But that was then and this is now. New reports show that oversight and accountability over contractors are much improved. And, considering how much money is being spent on them, one would expect nothing less. USA Today reported yesterday that this year spending on security contractors is projected to exceed $1.2 billion. Most of that bill, about $1 billion, is State Department spending, which is up 13 percent over 2007. The remaining $200 million covers Pentagon contracts.

Consider some of the findings from a July U.S. Government Accountability Office report. It found that both the Defense and State Departments have taken steps to strengthen oversight of private security contractors in Iraq since the Nisour Square shootings in Baghdad in September 2007.

The Multi-National Force - Iraq established the Armed Contractor Oversight Division to provide oversight and serve as MNF-I's overall point of contact on policies that govern PSCs working for the Pentagon. In addition, the division notifies the Iraqi Ministry of the Interior when an incident involving PSCs and Iraqi civilians occurs. Prior to the establishment of the oversight division the U.S. government did not coordinate PSC issues with the government of Iraq. Nor did it have a single structure for managing its PSCs in Iraq.

Ironically, the division is currently staffed with seven full-time employees comprising three military personnel and four contractors. It is the contractors who identify and track all PSC incidents, provide reporting through completion of investigations, process and log incident reports, and maintain contact with the Iraqi Ministry of the Interior representative to identify issues concerning PSCs.

MNF-I also has published comprehensive guidance related to the oversight of Department of Defense PSCs and made military units more responsible for providing oversight of PSCs in terms of incident reporting and investigating as well as contract management.

Coordination between the Defense Department and the State Department has improved since the Nisour Square incident. Now, the State Department coordinates its PSC movements with the Department of Defense through liaison officers, and by providing a daily briefing to MNF-I regarding upcoming PSC activities. As many of the worst incidents of PSC shootings have come from companies working for the State Department, this should serve to reduce such incidents.

And preliminary evidence suggests that is what is happening. Shootings by security contractors working for the United States in Iraq are down about 60 percent since the Nisour Square shootings. Of course, whether this is entirely due to new rules imposed in its aftermath or by the presence of more U.S. troops in Iraq during the surge is unknown, but it is encouraging.

One reason oversight is improving is that the MNF has sorted out numerous conflicting orders. According to GAO, prior to December 2007 there were between 40 and 50 separate fragmentary orders relating to regulations applicable to PSCs in Iraq. In December 2007, MNF-I issued Fragmentary Order 07-428, to consolidate the previous fragmentary orders and establish requirements for Multi-National Corps -Iraq to provide oversight for all armed Department of Defense contractors and civilians in Iraq, including PSCs.

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 four 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 within 96 hours of the incident.

Furthermore, the order increases the oversight responsibilities for military units by requiring the military to investigate serious incidents involving a Department of Defense PSC. Previous orders only directed the military to investigate incidents related to contractors firing weapons. According to the 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.

Most importantly, 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, commanders are to use the same standards as they would for their own units' actions. Moreover, 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.

Finally, Pentagon contract oversight efforts in Iraq also have been strengthened. The Defense Contract Management Agency has doubled the number of oversight personnel in the U.S. Central Command area of responsibility. The DCMA plans to increase the number of staff deployed there to 348 by the end of 2008. However, the GAO questioned whether the DCMA will be able to fill all the positions or sustain this increase.

(U.S. Navy veteran David Isenberg is a military affairs analyst. He is an adjunct scholar with the Cato Institute, a correspondent for Asia Times and the author of a forthcoming book, "Shadow Force: Private Security Contractors in Iraq." His "Dogs of War" column, analyzing developments in the private security and military sector, appears every Friday.)

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