Although BCCI as a "bank" eventually failed, spectacularly, costing its unsuspecting customers more than $10 billion, almost no one was punished for its myriad crimes, and the full extent of the organization's activities continue to be shielded by the many national governments that became entangled in its operations, including the United States and Great Britain, where the Labour government has made extraordinary interventions in court cases to protect BCCI's secrets, invoking the most draconian state secret laws to quash a lawsuit against the Bank of England for the blind but knowing eye that the regulator turned toward BCCI's deadly fraud.
Before exploring these deeper connections further, let's review the tip of the iceberg that Edmonds has courageously exposed, despite the very real threat of retaliation from the U.S. government. From the Times:
"Edmonds described how foreign intelligence agents had enlisted the support of US officials to acquire a network of moles in sensitive military and nuclear institutions. Among the hours of covert tape recordings, she says she heard evidence that one well-known senior official in the US State Department was being paid by Turkish agents in Washington who were selling the information on to black market buyers, including Pakistan.
"The name of the official – who has held a series of top government posts – is known to The Sunday Times. He strongly denies the claims. However, Edmonds said: 'He was aiding foreign operatives against US interests by passing them highly classified information, not only from the State Department but also from the Pentagon, in exchange for money, position and political objectives.'
"She claims that the FBI was also gathering evidence against senior Pentagon officials – including household names – who were aiding foreign agents. 'If you made public all the information that the FBI have on this case, you will see very high-level people going through criminal trials,' she said."
Edmonds goes on to provide details of the operation, which "appeared to be obtaining information from every nuclear agency in the United States," under the protection of Pentagon and State Department officials. Turkish and Israeli cut-outs were used to get nuclear info to the ultimate recipient, Pakistan's intelligence agency, Inter-Services Intelligence (ISI), and Abdul Qadeer Khan, "father" of Pakistan's nuclear bomb. As the Times notes:
While the Times declined to name the top State Department official cited by Edmonds, elsewhere she has said it was Mark Grossman, "former #3 at the State Department, former ambassador to Turkey, and current Vice President at The Cohen Group, the lobbying company run by former Secretary of Defense William Cohen," notes the blogger Lukery, who has long done sterling service in publicizing Edmonds' plight and her revelations – which, as Lukery notes, are not confined to the nuclear proliferation angle featured in the Sunday Times.
"The Pakistani operation was led by General Mahmoud Ahmad, then the ISI chief...Intelligence analysts say that members of the ISI were close to Al-Qaeda before and after 9/11. Indeed, Ahmad was accused of sanctioning a $100,000 wire payment to Mohammed Atta, one of the 9/11 hijackers, immediately before the attacks.
"The results of the espionage were almost certainly passed to Abdul Qadeer Khan, the Pakistani nuclear scientist. Khan was close to Ahmad and the ISI. While running Pakistan's nuclear programme, he became a millionaire by selling atomic secrets to Libya, Iran and North Korea. He also used a network of companies in America and Britain to obtain components for a nuclear programme. Khan caused an alert among western intelligence agencies when his aides met Osama Bin Laden."
Lukery goes on to note that the other "household names" mentioned by Edmonds include "Richard Perle and Douglas Feith and possibly Paul Wolfowitz. Less familiar names include Eric Edelman, Feith's replacement at the Pentagon, and former Congressman Stephen Solarz."
Lukery also zeroes in on this telling revelation:
(Grossman has denied all of Edmonds' allegations, telling the Sunday Times: "If you are calling me to say somebody said that I took money, that’s outrageous . . . I do not have anything to say about such stupid ridiculous things as this.")
"The Times article then notes something that I reported 18 months ago. Immediately after 911, the FBI arrested a bunch of people suspected of being involved with the attacks -- including four associates of key targets of FBI's counterintelligence operations. Sibel heard the targets tell Marc Grossman: 'We need to get them out of the US because we can't afford for them to spill the beans.' Grossman duly facilitated their release from jail and the suspects immediately left the country without further investigation or interrogation.
"Let me repeat that for emphasis: The #3 guy at the State Dept facilitated the immediate release of 9/11 suspects at the request of targets of the FBI's investigation."
