Iraqi exile con men fed lies to Bush Adm. & Media

I'm not shocked.

interesting ... thank you.

Chalabi is also wanted (convicted in absentia) in Jordan for bank fraud.

At first, I thought you were talking about Ken Lay.

Source of war data still paid
Posted on Sun, Feb. 22, 2004
Source of war data still paid

BY JONATHAN LANDAY, WARREN STROBEL AND JOHN WALCOTT
KNIGHT RIDDER NEWSPAPERS

WASHINGTON - The Department of Defense is continuing to pay millions of dollars for information from the former Iraqi opposition group that produced some of the exaggerated and fabricated intelligence President Bush used to argue his case for war.

The Pentagon has set aside between $3 million and $4 million this year for the Information Collection Program of the Iraqi National Congress, led by Ahmed Chalabi, said two senior U.S. officials and a U.S. defense official.
They spoke on condition of anonymity because intelligence programs are classified.

The continuing support for the INC comes amid seven investigations into pre-war intelligence that Iraq was hiding illicit weapons and had links to al-Qaeda and other terrorist groups. An investigation by the Senate Intelligence Committee is examining the INC's role.

The decision not to shut off spending for the INC's information-gathering effort could become another liability for Bush as the presidential campaign heats up.

Chalabi, who built close ties to officials in Vice President Dick Cheney's office and among top Pentagon officials, is on the Iraqi Governing Council, a body of 25 Iraqis installed by the United States to help administer the country following the ouster of Saddam Hussein in April.

The former businessman, who lobbied for years for a U.S.-backed military effort to topple Saddam, is publicly committed to making peace with Israel and providing bases in the heart of the oil-rich Middle East for use by U.S. forces fighting terrorism.

The INC's Information Collection Program started in 2001 and was "designed to collect, analyze and disseminate information" from inside Iraq, according to a letter the group sent in June 2002 to the staff of the Senate Appropriations Committee.

Some of the INC's information alleged that Saddam was rebuilding his nuclear weapons program, which was destroyed by U.N. inspectors after the 1991 Gulf War, and was stockpiling banned chemical and biological weapons, according to the letter.

The letter, a copy of which was obtained by Knight Ridder, said the information went directly to "U.S. government recipients" who included William Luti, a senior official in Secretary of Defense Donald Rumsfeld's office, and John Hannah, a top national security aide to Cheney. The letter appeared to contradict denials made last year by top Pentagon officials that they were receiving intelligence on Iraq that bypassed established channels and vetting procedures.


The INC also supplied information from its collection program to leading news organizations in the United States, Europe and the Middle East, according to the letter to the Senate committee staff.

The State Department and the CIA, which soured on Chalabi in the 1990s, saw the INC's information as highly unreliable because it was coming from a source with a strong self-interest in persuading the United States to topple Saddam.

The Defense Intelligence Agency has concluded since the invasion that defectors turned over by the INC provided little worthwhile information, and that at least one of them, the source of an allegation that Saddam had mobile biological warfare laboratories, was a fabricator. A defense official said the INC did provide valuable material on Saddam's military and security apparatus.

Even so, dubious INC-supplied information found its way into the Bush administration's arguments for war, which included charges that Saddam was concealing illicit arms stockpiles and was supporting al-Qaeda.

No illicit weapons have been found, and senior U.S. officials say there is no compelling evidence that Saddam cooperated with al-Qaeda to attack Americans.

A senior administration official questioned whether the United States should still be funding the program.

"A huge amount of what was collected hasn't panned out," he said. "Some of it has turned out to have been either wrong or fabricated."

BBB
Evidently, the con continues. Why does this man continue to receive US taxpayer funds?

BBB

Iraqi National Congress faces number of investigations
Posted on Fri, Feb. 27, 2004
Iraqi National Congress faces growing number of investigations
By Warren P. Strobel and Jonathan S. Landay
Knight Ridder Newspapers

WASHINGTON - The Iraqi National Congress, long championed by officials at the White House, Pentagon and on Capitol Hill, is facing a growing number of investigations into its provision of bogus intelligence on Iraq and whether some of its members may have tried to cash in on the fall of Saddam Hussein.

Democrats in the House of Representatives have asked the Defense Intelligence Agency to turn over raw intelligence supplied by the Iraqi exile group. They plan to review it for its accuracy and reliability, according to officials in the Bush administration and on Capitol Hill.

The move follows a recent decision by the Senate Intelligence Committee to expand its probe of prewar intelligence on Saddam to include the INC and other groups that played important roles in President Bush's decision to invade Iraq last March.

Democrats on the House intelligence panel were angered by reports that the DIA is continuing to pay the Iraqi group $3 million to $4 million a year for information, despite findings that show most of the group's earlier information on Saddam's weapons of mass destruction and ties to terrorism was false.

The continuing payments were first reported on Feb. 22 by Knight Ridder.

The INC's leader, Ahmad Chalabi, has had powerful patrons in the offices of Vice President Dick Cheney and Defense Secretary Donald H. Rumsfeld, as well as on both sides of the aisle in the U.S. Senate.

But three senior administration officials said the mood in Washington toward Chalabi has turned sharply cooler as a result of the revelations about prewar intelligence supplied by Iraqi defectors made available by his group.

In addition, several contracts for rebuilding Iraq that were won by firms with business or family ties to Chalabi are under intense scrutiny.

No criminal wrongdoing has been charged as a result of any of the probes.

One controversial contract for $327 million to supply equipment to the Iraqi armed forces was suspended by the U.S. Army this week following protests from the losing bidder.

A defense official said the DIA, the military's principal intelligence arm which is paying the INC to collect information on Iraq, isn't conducting any review of the INC's use of U.S. taxpayers' funds.

The senior officials said the White House's mood toward the INC changed markedly after Chalabi told a British newspaper on Feb. 18 that it didn't matter whether the group's prewar information was correct because its goal of ousting Saddam has been achieved.

Chalabi was quoted by the Daily Telegraph as saying: "As far as we're concerned we've been entirely successful. That tyrant Saddam is gone and the Americans are in Baghdad. What was said before is not important."

In a Feb. 20 letter to the newspaper's editor, Chalabi claimed he was misquoted.

