U.S. Mercenaries and vetting problems

Tim Spicer's World
by Andrew Ackerman

Military contracts are big game. And one of the most notorious hunters is a former British soldier whose past business ventures include violating a UN arms embargo in Sierra Leone and unwittingly triggering a coup in Papua New Guinea. His name is Tim Spicer, and in March his London-based company, Aegis Defense Services, bagged a $293 million contract from the Pentagon to protect US diplomats in Iraq.

One might think that the government would be wary of awarding such largesse to a man with a dubious background. But not only did the Pentagon have no idea who Spicer was when they gave his company a huge contract, they didn't seem to care when challenged about it.


Five Democratic senators, led by Ted Kennedy of Massachusetts, protested the Aegis contract on humanitarian grounds, urging the Pentagon to reconsider the deal in light of Spicer's background. He is, they noted, a man with a remarkable talent for entangling himself in scandal. In August, they asked Defense Secretary Donald Rumsfeld to review the Spicer deal. In a response last month, the Army admitted that its contracting officer was unaware of trouble spots in Spicer's past, but it refused to reconsider the contract.

"It is significant that the British Ministry of Defense was apprised of our intention...and did not object or advise against the action. Moreover, neither Aegis nor Mr. Spicer are on the...list of parties excluded from Federal contracting," wrote Sandra Sieber, director of the Army Contracting Agency. "We therefore had no legal basis to deny the award to Aegis, which won the competition fairly based on the rules and criteria established by our solicitation."

The $293 million pays Spicer's company to coordinate the dozens of private security forces operating in Iraq and to provide as many as seventy-five of its own teams of bodyguards per day. It's a "costs plus" contract, so Aegis is guaranteed a profit even if its costs increase. Using this type of contract for a firm run by a fellow of dubious ethics seems particularly questionable--especially considering that other contractors, most notably Halliburton, are under investigation for overcharging abuses.

In a country where insurgents are responsible for scores of attacks each day--including a mortar attack at the end of November in Baghdad's Green Zone that killed four workers for another British mercenary company--one might think that few people would be lining up to work as bodyguards. But the business is quite lucrative, and former special forces soldiers are queuing for jobs that can pay more than $100,000 a year. More than fifty private security companies are in Iraq today, with an estimated 20,000 hired guns working for them. Spicer's group is supposed to coordinate them all. And there's one more catch: Spicer appears to have no previous experience handling such a large security operation, nor any ties to Iraq.

Cut-Rate Diplomas

How doubts about the government's own "Dr. Laura" exposed a résumé fraud scandal

Paul Sperry




Laura L. Callahan was very proud of her Ph.D. When she received it a few years ago, she promptly rewrote her official biography to highlight the academic accomplishment, referring to it not once or twice but nine times in a single-page summary of her career. And she never let her employees at the Labor Department, where she served as deputy chief information officer, forget it, even demanding that they call her "Doctor."


Callahan's management style had always been heavy-handed. Once, while working in a previous supervisory role at the Clinton White House, she reportedly warned computer workers to keep quiet about an embarrassing server glitch that led to the loss of thousands of archived e-mails covered by federal subpoena. But with her newly minted Ph.D., Callahan became intolerable, several employees say, belittling and even firing subordinates who did not understand the technical jargon she apparently picked up while studying for her doctorate in computer information systems.


One employee was skeptical of Callahan's qualifications, however, and began quietly asking questions. The answers worried him, especially after Callahan was hired in 2003 as the Department of Homeland Security's deputy chief information officer. His concerns and the resulting investigation ultimately revealed a troubling pattern of résumé fraud at federal agencies, including several charged with protecting Americans from terrorism. The scandal raises serious doubts about the government's ability to vet the qualifications of public employees on whom the nation's security depends.


"When she was running around telling people to call her ?'Dr. Callahan,' I asked where she got her degree," says Richard Wainwright, a computer specialist who worked for Callahan at Labor for two years. "When I found out, I laughed."


It turns out Callahan got her precious sheepskin from Hamilton University. Not Hamilton College, the highly competitive school in Clinton, New York, but Hamilton University, the unaccredited fee-for-degree "distance learning" center in Evanston, Wyoming, right on the Utah border. Such diploma mills frequently use names similar to those of accredited schools.