The nuclear proliferation-for-profit ring is just one of the criminal operations that a genuine investigation of the 9/11 attacks would bring to light. Because once you start exploring any part of the dark nexus where so much of the world's business is really conducted – the shadowlands where covert operations, criminal networks, terrorism, high finance and state policy mingle, and battle, in profitable murk – all manner of chicanery is bound to emerge. And so, much as the probe into the assassination of John Kennedy was short-circuited in part to prevent exposure of a wide range of "black ops" involving the U.S. government, the Mob and other unsavoury players, so too the 9/11 attacks will never receive a full, unfettered investigation, but will remain forever – and deliberately – a matter of dispute, breeding arrant crankery and disturbing truth in equal measure, with the latter always tarred and obscured by the former.
This is also true, in some respects, of the 1992 U.S. Senate investigation into what was known as "the BCCI Affair," which left several stones unturned and many questions unanswered. There are two main differences, however. First, the Senate investigation – although it operated within fairly circumscribed limits, pulled many punches, and shied away from some evidence that clearly led to the highest echelons of government -- was actually much more thorough than the official probes of the Kennedy assassination and 9/11. And second, unlike those two investigations, which continue to generate heated interest year after year, the BCCI Affair has been almost completely erased from public memory. Yet a grasp of BCCI's operations – many of which simply continued in other guises when the "bank" itself disappeared – is essential to understanding much of what is happening in the political world today, including Edmonds' revelations.
(The amnesia surrounding BCCI is even more remarkable when you consider that the man who led the 1992 probe – which turned up so much dirt involving the first Bush administration – was none other than Senator John Kerry. Yet Kerry – who knew where so many Bush bones were buried, and who had once displayed genuine moral courage in denouncing the Vietnam War after his service there – used none of this knowledge, and showed none of this courage, when seeking to oust the second Bush Administration, which retained many tainted figures from the first reign, and was headed by a man who had taken millions of dollars from BCCI. Instead Kerry spent the campaign – as he had spent much of his Senate career – trying to prove to the corporate and militarist elite that he was a "safe pair of hands," someone who wouldn't really rock the boat or kill the elite's flock of golden geese. Having thus disarmed himself, he failed to generate the landslide he would have needed to overcome the Bush Faction's election-skewing machinery – although it is very likely that Kerry would have won the election anyway had Ohio's votes been counted fairly. But here too he folded and refused to fight, choosing, like Al Gore before him, not to risk his insider status with a serious, genuine challenge to the system.)
The full details of BCCI's origins and activities – and its bipartisan corruption of American politics – can be found in the Senate report of its investigation, which is available in full at the website of the Federation of American Scientists. It is a long report, but repays reading. The extent of the criminality and moral corruption it documents is truly mind-boggling. Below is a very brief précis of the Senate's findings.
BCCI was founded by Pakistan tycoon Agha Hasan Abedi, who used what Senate investigators called his "extraordinary personal charisma" to charm his way into friendships with the world's global elite, including U.S. President Jimmy Carter and, more crucially for the operation's development, Sheikh Zayed bin Sultan Al Nahayan, the illiterate ruler of Abu Dhabi, who had been installed as leader of the oil-rich state in 1966, after the British engineered a coup against his brother. Abedi became in effect the personal manager of Sheik Zayed's money – and the vast wealth of Abu Dhabi – which he used to fund the creation of BCCI.
As described by the Senate, BCCI's organization set-up sounds remarkably like the one set up later by Bush Family paymaster Ken Lay with his Enron Corporation:
"BCCI was from its earliest days made up of multiplying layers of entities, related to one another through an impenetrable series of holding companies, affiliates, subsidiaries, banks-within-banks, insider dealings and nominee relationships. By fracturing corporate structure, record keeping, regulatory review, and audits, the complex BCCI family of entities created by Abedi was able to evade ordinary legal restrictions on the movement of capital and goods as a matter of daily practice and routine. In creating BCCI as a vehicle fundamentally free of government control, Abedi developed in BCCI an ideal mechanism for facilitating illicit activity by others, including such activity by officials of many of the governments whose laws BCCI was breaking."
And what were the illicit activities that BCCI facilitated for its entangled crime gangs and government agents? The Senate report:
"BCCI's criminality included fraud by BCCI and BCCI customers involving billions of dollars; money laundering in Europe, Africa, Asia, and the Americas; BCCI's bribery of officials in most of those locations; support of terrorism, arms trafficking, and the sale of nuclear technologies; management of prostitution; the commission and facilitation of income tax evasion, smuggling, and illegal immigration; illicit purchases of banks and real estate; and a panoply of financial crimes limited only by the imagination of its officers and customers."
