Raleigh, N.C. — The North Carolina defense contractor once known as Blackwater has agreed to a $42 million settlement with the U.S. State Department for illegal weapons exports and other violations, officials said Tuesday.
As part of the deal, Moyock-based Academi LLC will pay a $7.5 million fine, and the U.S. Justice Department will defer prosecution of 17 criminal charges and will monitor the company's actions for an unspecified period to ensure compliance with federal export laws.
"Today's proceedings conclude a lengthy and complex investigation into a company which has provided valuable services to the United States government but which, at times and in many ways, failed to comply with important laws and regulations concerning how we as a country interact with our international allies and adversaries," U.S. Attorney Thomas Walker said in a statement.
"Compliance with these laws is critical to the proper conduct of our defense efforts and to international diplomatic relations. This prosecution is an important step to ensuring that our corporate citizens comply with these rules in every circumstance," Walker said.
Academi acknowledged it was guilty of two violations of the International Emergency Economic Powers Act by exporting satellite phones to Sudan in November 2005 without the required authorization.
The company also acknowledged four violations of the Arms Export Control Act and the International Trafficking in Arms Regulations:
- In October and November 2006, it proposed to provide security services and a threat assessment to the government of Sudan without obtaining a license from the State Department.
- Between October 2006 and June 2008, it provided military training related to overseas military operations for military and law enforcement personnel from Canada without a State Department license.
- Between January 2006 and December 2008, it provided technical and engineering data relating to the construction of armored personnel carriers to people from Sweden and Denmark without State Department authorization.
- Between October 2004 and March 2006, it exported ammunition and body armor to Iraq and Afghanistan without a State Department license.
Academi also admitted to six violations of various federal firearms laws by possessing automatic weapons without registration or permission to five counts of lying to the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives about the ownership of five firearms that had been given to the King of Jordan or members of his traveling entourage in June 2005.
“This company clearly violated U.S. laws by exporting sensitive technical data and unauthorized defense services to a host of countries around the world,” Brock Nicholson, special agent-in-charge of the regional office of U.S. Homeland Security Investigations. “In doing so, company employees were frequently in possession of illegal firearms and aided other foreign nationals in the acquisition of illegal firearms."