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An American CIA contractor facing murder charges in Pakistan has been released after more than $2 million in “blood money” was paid to the relatives of the victims, a lawyer for the families said Wednesday.

The release of Raymond Allen Davis sparked angry protests. Police fired tear gas to break up a crowd of about 200 demonstrators outside a U.S. consulate, some of whom burned tires.

Police made several arrests in Lahore and struck other people with batons, according to witnesses. There were smaller protests in other main cities as well.

Davis, who had been in jail since Jan. 27, was accused of killing two Pakistani men in a case that has seriously strained ties between Pakistan and the United States.

Lawyer Raja Irshad said 19 relatives appeared in court Wednesday to accept payments totaling $2.34 million. He said each told the court “they were ready to accept the blood money deal without pressure and would have no objection if the court acquitted Raymond Davis.”

A U.S. official said Pakistan had paid the families whose pardoning of Raymond Davis set the stage for his release. That arrangement allowed Secretary of State Hillary Rodham Clinton to assert in a news conference the U.S. didn’t pay compensation.

But the American government “expects to receive a bill at some point,” said the official, who spoke only on condition of anonymity because the situation was so sensitive. The payments to families in Pakistan are roughly 400 times as high as the U.S. has paid to families of many civilians wrongfully killed by U.S. soldiers in the wars in Iraq and Afghanistan.

Under negotiations to free Davis, the U.S. Embassy in Lahore said the Justice Department had opened an investigation into the shootings. In a statement, the embassy thanked the families for their generosity in pardoning Davis but did not mention any money changing hands.

Provincial law minister Rana Sanaullah told Geo television that Davis was released by the court and was free to go where he wanted, the Dawn newspaper reported.

Sanaullah Chaudhry Mushtaq, superintendent at Kot Lakhpat jail, said Davis left the jail in the company of U.S. consulate officials.

Davis, 36, left the country immediately for Kabul in neighboring Afghanistan, where he was expected to be debriefed extensively about his time in custody, Pakistani and American officials said.

In the U.S., Rebecca Davis said she was elated when she learned of her husband’s release in an early morning phone call.

“I knew it was self-defense. My husband is not a killer. He’s not a Rambo,” she said, speaking outside her home near Denver.

The U.S. ambassador to Pakistan confirmed that Davis had been pardoned and released and thanked the victims’ families for agreeing to the deal.

“The families of the victims of the January 27 incident in Lahore have pardoned Raymond Davis. I am grateful for their generosity. I wish to express, once again, my regret for the incident,” Ambassador Cameron Munter said in a statement released by the State Department.

Davis shot dead two Pakistanis in the eastern Punjab city of Lahore after what he described as an attempted armed robbery. A third Pakistani was killed when struck by a U.S. car rushing to aid the American.

Davis said he acted in self-defense and the U.S. contends he had diplomatic immunity and should have been immediately repatriated.

Munter, underscoring his “respect for Pakistan and its people,” said the U.S. remained committed to working with Pakistan “to move ahead in ways that will benefit us all.”

Rep. Dana Rohrabacher, R-Calif., complained that Pakistan already receives billions of dollars in U.S. aid. During a congressional hearing, he said the U.S. should look at whether foreign aid recipients “are treating us like suckers.”

Questions swirled around the identity of the victims from the beginning, with some media reports saying the men worked for Pakistan’s Inter-Services Intelligence (ISI) agency, and that they might have been known to Davis.

Other reports suggest they were armed robbers who had already targeted others in Lahore before attempting to rob Davis, tailing him on motorbikes along a congested city road.

U.S. officials initially described Davis as a consulate or embassy employee, but have since said on condition of anonymity that he was doing security work in Pakistan as a contractor for the CIA. They have said this does not make any difference to his right to diplomatic immunity.

Last month, President Barack Obama referred to him as “our diplomat” and demanded he be freed.

The case tested ties between the United States and Pakistan, a vital ally in the U.S.-led campaign against Taliban militants in Afghanistan, and Pakistan’s powerful religious parties had tried to block the deal.

CIA spokesman George Little, in a written statement, said the agency and its Pakistani counterpart “have had a strong relationship for years.”

“When issues arise, it’s our standing practice to work through them. That’s the sign of a healthy partnership — one that’s vital to both countries, especially as we face a common set of terrorist enemies,” Little said.