Continued from page 1

Last week, EOD Technology was one of eight security companies hired by the State Department under a $10 billion contract to provide protection for diplomats.

A statement released by EOD Technology said the Lenoir City, Tenn.-based company had been encouraged to hire local Afghans and that it provided the names of its employees to the military for screening. The company said the military has never made it aware of any problems with its handling of the contract.

In the case of ArmorGroup, the Senate panel says the company repeatedly relied on warlords to find local guards, including the uncle of a known Taliban commander. The uncle, nicknamed “Mr. White” by ArmorGroup after a character in the violent movie “Reservoir Dogs,” was eventually killed after a U.S. raid that uncovered a cache of weapons, including anti-tank land mines.

ArmorGroup, based in McLean, Va., lost a separate contract this year protecting the U.S. Embassy in Kabul after allegations surfaced that guards engaged in lewd behavior and sexual misconduct at their living quarters.

Susan Pitcher, a spokeswoman for Wackenhut Services, ArmorGroup’s parent company, said the company only engaged workers from local villages upon the “recommendation and encouragement” of U.S. special operations troops.

Ms. Pitcher said that ArmorGroup stayed in “close contact” with the military personnel “to ensure that the company was constantly acting in harmony with, and in support of, U.S. military interests and desires.”

In August, Afghan President Hamid Karzai announced that private security contractors would have to cease operations by the end of the year. The workers, he said, would have to either join the government security forces or stop work because they were undermining Afghanistan's police and army and contributing to corruption.