Revealed: Blackwater Founder Erik Prince's Business Ties With Netanyahu’s Disgraced Chief of Staff

U.S. businessman at center of storm over allegedly setting up back-channel between Trump and Putin has ties to Ari Harow and an Israeli financier

Hagai Amit
Hagai Amit
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Blackwater USA Chief Executive Erik Prince testifying before the House Oversight and Government Reform Committee on security contracting in Iraq and Afghanistan, Washington, October 2007.
Blackwater USA Chief Executive Erik Prince testifying before the House Oversight and Government Reform Committee on security contracting in Iraq and Afghanistan, Washington, October 2007.Credit: Larry Downing/REUTERS
Hagai Amit
Hagai Amit

U.S. businessman Erik Prince – who has just been accused of trying to set up a back-channel for communications between the Trump administration and Russia – has deep Israeli connections as well, including business dealings with Ari Harow, the disgraced former bureau chief to Prime Minister Benjamin Netanyahu.

The founder of the military contracting firm Blackwater is worth a reported $2.4 billion and is at the center of a ruckus over U.S. President Donald Trump’s relations with Russian President Vladimir Putin.

According to U.S. media reports, Prince was behind Trump’s indirect channels to Putin, through the Persian Gulf states. Last week Prince, 48, testified before the House Intelligence Committee on meetings that took place in the Emirates in January. He admitted to meeting with the head of a Russian investment fund earlier this year, but claimed it was nothing to do with Trump and Putin.

Haaretz has learned that Prince used to do business in Israel with Harow, the former chief of staff to Netanyahu. Harow turned state’s evidence in August after pleading guilty to fraud and breach of trust, and is collaborating with the police on two investigations into Netanyahu’s affairs.

Ari Harow in 2014, while working as Prime Minister Benjamin Netanyahu's chief of staff.Credit: Marc Israel Sellem

Prince also has long-standing ties with the Israeli financier Dorian Barak, formerly Harow’s business partner.

A former Navy Seal, Prince is reportedly close to Trump – so much so that, according to U.S. media reports, he was present at the Trump election party in New York’s Trump Tower in November 2016. He also advises Trump and the president’s son-in-law, Jared Kushner, on topics related to American foreign policy – from refugees to U.S. policy on Afghanistan. Prince reportedly has opinions on everything and isn’t shy about sharing them. His sister is Education Secretary Betsy DeVos.

His involvement in foreign policy raises eyebrows because of his involvement in Blackwater (now known as Academi), the multinational security firm that operates around the world. Though he sold the company in 2010, Prince has made a fortune from wars – from Iraq to Afghanistan. He has also attracted bad press: In September 2007, Blackwater employees escorting a convoy killed 17 Iraqis. They claimed it was an ambush, but Iraq claimed the killings were unprovoked. The Iraqi government refused to renew Blackwater’s license in 2009.

Five years ago, well before anybody predicted Trump’s election, Prince visited Israel and was hosted by Harow. At the time, Harow was a businessman with a private investment fund as well as being chief of Netanyahu’s bureau. Harow tried to interest Prince in investing in Indigo Strategic Capital, a venture capital fund that Harow was co-managing with Dorian Barak.

How much Prince invested in Indigo remains unknown, but it is known that through Indigo he invested in the Israeli companies NowForce (security) and Agent Vi (real-time video analytics).

Beyond Israel, Barak also tried to interest Prince in investing in an African rail project – with the Spanish infrastructure company Eurofinsa – and in a joint investment with the Tehran-born, British-Jewish billionaire Vincent Tchenguiz. Prince and Barak were also involved in a mining company called Alufer.

In late 2013, Harow signed a conflict of interest agreement, undertaking to sever ties with his private company 3H and vowing not to be involved in its management. It would be run by partners and his two brothers, he said, and Harow returned to serve as chief of staff for Netanyahu.

Harow is not known to have had ties with Prince over the last five years. But Indigo Strategic Holdings, a Cayman Islands-listed company that Barak set up to handle his joint activity with Harow, only closed in August.

Beyond Prince’s investments in Israel, the deeper significance of Harrow’s relationship with Prince may have been in introducing him to Barak. Previously, Barak worked as head of the mergers, acquisitions and business development division at Bank Hapoalim’s international division. He also prays at the same synagogue as Naftali Bennett, to whom he donated 1,800 shekels ($510) when the latter was successfully running for the leadership of Habayit Hayehudi in 2012.

Barak became an adviser to Prince on investments and finance, and served on the boards of Agent Vi, Indigo and other companies worldwide in which Prince had stakes – from Austria to Gibraltar. They include the British hydrocarbons and mineral exploration company Bridgeporth; another U.K. company called Airborne Technologies, which makes aviation systems (some refer to it as Prince’s private air force); and Alufer.

Barak and Prince are also involved in a holding company called Frontier Capital.

Barak also has ties in China, and launched an innovation center in Israel with KuangChi Science last year. The fund is supposed to invest $250 million, half in Israel. Its portfolio shows that it invested in companies in which Barak had previously invested money himself, partly through Prince.

With various people now touting Prince for a Senate run (including Steve Bannon), his Israeli ties could prove significant.

Harow’s representative said that in connection with a private company he had founded, he had been in touch with various business and philanthropic entities in Israel and elsewhere. During that time, he had not held any public office, and the ties described in this article ended in 2012, years before the U.S. presidential election, the statement said. “Any attempt to connect Harow with Prince and his activity in recent years is a cynical distortion of reality,” it added.

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