WASHINGTON – A day before four of its security guards died in Iraq, a Blackwater USA employee wrote company officials that it was time to stop the “smoke and mirror show” and provide crucial equipment for the private army in the field.

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Rep. Janice Schakowsky, D-Ill., (right) comforted Donna Zovko, the mother of a Blackwater employee who was ambushed and killed in 2004 in Fallujah. Zovko testified at a hearing of a House committee yesterday.
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“I need Comms (communications equipment). . . . I need ammo. . . . I need Glocks and M4s. . . . Guys are in the field with borrowed stuff and in harm's way,” said the e-mail, released at a House hearing yesterday.
Blackwater's Iraq operations manager at the time, Tom Powell, wrote the memo to other company officials on March 30, 2004.
The next day, a mob in Fallujah ambushed a supply convoy guarded by Blackwater, killing the four employees, who all were former members of the military.
The incident brought to U.S. television some of its most gruesome images of the Iraq war. The guards' bodies were dragged through the streets and mutilated, and two of the corpses were strung from a bridge.
Details of the incident emerged at a hearing of the House Government Oversight Committee, which is investigating Blackwater and the work of other large American military contractors in Iraq.
In the hearing yesterday, Tina Ballard, an Army procurement official, announced that the Army would withhold $19.6 million from Halliburton subsidiary KBR.
The penalty resulted from the Army's discovery, after months of denials to committee members, that Blackwater was hired as a subcontractor under KBR's support operations for the U.S. military in Iraq.
The contract prohibited hiring private guards, leaving that job to the U.S. military.
Halliburton, which has a five-year, $16 billion deal to support American military operations in Iraq, disagreed with the Army's interpretation and suggested that there was nothing to prohibit Halliburton's subcontractors from hiring such guards.
“Nowhere does it prohibit subcontractors from supplementing that protection with private security,” Halliburton said in a statement. “It is unrealistic to think that the military can both wage a war and at the same time protect every necessary civilian movement in Iraq.”
The company said it would “sit down with the Army to discuss and resolve these issues.”
The memo from Blackwater's Iraq operations manager was released after four family members of the men killed in Fallujah testified at the hearing that their loved ones were not given the armored vehicles, heavy weapons and other protections they were promised.
“I have requested Hard cars from the beginning and from my understanding an order is still pending. Why, I ask,” Powell said in the memo.
Andrew Howell, general counsel of Blackwater, told the hearing the vehicles had some steel plates and were “believed appropriate by everyone involved.”
“Did Blackwater meet its responsibilities?” asked committee Chairman Henry Waxman, D-Los Angeles.
“Yes, we did,” Howell replied.
“Have you skimped on equipment?” asked Rep. Chris Cannon, R-Utah.
“We have not skimped on equipment, no sir,” Howell said.
The hearing became emotional when Kathryn Helvenston-Wettengel, mother of slain Blackwater guard Stephen Scott Helvenston, read a statement on behalf of the families. She stopped several times to collect herself.
The three men killed in addition to Helvenston – a former SEAL from Oceanside – were Wesley Batalona, a former Army Ranger represented by his daughter Kristal; Michael Teague, formerly in an Army helicopter unit, represented by his widow, Rhonda; and Jerry Zovko, a former Army Ranger represented by his mother, Donna.
The families have sued Blackwater, contending that was the only way they could learn the circumstances of the killings. Howell said the U.S. military had classified the incident and he could not discuss the details.
The Blackwater attorney and several Republican lawmakers said the families were improperly trying to argue their case in a congressional hearing, rather than in a courtroom.
Helvenston-Wettengel said the security guards were denied armored vehicles, heavy weapons and maps for their convoy routes, and that the rear gunners were removed from vehicles to perform other duties.
“Blackwater gets paid for the number of warm bodies it can put on the ground in certain locations throughout the world,” she said. “If some are killed, it replaces them at a moment's notice.”
Helvenston-Wettengel said her son was alive when Iraqis tied him to his vehicle and dragged him through the streets. He eventually was decapitated.
Howell said lawyers for the family members were using the hearing for their own purposes, and that it should not delve into an “incomplete and one-sided exploration of a specific battlefield incident.”
Rep. Darrell Issa, R-Vista, said he did not believe the testimony was germane to a House committee scrutinizing U.S. companies with Iraq contracts.
Separately, Deputy Attorney General Paul McNulty announced that three Army Reserve officers were indicted yesterday, accused of taking part in a bid-rigging scam that steered millions of dollars for Iraq reconstruction projects to a contractor in exchange for cash, luxury cars and jewelry.
An American businessman in Romania was charged as the go-between for the military officers and the contractor. The husband of one of the reservists was accused of helping smuggle tens of thousands of dollars into the United States, which the couple used to pay for a deck and a hot tub at their New Jersey house.
Together, the five used the $26 billion Iraqi rebuilding fund “as their own personal ATM machines,” McNulty said.
The 25-count indictment, filed in U.S. District Court in New Jersey, marks the latest development in an investigation of $8.6 million in Iraq contracts awarded to construction mogul Philip Bloom.
Bloom, a U.S. citizen who ran construction and services companies under Global Business Group, has admitted to laundering at least $2 million that was stolen from reconstruction funds managed by the U.S.-led Coalition Provisional Authority in Iraq. He awaits sentencing.
The three reservists – Col. Curtis G. Whiteford of Utah, Lt. Col. Debra M. Harrison of New Jersey and Lt. Col. Michael B. Wheeler of Wisconsin – were responsible for helping supervise the funding and progress of the CPA contracts in Hillah, southwest of Baghdad.
In return for steering contracts to Bloom between 2003 and 2005, prosecutors said, the military reservists and their accomplices shared an estimated $1 million in cash, and were showered with Porsche and Nissan sports cars, a Cadillac SUV, real estate, a Breitling watch, business-class plane tickets, computers and other items.
Harrison's husband, William Driver, was charged with helping smuggle more than $300,000 into the United States, part of which was used for home improvements, prosecutors said.
One of Bloom's friends, businessman Seymour Morris Jr., allegedly acted as a go-between for the military officers and the construction company by illegally wiring money and securing the goods. Morris is a U.S. citizen who lives in Romania, and owns a Cyprus-based financial services business.
The New York Times News Service contributed to this report.