A COMPANY run by Tim Spicer, the former army officer at the centre of a political scandal in the late 1990s, has clinched an extension to a Pentagon contract to oversee the safety of civilian contractors in Iraq.

Aegis Defence Services co-ordinates communications between coalition forces, civilian contractors working on reconstruction projects, and their private security firms. It also provides bodyguards for senior American and Iraqi officials, and employs a total of 930 people in Iraq.

Spicer’s company was first chosen for the co-ordination role in a one-year deal signed last year. The selection sparked protests from American companies that were passed over, with Dyncorp, a defence and security contractor, questioning the decision in a formal complaint to the Government Accountability Office, the audit arm of the American government.

It is understood the Dyncorp complaint referred to the Sandline affair, in which a company where Spicer was a director sold arms to Sierra Leone in apparent breach of a UN embargo. Spicer later caused a furore by saying he had done so with the approval of the British government.

Spicer said last week that the complaint had been rejected, and the Pentagon had in recent weeks decided to extend the contract for a second year and expand it. The new deal would be worth about $145m (£79m), he said.

Aegis operates one national and six regional command centres in cities across Iraq. Staff act as a link between coalition forces and civilian contractors on security issues, passing on information on the activity of insurgents. They provide a daily intelligence service to contractors, and track the position of their vehicles.

“Basically we are trying to make sure they don’t run into trouble, and quickly helping them if they do,” said Spicer.

The concept of the command centres and the liaison function had persuaded the Pentagon to choose Aegis ahead of other bidders. “We were able to provide the type of clearances and personnel that made them feel comfortable with us handling sensitive and at times classified information,” he said. “It was far-sighted of the Americans to treat the contract in this way. We are completely integrated into the military chain of command.”

The Pentagon has an option to extend the contract for another year, but Spicer believes the centres will continue to function for the Iraqi civil authorities beyond then.

Times Recommends

• Lies and cover-up at MG Rover exposed by report
• High oil prices push manufacturing costs up
• Primark founder steps down as chief executive