The Komisar Scoop Reports & Analysis by Investigative Journalist Lucy Komisar

Monday, September 16, 2002

Police spoke to U.S. terror suspect

Filed under: arms trade,offshore,Scoops — Tags: — Lucy Komisar @ 2:54 pm

By Lucy Komisar
MSNBC.COM, Sept 16, 2002

MSNBC exclusive: Document shows Tunisian with alleged al-Qaida links gave information to Italians two years ago

A Tunisian-born terrorism suspect placed two weeks ago on Washington’s list of most-wanted militants confessed two years before to Italian police that he helped run an elaborate arms smuggling ring that aided Islamic militants, but it’s not clear whether Italian and U.S. officials acted on the information. The case, revealed in a confidential document obtained by MSNBC.com, raises new questions about intelligence gathering in the war on al-Qaida.

On Aug. 29, the Treasury Department announced it was adding Waddani to its list of top suspected terrorists.

ACCORDING TO THE confidential document obtained by MSNBC.com, the Tunisian who the U.S. Treasury Department recently added to its terrorist blacklist had two years ago reported to Italian authorities a scheme for moving weapons from Russia through Uzbekistan to Pakistan where they “would end in the military training camps for Islamic terrorists in Pakistan, Iraq and Afghanistan.”

The informant, Sekseka Habib Waddani, 32, then living in Milan, told Italian police that the arms were being “sold by the Russian Republic” because they were no longer modern. He said the weapons included pistols, Kalashnikov machine guns, missiles and grenades.

The classified Italian police report prompts questions about when the United States learned of Waddani, and whether any action was taken by Italian or U.S. officials after Waddani’s claim that large amounts of weapons were being sold to Islamic terrorists.

In the document, Waddani alleges that large amounts of Russian weapons were smuggled to Islamic militants in Pakistan and Afghanistan.

SUSPECT RAISES U.S. SUSPICION

According to police document, Waddani walked into a Milan financial police station on Sept. 27, 2000, and announced that he had information about arms trafficking. He said he knew about the operation because he had been involved when the weapons transited Italy and Switzerland. He said he was being blackmailed and asked for protection.

Just over a year later, in October 2001, the Italians indicted Waddani, but on charges that involved acts other than those he reported to the financial police, Italian officials say.

On Aug. 29 of this year, the U.S. Treasury Department announced it was adding Waddani to its list of top suspected terrorists, noting Italy’s charges against him — for involvement with the Algerian-based Salafist Group for Call and Combat, which operates in North Africa, Spain and Italy and “has supported al-Qaida activities.” The Treasury Department said Waddani was indicted by the Italians for trafficking in arms, explosives, chemical weapons, identity papers, receiving stolen goods and aiding illegal immigration.

Judge Luca Pistorelli in Milan told MSNBC.com that Waddani is at large: “We suppose he is in France; or maybe he went back to Tunisia.”

It was not immediately clear whether Italian officials acted on the weapons smuggling information Waddani provided, or whether U.S. investigators had been notified by their Italian counterparts of the encounter with the Tunisian suspect. When contacted by MSNBC.com, a CIA spokesman said the agency “respectfully declines to comment.”

At the Treasury Department, Deputy Assistant Secretary for Public Affairs Rob Nichols said, “I checked with our war room. I cannot answer your questions, as they contain sensitive or classified information.”

WEAPONS TO BALKANS, SOUTH ASIA

Waddani said the arms initially arrived weekly from Russia via the Italian port of Ancona on the Adriatic Sea across from Croatia. They were then shipped to the former Yugoslavia for use by Bosnian Muslim fighters in the 1992-1995 Bosnian war. Later, in 1998, ethnic Albanian insurgents in the Serbian province of Kosovo benefited from the arms supply, Waddani said. He said a Sicilian lawyer in Zurich and a Muslim lawyer helped to find buyers in the Bosnian and Albanian communities in Switzerland.

But Waddani told police that the system had been abandoned, because the transport of arms through Europe was “complex, expensive and dangerous.” Instead, the Russian weapons were sold to groups in Pakistan.

In the Italian police report, Waddani did not describe the exact route of the weapons destined for South Asia, but he said Russian smugglers brought them to Uzbekistan, from where they were passed to Pakistan as “mechanical components.” Waddani said the end purchasers of the arms ran “military training camps in Pakistan, Iraq and Afghanistan.”

