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Iraq's New War Zone: American vs. American

It's called "blue on white" — American versus American in the war zone that is Iraq (search).

On one side are Americans who have gone to Iraq as private contractors, helping Iraqis and the U.S. military with construction or security while often earning a bigger paycheck than they would have made at home.

On the other side are Americans serving in the U.S. military — soldiers and Marines who earn less money and whose primary responsibility is fighting a violent insurgency and stabilizing the Iraqi government.

Both entities try to work side-by-side in a country where the fog of war often causes confusion as to who is friend and who is foe. But some contractors and their families contacted by FOXNews.com are telling stories of verbal abuse and humiliation at the hands of a few individuals in the U.S. military.

Although these contractors say they stand behind President Bush and the U.S. military in the mission in Iraq and ongoing efforts to rebuild that country and put it on the road toward democracy, they say a few bad apples aren't helping in those efforts.

[Editor's Note: This is the first in a three-part series on tensions between American contractors working in Iraq and the U.S. military.]

Former Vietnam veteran Richard Peters is in Iraq working on construction projects in the "Green Zone" (search), rebuilding water treatment plants and police stations blown up by homicide bombers. Since April of 2003, Peters, who earned a bronze star and other accolades for his service in the U.S. Navy, has been back and forth on two different tours in Iraq.

But until Tuesday, he was afraid he would find himself in the area known as the "Red Zone" — areas outside the fortified Green Zone, also known as the "international zone, (IZ)" which houses many coalition and Iraqi government buildings — where the military cannot guarantee one's safety.

As he wrestled with the prospect of being evicted from his fairly safe work and living space, Peters said he was appalled at the treatment he received from a U.S. Army officer by the name of Lt. Col. Mike Casey who, according to military officials, has been aiding the Iraqi police in enforcing evictions of illegitimate tenants.

"It was one of those situations that blew me away ... he was very, very angered over American contractors," Peters told FOXNews.com in a phone interview from Baghdad last Friday.

Military officials said it's natural for some disagreements to arise between contractors and the military during an operation on this scale.

But "overall, we see a positive working relationship between the U.S. military and contractors — U.S., Iraqi, or otherwise," said Capt. Chris Watt, the public affairs officer for the Joint Area Support Group in Baghdad (search). The group coordinates and provides logistical, facilities, security, force protection and administrative oversight in the international zone until those jobs are transitioned to the new Iraqi government.

"In general, the relationships have actually been pretty good because they need each other," added Doug Brooks, president of the International Peace Operations Association (search), who noted that in northern Iraq, for example, the military is relying on contractors who are out in the field with Iraqis every day for intelligence. "I don't think [the tension over money, etc... is] a huge issue. It's been a continuing issue on a low scale and always will be."

From 'Hell's Highway' to the Green Zone

Peters first arrived in Iraq in April 2003 shortly after U.S. forces drove Saddam Hussein into hiding and he stayed for about five months. While working with Blackwater USA (search), a private security company, in Hillah, Peters became good friends with two Iraqi engineers.

That friendship led to an invitation to return near the end of 2004. This time, Peters went to Iraq with Associated Construction Management (search), a company he started as a sister firm to Morrison Security Corporation. Both companies are headquartered near Chicago. In the interim, Peters spent time in Afghanistan working on contracts for Morrison Security Corporation.

"What we've been attempting to do is obviously take part in some of these reconstruction bids," said Morrison Security Corporation President Sean Morrison, who is in constant contact with Peters overseas. "We have made some very good contacts and relationships with some Iraqi nationals."

Peters has three Iraqi engineer associates, two of whom are currently employed by the U.S. Army Corps of Engineers (search), which issues the majority of reconstruction work in Iraq. Those two have been deemed "mission essential" as quality assurance engineers for Iraqi infrastructure projects, according to official employment verification documents obtained by FOXNews.com.

When they first arrived for the current job, Peters and his team were stationed in the extremely dangerous Baghdad International Airport area. They made the 17-mile drive down what they called "Hell's highway" to the Green Zone for work every day. When one of the Iraqi engineers he was working with found out a contact was moving out of his Green Zone space, Peters jumped at the chance to rent it.

He signed what he thought was a legitimate rental agreement with the Iraqi owner of the apartment, which is in a building of mostly former Iraqi Republican Guard soldiers. He paid the presumed Iraqi owner $10,000 for the space and spent another $3,000 on furniture.

But when he arrived at the apartment on June 3, the Iraqi police told them to vacate the area. An American police consultant at a nearby Iraqi police station recommended Peters call Casey for help.

According to Peters, when he called Casey the next day, help was the last thing he received.

"If I had to put it in a word, he was vicious," Peters told FOXNews.com, referring to his first conversation with the officer. "The guy came back really strong and made it very, very clear that he absolutely wanted me out of there, that the whole thrust of why I was over here was to make money."

Peters said Casey didn’t give him any explanation why he needed to leave and issued him a warning: "If I can find you, I'll have you out in 24 hours."

