|
The War Profiteers - War Crimes,
Kidnappings, Torture and Big Money |
|
October 22nd,
2007 - Waxman Accuses Blackwater of Tax Evasion News article by the Associated
Press |
|
Waxman Accuses Blackwater of
Tax Evasion By Anne Flaherty Associated Press October 22, 2007 Washington - The Democratic
chairman of a House watchdog committee said Monday that Blackwater USA
violated tax laws and may have defrauded the government of millions of
dollars, a charge the embattled security firm said is groundless. Rep. Henry Waxman, who
chairs the Committee on Oversight and Government Reform, released a March
letter from the Internal Revenue Service that states the company's
classification of a security guard as an independent contractor, instead of
company personnel, was "without merit." Under U.S. law, companies
must pay Social Security and other federal taxes on their employees. But
unlike other security companies operating in Iraq, Blackwater says the guards
it trains, equips and deploys to Iraq and elsewhere are independent contractors
hired directly by the federal government. "By classifying its
armed guards and other personnel as independent contractors instead of
employees, Blackwater has apparently evaded withholding and paying these
taxes," Waxman, D-Calif., wrote in a letter to Blackwater chief Erik
Prince. Waxman's charge comes as the
company is struggling to salvage its reputation after a string of security
incidents involving its guards, including a September shooting that left 17
Iraqis dead. U.S. and Iraqi officials are
negotiating Baghdad's demand that Blackwater be expelled from the country
within six months, and American diplomats appear to be working on how to fill
the security gap if the company is phased out. Secretary of State
Condoleezza Rice has agreed to testify before Waxman's committee on Thursday. Blackwater spokeswoman Anne
Tyrrell said in an e-mail statement to The Associated Press that the company
has appealed the IRS ruling and that no final determination has been made.
Further, she said, the U.S. Small Business Administration has told the
company that Blackwater security guards do not have to be classified as
company employees. "It is unfortunate that
the chairman has relied upon a one-sided description of the issue to color
public perception without all the facts being presented," Tyrrell said. An IRS spokeswoman declined
to comment on the case, as is custom to protect privacy. Waxman has been
investigating Blackwater's business dealings for several weeks, including
whether the State Department unfairly awarded Blackwater a noncompetitive
contract and if its guards took control of two Iraqi military aircraft
without permission. According to the House
Democrat, the IRS' finding was the result of an inquiry filed by a Blackwater
guard. The guard later agreed not to discuss the matter with anyone,
including politicians or public officials, in exchange for receiving
compensation owed to him by Blackwater, Waxman said. The worker's nondisclosure
agreement, also released by Waxman on Monday, is "evidence that
Blackwater has tried to conceal the IRS ruling and the evasion of taxes from
Congress and law enforcement officials," he said. The primary factor in
determining whether a worker is an employee or independent contractor is the
degree of control the business has over its worker. Incorrectly classifying a
worker could mean steep penalties for the company, including a $25,000
penalty if the IRS determines an appeal is frivolous or groundless. In its March letter to
Blackwater, the IRS noted the company paid all of the guard's travel expenses
and signed a written agreement detailing the type of work required. "A worker who is
required to comply with another person's instructions about when, where and
how he or she is to work is ordinarily an employee," the IRS stated in
the letter. In testimony before Waxman's
committee earlier this month, Prince said Blackwater was not trying to avoid
legal responsibilities but rather wanted to give its guards more control of
their schedule. "We provide the trained
person with the right equipment, the right training, the logistics to get
them in and out of theater," Prince said. "When they get to Iraq or
they get to Afghanistan, they work for the State Department." © 2007 The Associated Press External link: http://www.chron.com/disp/story.mpl/ap/politics/5235465.html Blackwater Softens Its Logo
From Macho to Corporate By Paul von Zielbauer New York Times October 22, 2007 Baghdad - In the private
security business that has made Blackwater USA virtually a household name,
being tough is part of the game. Not just for its rifle-carrying contractors
but also for its corporate logo. Well, not anymore. The
well-armed men remain, but the company’s roughneck logo - a bear’s paw print
in a red crosshairs, under lettering that looks to have been ripped from a
fifth of Jim Beam - has undergone a publicity-conscious, corporate scrubbing. The company said the
decision to update its logo was made long before Sept. 16, the day a
Blackwater team guarding a State Department convoy in Baghdad fatally shot 17
Iraqis near a bustling traffic circle. But the new logo did not appear on
Blackwater’s Web site (www.blackwaterusa.com), until after the incident, a
Blackwater spokeswoman said. The rifle-scope crosshairs
so obvious in the old Blackwater logo have been reduced to a set of
horizontal elipses that bracket, but no longer enclose, the paw print, which
has also changed to more closely resemble an actual bear-paw imprint. The
original Blackwater logo had thick white serif lettering draped over the
crosshairs on a menacing black field. The new logo separates the image and
the letters, which now appear in buttoned-down sans-serif black and slightly
italicized on a white field. Though the red elipses in
the new logo retain the horizontal crosshairs, the overall look is far less
“kick your butt” and much more “quarterly report,” some branding experts
said. The new logo, which began to appear on some Blackwater material in late
July, may also speak volumes about the company’s desire to begin its second
decade on a more anodyne note. “I would say it’s a highly
significant change; they’re repositioning themselves,” said Lauren Miller,
the owner of MDesign, a graphic design firm in New York. “The old logo
suggests that they’re targeting people. The new logo is a more ambiguous,
more safe corporate logo.” “The subtle changes mean
everything here,” Ms. Miller said, “by eliminating the scope of a sniper’s
rifle.” Blackwater’s spokeswoman,
Anne Tyrrell, referred to the crosshairs as a reticle, and said it remained
intact in the new logo, “just modernized.” She said the idea to
redesign the logo came in May, when a graphic designer approached Blackwater
at its headquarters in Moyock, N.C. By that time, the company and its
founder, Erik Prince, had already become a topic of discussion at a
Congressional committee hearing in February on the actions of private
security firms in Iraq. Ms. Tyrrell said the old
logo was probably more fitting when the company was starting out as primarily
a trainer of military and law enforcement personnel. “It seems to be a trend
with companies,” she went on, “once they achieve some recognition, to lose
the words and go with just the logo.” She added, “We have a little bit of
recognition now.” Blackwater also began the
process of altering its name to Blackwater Worldwide. How well the new logo will
go over with Blackwater’s employees remains to be seen. “It’s still a good move away
from superfluous macho stuff that draws unwanted attention to the industry,”
said one former contractor who worked for Blackwater in Baghdad. “They’re
trying to make subtle changes and be the good guys,” he said. “It would have
been smarter to do this much earlier.” Copyright 2007 The New York
Times Company External link: http://www.nytimes.com/2007/10/22/business/media/22logo.html |