Wackenhut Services

Wackenhut Services, Inc. (WSI) was the government-services subsidiary of the Wackenhut Corporation, a Florida security company. It held guard and protective force contracts at Department of Energy sites, and in 1981 it entered a joint venture with the Cabazon Band of Mission Indians. The business was later known as G4S Government Solutions, Inc., and in 2014 it was renamed Centerra Group, LLC.¹

Corporate form and early records

The parent's Form 10-K for fiscal 1994 lists Wackenhut Services, Incorporated as a Florida corporation, 100 percent owned, alongside Wackenhut International, Incorporated and Wackenhut Corrections Corporation.² Timothy P. Cole joined the company in 1988 as president of Wackenhut Services, Incorporated, and became executive vice president and president of the Government Services Group on April 27, 1991.³

A Central Intelligence Agency memorandum dated December 13, 1967 in the Domestic Contact Service file on the company is headed "Initial Contact with:" and gives "Wackenhut Services Inc." at 3280 Ponce de Leon Boulevard in Coral Gables, with a telephone number. The body of the memorandum is redacted, and a handwritten notation at the top reads "Wackenhut Services Inc."⁴ The corporate history of Constellis describes Wackenhut Services, Inc. as established in 1960 as a wholly owned subsidiary to handle United States government contracts.⁵

Nevada Test Site

The company's annual report for 1984, catalogued in the Danny Casolaro papers, states that the security of the Nevada Test Site, "a 1,350-square-mile area of desert and mountain terrain larger than Rhode Island," had been entrusted to Wackenhut since 1965, and that its contingent there had a "defensive arsenal" that "includes sophisticated weapons, helicopters and armored vehicles."⁶ Wackenhut Advanced Technologies Corporation, a sister subsidiary, was selected, according to the 1985 annual report, to formulate the conceptual design of the security system for the nuclear device assembly facility at the Test Site, and the 1986 report adds design engineering for that system.⁷

The parent's 1994 Form 10-K reports that Wackenhut Services revenues were $8.1 million lower in 1994 than in 1993 because the Department of Energy reduced its manpower requirements. The filing states that the division was seeking contracts from other government departments to offset the decline.⁸

The Department of Energy Nevada Operations Office guard-services contracts held by Wackenhut Services Inc. carry the numbers DE-AC08-87NV10559 (cost-plus-award-fee, first recorded September 15, 1987 at $2,550,000, with transactions to February 1996), DE-AC08-93NV11011 (October 1992 to April 2003) and DE-AC08-98NV13149 (September 1998 to June 2005).⁹ A guard-services contract numbered DE-AC52-06NA14390, running from June 1, 2006 to January 31, 2012 with about $279.3 million obligated, and the Nevada Site Office security protective force contract DE-NA0001435, running from January 1, 2012 to February 28, 2018 with about $269.8 million obligated, are recorded under the recipient name Centerra Group, LLC.¹⁰

Edward J. Markey wrote in a letter of February 17, 2005 that a force-on-force exercise held at the Test Site in August 2004 had ended in failure for the guard force. Markey described a friendly-fire incident and a fistfight between two Wackenhut guards during the exercise, and he cited a Department of Energy Office of Inspector General report of February 11, 2005 that a Wackenhut employee had taken government and personal handguns to a training exercise at the site in 2003.¹¹

The Department of Energy's Voluntary Protection Program review of WSI-NV, the Nevada operation, in May 2008 states that the company was responsible for security for all Test Site personnel, facilities, equipment, material and operations. The review records that the company had been tasked in 2004 with establishing a special response team capability, that it had grown almost four times larger since 2004, and that it had been through a long period of contract uncertainty.¹²

Albuquerque training academy

The 1984 annual report states that the Department of Energy chose Wackenhut that year to establish and operate a Safeguards and Security Central Training Academy at Albuquerque, New Mexico, adding that "Never before has any Federal training center been contracted out to private industry." In winning the three-year, $5 million contract, the report states, Wackenhut Services competed against 92 companies, "including nine other finalists."⁶ Education-services contracts from the DOE Albuquerque Operations Office to Wackenhut Services Inc. carry the numbers DE-AC04-85AL27671 (first recorded September 1987, last transaction July 1998), DE-AC04-92AL72307 (November 1991 to May 1997) and, for the operation of a government educational building, DE-AC04-95AL97273 (May 1995 to February 2002, about $72.4 million).⁹

Savannah River Site

The 1994 Form 10-K states that the Department of Energy was the largest client of the parent, accounting for about 20 percent of consolidated revenue in 1994, and that the Savannah River Site contract (9 percent of revenue) and the Rocky Flats Plant contract (5 percent) were the largest of its DOE contracts.⁸