"Not having a safe place to live in Iraq is extremely unsafe and dangerous, to be evicted and cast out in the street was unimaginable and certainly unacceptable," Peters wrote in a diary he is keeping about his situation, a copy of which was obtained by FOXNews.com.

Later on June 4, Peters said he returned to the apartment and found an additional lock on his door that prevented him from entering. His Iraqi friends helped him open the door.

The next day, according to Peters, he started getting harassed by Iraqi authorities. Police barged through the door when he didn’t answer a knock. Two weeks later, Peters said, a U.S. military contingent of 15 to 20 soldiers did a "house check" that took about 30 minutes and confiscated all but one of his weapons that he was rounding up as part of Morrison Security Operations.

On June 22, Peters spoke with an Iraqi official who administers housing in the Green Zone and she gave him a week to vacate the apartment, since the Iraqi with whom Peters signed a rental agreement was illegal and was going to be evicted anyway.

Fearing the approaching deadline, Peters said he took his plight to the U.S. embassy in Baghdad. The advice he got was to go to Casey.

"I'm thinking, well let me call this guy, he's an American. It was recommended I call him for help and when I called him, he was worse than the Iraqi police," Peters said. "He says 'why are you over here?' He's yelling in the phone ... 'You're over here for the money. All you contractors are alike … I'm going to throw you out of the country, if I find you.'

"This is what I'm hearing from an American Army officer when I call him for help."

Several military officials in Baghdad who know Casey said he is a good officer, with one American lieutenant colonel in Baghdad saying, "he is a good officer attempting to do what is right for everyone ... I can only say that I have observed [him] doing his best to solve problems for everyone within the IZ."

U.S. Military: Iraqis Are Calling the Shots

The predicament facing both sides is that as the Iraqi government becomes more established, it is seeking to reclaim some real estate. The property in question was vacated by many after the Baathists fled the zone once Saddam was toppled; many Iraqis then moved in rent-free.

No legal residents of the area are being evicted, according to the U.S. military. Some military officials said that many people who have no legal claim to live in some places have offered to "rent" their building or unit to contractors for large sums of money because they know many contractors want safer places to live and work.

A spokesman for the U.S. Army Corps of Engineers noted to FOXNews.com that the Iraqi government is running a sovereign nation and is calling the shots but the U.S. military is sometimes brought in to enforce such decisions.

"Apparently, he's [Casey] the kind of guy who's had to enforce this process because where we all, in a nutshell, we're renting all this property we're occupying here in Baghdad … he's simply the person having to be involved in this action." said Lt. Col. Stan Heath of the U.S. Army Corps of Engineers. "There are some efforts ongoing … to give back some of the property we've been initially occupying … because we're not going to be there forever."

Watt of the JAGC told FOXNews.com that the U.S. military does not run the eviction process.

"The eviction process is a sovereign Iraqi government process," Watt said in an e-mail exchange with FOXNews.com. "This is a safety and security issue for the government, and they are taking the legal action necessary to enforce their laws and protect their officials."

The U.S. military may make recommendations on behalf of contractors with whom they have a valid contract but the final decision on who can live in the international zone is in the hands of the Iraqi government, Watt added. He said Peters did not have a contract with the U.S. military prior to arriving in Iraq nor did he follow approval procedures put in place by the government.

When asked specifically about the attitude and remarks allegedly made by Casey, Watt said that the lieutenant colonel "is passionate about the success of the Iraqi government. He can also be bold and blunt sometimes. The would-be contractor falsely accused Lt. Col. Casey of evicting him and then demanded the colonel do something about the contractor's own unwise business choices."

He added that "the unfortunate exchange of words" between the two men doesn't change the circumstances.

"The businessman's conversation with Lt. Col. Casey does not change the face that he purchased an Iraqi government-owned apartment from a squatter who did not own the property and had, in fact, received an eviction notice," Watt said.

Casey himself did not respond to e-mail requests for interviews. But FOXNews.com did communicate with Watt and other military officials in Baghdad after sending Casey an e-mail through the Coalition Press Information Center.

Leaving the Green Zone

Peters was given until Thursday by the Iraqi government to vacate the IZ apartment. He left two days early, moving Tuesday to an area near the Baghdad Airport out of fear for his own security if he stayed any longer in the Green Zone.

He obtained space in a trailer to both live and work near the airport through an associate. But this move is a temporary one — Peters has 30 days to find a new arrangement.

Peters said it's not so much the eviction but the handling of it by a fellow countryman that gets to him.

"I put 20 years in, I was on the SEAL team ... I've been in Vietnam, Panama, been here, spent a month in Afghanistan," Peters said. "Out of all my experiences in my entire life, I've never, ever, ever had an Army or any military individual treat an American or ever heard of them treating an American like that.

"What I heard him say was enough to make me realize this isn't the way America wants to portray itself ... we're all Americans, we're in the same war, we're all fighting for the same cause."

He added: "I don't have a vindictive stance. United we stand, united we fall ... this is so wrong, it's unbelievable. It very well could have cost me my life … we need to stick together as a nation, this is too important."

Check out FOXNews.com on Friday for the next part of the series, focusing on what happened to a group of 16 American contractors who the U.S. military detained in Fallujah.

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