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Heavy US reliance on private security in Afghanistan has helped to line the pockets of the Taliban, a US Senate report says.
The study by the Senate Armed Services Committee says this is because contractors often fail to vet local recruits and end up hiring warlords.
The report demands "immediate and aggressive steps" to improve the vetting and oversight process.
Some 26,000 private security personnel, mostly Afghans, operate in Afghanistan.
Nine out of 10 of them work for the US government.
Private security firms in Afghanistan provide guards for everything from diplomatic missions and aid agencies to supply convoys.
In August, Afghan President Hamid Karzai gave private security companies four months to end operations in Afghanistan.
'Mr White'
"All too often our reliance on private security contractors in Afghanistan has empowered warlords, powerbrokers operating outside Afghan government control," Democratic Senator Carl Levin, chairman of the Senate committee, said.
"These contractors threaten the security of our troops and risk the success of our mission," he added.
The report paints a disturbing picture of how some of those hired have little training or experience in firing weapons, while other contractors are warlords with known links to the Taliban, the BBC's Steve Kingstone in Washington says.
The document gives several notorious examples, including a man the Americans have nicknamed Mr White - after a character in the violent film Reservoir Dogs.
He is said to have funded the Taliban and to have hosted a meeting with a senior commander responsible for a wave of roadside bombs targeting Nato troops.
The report also says that - by funding warlords with their own private militias - the US is undermining its declared aim of creating a more stable Afghanistan.
It warns that the growth of a lucrative private security industry has drawn new recruits away from the Afghan police and army, where salaries are lower.
In response to the report, Doug Brooks, the president of a body that represents private security contractors, said contractors in the field faced hard choices regarding who to employ.
"If your option is either using the local nationals who may be working for a local headman or warlord, or importing somebody from another part of Afghanistan - which automatically makes them a target - you may not have a whole lot of choice," he told the BBC's World Today programme.
"There's an aspect to this, a best value aspect, that I think the US government has ignored for too long. The tendency among Congress is simply to go for the cheapest things they can find, the cheapest contractors, and that undermines I think the more quality contractors," Mr Brooks said.
The latest report follows July's Congressional inquiry, which said that trucking contractors paid tens of millions of dollars a year to local warlords for convoy protection.
In recent months, US forces in Afghanistan have pledged to increase their oversight of security contractors and set up task forces to track the money spent among sub-contractors.
Source: BBC
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