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A Bold Upstart With CIA Roots

Fast-growing Abraxas Corp. was founded after 9/11 by agency veterans. But some fear security risks in such work.

September 17, 2006|Greg Miller | Times Staff Writer

WASHINGTON — In the burgeoning field of intelligence contractors, an especially aggressive upstart is Abraxas Corp., a privately held company that has assembled a deep roster of CIA veterans to handle a wide range of clandestine assignments -- including secret work for an elite team of overseas case officers.

The company was founded by a group of former high-ranking agency employees, led by Richard "Hollis" Helms, a longtime overseas officer in the Middle East and onetime head of the CIA's European division, and Richard Calder, who was the agency's deputy director for administration.

In a radio interview last year, Calder said the firm was launched shortly after the Sept. 11 attacks by a group of retirees who felt spurned that the agency had not called to enlist their help. "We were all eager to do whatever we could do," Calder said. But, he said, "the phone never rang." Company officials did not respond to repeated requests for comment.

The company occupies an unmarked, third-floor office suite in McLean, Va., two miles from CIA headquarters. It has mainly specialized in providing veteran operatives and reports officers for positions in overseas stations and at CIA headquarters.

After the Sept. 11 attacks, "they went and signed up all these retired, Arabic-speaking officers and sold them back to the agency on contract," said a former CIA official familiar with the company, who spoke on condition of anonymity. "That's how Abraxas was born."

But Abraxas has also been tapped for unusual assignments. Several former CIA officials said Abraxas had been given a highly classified contract to craft "covers" -- false identities and front companies -- for the agency's nonofficial cover program.

The NOC program is one of the most sensitive and carefully guarded operations in the CIA. Most overseas case officers work under diplomatic cover, meaning they pose as State Department officials working at U.S. embassies and missions. If they are caught spying, they are typically protected from prosecution by diplomatic immunity.

Officers in the NOC program have no such protections, and therefore operate under substantially greater risk. Major corporations traditionally have cooperated with the CIA to allow case officers to hold positions in overseas branches. But since the Sept. 11 attacks, the CIA has been under increased pressure to devise more imaginative cover arrangements that might give operatives closer access to terrorist networks.

Former CIA officials said that Abraxas had played a leading role in this effort to craft new covers and that the firm had assembled a group of employees with experience in such work. Among them is Fred Turco, former head of the external operations and cover unit, which oversees the NOC program inside the agency.

Several former officials questioned the arrangement, saying that whatever talent Abraxas had assembled, outsourcing any work in such a sensitive program posed an inherent security risk. But others were more sanguine, saying that the CIA's failures to penetrate Al Qaeda and other terrorist groups underscored the need for fresh ideas and a more experimental approach.

"They're going where the expertise lies," said a former senior CIA official, who spoke on condition of anonymity. "It's a good example of them doing what they should be doing."

Abraxas declined to comment. Approached by a reporter outside the company's office, Helms said that speaking publicly about such matters "doesn't serve the public at all and damages the country."

Abraxas is part of a new breed of companies known in intelligence circles as "body shops" because -- unlike firms that provide manufacturing, engineering or technical services -- they are mainly in the business of supplying bodies for analysis centers, headquarters positions and overseas assignments.

A recent posting on Abraxas' website lists openings for computer programmers and intelligence analysts "for a broad spectrum of clients in and outside the national security arena."

In his radio interview, Calder said Abraxas got as much as 90% of its revenue from government contracts, though it has sought more business from the private sector through new products including computer software.

Office parks in suburban Virginia are increasingly cluttered with companies like Abraxas, as upstarts such as SpecTal move into territory long dominated by behemoths including Booz Allen Hamilton Inc. and Science Applications International Corp.

But few companies have taken advantage of the surge in contractor spending as adroitly as Abraxas. The company does not publicly report its financial results. But it was recognized last year by the Deloitte & Touche accounting firm as one of the nation's fastest growing young companies, posting revenue growth of 714% over three years.

This year, accounting firm Ernst & Young named Helms its Washington-area entrepreneur of the year.

greg.miller@latimes.com

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