of Defense, Acquisition, Technology, and Logistics; Office of the  Secretary of Defense, Office of the General Counsel, U.S. Central  Command; and the U.S. Army Corps of Engineers; officials from the State  Department, including the Bureau of Diplomatic Security, Office of  Acquisitions Management, and the Office of the Legal Advisor, and the U.S.  Agency for International Development to discuss oversight, coordination,  and accountability of PSCs in Iraq. We also met with the Executive  Secretary who led the State Department panel to review the State  Department’s security practices in Iraq to discuss the findings and  recommendations of their study.
We also interviewed officials from ten private security firms, located in the  United States, the United Kingdom, and/or Baghdad, Iraq, who currently  provide or have recently provided private security functions in Iraq. We  met with the three firms contracted by the State Department under the  Worldwide Personal Protective Service Contract as well as the firm hired  by DOD to run the Reconstruction Operations Center, the predecessor to  the Contractor Operations Cells. In addition, we interviewed several  others to reflect a range of firms that provide private security. The private  security firms we met with provided the U.S. government with a variety of  private security services, including static security, personal protective  detail, high threat protection, and convoy security. Our discussions  included qualification and training standards, employee conduct and  accountability, coordination with U.S. government agencies and their  tactical operations centers, interaction amongst the other PSC firms  operating in Iraq, vehicle and weapon tracking, and incident reporting  procedures. Additionally, we met with representatives from an Iraq-based  private security association to gain an industry perspective on the use,  role, oversight, accountability, and legal framework of PSCs operating in  Iraq.
We traveled to Iraq to meet with officials from DOD, including Multi- National Force-Iraq, Multi-National Corps-Iraq, and Multi-National  Division-Baghdad, and Joint Contracting Command-Iraq/Afghanistan to  discuss issues related to oversight, coordination, and accountability of  PSCs in Iraq. We met with senior officials responsible for the  establishment and operation of the Armed Contractor Oversight Division  and the Contractor Operations Cells, as well as the military liaisons who  are located in the State Department’s Tactical Operations Center.  Likewise, we met with officials from the State Department, including  senior officials from the U.S. Embassy Baghdad and its Regional Security  Office. We met with them to gain an understanding of the delegated  responsibility and oversight structure of PSCs in Iraq, procedures for the  coordination and communication between MNF-I and US Embassy  Baghdad for the movement of PSCs within the MNF-I battle space,  procedures for reporting and investigation in the event that a serious  incident occurs as well as applicable laws to hold PSCs operating in Iraq  accountable for their actions. While in Iraq, we toured DOD’s Contracting  Operations Cell and the State Department’s Tactical Operations Center,  witnessing the planning, oversight and coordination, and tracking of PSC  movements throughout Iraq. Additionally, in Iraq, we met with officials  from private security firms to gain an industry perspective.
We scoped our work to include only on PSCs that have a direct  contractual relationship with the U.S. government. As such, our work  excluded PSCs with an indirect relationship with the U.S. government,  such as those contracted by reconstruction firms. We reviewed processes  but did not evaluate how effectively they were being implemented because  the processes reviewed are new. We also did not evaluate how laws were  being used to hold contractors accountable. We conducted this  performance audit from February 2008 to April 2008, in accordance with  generally accepted government auditing standards. Those standards  require that we plan and perform the audit to obtain sufficient, appropriate  evidence to provide a reasonable basis for our findings and conclusions  based on audit objectives. We believe that the evidence obtained provides  a reasonable basis for our findings and conclusions based on our audit  objectives.
We visited or contacted the following organizations during our review:  The Department of Defense:    Office of the Under Secretary of Defense, Acquisition, Technology, and  Logistics, Washington, D.C.