Although Waddani didn’t mention al-Qaida by name, terror mastermind Osama bin Laden’s network operated up to a dozen military training camps in Afghanistan, and the group forged strong ties to tribes in northern Pakistan.

EUROPEAN MAZE

The weapons smuggling in Europe, Waddani said, flowed through a maze of companies and cities. Waddani told the Italian police that transactions in Switzerland were handled by HSS, a “trading company” that “belongs to a Pakistani named Haji Agka and to a Tunisian family of Zurich, Ahmed and Shoyab Sharifi. These latter are intimate friends of the head of the Muslim community of Zurich, [Albert] Ahmed Huber,” who facilitated “periodic and regular” shipments of weapons, Waddani said.

Ahmed Huber, a prominent member of Switzerland’s Muslim community, helped to facilitate arms shipments through Europe and Central Asia, according to allegations leveled by Habib Waddani, a U.S. terror suspect. Huber, who denies the charges, was added to Washington’s al-Qaida terrorist blacklist last November.

The United States put Huber on its al-Qaida terrorist blacklist last November, citing his membership on the board of al-Taqwa, the Lugano, Switzerland-based bank accused of moving bin Laden’s money.

In a phone interview, Huber responded to Waddani’s accusations: “I don’t know these people. I have never met these people. It is all rubbish. I have never been mixed up in any arms deals with the Kosovars or Albanians.” He added that though the Italian police gave Waddani’s statement to Swiss law enforcement, “the Swiss authorities never contacted me or anybody else.”

The Swiss Federal Justice Office in Bern had no comment.

According to Waddani, HSS would bring the arms by train to Switzerland as “machine parts” designated as “humanitarian aid” to be administered by the Mother Teresa of Calcutta Center of Lucerne. Waddani said the center, controlled by Albanians, moved war materiel and laundered money. The organizers named the center after Mother Teresa to deflect suspicion. From there, the “parts” would go to Italy and former Yugoslavia.

DOUBLE GAME?

Waddani noted that in the days when shipments came to Italy, they also included false documents for Muslims who lacked Italian residence papers. He said he got involved with the organization to get residence permits for his family, but that then he had been blackmailed. He told police he had obtained legitimate papers and did not want his previous contacts to endanger his status. If the Italian and American charges against Waddani are correct, the informant may have been playing a double game.

U.S. officials would not comment on the exact interest of Waddani to U.S. anti-terrorism specialists, but the Treasury Department’s terrorist blacklist gives an indication of the concerns Washington has for the Salafist organization to which Waddani belonged.

Ten other Salafist members were also put on the Treasury blacklist on Aug. 29. They include Adel Ben Soltane, arrested for the preparation of an attack against the U.S. Embassy in Rome; Yassine Chekkouri, who Scotland Yard investigators believe is “one of the highest” men in the al-Qaida organization; Mehdi Kammoun, who Italian authorities say organized a cell tied to al-Qaida; and Abdelhalim Remadna, who Italian authorities say is in direct contact with Abu Jaafar, the number three leader within al-Qaida.

Friday, September 13, 2002

Dealing with Dictators: Bell Helicopters skirted U.N. embargo to sell to Serbia

Filed under: arms trade,offshore,photo gallery,Scoops — Lucy Komisar @ 2:51 pm

By Lucy Komisar
In These Times, Sept 13, 2002

At a time when Americans are concerned about corporate fraud and corruption, another sort of corporate lawbreaking has been revealed in a report prepared for The Hague war crimes trial of former Serbian dictator Slobodan Milosevic: the violation of an international U.N. arms embargo.

Bell Helicopter logoAccording to U.N. investigators, on June 5, 1998, Serbia paid $154,785 to Bell Helicopter Textron, a Texas company, for spare parts for the maintenance of Bell helicopters. At the time, Serbia was under a U.N. arms embargo—in February, more than a year before NATO bombing began, it had commenced attacks against Kosovo—but it was in dire need of helicopters and other war supplies.

It got what it needed: Bell Helicopter parts and millions of dollars worth of other materials—through a network of shell companies and secret bank accounts that spread out from the offshore financial center of Cyprus through Greece and some 50 other countries, including the United States.

Bell denies any impropriety in the sale. “The parts we sold were fuselage parts for civil and commercial aircraft,” spokesman Mike Cox says. “There were no weapons involved.” He said Bell had checked with the U.S. Commerce Department, and “we were told we were in compliance.”