The article "implies that I admitted to disseminating false information, this is absolutely untrue," Chalabi wrote. "For the record, the INC never `coached' Iraqi defectors nor did we ever knowingly pass on false information."

Several officials said Bush was angered by Chalabi's comments and determined to find out whether the INC or anyone with ties to it is seeking personal gain from the war in Iraq.

"His (Chalabi's) time is rapidly coming," said one senior official.

He and others spoke on condition of anonymity because they aren't authorized to speak for the administration and because of the political sensitivities involved.

A copy of the letter was supplied by former assistant defense secretary Richard Perle, a long-time Chalabi friend and booster.

The INC's Washington spokesman, Francis Brooke, was in Baghdad and couldn't be reached for comment.

The $327 million contract to equip the Iraqi armed forces was awarded to Nour USA, a Virginia firm incorporated last May.

Among Nour's management is A. Huda Farouki, a businessman with close ties to Chalabi.

The contract was suspended following protests by a Polish arms-trading firm that bid unsuccessfully for the work. The firm charged Nour submitted an unrealistically low bid and had insufficient experience.

The New York newspaper Newsday reported this week that Nour also bankrolled another firm, Erinys, which won an $80 million contract to provide security for Iraq's oil sector.

A U.S. military official engaged in Iraq policy and deeply critical of the INC and its leader said, "Chalabi's run is about over, and it's about time.

"A lot of the information they provided was suspect from the start - some of it was almost laughably false - but it got into the bloodstream anyway, and the minute he and his people got to Baghdad, we started hearing horror stories about them taking over other peoples' property - houses, cars and so on," the official said.

"Now we're looking to see whether they've stuck their noses into the (postwar reconstruction) contracting process, too," he said.

Chalabi lost a key Washington ally this week in Perle, who resigned from the Defense Policy Board, an influential committee that advises Rumsfeld. In his resignation letter, Perle said he didn't want his views to be misconstrued for Bush administration policy during the election season.

At a Washington event Friday, and in a later telephone interview, Perle denied reports that the Bush administration had asked him to resign.

Iraqi exiles fed media false stories
Posted on Tue, Mar. 16, 2004
Iraqi exiles fed media false stories
BY JONATHAN S. LANDAY and TISH WELLS
Knight-Ridder Washington Bureau

WASHINGTON ?- The former Iraqi exile group that gave the Bush administration exaggerated and fabricated intelligence on Iraq also fed much of the same information to leading newspapers, news agencies and magazines in the United States, Britain and Australia.

A June 26, 2002, letter from the Iraqi National Congress to the Senate Appropriations Committee listed 108 articles based on information provided by the INC's Information Collection Program, a U.S.-funded effort to collect intelligence in Iraq.

The assertions in the articles reinforced President Bush's claims that Saddam Hussein should be ousted because he was in league with Osama bin Laden, was developing nuclear weapons and was hiding biological and chemical weapons.

Feeding the information to the news media, as well as to selected administration officials and members of Congress, helped foster an impression that there were multiple sources of intelligence on Iraq's illicit weapons programs and links to bin Laden.

In fact, many of the allegations came from the same half-dozen defectors, weren't confirmed by other intelligence and were hotly disputed by intelligence professionals at the CIA, the Defense Department and the State Department.

Nevertheless, U.S. officials and others who supported a pre-emptive invasion quoted the allegations in statements and interviews without running afoul of restrictions on classified information or doubts about the defectors' reliability.

Other Iraqi groups made similar allegations about Iraq's links to terrorism and hidden weapons that also found their way into official administration statements and into news reports, including several by Knight Ridder.

The Knight Ridder Washington Bureau, which obtained a copy of the INC letter, reviewed all of the articles in what the document called a "summary of ICP product cited in major English language news outlets worldwide (October 2001-May 2002)."

The articles made many assertions that so far haven't been substantiated 11 months after Baghdad fell, including charges that:

Saddam collaborated for years with bin Laden and was complicit in the Sept. 11, 2001, terrorist attacks. Intelligence officials said there is no evidence of operational ties between Iraq and al-Qaida, and no evidence of an Iraqi hand in the attacks.

Iraq trained Islamic extremists in the same hijacking techniques used in the Sept. 11 strikes and prepared them for operations against Iraq's neighbors and possibly the United States. Two senior U.S. officials said that so far no evidence has been found to substantiate the charge.

Iraq had mobile biological warfare facilities disguised as yogurt and milk trucks and hid banned weapons production and storage facilities beneath a hospital, fake lead-lined wells and Saddam's palaces. No such facilities or vehicles have been found so far.

Iraq held 80 Kuwaitis captured in the 1991 Persian Gulf War in a secret underground prison in 2000. No Kuwaiti prisoners have been found so far.

Iraq could launch toxin-armed Scud missiles at Israel that could kill 100,000 people and was aggressively developing nuclear weapons. No Iraqi Scud missiles have been found yet.

According to the letter, publications that produced the articles included the New York Times, the Washington Post, Vanity Fair, the Atlantic Monthly, the Times of London, the Sunday Times of London, the Sunday Age of Melbourne, Australia, and two Knight Ridder newspapers, the Kansas City Star and the Philadelphia Daily News. The Associated Press and others also wrote stories based on INC-provided materials.

Other U.S. and international news media, including the Pioneer Press, picked up some of the articles.

Many of the stories noted that the information they contained couldn't be independently verified.

In at least one case, the INC made a defector available to a journalist before his information had been fully reviewed by U.S. intelligence officials.

The defector, an engineer, Adnan Ihsan al-Haideri, claimed in a Dec. 20, 2001, New York Times article by Judith Miller that there were biological, nuclear and chemical warfare facilities under private villas, the Saddam Hussein Hospital and fake water wells around Baghdad.

Senior U.S. officials said U.S. arms inspectors have found no fake wells or a laboratory under the hospital. Some secret rooms have been located under villas, mosques and palaces, but the officials, who asked not to be identified, said they weren't among locations that al-Haideri claimed to know about.

INC leader Ahmad Chalabi and other officials have insisted that the group screened all defectors as thoroughly as they could.

U.S. intelligence officials have determined that virtually all of the defectors' information was marginal or useless, and that some of the defectors were fabricators or embellished the threat from Saddam.

