According to a report by MSNBC and based on alleged sworn declarations by two Blackwater employees in federal court, the firm used child prostitutes at its compound in Baghdad's fortified Green Zone.
The declarations added Iraqi minors got involve in sexual acts with Blackwater members in exchange for one dollar, and Erik Prince, the firm's owner,
Based on other statements, the firm was involved in another sex scandal;
The two employees also alleged that Prince
Prince also allegedly forced health professional to endorse the redeployment of those Blackwater members who had been mental problems, such as excessive drinking and drug abuse. Other charges against the firm include arms smuggling, money laundering and tax evasion.
The criminal activities of the firm first came under scrutiny after a group of the firm's members who were tasked to guard US diplomats in Iraq opened fire on civilians in Baghdad on September 2007, killing 17 people.
According to federal contract data obtained by The Nation, the Obama administration has recently extended a contract with Blackwater for more than $20 million for "security services" in Iraq.
By Daniel Dombey in Washington
Financial Times, August 8 2009
The target of many of the claims is Blackwater, the private security company now known as Xe, which lost its licence to operate in Iraq after 17 Iraqis were killed in a September 2007 shoot-out in Baghdad's Nisour Square.
While the US justice department is pursuing manslaughter charges against five former Blackwater contractors in Texas, this case in Virginia is a civil one, arising from the claims of survivors and the bereaved families against Blackwater itself.
In recent days, previous arguments in the Virginia case have been overshadowed by the extraordinary claims in two anonymous affidavits from US citizens who, on behalf of the plaintiffs, allege they saw crimes committed by Blackwater and its founder Erik Prince. He stepped down as chief executive this year but still serves as chairman.
"John Doe 1", who says he joined Blackwater after being honourably discharged from the marines, says he is anonymous because "I fear violence against me in retaliation for submitting this declaration . . . I have learned from my Black-water colleagues and former colleagues that one or more persons who have provided information or who were planning to provide information about Erik Prince and Blackwater have been killed in suspicious circumstances."
"John Doe 2" alleges more bluntly that "on several occasions after my departure from Mr Prince's employ, Mr Prince's management has personally threatened me with death and violence".
The North Carolina-based company itself did not respond to requests for comment by yesterday afternoon.
But, in a memorandum filed to the court this week in support of the defendants' motion to ask the court to limit the plaintiffs' extrajudicial comments, its lawyers denounced the
The memorandum adds:
In his affidavit, John Doe 1 alleges that Blackwater used bags of dog food to smuggle weapons into Iraq and
John Doe 2 alleges that Mr Prince operated a web of companies to
In a bizarre addition, John Doe 2's affidavit says:
The defendants - including Blackwater companies and Mr Prince himself - have argued that the plaintiffs lack evidence, relying on "sensational and unfounded allegations" to prejudice potential jurors.