Defense contractor CACI International went on the offensive on Wednesday as it sought to contain the fallout from the alleged involvement of some of its staff in the abuse of prisoners in Iraq. CACI and Titan, another contractor named in accusations, risk becoming an easy target for the US Government as it looks to find someone to blame.
CACI and Titan have both rushed to respond to the leaking of a US Army report, which reportedly alleged that staff from private contractors had been linked to "sadistic, blatant and wanton criminal abuses" occurring in Abu Ghraib prison in late 2003. A clear concern for CACI is the potential damage that being named in the Taguba report could do to its reputation and business. CACI provides a range of technology services and application development and implementation for the military. It also provides non-IT related services such as training, intelligence and national security services.
The open discussion CACI is having with the press and its customers about the allegations is clearly a charm offensive, which it hopes will maintain an image of openness and trust. However, what is inevitable is that the longer the debacle continues, the more damage it is going to cause CACI.
Titan is currently undergoing an SEC investigation into alleged corruption. The company, which is currently being acquired by Lockheed Martin, came under a criminal investigation by the US Justice Department in early March for allegedly making illegal payments to certain international officials.
This scandal already put the proposed $2.4bn merger with Lockheed in doubt. Should Titan end up being implicated in the Iraq abuse case, this could become another stumbling block to the merger.
Yet perhaps the biggest threat to the long-term future of both CACI and Titan could be from the US Government itself. Keen to find some resolution to this political issue, it could end up pursuing a witch-hunt against any of the private contractors that have been involved in the alleged abuses.
This does not bode well for either CACI or Titan, which to date say they have not received any accusation, indictment, or even a phone call from the US Government questioning their propriety.