Many of the articles relied on interviews with the same defectors, who appeared to change facts with each telling. For instance, one defector first appeared in several stories as an Iraqi army former captain, but a later story said he was a major.

The Information Collection Program (ICP) was financed out of the more than $18 million that Congress approved for the Iraqi National Congress, led by Chalabi, now a member of the Iraqi Governing Council, between 1999 and 2003. The group remains on the Pentagon's payroll.

The INC letter said that it fed ICP information to Arab and Western news media and to two officials in the offices of Vice President Dick Cheney and Secretary of Defense Donald Rumsfeld, the leading invasion advocates.

The information bypassed U.S. intelligence channels and reached the recipients even after CIA, Defense Intelligence Agency and FBI officers questioned the accuracy of the materials or the motives of those who supplied them.

Some of the information, such as the charge that Iraq ran a terrorist training camp in Salman Pak, found its way into administration statements, including a Sept. 12, 2002, White House paper.

The CIA and the State Department had long viewed the INC as unreliable.

Relationship with Chalabi proves costly for Bush administrat
Posted on Sun, May. 23, 2004
Relationship with Chalabi proves costly for Bush administration
By John Walcott
Knight Ridder Newspapers

WASHINGTON ?- Of all the Bush administration's missteps in Iraq, the worst may have been listening to Ahmad Chalabi.

The former Iraqi exile fed the administration bogus intelligence on Iraq's weapons programs and ties to international terrorism. He encouraged an invasion with fewer troops that U.S. generals wanted by assuring Americans they would be greeted as liberators and that entire Iraqi army units would surrender. He urged the administration to purge members of Saddam Hussein's Baath Party from the police, the military and the government, creating a security vacuum quickly filled by violent insurgency.

The graphic scandal in Iraq's prisons has so far eclipsed the Chalabi story. But his influence on the administration's case for war, its plan for war and its planning for postwar Iraq could prove to be an even more damaging scandal than the treatment of Iraqi prisoners by the U.S. military.

Much of what Chalabi said before, during and after the U.S. invasion of Iraq has turned out to be wrong, and one of his top aides is now accused of supplying U.S. intelligence to Iran.

That doesn't mean Chalabi and his Iraqi National Congress are responsible for a war that's claimed 970 American lives and thousands of Iraqi ones. The administration didn't need much encouragement to declare war on Saddam, and its goals ?- remaking the Middle East, reducing America's dependence on Saudi Arabia, demonstrating a new doctrine of pre-emptive war ?- were far more ambitious than Chalabi's desire to oust Saddam.

Yes, Chalabi went out of his way to lobby the administration to expand its war on terrorism to Iraq. But officials in Vice President Dick Cheney's and Defense Secretary Donald H. Rumsfeld's offices and on the staff of the National Security Council went out of their way to believe what he told them, despite repeated warnings about him from the CIA, the Defense Intelligence Agency and the State Department.

"Most of us who have worked this area for a living think Chalabi and the others in their Bond Street suits are really charlatans," one defense official told Knight Ridder in September 2002, as the administration was beginning its campaign to build public and congressional support for invading Iraq.

If Chalabi didn't talk the administration into invading Iraq, his dubious intelligence underpinned much of its case for war, and his prediction about how Iraqis would greet American troops encouraged Pentagon civilians to spurn advice from their own generals about how many and what kind of troops it would take to secure Iraq. Among the troops the Pentagon left out were sufficient numbers of military police.

Chalabi's assurances that he had a secret network of allies inside and outside Iraq, meanwhile, encouraged Pentagon planners to ignore a State Department effort to prepare for a post-Saddam Iraq. Instead, Pentagon officials assumed that with their help, Chalabi, a Shiite Muslim like 60 percent of Iraq's population, could assemble a new government and get the battered country back on its feet.

Chalabi, however, turned out to be a divider, not a uniter, and allegations of corruption further damaged his credibility among Iraqis. In one poll this year, Chalabi finished behind Saddam. As a result, when American troops were greeted by improvised explosives and rocket-propelled grenades rather than rose petals, and when Chalabi's return from 46 years in exile was less than triumphant, the administration was unprepared to cope with a widespread insurgency and political chaos.

Why did Chalabi and the INC's defectors, despite the warnings about them, as well as several troubling polygraph tests, get such a ready hearing in the Pentagon and the White House? There were four main reasons, said senior military and intelligence officials and diplomats who tried in vain to debunk Chalabi's information:

?- "Chalabi told people in high places what they already believed ?- that Saddam was hiding weapons of mass destruction and that he might give them to (Osama) bin Laden," said one intelligence official.

?- The CIA had little or no good intelligence and few human sources of its own to debunk what Chalabi's defectors said. Moreover, Chalabi's allies in and around the Bush administration "trusted him more than they trusted the CIA," said one U.S. intelligence official.

?- Chalabi had cultivated the friendship of key legislators, neoconservative leaders and journalists. Providing his defectors to reporters and columnists as well as to the Defense Intelligence Agency helped create the illusion that there were multiple sources of the same information.

?- Chalabi's rosy postwar scenario sidestepped the hard questions raised by the State Department and others that might have undermined public support for invading Iraq.

Now Chalabi is biting the hand that fed him, denouncing the U.S.-led occupation of Iraq in an attempt to woo the popular support that so far has eluded him.

The administration is trying to explain why its case for war was so flawed, battling an insurgency it never expected, reversing its "de-Baathification" policy and investigating whether Chalabi's security chief passed U.S. intelligence to Iran ?- and if he did, who gave it to him.

Relations between Chalabi and the United States have so soured that last Thursday Iraqi police, backed by U.S. soldiers, raided Chalabi's Baghdad home and offices and confiscated documents and computers.

On Sunday, Chalabi mounted an all-out public relations campaign, appearing on four talk shows to defend himself and criticize a U.S. mission he once helped set in motion. He blamed the raid and the accusations of links to Iran on CIA Director George Tenet and called on Congress to conduct an investigation.

He also denounced the U.S. occupation of Iraq.

"Americans were greeted as liberators," Chalabi said on ABC. "The liberation was easy and successful. The occupation is a failure." He said U.S. officials "did not listen that they should not do occupation because they would lose the moral high ground and they did that and the troubles started then."
------------------------------------

(Knight Ridder Newspapers correspondent James Kuhnhenn contributed to this report from Washington.)

