But as Livioco also noted, DynCorp expected to give back some of those gains with the drawdown. And that is indeed happening now. It spurred Moody’s Investors Service to downgrade the company in May, in fact, and to revise its outlook to negative from stable. The credit rating agency pointed to the Logistics Civil Augmentation Program from the Army — 31 percent of total first quarter revenue for DynCorp — which is “heavily tied to the ebbing U.S. troop level in Afghanistan.” It also noted that company revenue could continue declining at a rapid pace if U.S. contract awards remain tepid or if U.S. and NATO troops fully withdraw from Afghanistan at the end of 2014.

But the company has not stood idly by. It consolidated business units last year to create DynGlobal, which focuses on the expansion of commercial and international business and offsets losses from U.S. government opportunities. That joined logistics and aviation as one of three primary segments for the company — all of which provide a fair amount of growth potential, particularly when not tied so tightly to wartime support. And that focused presumably played directly into the decision by the company to bring on S. Gordon Walsh as its new chief executive, a 16-year veteran of L3 Communications Inc. with executive experience in the logistics services business. Also noted by DynCorp in the announcement was his experience with “strategic realignment” — a none-too-subtle hint that DynCorp is undergoing significant change.

Why not stick with DynCorp‘s current CEO, Steven Gaffney, who was the one to call reliance on the U.S. government “no longer a truly viable growth strategy” in May?

DynCorp didn’t say, but there’s a good chance it had less to do with executive failures and more to do with timing. Gaffney was appointed CEO in August of 2010, soon after DynCorp was acquired by Cerberus Capital management LP. Prior to that, he was already serving as the company’s board chairman. Much like John Jumper was appointed CEO of the former Science Applications International Corp. to see the company through its corporate split, then move on, it’s feasible that Gaffney was appointed mainly to help transition DynCorp post-acquisition, and then establish a new strategy forward.

But instead of Mr Carroll, a former member of the elite Navy SEAL Team Six, being disciplined, Mr Richter was the one sent home. U.S. Embassy officials in Baghdad told him he had to end his investigation and leave Iraq because he was disrupting the security options Blackwater was providing for diplomatic staff, the New York Times reports.

ust over two weeks later, Blackwater contractors opened fire in Baghdad's Nisour Square, allegedly killing 17 civilians and wounding 20 others. The incident caused massive outrage among the Iraqi public and is believed to be one reason Iraqi leaders refused to agree to allow U.S. troops to stay in the country past 2011.

Mr Richter claims: 'Mr. Carroll’s statement was made in a low, even tone of voice, his head was slightly lowered; his eyes were fixed on mine. I took Mr. Carroll’s threat seriously. We were in a combat zone where things can happen quite unexpectedly, especially when issues involve potentially negative impacts on a lucrative security contract.'

Mr Carroll has not commented publicly on the allegations. Despite his abbreviated visit to Iraq, Mr Richter's report paints a damning picture of Blackwater, which was paid more than $1billion to guard American diplomats.

He comments in his report that 'Blackwater contractors saw themselves as "above the law" and actually believed that they "ran the place."'

Mr Ritcher details a pattern of drunken partying by Blackwater contractors, including with female visitors.

In one incident, he describes four guards drunkenly commandeered a $180,000 armored vehicle to drive to a party and then crashed it into a blast barrier.

Contractors kept their weapons in their personal quarters, despite rules against it, and carried all manner of automatic weapons, machine guns and rocket launchers - even when the contractors were not certified to use them, according to the report.

Blackwater guards were also alleged to frequently run Iraqi civilian cars off the road and fire into neighborhoods, sometimes even killing civilians, Mr Richter alleges.

Mr Richter's review also found the company's security operations lacking. The contractor often reduced or otherwise changed the number of men assigned to a protective detail without getting permission from the State Department.

They also over-billed the State Department and falsified records, Richter alleges.

A Blackwater-affiliated contractor also allegedly mistreated migrants it hired to work in its security compound, offering them low wages and squalid conditions for housing - including packing three men in a tiny room with no bed.

The company was also accused of badly mismanaging a cafeteria on its compound, providing unsanitary and substandard food. Conditions were so bad, a U.S. military officer wrote a letter to the State Department saying it should be shut down.

Blackwater was sold in 2010 and the new owners changed its name to Academi. A spokeswoman for Academi, based in Virginia, declined to comment.

Iraqi officials had demanded to try to Blackwater guards alleged to have committed the 2007 Nisour Square massacre in Iraqi courts. However, in 2008, the U.S. government indicted 14 security contractors on charges related to the shooting.

In 2009, a federal judge threw out all charges.  However, an appeals court allowed the charges to go forward. The case is still pending.