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Oil for Food Sales Seen As Iraq Tie To Al

Qaeda
U.S. Probes Bank Network
By MARC PERELMAN
FORWARD STAFF

The hunt for Saddam Hussein's money could provide some clues to one of the claims made
by the Bush administration to justify its war in Iraq — the possible link between the former
Iraqi regime and the Al Qaeda terrorist group.

Two entities, a shadowy banking network linked by the administration to Al Qaeda and a
Saudi oil company close to the Taliban regime, were involved in buying oil from Saddam
Hussein under the United Nations' oil-for-food program, the Forward has learned.

The now-defunct program allowed Iraq to buy food and medicine with its oil proceeds
under U.N. supervision. Although the oil sales in question were legal and approved by the
U.N., several observers say the system involved kickbacks and was used by Saddam to buy
political support and to finance intelligence activities and even terrorist groups.

"It seems very plausible that some of the oil money went to terrorism financing," a
terrorism-financing expert closely monitoring Iraq said on condition of anonymity. "I
believe this actually happened."

Among Iraq's oil customers since 1997 is a Liechtenstein-based company called Galp
International Trading Establishment, a subsidiary of Portugal's main oil company, according
to a list of oil purchasers obtained by the Forward. The U.N. has not published the list.

The company chose as its legal representative in Liechtenstein — a tax haven known for
hosting thousands of shell companies — a company called Asat Trust, according to
Liechtenstein business records.

Asat Trust was designated by the United States and the U.N. as a financier of Al Qaeda
through its links to Al Taqwa, a cluster of financial entities spanning the globe from the
Bahamas to Italy and controlled by members of the Muslim Brotherhood.

The operation raises the possibility that Iraq quietly funneled money to Al Qaeda by
deliberately choosing an oil company working with one of the terrorist group's alleged
financial backers.

http://www.forward.com/issues/2003/03.06.20/news2.html 7/14/03
1) U.N. Group Finds No Hussein-AI Qaeda Link
By TIMOTHY L O'BRIEN
New York Times
UNITED NATIONS, June 26 -- The chairman of the monitoring group appointed by the United
Nations Security Council to track Al Qaeda told reporters here today that his five-member team
had found no evidence linking Al Qaeda to Saddam Hussein's administration in Iraq.

A report issued by the monitoring group did find that, despite "marked successes" in the fight
against Al Qaeda, a new generation of Qaeda-trained terrorists, as well as veterans of the group,
continue to threaten the global community.

The report praises the capture of several senior Qaeda operatives and successful efforts to block
the group's access to the international banking system, but said recent bombings in Saudi Arabia,
Morocco and elsewhere suggest that Al Qaeda "and its associated groups still pose a significant
threat to international peace and security."

Michael Chandler, the chairman of the monitoring group, cautioned that the absence of evidence
linking Mr. Hussein to Al Qaeda was not definitive.

'That doesn't mean to say it doesn't exist," Mr. Chandler said, but simply that his team has found
no such evidence.

During Security Council testimony in February, before the United States-led war with Iraq,
Secretary of State Colin L. Powell said that Al Qaeda training camps existed in northeastern Iraq.
Mr. Chandler acknowledged Mr. Powell's findings today and did not contest them, noting that the
camps Mr. Powell referred to may have been destroyed by American military strikes.

The report raised alarms about Al Qaeda's potential access to nuclear and chemical weapons
and its continuing ability to finance its activities through charities and the drug trade.

"There is evidence, from Al Qaeda training manuals and other intelligence, that Al Qaeda has
investigated the ways and means of developing" nuclear, chemical and biolgical weapons, the
report stated.

The report also painted an ominous picture of a new generation of Qaeda operatives, who
apparently first surfaced in the recent bombings in Casablanca, Morocco. The reason for Al
Qaeda's resilience, the report said, is its religious zeal.

'They retain strong appeal among Islamic extremist elements around the world and are able to
draw on a substantial number of cadres trained in Afghanistan or in other training centers
associated with the Al Qaeda network," the report stated. 'There are also indications that the Al
Qaeda network has been able to reconstitute its levels of support."

Previous reports produced by Mr. Chandler's monitoring committee have drawn criticism for
inexact or inaccurate data, but federal law enforcement authorities and members of diplomatic
missions to the United Nations said today's report was well grounded.

In its analysis of terrorist financing, the report notes that the successful vetting of the banking
system for terrorist funds has forced Al Qaeda and other terrorist groups to rely more heavily on
informal financial networks known as hawalas to move money.

The report also deplores that the United Nations list of Al Qaeda operatives and associates of
Osama bin Laden is relatively short, a problem it attributes to the unwillingness or inability of
some countries to provide names to the monitoring group. Most of the names so far, officials here
said, have come from the United States.
2) UN terrorism unit finds no link between Iraq, Al Qaeda
By Dafna Linzer
Associated Press

NEW YORK -- A United Nations terrorism committee has found no evidence linking Iraq to Al
Qaeda but did not investigate specific Bush administration claims of such ties, officials said
Thursday.

The terrorism committee has just completed a draft report charting efforts by countries to track
and shut down Osama bin Laden's operations. The report notes success in the war on terrorism
stemming from the arrests of some top Al Qaeda figures.

But it also says the group has been able to reconstitute support and benefit from loopholes to
continue acts of terrorism worldwide.