NEWSWEEK: The Rise and Fall of Chalabi: Bush's Mr. Wrong
The Rise and Fall of Chalabi: Bush's Mr. Wrong
By Evan Thomas and Mark Hosenball
NewsweekMay 31 issue

Ahmad Chalabi may go down as one of the great con men of history. But his powerful American friends are on the defensive now, and Chalabi himself is under attack.

For the hard-liners at the Defense Department, the raid came as a surprise. Secretary of Defense Donald Rumsfeld and his senior deputies, Paul Wolfowitz and Douglas Feith, got the news from the media. When Iraqi police, guarded by American GIs, burst into the home and offices of Ahmad Chalabi and his Iraqi National Congress, looking for evidence of kidnapping, embezzlement, torture and theft, the men who run the Pentagon were left asking some uncomfortable questions. "Who signed off on this raid?" wondered one very high-ranking official. "What were U.S. soldiers doing there?" asked another, according to a source who was present in the room.

Until at least very recently, Chalabi had been the darling of these top Pentagon officials. How could it be that the men who run the most powerful military in the world could not know that their own troops were about to run a raid on a man once regarded as the hope of free Iraq? Just last January, Chalabi had been seated behind First Lady Laura Bush at the State of the Union Message. Now, according to intelligence officials, he is under investigation by the United States for leaking damaging secrets to the government of Iran.

A civil war simmered in Iraq last week, not between Sunnis and Shiites, but between American government officials. On the one side are the neoconservatives inside the Pentagon and the Bush administration who backed Chalabi as a freedom fighter; on the other are the spooks and diplomats who have long distrusted the former Iraqi exile with a taste for well-cut suits. The neocons, who once swaggered, seem to be slipping, losing confidence and clout. It is telling that the ground commanders in Baghdad who participated in the raid on Chalabi headquarters did not bother to inform their chain-of-command higher-ups at the Pentagon. (The raid was apparently OK'd by the American proconsul in Baghdad, Paul Bremer, probably with tacit approval of White House officials.) Embarrassed by horrific images from Abu Ghraib, a growing number of uniformed soldiers are blaming their political bosses in Washington?-Rumsfeld, Wolfowitz and Feith?-for whatever goes wrong in Iraq.

Americans may be beginning to wonder: is anyone in charge over there? For an administration that prides itself on clarity of leadership, the Bushies seem to be lost in the Mesopotamian sandstorm. Everyone and no one was responsible for the prisoner-abuse scandal; the deadline for turning over the country to a new government is five weeks away, and the outcome is highly uncertain. Chalabi, who was supposed to be Our Man in Baghdad, is now whipping up anti-American sentiment. It wasn't long ago that Chalabi was touted as a great democrat, a friend of Israel, an Arab who "thought like us." He was going to help Americans reshape the troubled Middle East in our own image. But just as Chalabi once seemed to personify the utopian dreams of the true believers?-remember those bouquets that would greet the troops??-his fall from grace suggests a more depressing turn in the Iraq reality show.

Chalabi should not be a scapegoat for all that ails the American occupation of Iraq. When it served their own ideological agenda, his neocon sponsors engaged in a willing suspension of disbelief. The ideologues at the Defense Department were warned by doubters at the State Department and CIA that Chalabi was peddling suspect goods. Even so, the Bushies were bamboozled by a Machiavellian con man for the ages. Chalabi (who vigorously denies wrongdoing and has donned a martyr's robes) has survived a fraud conviction, betrayals and scandals before. He may yet emerge on top. His story would be darkly entertaining, even funny after the fashion of a late John le Carre novel, if the consequences were not so serious.

Chalabi, 59, is a Savile Row Shiite who has spent much more time in London than in Baghdad. His career as a banker has been a trail of lawsuits and investigations (and one conviction for fraud, in absentia by a military court, in Jordan; Chalabi says he was framed by Saddam Hussein). Along the way, Chalabi has worked as an American spy and enjoyed the life of bon vivant ?-and friend to the great. Though he plotted for years to overthrow Saddam, he was not taken seriously by the regime. NBC's Tom Brokaw recalled a conversation with a friend of the then Deputy Prime Minister Tariq Aziz on a trip to Baghdad in the summer of 2002. "You guys can have Chalabi!" the Saddam flunky told the American newsman. "You can keep feeding him all the prime rib and expensive Scotch. He doesn't know anyone here. He hasn't been to Iraq in 25 years."

But Saddam's henchmen underestimated Chalabi's wiles and staying power. He may be a dandy, but he is also a nervy risk taker. If he reinvents himself as an Iraqi patriot, his moral shortcomings may even be overlooked by history. Who remembers that in his day, Simon Bolivar, the liberator of South America, was regarded as a crook? Engaging scoundrels can be effective, if they don't get killed by the enemies they make (or fool) along the way.

Chalabi has not always charmed his patrons. His first run as a CIA asset in the early- and mid-' 90s was a disaster. Chalabi's attempts to foment an insurrection were aborted in a fiasco still known around the agency as the "Bay of Goats." His case officers didn't trust him. "There was a lot of hanky-panky with the accounting: triple billing, things that weren't mentioned, things inflated... It was a nightmare," says a former U.S. intelligence official who worked with Chalabi. "His primary focus was to drag us into a war that [President] Clinton didn't want to fight."

Chalabi had more luck with a group of Republican hard-liners who formed a kind of government-in-exile in the 1990s. So-called neoconservatives like Wolfowitz and Richard Perle, the veteran bureaucratic infighter known in the Reagan administration as the "Prince of Darkness," were drawn to Chalabi's ideas. Several, like Wolfowitz and Doug Feith, a then obscure Washington lawyer who had once worked for Perle at the Pentagon?-and now serves?-as under secretary of Defense for policy?-began talking about a speech Chalabi gave to the Jewish Institute for National Security Affairs in June 1997. In that speech,Chalabi promised that Saddam could be overthrown on the cheap if the United States dared back a guerrilla force led by Chalabi. (Feith told NEWSWEEK that he found Chalabi's vision of post-Saddam Iraq to be "quite moving.") A side benefit, Chalabi suggested in his conversations with the neocons, would be an Arab country friendly to Israel. Soon Chalabi was dining from time to time with Perle, a fellow epicure.

