Guard shot at Australian embassy By David Wroe and Lindsay Murdoch Australian Federal Police are investigating the shooting death of security contractor, 34, at the Australian embassy in Baghdad.
In an incident that will raise questions about the security measures for diplomats and the Australian-founded private firm that guards embassy workers, the former Australian soldier was shot dead early on Thursday morning. 
A fellow Australian guard, believed to be a former special forces soldier, was taken to a military base at Baghdad Airport for questioning, sources said.
Both worked for the Australian- founded Unity Resources Group, one of the leading security firms in the Middle East, which has faced accusations in recent months of corner-cutting, though the Australian government has vigorously denied those reports.
Foreign Minister Julie Bishop confirmed only basic details, saying that a "tragic incident" had happened and "there is a thorough investigation under way".
The shooting is believed to have happened at the contractors' accommodation, which is within the embassy compound, giving the AFP jurisdiction to investigate.
Sources said alcohol was involved in the incident and that the guard who had been taken for questioning had been working in Iraq as a contractor since 2005.
A Baghdad staffer for URG referred Fairfax Media to head office in Dubai, which did not respond to phone messages or emails.
It is understood the victim was a former infantry soldier in the Australian Defence Force and the man being questioned was a former commando in the ADF.
In   February, Department of Foreign Affairs and Trade secretary Peter Varghese strongly dismissed reports of problems with the contract with URG.
Mr Varghese told a Senate hearing that the reports of corner- cutting and a drop in the price paid by the department under the contact had come from "disgruntled former employees" and were "without foundation".
The new security contract had dropped to $51million over three years - down from the previous contract of $100million over five years..