Unbeknown to Callahan, Wainwright had once lived near the small town of Evanston (population: 10,903) and knew it well. As a student at the University of Utah in Salt Lake City, where he received his bachelor's degree years ago, he had made beer runs to Evanston, less than 60 miles away. He knew there were no universities there, or at least none worth attending. "Evanston doesn't have much but a few motels and liquor stores," he tells me. "I looked up Hamilton University on the Web and saw it was an old Motel 6, and I knew it was bogus."


Indeed, the old motel lobby is clearly visible in a photo of the main entrance to Hamilton posted on the home page of the school's Web site at hamilton-university.edu. Click on "Campus," and you'll find more photos of the converted motel, as well as another small building on the campus, shot from a sharp angle to make it appear large and august.


If the other building looks like a church, that's no illusion. It is a church?-sort of. Callahan's alma mater is run by the Faith in the Order of Nature (FION) Fellowship Church, also in Evanston. In fact, the church is headquartered at the same address as Hamilton, which was organized as a "nonprofit theocentric institution of higher learning" in 1976 and claims a religious tax exemption.


Student of Nature

Here's where it really gets weird. FION believes all life forms, including bugs and trees, are created equal and should be treated with equal respect. It feels the same way about education.


"We accept all education as equal in Nature," according to the church's stated doctrine. "We offer recognition and special designations to those who have achieved higher levels of understanding regardless if obtained naturally or formally." Apparently that's how it got into the diploma business. FION's Web site describes Hamilton University as "a Nature-based institution of higher learning, which grants university level degrees that are based in whole or in part of [sic] education obtained through Nature." Since there's little, if any, coursework required, call it education by osmosis.


But this Nature isn't free. Tax-exempt Hamilton, with a staff of three, charges a flat fee of $3,600 for nature lovers in need of a Ph.D., while certifying that all its degrees are accredited "based on the rigid accrediting standards of the American Council of Private Colleges and Universities." And not to worry, Hamilton's Web site assures future graduates: "All transcripts carry the ACPCU seal."


What it doesn't mention is that ACPCU is a fake accrediting agency that the FION church set up to accredit Hamilton. The U.S. Department of Education does not recognize ACPCU as a legitimate accrediting body. (Hamilton officials did not respond to requests for comment. Calls go to a voicemail system.)


To get her Ph.D., Callahan merely had to thumb through a workbook and take an open-book exam. The whole correspondence course?-which includes instruction on business ethics?-takes about five hours to complete. A 2,000-word paper (shorter than this article) counts as a dissertation.


In short, Callahan's diploma isn't worth the paper it's written on. Though there is that nice leather-bound holder.


It gets worse. Callahan owes her entire academic pedigree to Ham U. The bachelor's and master's degrees in computer science she lists on her résumé were also bought at the diploma mill.


The high-paid senior official was plainly pulling a major scam. And Wainwright was on to her. "I had finally caught Callahan in one of her lies that she would not be able to get out of," he says of his unpopular boss.


Paid Vacation

At the time, Callahan had applied for an important high-level position at the Department of Homeland Security. The job was deputy chief information officer, similar to the post she held at the Labor Department. But this new job required integrating and managing some of the nation's most sensitive databases in a time of war. Callahan clearly wasn't qualified, no matter what her résumé said. Wainwright wondered if she could even be trusted with a top-secret security clearance.


After Callahan landed the post in April 2003, Wainwright anonymously tipped off a Beltway trade journal about her phony degrees and fraudulent résumé. Government Computer News broke the story about Callahan, triggering an 11-month congressional investigation that culminated in government-wide reforms meant to curb the use of diploma mills by federal employees, whose tuition is often financed by taxpayers.


"She was in a position where she could cause…damage to the United States," Wainwright says, speaking publicly for the first time about the case. "And that's why I did what I did."


Callahan's fraud was exposed in May 2003. Curiously, she wasn't forced to resign until March 26, 2004, after being placed on administrative leave?-with pay?-the previous June. That means she continued to draw her Department of Homeland Security salary of between $128,000 and $175,000 for nearly 10 months while under a serious ethical cloud. Misrepresenting qualifications on a résumé, an official bio, or an application?-including submitting false academic credentials?-is grounds for immediate dismissal, according to federal rules written by the U.S. Office of Personnel Management (OPM).