How The Private Military Industry Went Global

in december 2019 former nissan ceo carlos ghon made his dramatic escape from japan he allegedly had some help from a former u.s green beret and his son michael taylor a former green beret and his son smuggled him out of japan in a music equipment box and more recently a company based out of florida named silvercore usa launched an ill-fated coup attempt in south america it was a poorly planned attempt to overthrow the embattled president of venezuela nicholas maduro in seattle a television cruise protective detail disarmed protesters who had gained access to abandoned police firearms on may 30th 2020 amid a wave of protests after the death of george floyd he was contracted by one of the news networks out there um for private security he did four years in the marine corps and then after doing his four years in the marine corps he ended up getting into private military contracting private security is expected to grow to an 81 billion dollar industry by 2023 and that's just in the united states there exists a higher risk higher reward sector that attracts people with a unique and expensive skill set only acquired through military experience some of these jobs are word of mouth others are hiding in plain sight on employer websites and job boards sites like shooter jobs cater to private security roles and the compensation is highly competitive think of it as like delta airlines you know you get started as an us air force pilot and then when you leave you go to delta um so it's a kind of a crass analogy but it's the the world of mercenaries it's an illicit economy some of these individuals are part of what are known as private security companies or private military companies better known as pmcs private military company is a term of art that is code for mercenary they are profit driven and strive to show value and efficiency to their clients just like any other company they can provide executive protection training expertise for other security agencies companies or government clients their heavily armed employees can be seen at us embassies on cargo ships traversing dangerous seas or even training soldiers and police and foreign nations although there are numerous companies in the us that provide these services there are other nations such as russia that have their own pmcs one russian pmc the wagner group gained notoriety in syria and was involved in a clash with u.s forces in 2018. russia's private security industry has grown in leaps and bounds over the last couple of decades i mean mercenaries are the second oldest profession machiavelli knew how to use and fight with mercenaries we at war colleges we don't even study them the intelligence community does not collect on them i think this could be one of the biggest insecurity threats of the 21st century and it's unfortunate that not much is known about it after 9 11 the us found itself embroiled in two major conflicts one in afghanistan and one in iraq following the initial invasions there was a need for more manpower to train the new security forces in both countries the us military is an all-volunteer force which means rapidly increasing the size of the military would require conscription also known as the draft which was notably used during world war ii in vietnam one answer was to have the private sector fill the gap instead there are some people like that just doing it for the money but actually there's all sorts of strange people out there doing it some are doing it for the money some people are doing it for the adventure and some people were you know their vets of iraq afghanistan other wars they come back home they find out they don't want to be a walmart you know checkout guy or gal and so they got back to what they know the free market rapidly reacted to the profit potential of the massive government contracts to provide a myriad of services including private security and protective services details i know specifically for guys coming out of the special operations background there's some you know fairly lucrative contracts that can be had if you've had if you have the right skill sets at the height of the iraq war there was one contractor to every military service member deployed the ratio is now five contractors to every one u.s soldier not all of these are security rules contractors do everything from laundry to electrical work to construction during the wars in iraq and afghanistan companies such as blackwater triple canopy and dyncorp were responsible for fielding heavily armed and trained employees and also recruiting and organizing security contractors from a multitude of nations such as chile peru and uganda recently even as the us military footprint in the middle east and central asia has diminished spending on contractors says increase the pentagon spent 370 billion on contracting services in 2019. that's 164 billion dollars higher than what was spent on contractors in 2001. according to a new study from brown and boston universities about 53 000 us contractors were stationed in the middle east in 2019 compared with about 35 000 us troops day rates were a thousand twelve hundred dollars a day and up for certain people and so they were getting insane amounts of money and then living like they that money was a career right and now all of a sudden it's like you've got some time in the military under your belt and maybe your marriage is already stressed and now you're doing this contracting thing where you say oh i'm just gonna go make some good money but now you bought a house you bought a couple cars you bought some toys and now you're relying on continuing to do these contracts to pay those bills and it becomes this this cycle that you can't really escape privately hired security is one of the world's oldest professions and although there are an estimated 1.8 million people working security jobs in the us alone the efforts of private security companies are notably different than your average malcolm the landscape of the private security industry in the us is constantly shifting the firm formerly known as blackwater now known as academy merged with its competitor triple canopy in 2014 to form the constellas group the constellous group was bought by a private equity firm apollo global management for around 1 billion these private security companies tend to employ former military usually with infantry or special operations backgrounds to take on higher risk higher reward opportunities the employees of these companies at times can be teaching foreign military clients such as the iraqi military or protecting a client such as the contractors who defended the us embassy in iraq after the assassination of the iranian general kosum solomoni in early 2020 they can also be used in personal protective roles like protecting state department employees however recent examples of private security companies such as silvercore usa are prime examples of what can go wrong in this conflict-driven industry