But Chalabi was broke, or nearly so. In 1998 he and his friends skillfully lobbied Congress to provide funding for his organization, the Iraqi National Congress. The Iraq Liberation Act passed with overwhelming support from Democrats and Republicans. It was seen as an easy vote, giving the appearance of taking a stand against Saddam without actually having to do much.

Clinton had no intention of going to war with Iraq. Bush might not have either, but for 9/11. Before the terrorists struck, Bush administration policy toward Iraq consisted mostly of a futile attempt by Secretary of State Colin Powell to fiddle with sanctions against Iraq before the United Nations dropped them altogether. But the neocons in the Bush cabinet, led by Deputy Defense Secretary Wolfowitz, were ready to march on Baghdad before the World Trade Center stopped smoldering. President Bush, Vice President Dick Cheney and Secretary Rumsfeld were all itching to show off American strength. The rest of the government and the American people needed some persuading. Ever the opportunist, Chalabi came along to tell the war hawks just what they wanted to hear?-and to provide the sort of frightening "evidence" that could galvanize the nation into action.

Chalabi is an expert manipulator who knows how to work the press as well as congressmen, lobbyists and think-tankers. He began coming up with Iraqi defectors who told reporters stories of Saddam's allying with terrorists and stockpiling weapons of mass destruction. After lurid stories appeared in the press (and softened up bureaucratic skepticism in the government), Chalabi would pass on the defectors to American intelligence agencies. Thus, in December 2001, Chalabi produced a defector who told The New York Times that he had seen biological- and nuclear-weapons labs hidden around Baghdad, including one underneath a hospital. The defector later became a source for the Defense Intelligence Agency. To Vanity Fair, Chalabi peddled another defector, a supposed former general in the Iraqi secret police, who told of terrorists-in-training practicing to hijack passenger aircraft at a secret base near Baghdad. (The defector, Abu Zeinab, was dismissed by the CIA as a "bullsh----er," according to an intelligence source; newly coached by the INC, he went back to the CIA and was again rejected.)

When American spooks proved resistant, Chalabi cozied up to their counterparts in foreign intelligence services. To the Germans, Chalabi provided a source code named "Curveball" (appropriately, as it turned out), who told of Saddam's building mobile bioweapons labs. Another defector sent to the DIA by Chalabi supported Curveball's tale. DIA labeled this defector a "fabricator" and attached a warning notice to his report, but the notice was so highly restricted that other intelligence officials never saw it. Both defectors' reports?-apparently pure fiction?-worked their way into official pronouncements and became part of the Bush administration's building case for war. Months later, when Colin Powell was feeling burned for having dramatically presented "facts" to the United Nations Security Council that turned out to be shaky at best, the secretary of State privately, but bitterly, blamed Chalabi.

Powell also faults the neocons in the Bush administration who swallowed Chalabi's phony stories and pushed them into speeches by the president and vice president. With his clever sense for bureaucratic gamesmanship, Chalabi fed the neocons' hunger for raw intelligence. If the CIA and other spy services weren't going to come up with the goods on Saddam, then Chalabi would. He found a receptive audience in the office of the vice president and at the Pentagon. I. Lewis (Scooter) Libby, the veep's chief of staff, and Wolfowitz were eagerly looking for links between Saddam and Al Qaeda. With his media friends, Chalabi hyped a story, often cited by the neocons, about a secret meeting in Prague between Muhammad Atta, the leader of the 9/11 hijackers, and a high-level Iraqi intelligence officer. (After months of investigation, the CIA and FBI determined that the meeting had never taken place.)

Much of Chalabi's dubious intelligence was funneled to the DIA through top Pentagon civilians. Under Secretary Feith himself signed a long and detailed summary of the intelligence linking Saddam to terrorists and WMD. The Feith memo, stamped secret, submitted to Congress and leaked to the conservative Weekly Standard magazine last summer, reads like a conspiracy theorist's greatest hits. Interviewed last week by NEWSWEEK, Feith was a little defensive about his relationship with Chalabi. "The press stories would have him as my brother. I met him a few times. He was very smart, very articulate," Feith said. Feith allowed he has always been drawn to the stories of exiles who come back to save their countries. But he rejected the idea that he had been Chalabi's tool or dupe.

Over at the State Department and CIA, career bureaucrats viewed Chalabi with a jaundiced eye. State Department auditors found that Chalabi had not always kept the most meticulous records of the funds flowing into the Iraqi National Congress. Diplomats suspected Chalabi was using taxpayers' money to fund his own war-propaganda campaign, which was barred by law. In the summer of 2002, the State Department moved to cut off Chalabi's funding, but he was rescued by his friends at the Pentagon. That fall the Defense Department began picking up the check using secret intelligence funds. All told, Chalabi's INC has been paid about $33 million by State and some $6 million by the DIA. (Not all of Chalabi's intelligence operation was dodgy; last week, Joint Chiefs of Staff Chairman Gen. Richard Myers told Congress that some of the information turned over by the INC had saved the lives of American soldiers.)

With his eye on Saddam's soon-to-be-empty throne, Chalabi took an active interest in planning for postwar Iraq. In retrospect, his involvement was unfortunate. At best, it contributed to government paralysis and fed a standoff between the ever-feuding State and Defense departments. Chalabi's closest ally, Richard Perle, vigorously denied to NEWSWEEK that the neocons wanted to "install" Chalabi as the new head of Iraq. "No one installed by the United States could survive," said Perle. But the neocons did want to help train and equip Iraqi exiles loyal to Chalabi who could be airlifted into Iraq and take over as a security force (or as Chalabi's private army, depending on your point of view).

The State Department stood against this plan. A team of diplomats and Arab experts worked up a 15-volume Future of Iraq project that Defense Department officials dismissed as overly academic and "nonoperational." At Feith's office in the Pentagon, charged with postwar reconstruction, the Future of Iraq documents were consigned to the dustbin. When various Iraqi-exile groups met outside London in the fall of 2002 to try to compromise on a post-Saddam government, the outcome was the mild anarchy of dueling press conferences to announce vague and uncertain plans.