A Wackenhut annual report describes a security force of more than 600 people at the Savannah River Plant, provided by Wackenhut Services, Incorporated under a Department of Energy award to the company, and states that the Savannah River force conducted Special Response Team training.¹³

Centerra Group, formerly known as Wackenhut Services, Inc., has provided security at the Savannah River Site since 1983, and in December 2018 marked 35 continuous years of that work.¹⁴ The Savannah River Operations Office guard-services contracts to Wackenhut Services Inc. carry the numbers DE-AC09-83SR11046 (September 1983, $2,122,000), DE-AC09-88SR18002 (transactions from November 1988 to March 2000, including a $43,555,000 modification in November 1988), DE-AC09-93SR18292 (September 1993 to December 2003) and DE-AC09-99SR18950 (October 15, 1999 to December 31, 2009, about $901.6 million obligated).⁹ Under the name Centerra Group, LLC, contract DE-AC30-10CC60025 ran from October 8, 2009 to July 14, 2023, with about $1.38 billion obligated.¹⁰

Rocky Flats Plant

A letter report of the General Accounting Office dated June 4, 1996 and addressed to Representative David E. Skaggs states that Wackenhut Services, Inc. provided the security services at the Rocky Flats Plant and was the primary custodian of the site's military equipment. The report states that Wackenhut Services assumed responsibility for the military equipment inventory in 1991, that three night-vision devices valued at about $15,000 could not be located, and that the Department of Energy wrote off the loss in 1995.¹⁵

In a letter of July 16, 1992 to Terry Vaeth, the Department of Energy manager at the site, Timothy P. Cole wrote: "The distrust, doubt and fear our Security Inspectors have for certain DOE officials is unhealthy and may lead to serious consequences."¹⁶ The Rocky Flats Office guard-services contracts to Wackenhut Services Inc. carry the numbers DE-AC34-91RF00025 (first transactions November 1990 and February 1991, of $7.5 million and $25.9 million, through March 2003) and DE-AC34-93RF00283 (April 1993 to November 1997).⁹

Oak Ridge Reservation

In October 1999 the Oak Ridge Operations Office chose Wackenhut Services, Inc. as prime contractor for selected protective services at Oak Ridge facilities, under a three-year contract with two one-year options valued at approximately $75 million per year. The Oak Ridge National Laboratory employee newsletter stated that the new contractor would begin on January 1, after a transition period of about 90 days.¹⁷ The contract is numbered DE-AC05-00OR22690 and carries a period beginning October 15, 1999; the successor Y-12 contract, DE-AC05-02OR22928, begins July 15, 2002.¹⁰

The Department of Energy's Office of Inspector General audit of the restructuring of security services at the Oak Ridge Operations Office (IG-0487) states that in fiscal 2000 the office awarded a three-year base term contract valued at $218 million to Wackenhut Services, Incorporated. It states that security costs rose from $78.4 million in fiscal 1999 to an estimated $92.1 million in fiscal 2000, against projected savings of about $5 million a year.¹⁸

Principal Deputy Inspector General Herbert Richardson told the House Committee on Energy and Commerce Subcommittee on Oversight and Investigations on March 4, 2004 that the Inspector General had reviewed improprieties in protective force performance testing at the Oak Ridge complex. He described a pattern of actions by site security personnel, spanning back to the mid-1980s, that may have negatively affected the reliability of those tests.¹⁹ Markey's letter attributes to a January 2004 Inspector General finding that Wackenhut supervisory personnel had been told in advance of a drill at the Oak Ridge protective force, and to a March 2004 Inspector General report that training had been eliminated or modified at four sites where the parent held the security contract, including the Test Site, Savannah River, Rocky Flats and the Y-12 plant.¹¹

The Inspector General's inspection report of February 2006 (IG-0719) states that after the creation of the National Nuclear Security Administration, the protective force services for the Y-12 National Security Complex were placed under a separate contract, so that Wackenhut Services provided protective services under two essentially identical contracts at Oak Ridge. The report states that the contracts were awarded to Wackenhut in October 1999, and that modifications to them gave the contractor profit from increases in overtime hours in the post-9/11 environment. It estimates that for 2005 alone the company may have been paid about $1.8 million in additional profit by the Y-12 Site Office beyond the award fee.²⁰

The Cabazon joint venture

The Bua report of March 1993, the Department of Justice Office of Professional Responsibility report on the INSLAW matter by Special Counsel Nicholas J. Bua, states that the Cabazons formed Cabazon Security Corporation in early 1981, and that Robert Frye, then president of Wackenhut Services, Inc., responded on Wackenhut's behalf when the company solicited capability statements from security firms.²¹ The report states that the joint venture agreement of April 1981 was signed by Frye for Wackenhut and by Tribal Chairman Arthur Welmas for the Cabazon company. It quotes the agreement's primary purpose as "qualify for, bid on, and obtain government guard service contracts," and states that the venture bid on two government security contracts that it did not receive.²²

