UK security guard shot dead in Iraq

A British security guard is being held in Iraq on suspicion of murdering two of his colleagues, it was confirmed last night. The dead men, a Briton and an Australian, are believed to have died from gunshot wounds following an argument in Baghdad's heavily protected Green Zone.

Danny Fitzsimons is alleged to have shot British colleague Paul McGuigan and Australian Danny Hoare in the early hours of yesterday. Yesterday a spokesman for their company, ArmorGroup Iraq, said that its staff was fully co-operating with the Iraqi police investigation which could lead to the first Iraqi criminal trials involving UK nationals since a security deal was signed between the US-led security forces and Baghdad at the beginning of the year.

A spokesman for ArmorGroup Iraq, Patrick Toyne-Sewell, said Briton Paul McGuigan and Australian Darren Hoare died in a "firearms incident" in Baghdad's International Zone yesterday. "We are working closely with the Iraqi authorities to investigate the circumstances of their death," he said.

The Iraqi military said it understood the gunman had shot his co-workers and wounded an Iraqi with a pistol inside the Green Zone. Iraqi military spokesman Qassim al-Moussawi said: "It started as a squabble. The matter is now in the hands of Iraqi justice."

The Foreign Office said that two British men were being held in Iraqi custody in connection with the investigation. But last night ArmorGroup said that the second Briton had since been released.

ArmorGroup is described as a "protective security company" that has been operating in Iraq since 2003. It holds contracts with the British, American and Iraqi governments to provide security in Iraq where it employs 1,000 personnel, three-quarters of whom are Iraqis. Previously chaired by former Conservative minister Sir Malcolm Rifkind, ArmorGroup was taken over by rival security firm G4S last year.

The US-Iraqi security pact that replaced the UN mandate for foreign forces lifted the immunity that had been enjoyed by foreign contractors in Iraq for much of the six-year occupation.

The move was provoked by outrage over a mass shooting in Baghdad in September 2007 involving a US security firm, Blackwater Worldwide, now known as Xe. In that incident, 17 Iraqis died in a shootout involving a Blackwater convoy in Baghdad. The deaths triggered a backlash against the foreign security companies that made fortunes in Iraq. Nouri al-Maliki, the Iraqi Prime Minister, called for Blackwater to be ejected from the country, but the North Carolina-based company managed to hold on to its lucrative contracts. Under new corporate branding, it will stay until September.

Blackwater was one of the first companies of its kind in Iraq after the 2003 invasion, winning multi-million dollar contracts from Washington, keen to reduce military costs by turning to the private sector for help. It was followed by a number of British security companies, including ArmorGroup. Recently, contracts have started to dry-up.

Until this year, all foreign security workers were immune from Iraqi law but they now face criminal prosecutions should they shoot first and ask questions later. The security agreement also set a timeline for the withdrawal of American forces from urban areas by the end of this month and from the entire country by 2012.

In the first case since the new deal was signed, US-backed Iraqi forces detained five Americans on 3 June in connection with an investigation into the stabbing death of a fellow contractor. The five were released into American custody and Iraqi authorities said their case did not involve the killing of James Kitterman of Houston, who was found dead in the Green Zone on 22 May.