Tina Ballard, deputy assistant secretary for policy and procurement for the U.S. Army, told the same hearing that they had taken back $19.6 million from Halliburton for employing private security guards in Iraq, because their contract specifically stated that they could only use U.S. military for security. "We removed the money yesterday," said Ballard (on February 6th, 2007)
Halliburton, a Houston, Texas-based company, has been paid over $20 billion to provide logistical support to U.S. troops occupying Iraq such as building bases, cooking food and cleaning toilets.
Although Halliburton director of security, George Seagle, acknowledged that the company had used Blackwater and other private security sub-contractors in Iraq, he denied that the company was working for them in Fallujah, the day that the four Blackwater men were killed in Fallujah in March 2004, as related earlier. He also told the Congressmen that he did not know what company provided security for their convoys because that was the responsibility of the sub-contractor.
"You should know who you hired, who you sub-contracted to," scolded Republican Congressman Christopher Shays. "You can't be Pontius Pilate and wash your hands of the matter."
Seagle's statement contradicts a 2004 investigation by the Raleigh News-Observer, which unearthed documents that suggest that Blackwater was working indirectly for Halliburton via a complex pyramid of sub-contracting.
An email dated June 3, 2004, produced by Congressman Waxman at the hearing, quotes James Ray, a Halliburton contract administrator, warning the company that they could get into trouble for using Blackwater. "We should not attempt to effect a material change in our contract with the government by hiring a company that we know uses armed contracts. That company is an agent of KBR (Halliburton) and if anything happens KBR is in the pot with them. Even with lipstick, a pig is a pig. Dancing around it will only weaken out position with the government."
Blackwater counsel Andrew Howell says that the men who were killed in Fallujah, were providing security for a company in Kuwait named Regency Hotel, which in turn was employed by a company named ESS in Germany.
Throwing fresh doubt on this matter, was Steve Murray, the director of contracting for ESS, who was also at the hearing says that the four men who were killed that day were actually protecting another major U.S. engineering company named Fluor on that particular day.
But Tom Flores, the director of security for Fluor, who also testified at the hearing, says he was unaware that the Fallujah convoy was protecting his company.
"This tells me that we are not going to have good quality work if neither the government or the contractors can tell us who the subcontractors are," said an exasperated Shays.