Office of General Counsel, Arlington, Va.    Office of the J4, Washington, D.C.    U.S. Central Command, Tampa, Fla.    Defense Contract Management Agency, Baghdad, Iraq    Multi-National Forces-Iraq, Baghdad, Iraq    Multi-National Corps-Iraq, Baghdad, Iraq    Multi-National Division-Baghdad, Baghdad, Iraq    Joint Contracting Command Iraq/Afghanistan, Baghdad, Iraq Department of the Army:    Army Corps of Engineers Gulf Regional Division, Baghdad, Iraq    Army Corps of Engineers, Logistics Movement Coordination Center,    Bureau of Diplomatic Security, Arlington, Va.    Office of Acquisitions Management, Arlington, Va.    Office of the Legal Adviser, Arlington, VA; Baghdad, Iraq    Secretary of State’s Panel on Personal Protective Services in Iraq,  Washington, D.C.
US Embassy Iraq, Baghdad, Iraq   Criminal Division, Washington, D.C.    Federal Bureau of Investigation, Washington, D.C.
Private Security Association of Iraq, Baghdad, Iraq   Aegis, London, United Kingdom    Armor Group, London, United Kingdom    Blackwater, Baghdad, Iraq; Moyock, N.C.    Blue Hackle, Baghdad, Iraq    Control Risks Group, London, United Kingdom    Dyncorps International, West Falls Church, Va.    Erinys International, London, United Kingdom    Olive Group, Baghdad, Iraq    Raymond Associates, Clifton Park, N.Y.    Triple Canopy Inc., Herndon, Va.
section_title: Appendix II: Implementation Status of Recommendations from the Secretary of State’s Panel on Personal Protective Services in Iraq
paragraphs: According to State Department officials, the department has also begun to  implement other recommendations made by the panel including the  installation of audio and video recording equipment in security vehicles  and the creation of an eight person unit to investigate any reported and  alleged incidents involving State Department PSCs including those  involving injuries or death. In July 2008, officials provided information on  the status of the implementation of the recommendations noting that 16  were completed and that others were dependent on other agencies or  governments. This appendix provides additional information on all of the  panel’s recommendations, their implementation status, and our  assessment of the implementation status. In certain instances our  assessment differed from the State Department’s. For example, the panel  recommended that the Regional Security Office should be provided video  and audio recording equipment for each security vehicle operating in Iraq.  According to the State Department, they have fully implemented this  recommendation by installing video recording systems into 140 vehicles  and installing a radio recording system in the Regional Security Officer’s  Tactical Operations Center to record all Embassy radio transmissions.  However, according to State Department officials the goal is to install the  equipment into 233 vehicles by December 2008. Therefore, it is our  assessment that implementation of the recommendation is still in  progress. Similarly, the panel also recommended that a working group  should be established to determine ways to move the Iraqi licensing  process forward more transparently. The State Department stated that in  its view this recommendation has been completed because it established  the working group and that it was not necessary to have improved the  licensing process to consider the recommendation implemented.
section_title: Appendix III: Comments from the Department of Defense
section_title: Appendix IV: Comments from the Department of State
paragraphs: The following are GAO’s comments on the State Department’s letter dated  July 24, 2008.
subsections: section_title: GAO Comments
paragraphs: 1.  The State Department commented that it had completed more than  half of the 18 recommendations made by the Secretary of State’s panel.  The department noted that three of the recommendations were  dependent on other agencies or governments and the remaining  recommendations would be completed by December 2008. In appendix  II of the report, we note the State Department’s assessment on the  status of implementation for each of the panel’s 18 recommendations.  This information is presented verbatim from information provided by  the State Department. We also added an acknowledgement in the  report that the State Department has implemented 11 of the 18  recommendations made by the panel.  2.  We revised the report to attribute the number of Iraqi civilian deaths  caused by the September 16, 2007, incident to the report of the  Secretary of State’s Panel on Personal Protective Services in Iraq.  3.  We revised the report to include “nature of the contractor’s  employment” among the factors that could affect whether a particular  law provides extraterritorial jurisdiction in a specific case.   4.  While DOD and the State Department have improved communication  and coordination related to PSCs in Iraq, we have no basis to state that  these improvements are significant.  5.  The report was revised to accept the suggested change.  6.