The report states that "the joint venture had no employees at any time" and that "The only individual employed by Wackenhut was Frye." It found no evidence that Michael Riconosciuto, who claimed in a March 21, 1991 affidavit to have been director of research for the venture, was employed by Wackenhut or by the venture.²³

An inter-office memorandum from A. R. Frye to R. E. Chasen of the "S & S Group," headed "DIV/AREA: WSI" and dated May 25, 1981, reports a trip of May 11 to 22, 1981 to New Jersey, Indiana and Washington, D.C., made with Dr. John Philip Nichols, the tribal administrator. The memorandum states that Zokosky also accompanied the writer for the first part of the trip, and that personnel contacted at the arsenal included R. Scott Westley of the Army project office and Dr. Harry D. Fair. The memorandum lists three purposes: to explore manufacture of 120 mm combustible cartridge cases on Cabazon land, to have the "Cabazon-WSI Joint Venture" placed on bidders' lists for set-aside contracts, and to contact agencies about export licenses for items on the Munitions List, specifically night-vision goggles.²⁴

The Bua report places a night-vision demonstration on the evening of September 10, 1981 at the Lake Cahuilla gun range in Indio. It states that Nichols's view was that the Cabazons, as a sovereign nation, were not subject to the usual export and import controls, and that Wackenhut's files showed marketing efforts directed at individuals identified as representatives of the governments of Guatemala and Honduras. The report states that the same files held internal memoranda in which Wackenhut personnel expressed the opinion that any sales of night-vision equipment would need State Department approval, and copies of preliminary applications Wackenhut filed with the State Department. Its finding: "As far as we could tell, no sales were ever made."²⁵

The report states that Peter Zokosky, a former president of Armtec Defense Products of Coachella who advised Nichols on a possible second source of combustible cartridge casings for the United States Army, travelled with Nichols and the joint venture to Picatinny Arsenal, and that Frye said he first met Riconosciuto on a trip to the arsenal that he believed took place in May 1981. Zokosky agreed there was a May 1981 trip but said Riconosciuto was not on it, and that Frye met him on a second trip in October 1981.²³

Spy magazine reported in September 1992 that Eden Pastora, who had been spotted at a test of night-vision goggles at a firing range near the Cabazon reservation in the company of Nichols and a Wackenhut executive, offhandedly identified that executive, A. Robert Frye, as "the man from the CIA" in an interview with the magazine. The article adds that in a subsequent conversation Pastora denied knowing Frye.²⁶

In a March 21, 1985 interview with the Desert Sun, Frye said: "We severed our relations with the tribe over a year ago."²⁷ A letter by Riconosciuto, written after a March 11, 1982 meeting with George R. Wackenhut and John Amarell in Las Vegas, states: "Bob Frye of Wackenhut Services, Inc., gave personal invaluable assistance to me at the Picatinny Arsenal in Dover, New Jersey."²⁸

Later corporate history

The parent's 1994 Form 10-K reports a suit captioned "Essex Corporation vs Wackenhut Services, Inc.," Case No. 94-908 JC/DJS in the United States District Court for the District of New Mexico, in which the plaintiff claimed multi-million dollar damages for tortious interference with contract and related torts. The filing states that the parent's insurance carrier had denied coverage and that the company denied the claims.²⁹ The docket, 1:94-cv-00908 before Judge John Edwards Conway, was filed on August 8, 1994 on diversity jurisdiction, classified as a suit for other personal property damage, and terminated on March 29, 1996.³⁰

In April 2010 G4S Wackenhut dropped the Wackenhut name, and Wackenhut Services Incorporated was described as "the Palm Beach Gardens, Fla., firm spun out of Wackenhut and known for providing armed security services to the U.S. government and critical infrastructure."³¹ A Florida registry record, as reproduced by OpenCorporates, lists a branch of Wackenhut Services Limited Liability Company, a Colorado company, under Florida document M13000005194, with an inactive status.³²

In late November 2014, G4S Government Solutions, Inc. was acquired by Alvarez & Marsal Capital Partners for $135 million and rebranded as Centerra Group, LLC. Its president and chief executive, Paul Donahue, said that the unit had operated under the Wackenhut Services brand from 1960 to 2011, that it had about $500 million in revenue, that it had been "owned by a $10 billion company," and that it represented roughly five percent of its parent's revenues. Donahue said the company wanted a name that had not been used and that was like Wackenhut.¹

Constellis lists Centerra's 2017 acquisition in its own timeline, through which the business became part of the Constellis portfolio.⁵