Doomed by bureaucratic infighting and a notable lack of enthusiasm among the community of potential freedom fighters, the plan to build an Iraqi-exile force fizzled. Something like 100 Iraqi men showed up to be trained as soldiers at a camp in Hungary. Nonetheless, Chalabi and his INC entourage were airlifted into southern Iraq by the Pentagon shortly after the American invasion in April 2003.

As soon as Saddam's statue was toppled, Chalabi moved into Baghdad to become, in effect, the new nation's first warlord. He set up office in the Baghdad Hunting Club, a comfortable, vaguely colonial-sounding establishment in a posh neighborhood, and then moved his operation into an edifice with outlandish pagoda-style turrets and vast corridors, known as "the Chinese House." Through associates, he took over the old Finance Ministry and later his clan set up one-stop shopping for foreign companies that wanted to do business in the new Iraq.

Chalabi was not universally endorsed in the upper echelons of the Bush administration. True, when President Bush went to the United Nations last September to proclaim a free Iraq, the man sitting in Iraq's seat at the General Assembly was Ahmad Chalabi. But when Chalabi was first flown into Iraq by the Defense Department, national-security adviser Condoleezza Rice was visibly startled when reporters gave her the news that Chalabi was on the ground and had rounded up a 700-man local army. Even Rumsfeld was less than a totally committed Chalabi partisan. "Why do people keep saying that Chalabi is my candidate?" Rumsfeld would wonder aloud at meetings of the Defense Advisory Board, according to Perle, who was a member. But a quick and sure Chalabi takeover offered Rumsfeld the one thing above all he wanted: a fast way to get American troops out of Iraq. No fan of "nation-building," Rumsfeld wanted a new Iraqi government that could take over and run the place.

It is not clear what role Chalabi played in the Bush administration's decision to suddenly and totally "de-Baathify" Iraq, including the decision (now regretted) to disband the Iraqi Army. A senior Defense Department official deeply involved in the decision to purge Saddam's Baath Party members says that Chalabi was not consulted. Nonetheless, when the 25-member Iraqi Governing Council was formed by Bremer that spring, it was Chalabi who took over the so-called De-Baathification Commission.

Chalabi set about his business with a vengeance. He acquired (he claims with American encouragement) vast stores of Baath Party records, including memberships and records of payments made and services rendered. With those tools, U.S. investigators now believe, Chalabi's outfit was able to extort and blackmail to get his way. By threatening to expose old ties to Saddam, Chalabi could be very persuasive with Iraq's new rulers and get rid of the ones he didn't like. (Chalabi and his lawyers specifically deny the blackmail charge.)

A certain amount of corruption is to be expected when new governments arise out of old dictatorships. But, according to Iraqi investigators who raided Chalabi's house and headquarters last week, Chalabi's empire pushed the boundaries of brazenness. Today his extensive network of cousins and nephews runs almost every major bank. The minister of Finance, Kamel Gailani, is regarded as a weak Chalabi crony. "He was put in that position as a button for Chalabi," says a Coalition Provisional Authority official who works in the financial sector.

Judging from the allegations made last week in Baghdad, Chalabi has run the INC the way Tony Soprano runs the Bada Bing. Chalabi's INC associates have been accused of using their connections at the Ministry of Finance and the major banks to commit fraud and embezzlement, according to charges that led to the raid on Chalabi's headquarters. Chalabi's men have also been accused of extortion and kidnapping by the Iraqi Central Criminal Court, which was set up by the U.S.-run CPA. Aides to Chalabi, who has not been personally charged with any crimes but is said to be a target of the investigation, claim that the criminal probe is an American plot to smear him.

The head of the CPA?-Ambassador Bremer?-is known to have tired of Chalabi's shenanigans and his increasingly anti-American statements. The U.N. envoy to Baghdad, Lakhdar Brahimi, is reportedly fed up with Chalabi as well. Chalabi has been running his own investigation into the United Nations' old Oil-for-Food program. By identifying Iraqi businessmen and political figures who were siphoning off money from the humanitarian program?-not to mention certain European and U.N. officials who may have had their hands in the till?-Chalabi could resort to playing a blackmail game.

According to U.S. officials, Chalabi tried to quash the corruption investigation against him by some crude enticements. His nephew, Salem Chalabi, has been accused of offering, through an intermediary, one of the main Iraqi investigative magistrates a seat on the tribunal that will try Saddam Hussein. Last week the magistrate told NEWSWEEK that he had received such an offer, but declined to say from whom. Salem has denied making any such offer, and Chalabi and his associates all insist they will be cleared of any wrongdoing.

But Chalabi has clearly lost his get-out-of-jail-free card. American intelligence is particularly concerned with Chalabi's former top intelligence chief, Aras Habib, who seems to have disappeared from Iraq. Habib has murky ties to Iranian intelligence; the FBI, NEWSWEEK has learned, is investigating whether Chalabi and his aide passed classified information to the Iranian government, as well as who in the U.S. government might have leaked it. A few American spooks even speculate that Habib has been working for Tehran all along?-to the point of spreading disinformation about Saddam's WMD stockpiles to help lure the Americans into toppling Saddam, Iran's bitter enemy in a long and losing war during the 1980s. The theory seems very far-fetched?-why would Tehran want America to occupy its neighbor Iraq? But in the back-stabbing, "Spy vs. Spy" world of Baghdad, all conspiracy theories have their day.

Chalabi's defenders among the neocons are clearly weakened. Perle, his strongest advocate, had to drop off the Pentagon's Defense Advisory Board because of various business interests. Feith had been under attack; his resignation or firing is routinely (though inaccurately) rumored in the press. Even Wolfowitz, the cockiest of the neocons, did something very unusual last week: he admitted, in congressional testimony, an error (overestimating Iraqi patience with foreign occupation).

Though Bremer was picked for his Baghdad job by Rumsfeld, he has fallen out with the Pentagon and now speaks more regularly to Rice and her staff at the White House. The uniformed military is in almost open revolt against its civilian masters in the offices of Wolfowitz and Feith. The troops resent the Bush administration hard-liners as dangerously ideological.