Marise Stewart, director of international government relations for Textron, Bell’s parent corporation, contradicts that. “We don’t have to check with anybody,” Stewart says. “In the case of a civilian commercial aircraft or parts sale, there’s no requirement for clearance or review.”

Asked if there was any discussion inside Bell about the advisability of selling to Serbia, she replied that the only reason for discussion would be if Bell thought the customer might not pay.

Helicopters are civilian and military dual-use equipment, allowing manufacturers as well as governments to skirt embargo rules. Any helicopter can carry secret police and troops, and civilian choppers can easily be retrofitted for military use. That seems to be what Serbia did. Radomir Markovic, head of the Serbian state security branch—the secret police—told Hague Tribunal interrogators that “We needed to secure foreign currency reserves to provide … guns for [security branch] helicopters.” He added, “I know that the equipment needed by the service arrived.”

Markovic’s admission shows the Serbs were retrofitting their helicopters for military use. Should Bell have taken into account that Serbia might arm its helicopters? “We do not have any legal requirements to look behind the customer’s ultimate intention or motivation,” says Stewart.

For something “legal,” the Serbs went to a lot of trouble to disguise their Bell spare parts purchases. Hague investigator Morten Torkildsen, a Norwegian forensic auditor, wrote in his June report that the Bell transaction was handled by a company called Abridge Trading, run in Cyprus with an account at the Hellenic Bank there.

Torkildsen said bank documents show that Abridge’s primary function was purchase of military equipment for Serbia. Bell officials declined to comment on whether the request for the sale came directly from Abridge or the Serbian government, or to answer questions regarding what it knew about Abridge.

On April 18, 1997, Abridge also paid more than $1 million through its Hellenic account to AM General Corporation of South Bend, Indiana, to buy 20 Hummer vehicles—the more comfortable version of the Humvee battlefield transport vehicle. That sale occurred during the lifting of the arms embargo (from October 1996 to March 1998) following the ephemeral Dayton peace accords. Asked about the moral implications of the sale, spokesman Craig MacNab says, “The vehicles in question are civilian vehicles. They’re just trucks, not tanks or jetfighters.”

MacNab says the company sold the Hummers through an agent—that is, Abridge—and, “as I understand, the end-users were companies. Who they were lies beyond my ken. I have seen correspondence with end-users [who] might have been civilian companies.”

To circumvent the embargo, Serbia paid Abridge and other suppliers through eight different shell companies it had set up. To transfer money out of Serbia to Cyprus, Serbian officials physically carried millions of dollars worth in currency, generally wrapped in packing paper, to deposit in Cypriot banks. As Mihalj Kertes, Serbian customs chief at the time, later said, he and other officials brought money to Cyprus, and in return got “a passage to the world.” No questions asked.

The money went to Cypriot accounts of the shell companies, and from there to trading companies that arranged shipments with firms in Israel, Russia, Germany and the United States. The weapons, night-vision equipment, armor-plated vehicles and helicopters the money purchased allowed Milosevic to stay in power and carry out the war.

Investigators at the U.S. Treasury Office of Foreign Assets Control believe that at least $1 billion was moved out of Yugoslavia through Cyprus banks. Torkildsen, the U.N. investigator, found that half a billion dollars was deposited in the accounts of Serbian shell companies between July 1992 and June 2000, and $250 million in cash from January 1998 to March 1999, during the height of the war in Kosovo.

Under Cypriot law, typical for offshore havens, “nominees”—that is, front men—could be named as directors and shareholders on public incorporation documents. Only the National Bank of Cyprus had the right to know real owners. But the Serbs also gave the bank phony names, which were routinely accepted. Torkildsen followed the money trail to companies and individuals in more than 50 countries and found large transfers to such secrecy havens as Austria, Switzerland, Luxembourg, Liechtenstein, Singapore, Monaco, Guernsey and the Isle of Man.

The secret financing facilitated evasion of U.N. embargoes from 1994 to the end of 2000, including the last two years of the war in Bosnia and the 1998-1999 conflict in Kosovo, ending only with the demise of the Milosevic regime in October 2000. Torkildsen says, “In my career, I have never encountered or heard of an offshore finance structure this large and intricate.”

The Kosovo phase of the Milosevic trial has just ended. The arguments and judgment, of course, will be based on human rights issues, not money laundering. However, the Torkildsen report could help the current Serb government’s efforts to recover stolen funds. Because the helicopters are dual-use equipment—and Bell will claim it sold them for civilian purposes—it is almost certain nothing will happen to the company.

Article on In These Times site

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