silvercore usa started as a firm focused on executive protection and school shooter prevention staffed by former special operations troops eventually the company attempted to overthrow the maduro regime in venezuela resulting in two employees both former green berets being captured during the ill-fated coup attempt not surprising to me that that particular company dabbled in other aspects of security i think that they saw this as their potential big fish and like a lot of other kind of you know get rich quick schemes it's sometimes you know too good to be true and i think that maybe this was one of those scenarios where it was just a little bit too good to be true and it was a little bit more complicated than maybe what initially met the eye another example of the unforeseen consequences involves the rise of the wagner group a private military company based in russia the wagner group is a russian private military company okay they're like black water but much more lethal and they have a lot more free hand they work for the gru which is russia's military intelligence directorate this private military company has been employed in syria and africa foreign affairs experts have accused russia of using the wagner group to further its own goals overseas on february 7 2018 a group of pro-regime syrian forces including russian mercenaries from the wagner group launched an attack on u.s forces that included tanks and armored vehicles u.s forces fought off the attackers in a four-hour battle leaving hundreds of pro-regime casualties the wagner group is central to one theory behind the ongoing controversy around russia paying taliban insurgents to kill us troops one reason for the bounties could be revenge for the wagner group mercenaries killed by us forces in syria in 2018. i think it's important to keep in mind that it's not easy to connect the dots in a straight line from the us strike on a so-called wagner contingent in february 2018 in syria and what's happening today in afghanistan it's just a regional reality that russia will always have a stake in outcomes in afghanistan what is significant here is the escalation up the ladder toward confrontation for the first decade after 9 11 the u.s was the primary customer for private security companies however as the us has diminished its role in the middle east other countries have shown a desire for private security companies to provide training security and in some cases direct action in war zones i think it i think the era of black water and and triple canopy and dying core and egypt i think that is a bygone era there might be something like that in the future but you know these companies were big they were upfront the us military has invested in human capital and the experience that special operations forces have gained in iraq syria and afghanistan holds a unique value in the world market in the united arab emirates some former u.s special operations soldiers were recruited to provide training for the uae military only to then find themselves in the legally precarious situation of providing direct military aid to a foreign government in libya russia's wagner group has been active in supporting the libyan national army commander khalifa haftar as wagner expands operations u.s firms have faced a much more austere period of government contracts i think companies also learned that that was not a money-making adventure for them the headline risk was simply too much it got them in too much trouble and we're seeing like constellous group who which bought triple canopy which bought blackwater they're like basically in default right now the rise of private security companies fighting in hotspots across africa the middle east and eastern europe has shown that other countries and private entities have recognized the value of hiring well-trained and well-armed security forces to perform tasks that otherwise would not be accomplished so like china people have been saying for a long time like well watch that space when china moves into private military companies it'll be big because they have the largest domestic security guard business in the world you know however chinese you know it's one thing to be like a whack-and-hut maul guard and a mercenary that's one difference the second is that china has a really they're not battle tested unlike say the russian military or the american military so it's not like they have a huge core of hardcore vets that they can deploy and they also tend to deploy their own chinese military in africa just under a different you know sort of like little not little green men but little i don't know red men or something like that so they don't really use that model eric prince the former ceo of blackwater is attempting to break into the chinese private security market with frontier services group a security company based out of hong kong which aims to provide training to chinese clients prince declined cnbc's request for an interview meanwhile the wagner group in russia continues to expand its footprint in libya and the central african republic but what we found interestingly is that the majority of folks that we found in our data who sign up to become a private security contractors in russia are cycling through units in the western and southern military districts which you know is known for its counter-terrorism sort of orientation but also has a lot of these units that were transitioned to contract nikki contract units essentially and so they're cycling on and off it seems between different terms of service this is kind of a stop gap band-aid solution for russia's um challenges with mobilizing defense nations in the middle east have continued to hire private security companies to train and augment their own security services we're seeing we're seeing ex-navy seals ex-green berets in yemen fighting for middle eastern monarchies we're gonna see more of that and i think if you're or the you know like the silver core in venezuela i think that there's a lot of entrepreneurs specifically veteran entrepreneurs that are kind of trying to find their way and i think that's what happens with a lot of these guys that have these start-up personal security companies where it's like hey we need to bring money in somehow we'll kind of take what we can get contract wise so one day that might be executive protection another day that might be you know at a rally or something like that and then oh hey our name got floated around in the right circle and now we're you know staging a coup in venezuela

Channel: CNBC

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Keywords: CNBC, business, news, finance stock, stock market, news channel, news station, breaking news, us news, world news, cable, cable news, finance news, money, money tips, financial news, Stock market news, stocks, police surveillance, protests, police brutality, private military, military spending, private security, war

Id: 17Scy1rBb4U

Length: 12min 21sec (741 seconds)

Published: Thu Jul 23 2020