Their animus has been inflamed in recent weeks by the prisoner-abuse scandal. From the Joint Chiefs of Staff on down through the ranks, soldiers blame the politicians for making a hash of the war on terror. By throwing aside the protections of the Geneva Conventions, the true believers at Defense, the White House Counsel's Office and the Justice Department may have put American soldiers at risk in future wars. The evidence mounts that the ideologues were at least cavalier about the laws that protect captured soldiers. NEWSWEEK has uncovered a Jan. 9, 2002, memo written by two Justice Department lawyers, John Yoo and Robert Delahunty, which argued that the Geneva Conventions did not apply to any Taliban or Qaeda fighters flown to the detention center at Guantanamo Bay, Cuba, because Afghanistan was a "failed state" whose militia had no standing under international treaties.

The prisoner-abuse scandal, not the fall of Ahmad Chalabi, seemed to be animating the crowds in Baghdad. The list of top-this outrages grows: prisoners anally penetrated by phosphorus-tipped nightsticks, prisoners fondled by female guards, prisoners fed from toilets, prisoners ridden like dogs and prisoners forced to eat pork and drink liquor. Only a small crowd gathered outside U.S. headquarters in the Green Zone to protest the treatment of Chalabi. That didn't stop Chalabi from sounding like a cross between Moses and Mahatma Gandhi. "Let my people go," he declared. "Let my people be free! It is time for the Iraqi people to run their own affairs." The Iraqis may run Chalabi to prison or out of the country. Right now, his poll rating in Iraq stands somewhere below Saddam Hussein's. On the other hand, Chalabi has a way of resurfacing and reinventing himself. Why not as the man who took America for a ride and freed his country?
------------------------------------

With Michael Hirsh, Michael Isikoff and John Barry in Washington, Rod Nordland, Melinda Liu and Babak Dehghanpisheh in Baghdad, and Christopher Dickey in Paris

Re: NEWSWEEK: The Rise and Fall of Chalabi: Bush's Mr. Wrong


This is both interesting and dangerous. The US Army in Iraq is playing politics.

Chalabi papers may expose prominent people's ties to Saddam
Mr. Chalabi makes many prominent Americans, European and Arabs uneasy because they don't know what several tons of Mukhabarat documents seized by INC will reveal about their secret dealings with Saddam. Rumor has it they contain names of all foreigners rewarded by Saddam for services as "agents of influence." These reportedlyinclude the names of Qatar-based Al Jazeera reporters who worked for Iraqi intelligence.

http://www.able2know.com/forums/viewtopic.php?t=19374&highlight=&sid=70289ae17cfdf8f49587049e987bb1b2

Military Week comments re Chalabi & the neocons
Without Reservation
A biweekly column by Karen Kwiatkowski, Lt. Col. USAF (ret.)
posted 21 May 04
Full Circle with Ahmad Chalabi

U.S. military just raided the spacious home of Ahmad Chalabi in Baghdad. They had a good morning, driving away with several members of the Iraqi National Congress under guard, boxes of documents, and Chalabi's own computer.

Chalabi is outraged. "I am America's best friend in Iraq!" he wails. Chalabi has indeed been close to guys like Deputy Secretary of Defense Paul Wolfowitz and former Defense Policy Board Chairman Richard Perle. Perhaps he confused these individuals with the rest of the country, or possibly he mistakenly assumed they represented widely shared American interests.

He has now gone from a "hero in error" with his lies and manipulation of America prior to the invasion of Iraq to being told this month's $335,000 U.S. government welfare check will be his last, and having his home ransacked by heavily armed American soldiers none too happy about the way Iraq has turned out.

Former Marine Middle East Specialist and Counterintelligence Officer Dale R. Davis is now working in the private sector in Dubai. Recently assigned as the Director of International Programs and Lecturer of Arabic and Middle East Security Studies at the Virginia Military Institute, Davis has been watching the Middle East closely for many years.

He often shares his timely and succinct analyses of Middle East issues via his e-mail list. This week he observes the American military raid, and I have his permission to share it with you in its entirety.

Recent events have been truly amazing. The civilian leadership of the Pentagon, comprised almost entirely of neo-conservatives is desperately clinging to the ropes. Paul Wolfowitz has finally admitted that a series of mistakes and misjudgments, most of which originated in his office, have greatly complicated US efforts to secure a strategic victory in Iraq - a truly astonishing occurrence since the norm for Wolfowitz and the rest of the Pentagon civilian leadership is to admit nothing, deny everything, and then make counter-accusations.

Now, the neo-con darling, Ahmed Chalabi, has had his house surrounded by the US military. What is the nexus of these events? Well, it was Chalabi who provided the intelligence that buoyed the ideological underpinnings of America's failed policies in Iraq. Despite warnings from experts on all sides, the Pentagon neo-cons clung relentlessly to Chalabi, even after he admitted to fabricating intelligence during the run-up to the war. Now with investigations likely to determine that prison abuses in Iraq had their roots in controversial policies originating from the civilian side of the Pentagon, and facing crisis after crisis in Iraq the neo-cons are attempting to cut their losses and are unable to counter maneuvers by an outraged senior military leadership aimed at limiting their meddling in the conduct of the war.

The uniformed military has wisely seized on this moment of neo-con "weakness" to wrest strategic control of the war away from the "suits" at OSD. Implementing their own strategy of pre-emption, Marines and Soldiers are applying practical, realistic solutions in places like Fallujah and soon in Najaf and Kerbala. This raid on Chalabi's house is aimed at further isolating or removing, if possible, the neo-con point man who has loudly opposed the rational decisions taken recently by US military leadership. It's unfortunate this particular pre-emptive attack wasn't launched much earlier. If it had, perhaps the situation in Iraq would still engender hope. Too many young American men and women have been killed or wounded for the sake of the egos of a few dilettantes and ideologues in Washington and their corrupt clients.

If Dale Davis is right, perhaps we may entertain the precious idea that sanity can ultimately prevail in our Middle Eastern policy. Instead of a bungling and wasteful set of forced occupations and collaboration through intimidation, this little house-cleaning operation may have kicked down a foreign policy door long locked by neoconservative groupthink and prejudices.

Ahmad Chalabi has come full circle, and will be likely to leave Iraq again as he did as many years ago. Few Iraqis have ever found him to be credible, reliable or trustworthy. On this the United States military and the people of Iraq agree. It is a good sign.