We are unclear how the language in footnote 28 is misleading or  suggests a loophole in 18 U.S.C. 7(9).  We did change the language as  suggested by the State Department to clearly state that  "the statute  essentially exempts people who are already subject to MEJA (in other  words, giving preference to MEJA as the source of jurisdiction)."  7.  The State Department misinterpreted our conclusions. Our statement  that the improvements made by DOD and the State Department may  reduce, but not necessarily eliminate, incidents is intended to  demonstrate that regardless of the level of oversight provided, in  places with tenuous security situations such as Iraq,  incidents  involving PSCs may still occur. As we noted in our conclusions, a  strengthened framework of PSC oversight and coordination in Iraq will  enable the U.S. government to be better prepared to respond  effectively when incidents do occur.  8.  While we incorporated the requested updated information into the  status of implementation column of recommendation 1, we disagree  that the State Department has completed implementation of the  recommendation. The State Department noted that the department’s  Office of the Legal Advisor was actively engaged in this manner  through an interagency working group led by the Department of  Justice. However, the effort to establish a clear legal basis for holding  contractors accountable under U.S. law is still ongoing. Therefore, we  assert that this recommendation has not been implemented.   9.  The State Department commented that it disagreed with our assertion  that the status of implementation of recommendation 2 should be cited  as in progress. In its comments the department noted that the  recommendation was worded not to require that the State Department  create or negotiate a new regulatory framework, but to merely  “commence discussions” with the Government of Iraq on this subject.  While negotiations with the Government of Iraq are ongoing on a  Status of Force Agreement and a Strategic Framework Agreement, it is  our assertion that implementation will be complete when an  agreement is reached.   10. Based on additional information provided to by the State Department  we have changed our assessment of the status of this implementation  to “GAO agrees with the State Department’s assessment.”   11. While we have incorporated the requested updated information into  the status of implementation column of recommendation 5, we  disagree that the State Department has completed the implementation  of this recommendation. We assert that fully implementing the  recommendation means that the additional personnel should be  recruited, trained, and deployed to Iraq, a process that has not  happened yet. Therefore, we believe that implementation of the  recommendation is still in progress.  12. The State Department requested that we incorporate updated  information into the status of implementation column of  recommendation 9. While we updated the column, we disagree that the  State Department has completed the implementation of this  recommendation because not all of the department’s vehicles have  been outfitted with the video recording systems as recommended by  the panel. According to the State Department, to date the equipment  has been installed in 140 of the 233 vehicles it intends to place this  equipment in. The State Department noted that it expects this process  to be completed by December 2008. As such our assessment of the  status of implementation is that implementation is ongoing.   13. While we have incorporated the requested updated information into  the status of implementation column of recommendation 10, we  disagree that the State Department has completed the implementation  of this recommendation.  As noted in appendix II, the panel  recommended that the State Department place a readable number on  the right rear door of each vehicle utilized, to enable anyone wishing to  question its mode of operation to identify the unit to the Regional  Security Office. The systems and measures being implemented by the  State Department may assist the monitoring of these vehicles by U.S.  government officials. However, these systems do not enable any  person, such as an Iraqi citizen standing on a street corner, to identify  the unit to the Regional Security Office.     14. We incorporated the requested updated information into the status of  implementation column for recommendation 11. Based on this  additional information we now agree with the State Department that  the recommendation has been implemented.   15. We incorporated the requested updated information into the status of  implementation column for recommendation 15.  16. While we incorporated the requested updated information into the  status of implementation column of recommendation 16, we stand by  our initial assertion that the recommendation is ongoing and therefore  not complete. According to information provided by the State  Department, officials from the department have had numerous  conversations with officials from the government of Iraq regarding the  licensing and registration of PSCs in Iraq and had established a  working group. However, officials were unable to provide a written  account for these discussions when asked and stated that it considered  the recommendation completed because the intent of the  recommendation was to start holding talks and not to have necessarily  improved the licensing process.