Working with a small cadre of loyalists — including a former South African commando, a former Australian air force pilot, and a lawyer with dual citizenship in the U.S. and Israel — Prince sought to secretly rebuild his private CIA and special operations enterprise by setting up foreign shell companies and offering paramilitary services, according to documents reviewed by The Intercept and interviews with several people familiar with Prince’s business proposals.
Several of the proposals for private security services in African nations examined by The Intercept contained metadata in the digital files showing Prince and his inner circle editing and revising various drafts.
Since 2014, Prince has traveled to at least half a dozen countries to offer various versions of a private military force, secretly meeting with a string of African officials. Among the countries where Prince pitched a plan to deploy paramilitary assets is Libya, which is currently subject to an array of U.S. and United Nations financial and defense restrictions.
Prince engaged in these activities over the objections of his own firm’s corporate leadership. Several FSG colleagues accused him of using his role as chairman to offer Blackwater-like services to foreign governments that could not have been provided by the company, which lacks the capacity, expertise, or even the legal authority to do so.
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Prince developed the paramilitary services proposal for Libyan officials in 2013, before FSG was created, according to documents and two people familiar with the pitch. He made several trips to Libya to meet with government officials there.
The Libyan proposal, reviewed by The Intercept, was code-named Operation Lima. It offered the Libyans an array of military equipment and services — including weaponized vehicles, helicopters, boats, and surveillance airplanes — to help stabilize eastern Libya. The ground force, according to a person involved with the plan, would consist of a troop of former Australian special operations commandos. Given the instability of the government and Prince’s inability to navigate complex Libyan factions to vet potential partners, he had trouble finding the right power brokers to help sell the proposal.
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By May 2015, Prince had rebranded himself and claimed a legitimate public reputation as FSG’s chairman. Without the approval of FSG’s management, he returned to Libya offering a freshly repackaged proposal, according to a person involved with the plan. Rather than a counterinsurgency force, Prince proposed a similar set of equipment and services, but with a new justification: The mercenaries would be there to engage in border security.
According to an internal slide presentation, Prince’s private force would operate in Libya for the stated purpose of stopping the flow of refugees to Europe. Libya is one of the main routes for migrants trying to enter Europe from eastern Africa and parts of the central Sahel region.
Prince told colleagues that he received preliminary approval for the border force from a senior Libyan official, but would need to secure European support to loosen up restrictions on Libyan money and weapons, which would otherwise impede the plan, according to a person who discussed the proposal with Prince.
By exploiting European fears of a mass exodus from the Middle East and North Africa, Prince believed he could obtain political buy-in from Europe to bring a foreign force into Libya.
... Prince’s May 2015 proposal for the Libya operations suggested, “Funding can be jointly shared by the EU and Libyan government from Libyan Investment Authority money frozen in European Banks.”
However, according to two people involved in the proposal, Prince grew frustrated with the failure to get European help in releasing the frozen Libyan funds, and began looking for other ways to get his border force funded.
By then, the U.S. government was already investigating Prince for possible weapons deals in Africa, according to the former senior U.S. intelligence official and the former intelligence official briefed on the matter. In the course of the surveillance operation for that investigation, U.S. intercepts revealed Prince appearing to discuss efforts to open bank accounts in China to help his Libyan associates.
“Money laundering for Libyan officials using a Chinese bank — that is the issue that pushed it over the edge” for the Justice Department, said the second former intelligence official.
The U.S. spies monitoring Prince soon discovered that he had traveled to the Chinese-controlled peninsula of Macau in an effort to open a bank account, according to two people familiar with the investigation. A well-connected source within the Macau banking community told The Intercept that Prince first attempted to open an account at the Macau branch of a European-connected bank, but was denied after a review by the bank’s European headquarters.
Later, Prince traveled to Beijing, where he met with Chinese agents from the Ministry of State Security, according to the second former intelligence official and a source familiar with the meeting.
In January, Prince returned to Macau and opened an account at the Bank of China, according to several sources, including the second former intelligence official and the source with close connections to Macau’s banking community.
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While Prince’s re-invented Libya “border security” proposal was framed as a means of stopping migration, sources with knowledge of Prince’s business strategy allege that he had greater ambitions in that country. One person involved in Prince’s plan said the anti-migration force was seen as a vehicle for Prince to build a “backdoor” for so-called kinetic, or lethal, operations in Libya — a form of mercenary mission-creep. “During the day, you do interdiction of migrants — not kinetic,” said the person involved in the plan. “But those routes are used by weapons smugglers and drug traffickers at night. Insurgents too. Erik’s guys can then be offered to the Libyans to help with their other problems. That’s how you get kinetic.”
The plan called for a series of “border security” bases housing intelligence centers, helicopters, surveillance airplanes, and weaponized vehicles. Prince proposed a fully equipped, contemporary military force to be staffed in part by foreign mercenaries.
“This is Erik Prince using the refugee crisis in Europe in an effort to put mercenaries on the ground in Libya,” said Malcolm Nance, a former U.S. Naval officer who trained special operations forces and has extensive experience in Libya since the fall of Qaddafi. “They think they’re going to solve the migration problem with technology and a bunch of Western mercenaries?” Nance, who reviewed a copy of Prince’s plan provided by The Intercept, called the proposal “fantasy baseball.”
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Prince has run up against ITAR in the past. In 2010, Prince sold most of his equity in the companies that fell under the Blackwater umbrella. Claiming that left-wing activists, Democratic politicians, and lawsuits had destroyed his companies, he left the United States and became a resident of Abu Dhabi. The remnant of his network was renamed Academi LLC. Federal prosecutors eventually attempted to prosecute Prince’s former companies, culminating in a 2012 deferred prosecution agreement to settle a lengthy list of U.S. legal and regulatory violations committed from 2005 through 2008 when Prince was in charge, including ITAR violations.
A senior official involved with the Blackwater-related litigation, who has since left the government, told The Intercept that the Obama administration’s continued willingness to award contracts to former Blackwater entities while the case was active was a fatal impediment to a successful prosecution. The official, comparing the former Blackwater empire to a drug syndicate, added that prosecutors could not get anyone under Prince to testify against him personally. “This is very much the concern,” the former official told The Intercept. “You push the buttons on the company, but the main bad guy gets away and does it again.”
No criminal charges were filed against Prince.
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