Why did the Pentagon award a $7 million Afghanistan security contract to this group of Native Americans in Oklahoma?
- By John Reed
John Reed is a national security reporter for Foreign Policy. He comes to FP after editing Military.com’s publication Defense Tech and working as the associate editor of DoDBuzz. Between 2007 and 2010, he covered major trends in military aviation and the defense industry around the world for Defense News and Inside the Air Force. Before moving to Washington in August 2007, Reed worked in corporate sales and business development for a Swedish IT firm, The Meltwater Group in Mountain View CA, and Philadelphia, PA. Prior to that, he worked as a reporter at the Tracy Press and the Scotts Valley Press-Banner newspapers in California. His first story as a professional reporter involved chasing escaped emus around California’s central valley with Mexican cowboys armed with lassos and local police armed with shotguns. Luckily for the giant birds, the cowboys caught them first and the emus were ok. A New England native, Reed graduated from the University of New Hampshire with a dual degree in international affairs and history.
The Muscogee Nation, part of the Creek Indian tribe, which fought with Confederate troops against the U.S. military during the Civil War, is now guarding Americans stationed at U.S. bases in Herat and Helmand, Afghanistan, under a $7 million Pentagon contract. The Muscogee Nation Business Enterprise (MBNE) is a 100-person firm that has in the past used its status as a tribal-owned company to win government business, some of which it then subcontracted to a larger security company, but it says that its employees are fulfilling this contract, providing security in a war zone.
Neither MBNE nor the Pentagon would provide specifics about the deal, citing security concerns. But, according to the contract announcement, made August 9, MBNE is "to provide life support services to the Department of Defense Task Force for Business and Stability Operations in Afghanistan. These services will include basic necessities, complex security, and personnel security details for safe travel in the immediate region around the Herat and Helmand facilities."
The task force is a U.S. military organization charged with building up Afghan industries, particularly mining, agribusiness, and IT in order to "help Afghanistan achieve economic sovereignty," according to a Pentagon website.
Given its small size, at first glance the notion that MBNE is protecting U.S. efforts in Afghanistan — a business dominated by large private security firms — seems implausible. Experts contacted about the contract initially speculated that MBNE might be a so-called pass-through firm.
Pass-through companies are often tiny but politically well-connected Native American-owned businesses that bid for government deals reserved for small, tribal-owned businesses. These firms, usually consisting of a handful of people, then subcontract much or most of the actual work out to a large organization. A small tribal-owned company gets some government business, and the big contractors get a slice of the action.
And, indeed, MNBE used to subcontract at least some of its government-security business in Afghanistan to the Maryland-based Ronco, a private security firm "wholly owned" by G4S, previously known as Wackenhut. G4S, which claims to be largest private security firm in the world, ran security at the London Olympics and guards a range of U.S. government facilities — from national park sites to sensitive nuclear research facilities, such as the Nevada Test Site.
What’s more, MNBE, which is based in Okmulgee, Okla., explicitly describes itself as a small, tribal-owned business that specializes in helping larger companies win federal contracts by partnering with them to take advantage of federal laws designed to funnel government contracts to Native American-owned companies.
"MNBE has developed business skills necessary to compete and perform in the market place and have [sic] developed a network of potential teaming partners for various customer requirements," reads its website. "Not only are you getting a company with a proven track record but regulations allowing the customer flexibility and efficiency in meeting their particular requirements. Tribal owned 8(a) firms, such as, MNBE are eligible to receive sole source direct award 8(a) contracts regardless of dollar size, while all other 8(a) firms may not receive sole source contracts in excess of $3 million for services and $5 million for manufacturing."
8(a) is a U.S. government program that gives preferential treatment, financial assistance, and mentorship to businesses owned by "socially and economically disadvantaged individuals."
In the last decade, the Department of Homeland Security and a number of Alaskan native-owned companies got in hot water in part because the Alaska companies outsourced more than 50 percent of the actual work to a large firm, a violation of federal contracting rules.
However, according to MNBE’s CEO, Woody Anderson, the small firm owned by the Muscogee Nation Indian tribe is indeed protecting U.S. military projects in Afghanistan. "The people that we have in this contract here are our employees; they’re not Ronco employees," Anderson told FP during a Sept. 21 telephone interview.
While the actual bodyguards working for MNBE aren’t members of the Muscogee tribe, some of the technicians who install cameras and other security gear in Afghanistan are, according to Anderson, who says that, of MBNE’s hundred-plus employees, about a dozen are tribe members.
For the last two years, MBNE partnered with Ronco to provide security to the Pentagon’s Task Force for Business and Sustainability Operations in Afghanistan, learning what it takes to run a private security outfit in a war zone and recruiting former military commandos to staff its security teams.
"The 8(a) program was an opportunity to get our foot in the door," said Anderson; now, MBNE is striking out on its own.
"I’ve got a guy named Mike Brown who is our Afghan operations guy, and Mike’s retired Army, and we have gotten most of these folks through his contacts and other folks over there, because a lot of these guys are former military folks," said Anderson. "We’ve also recently hired some folks from Ronco" as that company has drawn down its operations in Afghanistan.
Building on the Afghanistan contract, MNBE has sent representatives to security industry expos in Dubai and is preparing to attend a similar expo in Ethiopia, hoping to gin up similar contracts to the one in Afghanistan. "Where some of the same things that we’ve been doing [in Afghanistan], they’re going to be looking at some of those same opportunities in" the Middle East and Africa, said Anderson.
When asked about the information on its website describing the company’s specialty as partnering with other companies to bid on contracts reserved for tribal owned businesses, Anderson, citing security, says that information is deliberately out of date. In fact, he said, MNBE is no longer participating in the 8(a) small business program.
"I really do some of that for security reasons. We’ve been very fortunate, we’ve not had any adverse things happen over there since we’ve been doing that…. I don’t like to advertise that because I don’t want people [looking at the website] to know where our people are, because they’re traveling back and forth all the time."