Mercenary armies are running amok around the world

• A recent report by UN investigators detailed a bungled plot to prop up Libyan strongman Khalifa Haftar with mercenaries, allegedly including a special hit squad.
• Not all the details of that 2019 plot are clear, but it underscores the increasing use and ongoing opacity of operations by private military contractors around the world.
• Visit the Business section of Insider for more stories.

It may take years to unravel the tangled web surrounding "Project Opus," the bungled 2019 mercenary operation to prop up Libyan strongman Khalifa Haftar, which allegedly included efforts to deploy a special hit squad to Libya.

Few observers tracking the burgeoning global market for privatized armies, however, were likely surprised by reports last week that UN investigators suspect the involvement of former Blackwater CEO Erik Prince.

The recently leaked UN report makes only glancing mention of Prince's alleged ties to the operation, but it marks the second time since the 2011 Arab Spring uprisings that Prince's company, Hong Kong-based Frontier Services Group, or FSG, has been linked to allegations of trying to sell military services in Libya.

In fact, the UN report references a detailed PowerPoint presentation elaborating on FSG's alleged plan to deploy a fleet of drones and helicopters to protect coastal areas of Libya, which appears to bear the hallmarks of a similar plan that Prince hawked to potential buyers back in 2013, according to reporting by The Intercept.

Prince has denied any personal link to Project Opus, as did his one-time business associate Christiaan Durrant, who was named by the UN in connection with the $80 million mercenary operation. Prince and his lawyers this week also rejected allegations of having any links to two others named in the UN report: Amanda Kate Perry, a British business manager for Opus Capital Assets, which is based in the United Arab Emirates, and Stephen Lodge, a former member of the South African air force.

What is undeniable, however, is that Prince's firm, FSG, is one of the largest providers of private military services in Africa. Moreover, China's state-owned CITIC Group - one of the major shareholders in Prince's company, through its holdings in the Chinese conglomerate CITIC Limited - is by far one of the biggest foreign investors on the African continent. China's increasing role in financing private military security contractor operations in Africa is beyond doubt, and so are its links to FSG.

While UN investigators have reportedly been stymied by the smoke and mirrors surrounding the true ownership of a chain of shell companies linked to FSG's attempts to buy Cobra helicopters in Jordan as part of its Libya operation, it would be surprising if the trail did not lead back to CITIC Limited and the Chinese government.

Although publicly available corporate registries indicate the original holding company that spawned FSG was incorporated in Bermuda in 1989, the Hong Kong company that hired Prince after Blackwater was reorganized, known as DVN Holdings, appeared to have a beneficial stake in FSG in March 2014.

Prince, according to The Intercept, pitched the idea of providing border security services in Libya to potential contracting parties in Germany and Italy only months before DVN Holdings named Prince its executive director in January 2014 and soon rebranded as FSG.

Chang Zhenming, chairman of CITIC Group, has served as the chairman of the board of directors for FSG since at least 2018, overseeing the company's sprawling operations alongside Prince and other high flyers. With insurance operations based in Shanghai and satellite offices spanning the globe from Kashgar to Kinshasa, FSG is arguably one of the biggest providers of contract military services in the world.

In the six years since CITIC announced it would invest $113 billion in China's sprawling Belt and Road Initiative, FSG has deployed skilled military experts to help secure infrastructure and mining projects across Africa and Asia, according to news releases posted on FSG's company website.

The question that UN, and possibly US, investigators now urgently need to answer is whether FSG is essentially an arm of the Chinese government, given the outsized stake that the state-owned and -operated CITIC has in it.

Should those links between FSG, CITIC and the disastrous 2019 mercenary adventure, as well as a second attempt to mount a Libyan operation in 2020, bear out, Prince could face a travel ban and asset freeze for violating the UN arms embargo on Libya.

Given the expansive reach of CITIC's global investments and vast stakeholder shares across Chinese industries, there is also the risk that FSG's operations could be targeted for sanctions by the US Treasury Department. Several Chinese state-run firms have already been sanctioned, for instance, under the Countering America's Adversaries Through Sanctions Act, or CAATSA.

In 2018, the Treasury Department brought sanctions against the Chinese military under CAATSA for purchasing missile systems and jets from Russia. While it is not clear whether an analogous case could be made for FSG's reported purchase and intended use of a Russian-made Antonov cargo plane in the Project Opus caper, those links certainly demand more scrutiny.

The UN investigation in Libya also raises questions about whether Prince and the Chinese state companies he is tied to have breached internationally recognized protocols prohibiting the deployment of mercenaries for profit and seeking greater accountability for private military companies and signatory states.

China, like Russia, is not listed as a signatory of the Swiss-monitored International Code of Conduct Association, known as ICoCA, but several Chinese private contractor firms are members.

Although the ICoCA code is purely voluntary, and not legally binding, it serves as an important guide for best industry practices and is slowly gaining traction, along with the UN Working Group on the Use of Mercenaries.

Both organizations draw on the expertise of industry leaders, civil society organizations and academics to bring more transparency to the private military security sector. But they still lack the institutional support needed to help drive efforts to rein in off-book mercenary activities.

And, no wonder, with big, well-connected players like Prince evading any accountability. Prince, of course, is a prominent supporter of former President Donald Trump, and his sister, Betsy DeVos, served as Trump's secretary of education.

Prince has so far eluded any consequences for accusations from members of Congress that he perjured himself during his testimony in connection with special counsel Robert Mueller's investigation into Russian interference in the 2016 elections. Prince had secretly organized a now-infamous meeting in the Seychelles in January 2017 with the apparent aim of setting up a backchannel between then-President-elect Trump and Vladimir Putin.

During his spree of pardons late last year after he lost reelection, Trump pardoned four Blackwater contractors who were convicted in connection with war crimes in Iraq while working for Prince, in the notorious massacre of 17 unarmed Iraqi civilians in Baghdad's Nisour Square.

The UN Working Group rightly deemed the pardons a violation of international law, but despite some other initial criticism, the world just seemed to shrug. Washington, it seems, is only really concerned with the nefarious mercenary activities of Russian fighters affiliated with the so-called Wagner Group - and even then, few in Congress really seem to know what to do about the growing problem of those mercenary operations.

Although odds are hard against any real near-term action on FSG's reported involvement in Libya's 10-year proxy war, one can only hope that the State Department's bid this week to rejoin the UN Human Rights Council, which the Trump administration left, will be a first step from the Biden administration toward greater policy coordination and accountability for the private security industry.

In his remarks on the move, Secretary of State Antony Blinken said he hoped that council would reexamine its "disproportionate focus on Israel."

Indeed, when it comes to mercenary activity, more proportionate scrutiny of many Human Rights Council members, especially its biggest players - the United States, Russia and China - would seem to be in order.

Candace Rondeaux is a senior fellow and professor of practice at the Center on the Future of War, a joint initiative of New America and Arizona State University. Her WPR column appears every Friday.