The Senate investigators found that the CIA lied about is extensive, long-term contacts with BCCI, although the Kerry panel often couched this flagrant falsehood in more decorous tones, e.g., "the CIA inadvertently failed" to tell the proper federal officials about BCCI's criminal activities (emphasis added). Still, much of the findings are straightforward on this point: "After the CIA knew that BCCI was as an institution a fundamentally corrupt criminal enterprise, it continued to use both BCCI and First American, BCCI's secretly held U.S. subsidiary, for CIA operations."
The criminals of BCCI were intimately involved in the execution of U.S. foreign policy during the Reagan-Bush administrations, including the Iran-Contra scandal, in which Reagan officials shipped weapons to American hostage-takers in Iran in exchange for clandestine cash for the terrorist army it was using to wage proxy war against Nicaragua. When George Bush Sr. became president, BCCI became a primary conduit for funneling secret aid to Saddam Hussein. The organization also received extraordinary protection from the White House when lower-level federal prosecutors began indicting BCCI associates for laundering drug cartel money and running guns and money to Iraq.
As I have noted elsewhere, the Italian bank BNL was one of BCCI's main tentacles. BNL's Atlanta branch was the primary conduit used to send millions of secret dollars to Saddam for arms purchases, including deadly chemicals and other WMD materials supplied by the Chilean arms dealer Cardoen and various politically-connected operators in the United States like, weapons merchant Matrix Churchill.
When three BNL officials were indicted in 1991 for a fraud scam used to mask payments to Saddam, Bush I moved to throttle the investigation. He appointed lawyers from both Cardoen and Matrix to top Justice Department posts – where they supervised the officials investigating their old companies. The overall probe was directed by Justice Department investigator Robert Mueller. Meanwhile, White House aides applied heavy pressure on other prosecutors to restrict the range of the probe – especially the fact that Bush cabinet officials Brent Scowcroft and Lawrence Eagleburger had served as consultants for BNL during their pre-White House days as partners in Henry Kissinger's lobbying outfit, Kissinger Associates.
[In addition to these connections with the criminal network, another of Kissinger's partners, retired Brazilian diplomat Sergio da Costa "served as the front-man" for the BCCI takeover of a Brazilian bank, Senate investigators found. Tellingly, the Senate report's chapter on Kissinger Associates' contacts with BCCI was deleted from the final, published version – reportedly after pressure from Kissinger himself – although it can still be found in the FAS version noted above. Kissinger, of course, would later turn down an appointment from Bush II to direct the official investigation into the 9/11 attacks – in order to avoid public scrutiny of his business affairs.]
The Kerry report found that the 1991 BNL probe had been unaccountably "botched" – witnesses went missing, CIA records got "lost," all sorts of bad luck. Most of the big BCCI players went unpunished or got off with wrist-slap fines and sanctions.
One of the White House aides who unlawfully intervened in the BNL prosecution was a certain factotum named Jay S. ByBee. In 1994, ByBee was appointed by George W. Bush to a place on the federal appeals court – a lifetime sinecure of perks and power. Mueller, meanwhile wound up as head of the FBI, appointed to the post in by George W. in July 2001, where directed the FBI's response – or lack of response – to the torrent of terrorism alerts during that fateful summer.
Bush II had good reason to reward those who helped his father provide cover for BCCI. In addition to the continuing "shadowland" relationships between U.S. intelligence and key players in BCCI operations (especially the ISI connections which had used BCCI to fund Pakistan's secret nuclear arms program), George Walker Bush had benefited materially from his own connection to BCCI. As Kevin Phillips points out in his devastating – and woefully ignored – book on the Bushes, American Dynasty, Bush II's first large-scale business enterprise, the Arbusto oil company, was almost certainly financed in part with investments from American frontmen for BCCI-connected Saudi grandees Salem bin Laden, older brother of Osama bin Laden and then the head of the family, and Khalid bin Mahfouz, a major stockholder in BCCI.
The failing Arbusto was later bought out by Harken Energy in a sweetheart deal that landed business failure Bush a plum spot on the Harken board and plenty of stock to play with. Bush soon worked his magic touch on Harken: the company began to tank. It was saved by an unusual infusion of $25 million from the Union Bank of Switzerland, one of BCCI's associates. The deal was brokered by long-time Bush family contributor Jackson Stephens – who, curiously enough, was also a major paymaster for Bill Clinton's political rise. In fact, in 1992, Stephens was the largest individual contributor to both Bush I and Clinton in their presidential contest.
