Firm Once Known as Blackwater to Pay $7.5M Fine

Academi LLC, the military contractor formerly known as Blackwater Worldwide, has agreed to pay a $7.5 million fine to settle charges of arms-sales violations, the U.S. Justice Department said on Tuesday.

The agreement, filed in U.S. District Court in New Bern, North Carolina, covers unauthorized sales of satellite phones in Sudan, unauthorized military training provided to foreign governments including Canada's, the illegal possession of automatic weapons and other violations, the Justice Department said.

The sales and training in question took place from 2005 to 2008 and did not have the authorization of the U.S. Treasury and State departments, as required by law, prosecutors said.

Academi acknowledged "responsibility for the conduct" in signing what is known as a deferred prosecution agreement with the Justice Department.

The agreement means the company will not face prosecution for the 17 alleged counts as long as it meets auditing requirements and complies with export restrictions.

Two years ago Blackwater, which also used the name Xe Services LLC, reached a $42 million settlement with the State Department for similar allegations.

As a military contractor for the U.S. government in Iraq, Blackwater was a target of intense international scrutiny. In March 2004, four of its security guards were ambushed and killed, and two of their bodies were hung from a bridge in Fallujah.

"This company clearly violated U.S. laws by exporting sensitive technical data and unauthorized defense services to a host of countries around the world," Brock Nicholson, special agent in charge of U.S. Immigration and Customs Enforcement investigations in North Carolina and two other states, said in a written statement.

Privately held Academi was once based in North Carolina and still has a large training facility there. A spokesman for Academi said it would be releasing a statement shortly.