Nowhere in the 42-page draft is there any mention of Iraq or claims that it served as a haven for
Al Qaeda.

"Nothing has come to our notice that would indicate links between Iraq and Al Qaeda," said
Michael Chandler, the committee's chief investigator.

The committee first heard of alleged ties during Secretary of State Colin Powell's February
presentation to the Security Council before the Iraq war.

"It had never come to our knowledge before Powell's speech, and we never received any
information from the United States for us to even follow up on," said Abaza Hassan, a committee
investigator.

U.S. diplomats said Powell had laid out all the evidence to the council.

"We know that Iraq provided some training to Al Qaeda in chemical weapons development, and
we also know there were clear contacts between them that can be documented," said Richard
Grenell, spokesman for the U.S. mission at the UN.

Powell insisted in his presentation that Saddam Hussein's regime was allowing a senior Al Qaeda
member named Abu Musab Zarqawi to operate from Baghdad. Zarqawi has been indicted for the
murder of a U.S. diplomat in Jordan on Oct. 28, 2002.

The alleged connections were cited by the administration as one of the key reasons for going
after Hussein.

But the committee saw no need to investigate Zarqawi's movements and deliberately stayed
away from investigating Iraq.

"There are other committees in the United Nations that deal with Iraq," Chandler said. "We have
concentrated our efforts where clearly Al Qaeda was active."

One of the places it is looking into is Iran.

The United States has said senior Al Qaeda figures are in Iran, and officials were investigating
whether they were linked to a May attack in Saudi Arabia.

Chandler, who visited the Iran-Afghanistan border in October, said he had been satisfied then
with steps the Iranians were taking.
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Date: Mon, 14 Jul 2003 22:45:13 -0400
From: Philip Zelikow <pzelikow@9-11commission.gov><P
To: "" <team1 @9-11 commission.gov>4|'
Reply-to: "" <pzelikow@9-11commission.gov>4P
Subject: FW: On Iraq-Al Qaeda Connection

We should be able to check some of this out.

Philip

Original Message
From: Katsu Furukawa [mailto:katsu.furukawa@miis.edu]
Sent: Monday, July 14, 2003 3:21 PM
To: katsu.furukawa@miis.edu
Subject: On Iraq-Al Qaeda Connection

Standard Weekly

The Al Qaeda Connection, cont.

More reason to suspect that bin Laden and Saddam may have been in
league.
by Stephen F. Hayes
07/11/2003 5:45:00 PM

THE INDISPENSABLE Glenn Reynolds has linked to an article in the

Nashville
Tennessean written by a Tennessee judge who believes he is in possession
of
documents linking^Saddam Husl3e~±n^and Osama bin Laden.

The judge\is Gilbert S. Merritt, a federal appeals court judge invited

to
help Iraqis construct a legal system in postwar Iraq. He is, according
to
Reynolds, "a lifelong Democrat and a man of unimpeachable integrity."

Here is an excerpt of his account:

The deciHaent shows that an Iraqi intelligence offixjer, Abid Al-Karim

Muhamed ^)
as-signed to the Iraq embassy in Pakistan, is ''responsible for
the
coordination of activities with the Osama bin Laden group.''

The document shows that it was written over the signature of Uday Saddam
Hussein, the son of Saddam Hussein. The story of how the document came
about

http://kinesis.swishmail.com/webmaiyimp/message.php ?index=454 7/15/03

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Date: Mon, 25 Aug 2003 22:39:51 -0400
From: Philip Zelikow <pdz6n@virginia.edu>^
To: "" <team1 @9-11commission.gov>4P
Reply-to: "" <pdz6n@virginia.edu>4J
Subject: FW: Saddam's al Qaeda Connection : The evidence mounts, but the administration says surprisingly little.

® 2 unnamed text/html 32.28 KB H

We need to follow up, if any of this is true. There are a variety of very specific assertions ...

Philip

Saddam's al Qaeda Connection

From the September 1 / September 8, 2003 issue: The evidence mounts, but the administration says
surprisingly little.
by Stephen F. Hayes
09/01/2003, Volume 008, Issue 48

KIDS KNOW exactly when it comes—the point when you're repaving a driveway or pouring a new
sidewalk, right before the wet concrete hardens completely. That's when you can make your mark.
The Democrats seem to understand this.

For months before the war in Iraq, the Bush administration claimed to know of ties between al Qaeda and Saddam
Hussein's Iraq. For months after the war, the Bush administration has offered scant evidence of those claims. And the
conventional wisdom-that there were no links-is solidifying. So Democrats are making their mark.

"The evidence now shows clearly that Saddam did not want to work with Osama bin Laden at all,
much less give him weapons of mass destruction." So claimed Al Gore in an August 7 speech.
"There is evidence of exaggeration" of Iraq-al Qaeda links, said Carl Levin, chairman of the Senate
Armed Services Committee, who recently launched an investigation into prewar intelligence.
"Clearly the al Qaeda connection was hyped and exaggerated, in my view," said Senator Dianne
Feinsten. Chimed in Jane Harman, the ranking Democrat on the House Select Committee on
Intelligence, as reported in the National Journal, "The evidence on the al Qaeda links was sketchy."
Jay Rockefeller, the ranking Democrat on the Senate side of that committee, agrees. "The evidence
about the ties was not compelling."

http://kinesis.swishmail.com./webmail/imp/message.php?index=720 8/26/03