Phillips quotes a 1991 Wall Street Journal story on young Bush's myriad ties to the criminal organization: "The mosaic of BCCI connections surrounding Harken Energy may prove nothing more than how ubiquitous the rogue bank's ties were," the paper wrote. "But the number of BCCI-connected people who had dealings with Harken – all since George W. Bush came on board – likewise raises the question of whether they mask an effort to cozy up to a presidential son."
Given the copious documentation by the Senate and media investigations of Bush I's extensive use of BCCI to fund his and Reagan's illegal dealings with Saddam, Iran, drug cartels and the Contras, and Bush's strenuous efforts to block investigations of BCCI, the latter's huge payoffs to Bush II look more like payments for services rendered by the Bush Family, rather than just attempts to curry presidential favor.
Many of the same interests that employed BCCI for various black ops turn up again in Sibel Edmond's revelations: the ISI and Abdul Qadeer Khan, and Turkish and Israeli criminals/covert operators. Indeed, the latter played a key role in one of the Senate report's more chilling segments: "Training of Cartel Death Squads." From the report:
"In April 1989, a network of Israeli arms traffickers, operating out of Miami, made a shipment of 500 Israeli manufactured machine guns through the Caribbean island of Antigua for the use of members of the Medellin cartel. Later, one of these weapons was used in the assassination of Colombian presidential candidate Luis Carlos Galan, and several other of the weapons were found in the possession of cartel kingpin Jose Gonzalo Rodriguez Gacha after his death in a gunfight with Colombian drug agents.
"The principals in the arms trafficking included Yair Klein, who had previously been identified in Colombian drug enforcement documents as involved in training paramilitary squads for the cocaine cartel in Medellin; Pinchas Shahar, an Israeli intelligence operative, and Maurice Sarfati, an Israeli "businessman" operating out of Miami and Paris.
"The scandal broke after a broadcast by NBC News on August 21, 1989 about Klein's activities, and a Colombian judge charged Klein with having engaged in criminal conspiracy in training the private armies for the cartel. In the months that followed, the scandal extended to Antigua as well, an island with no substantial military force and no need for the 500 machine guns its foreign minister ordered from Israeli military industries."
Oddly enough, the arming and training of death squads in Antiqua grew out of yet another corruption of Reagan-Bush policy by BCCI: a U.S. government loan of $2 million to Sarfati, supposedly for a melon farm he was to establish in Antiqua. The money was funneled through the Overseas Private Investment Corporation (OPIC), a prime channel of crony pork – and cover for covert operations – for decades. The loan was obtained after BCCI officials vouched for Sarfati's worthiness to OPIC. The Senate report says:
"Ultimately, OPIC lost its entire investment in the melon farm and concluded that it had been defrauded by Sarfati. After filing suit against Sarfati, OPIC sold its remaining interest in the melon farm, at a loss of 50 cent on the dollar, to an Israeli businessman, Bruce Rappaport, and an entity owned by him called the Swiss American Bank. Rappaport, a confidante of former CIA director William Casey, was in this period also in frequent contact with BCCI's original U.S. contact, Bert Lance [who had been forced to resign as Jimmy Carter's budget chief during a corruption scandal. Lance was also a major partner with Jackson Stephens and others in BCCI-related deals.] Coincidentally, one of BCCI's principal board members, Alfred Hartmann, who was also chairman of BCCI's secretly-owned Swiss affiliate BCP, also sat on the board of another of Rappaport's banks."
This is the way the world works. Behind the glitz and gossip of presidential campaigns, behind all the earnest "policy debates" on Capitol Hill, behind all the "position papers" and "vision statements" of think tanks and political parties, behind all the great panoply of state and our august Establishment institutions, thieves and murderers have their way, in league with the great and good.
Anyone who ascends to national power has to make a deal with the devil: either directly to plunge their hands into filth and blood, or else swaddle themselves in "plausible deniability," looking away from the grubby details but knowing full well that their minions, agents and backers are doing "whatever it takes" to keep the machine of power and money rolling on.
This doesn't mean that leaders can't also try to do good things as well, and occasionally accomplish them. After all, Al Capone was famous for his acts of benevolence. Indeed, some leaders pursue idealistic or ameliorative policies in order to "justify" the crimes and lies that sustain the system which has raised them on high. But the devil will have his due, and the price of power must always be paid – and it is ordinary people, especially the most innocent and vulnerable among us, who always end up paying it.
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This story was published on January 10, 2008.