Alliance between Chalabi, U.S. conservatives now in ruins
Posted on Fri, May. 28, 2004
Alliance between Chalabi, U.S. conservatives now in ruins
By Warren P. Strobel and Jonathan S. Landay
Knight Ridder Newspapers

WASHINGTON - In June 2001, at an annual retreat in fashionable Beaver Creek, Colo., for current and former world leaders, Pentagon adviser Richard Perle introduced two men to each other who would help guide the United States to war in Iraq.

Iraqi exile leader Ahmad Chalabi and Vice President Dick Cheney then went for a two-hour afternoon walk, according to a former senior U.S. government official who was present.

That day marked a turning point in the budding alliance between Chalabi and prominent U.S. conservatives. Both sides were eager to see Iraqi dictator Saddam Hussein ousted from power, and after the Sept. 11 terrorist attacks, although there was no evidence that Saddam was involved, they pushed that goal relentlessly.

The partnership involved overt and covert U.S. support for Chalabi's bid to be Iraq's next leader. His Iraqi National Congress in turn provided intelligence about Saddam's weapons programs and links to terrorism - most of which turned out to be bogus or unproved.

The alliance with Chalabi is now in ruins.

U.S. intelligence officials have accused his security chief of passing highly classified American secrets to Iran. Iraqi police, backed by U.S. personnel, raided Chalabi's home and his offices May 19, seeking to arrest associates on charges of financial corruption.

The FBI has opened a probe into who gave the compromised data - so sensitive that it put U.S. soldiers' lives at risk and was known to only a handful of government officials - to the INC.

Little has been made public about the investigation, but it's believed to be focusing on officials in the Pentagon and elsewhere in the U.S. government who were closest with Chalabi and were his strongest boosters.

Some current and former U.S. officials speculate that Iran not only received U.S. secrets but also used Chalabi's group to pass false threat information to the United States about Saddam, with whom Iran had fought an eight-year war. Iran's likely goal, they say, was to precipitate a U.S. invasion and take advantage of the ensuing chaos, or to keep pressure on for continuing U.N. sanctions that would keep Saddam contained.

Chalabi's longtime relationship with the theocratic regime in Iran was no secret.

He traveled frequently to Tehran and relied on the Iranian government's goodwill to establish a base of operations in northern Iraq, which was outside of Saddam's control for most of the 1990s.

The Bush administration allowed the INC, which received at least $40 million in U.S. funding over the years, to establish an office in Tehran, approving a special license required under U.S. sanctions on Iran.

CIA warnings that Chalabi had become too close to Iran's regime fell on deaf ears in Washington, current and former intelligence officials said.

"They ignored it," said Robert Baer, a retired CIA officer who dealt with Chalabi and other Iraqi opposition leaders in northern Iraq in the mid-1990s.

Baer said that the CIA suspected for years that Arras Habib, Chalabi's security chief, worked for Iranian intelligence. U.S. intelligence officials say Habib, now a fugitive, is an agent of Iran's Ministry of Intelligence and Security.

"We always assumed that he was an Iranian agent," Baer said in an interview. Habib's family was in Iran, he depended on Tehran for survival, and "our conclusion was that he was working more for Tehran than for anybody."

Moreover, counterintelligence experts in the Defense Intelligence Agency circulated a warning in mid-2002 that the INC had been deeply penetrated, this time by Saddam's agents, said a senior administration official, who like others spoke on condition of anonymity because of the sensitivity of the issue.

Chalabi denies that he or anyone in the INC passed U.S. secrets to Iran.

A senior INC adviser said Habib passed a polygraph exam that the CIA administered in London in the fall of 2002, when he was asked specifically about ties to Iran.

But a senior U.S. intelligence official said he knew of no such CIA exam.

Habib's cousin, Ali Karim, was one of several hundred Iraqis working with the CIA in northern Iraq who were evacuated by the United States in 1996 after Saddam's forces invaded the semi-autonomous region.

Karim and a half-dozen others were jailed in the United States after the FBI accused them of being spies. Karim, who was represented pro bono by former CIA chief James Woolsey, was granted asylum in June 2000 after a federal immigration judge declared the case against him "weak at best."

It remains unclear why the warnings about Chalabi and his group were ignored.

Baer says it reflects the same naivete that President Reagan demonstrated in dealings with Iran in the arms-for-hostages scandal known as Iran-Contra.

What's clear is that Chalabi and his group got extraordinary aid from some sectors of the U.S. government, even as the CIA, State Department and many in the uniformed military fought to limit reliance on him.

From 2000 to 2003, the INC received $33 million from the State Department, which was never enthusiastic about supporting the group. The State Department gave control of the funding to the Pentagon in October 2003, and the DIA paid several million more for the INC's information. The payments were ended only this month.

Middle East experts at the State Department who criticized Chalabi and his plans frequently were transferred or frozen out of U.S. policy-making on Iraq.

The senior INC adviser, who requested anonymity, said ties between Chalabi and conservatives in Washington are exaggerated. For example, he said, Chalabi hasn't spoken to Cheney since before the war began in March 2003, and he hasn't spoken with U.S. government officials at all since the raid on his house.

"The idea that there's some kind of very close, interlinked relationship is not true," he said.

But, in the opening days of the war, on Cheney's orders, Chalabi and several hundred of his fighters were flown from northern Iraq to an airbase in south-central Iraq.

During and after the conflict, uniformed and civilian Pentagon officials accompanied him, providing him with communications gear and other critical support.

In January, Chalabi sat near first lady Laura Bush during the president's State of the Union address.

In Iraq, Chalabi allies and relatives were given key spots in the Finance Ministry, the committee charged with purging members of Saddam's Baath Party, and in the prosecution of Saddam. The INC took control of the files of Saddam's brutal secret service, the Mukhabarat.

Now, while many of Chalabi's former backers in and out of government have cooled on him, a few continue to defend him.

Perle told the New York-based weekly newspaper The Forward last week that he believes Chalabi was the victim of a campaign orchestrated by Iran and the CIA. The Iranians "very well may have induced the CIA to believe Chalabi gave them (sensitive intelligence). And the CIA was certainly very happy to hear that," Perle was quoted as saying.

Others see a simpler explanation. Said the former official who witnessed the Cheney-Chalabi introduction: "Was Chalabi using us and being used by us?"