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Oakland's Surveillance Contractor Has a History of Fraud

The multibillion-dollar company hired to build a citywide surveillance system also has a record of supplying weapons and training to anti-democratic governments around the world.

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"There was a culture in the [New York Mayor Michael] Bloomberg administration — the private sector knows best — that was really difficult to penetrate," said James. "It was incredibly difficult for this administration to understand that CityTime was a runaway train and that there was no one in the driver's seat." SAIC was making millions, however, and kept the contract alive.

Federal prosecutors eventually filed charges against eleven former SAIC employees, and in 2012, the firm agreed to pay a $500 million settlement. The CityTime scandal was the largest case of municipal fraud in New York City's history. SAIC has since been flagged in New York's database of city vendors, and faces a difficult uphill battle to win contracts there in the future.

But CityTime was not an isolated incident of SAIC failing to deliver on a major government contract. In 2000, the firm won a lucrative agreement to upgrade the FBI's Virtual Casefile System, also known as Trilogy. A 2006 Washington Post investigation exposed the project as a catastrophic failure, thanks to "poor conception and muddled execution." Yet SAIC still pocketed $100 million from the project.

SAIC was also responsible for a failed multibillion-dollar intelligence system project for the National Security Agency called Trailblazer that was junked in 2006 and characterized as one of the worst intelligence failures in US history. An investigation by Shorrock for The Nation magazine about the Obama administration's war on whistleblowers delved into the lives of four NSA employees who drew attention to Trailblazer's inoperability — and SAIC's wrongdoing — and were targeted in leak investigations as a result.

Civil libertarians have described Oakland's DAC as suffering from mission creep, a process by which a project morphs to encompass activities beyond its original justification. That seems to be the case with other urban spy systems built by SAIC as well. In 2004, the Greek government hired the company to blanket Athens with more than 1,000 cameras and sensors, as well as other surveillance and communications gadgets for the police to use during the Olympics.

"The SAIC surveillance system was considered by the Greek governments, under the US Embassy's blessing, a long-term security investment, and a panacea to be used for post-Games security purposes against terrorism and crime," said Minas Samatas, a professor at the University of Crete and an expert on surveillance. "That future promise, regardless of its credibility, was necessary to justify its outrageous cost." The total cost was several hundred million dollars, although a full accounting is difficult because of various layers of waste and enormous cost overruns that SAIC claimed were the Greek government's fault.

A permanent citywide surveillance system is extremely controversial in Athens. "This was perceived as a threat to hard-won political liberties in Greece," Samatas said, referring to the era after a neo-Fascist military junta had ruled Greece from 1967 to 1974 and had received US aid and weapons that were used on the Greek people. "After the [2004] Games, these cameras were used to monitor not only traffic, but also rallies and demonstrations," Samatas told us.

But SAIC's Greek surveillance system hasn't worked as planned. Samatas said only a fraction of the cameras installed actually provide footage, and that the communications networks simply never worked. "Fraud was involved," explained Samatas, who points to bribes and other questionable practices used by the joint venture between Germany's Siemens Corporation and SAIC to obtain the original contract. Even so, last year SAIC convinced an international arbiter to order Greece to pay $52 million to SAIC for money the company says it lost on the project.

SAIC also is involved in supplying weapons and training to anti-democratic governments around the world. The Egyptian coup of July 3 was carried out by soldiers who received training under a $46 million SAIC contract. For fifteen years SAIC has been working with the Egyptian military, under the US Army's watch, to ready Egyptian soldiers for combat under a program called the "Egyptian Combat Training Center," according to a US Army spokesperson. The Army told us that the most recent work order was finalized in 2011, requiring SAIC to provide "player units, detectors, and other equipment to facilitate force-on-force live training.

"SAIC is responsible to develop, deliver, install and test the system in Egypt," and company employees "train the Egyptians on the use of the equipment," said Robert Gomez, assistant project manager for foreign military sales at the US Army Program Executive Office for Simulation, Training, and Instrumentation. Over the last month, the Egyptian military has killed hundreds of protesters, mainly those who oppose the coup against the country's elected president.

SAIC is also training Saudi Arabia's security forces. In 2009, the US military awarded SAIC a multimillion-dollar contract to establish the "Saudi War College" and to "assist in preparing and educating Saudi leaders to face domestic and global challenges," according to a company press release. The Saudi royal family is a religious dictatorship known for financially supporting anti-democratic regimes across the Middle East. The Saudi monarchy strongly supported the recent Egyptian military coup and violent repression of protests.

"Saudi Arabia has not experienced the kind of popular protests that have occurred elsewhere in the Middle East and North Africa in recent years," according to Freedom House, an organization that tracks political freedoms around the world. "Saudi activists used social media to call for a 'Day of Rage' to be held in March 2011. However, authorities dispatched security personnel across the country as preemptive measures, and large protests failed to materialize." SAIC is currently hiring dozens of instructors to train Saudi military personnel at the country's War College.

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