SUPPORTING RIGHT-WING SAUDI ARABIA

SAUDI ARABIA

CONTENTS

1. THE BUSH-BIN LADEN CONNECTION

2. BUSH, BIN LADEN, AND THE CARLYLE GROUP

3. BUSH ALLOWS BIN LADENS TO LEAVE THE U.S.

4. THE SAUDI-U.S. RELATIONSHIP

5. THE SAUDI-BIN LADEN CONNECTION

1. THE BUSH-BIN LADEN CONNECTION

 

Before his death in a 1968 plane crash, bin Laden’s father, Mohammed Bin Laden, made a fortune off construction contracts awarded by the Saudi royal family. The $5 billion per year construction conglomerate, known as the Binladin remained closely tied to the Saudi royal family. After the death of Mohammed bin Laden, control of the company passed to Salem bin Laden, Osama’s half brother. (The Texas Observer, “The Bush-Bin Laden Connection,” November 9, 2001)

1. JIM BATH AND KHALID BIN MAHFOUZ. The George W. Bush/Jim Bath connection began the following decade. In the early 1970s, the two flew fighter jets together in the Texas Air National Guard. In 1976, Bath was recruited by CIA Director George Herbert Bush to create offshore companies to move CIA funds and aircraft between Texas and Saudi Arabia. (The Texas Observer, “The Bush-Bin Laden Connection,” November 9, 2001; Toronto Sun, September 24, 2001)

<:P>In 1978, Salem bin Laden, older brother to Osama, invested a large chunk of money in Bush’s Arbusto Energy, Bush’s first oil company. Salem appointed James Bath, a close friend of Bush who served with him in the Air National Guard, as his representative in Houston, Texas. Bath himself invested $70,000 in the company. The same year, Bath bought Houston Gulf Airport on behalf of the Saudi Arabian multi-millionaire. (Toronto Sun, September 24, 2001)

<:P>Bath acted as the Bin Laden family’s representative in North America, investing money in various business ventures. Bath also became the business representative of Khalid Bin Mahfouz, a member of Saudi Arabia’s most powerful banking family and owners of the National Commercial Bank, the principal bank of the Saudi royal family.

<:P>Mahfouz’s sister was also a wife of bin Laden. (Beaty, Jonathan and Gwynne, The Outlaw Bank: A Wild Ride into the Secret Heart of BCCI, New York: Random House, 1993; Judicial Watch: Bush/bin Laden Connection, October 6, 2001; Toronto Sun, September 24, 2001; Wayne Madsen, In These Times)

<:P>A friendship was struck between the bin Ladens and Bushes in the 1970s in Houston, Texas. The Bin Laden family helped fund Arbusto Energy, George W. Bush’s first oil venture. One of many investors, Bath gave Bush $50,000 for a 5 percent stake in Arbusto. (Beaty, Jonathan and Gwynne, The Outlaw Bank: A Wild Ride into the Secret Heart of BCCI, New York: Random House, 1993; Judicial Watch: Bush/Bin Laden Connection, October 6, 2001; Wayne Madsen, In These Times, November 12, 2001; Center for Research on Globalization, February 28, 2002)

<:P>When Arbusto Energy teetered on the brink of bankruptcy, the company remained solvent by merging with Arbusto 7 Oil Company. Bath invested money from Salem Bin Laden and Mahfouz in the new company. Bath said more than $1-million of the Saudis’ money was pumped into Bush’s venture. Bath bought the Saudi royalty an airport, office, and apartment buildings. Eventually, Salem and Mahfouz bought an enormous mansion in River Oaks, Houston’s most affluent neighborhood. (Beaty, Jonathan and Gwynne, The Outlaw Bank: A Wild Ride into the Secret Heart of BCCI, New York: Random House, 1993; Judicial Watch: Bush/Bin Laden Connection, October 6, 2001)

<:P>Bush’s third oil firm, Harken Energy, was operated by Alan Quasha, a New York lawyer who was also a Republican Party fundraiser. Sheikh Abdullah Bahksh of Saudi Arabia, a 16 percent shareholder in Harken Energy. He was represented by a Palestinian-born Chicago investor named Talat Othman, who served with George W. Bush on the board of Harken Energy. (Beaty, Jonathan and Gwynne, The Outlaw Bank: A Wild Ride into the Secret Heart of BCCI, New York: Random House, 1993; Judicial Watch: Bush/Bin Laden Connection, October 6, 2001)

<:P>Othman made at least three separate visits to the White House to discuss Middle East affairs with then President George Herbert Bush. Just prior to the Gulf War, Harken Energy, with no previous international or offshore drilling experience, was awarded a 35-year petroleum exploration contract with the emirate of Bahrain. (Beaty, Jonathan and Gwynne, The Outlaw Bank: A Wild Ride into the Secret Heart of BCCI, New York: Random House, 1993; Judicial Watch: Bush/Bin Laden Connection, October 6, 2001)

<:P>Mahfouz and other Saudis attempted to transfer $3 million to various Bin Laden front operations in Saudi Arabia in 1999. Saudi officials stopped Mahfouz from contributing money directly to bin Laden. (Wayne Madsen, In These Times)

<:P>BILL WHITE. o in 1970s, Charles W. “Bill” White, a former Annapolis graduate and United States Navy pilot, became part of the Bush-White-Bin Laden connection. Bath hired White as his partner in his real estate firm. Bush used Bath to funnel money from Osama bin Laden’s rich father, Sheikh bin Laden, to set up Arbusto Energy. Bath went on to make a fortune by investing money for Mahfouz and Sheikh bin Laden. (Beaty, Jonathan and Gwynne, The Outlaw Bank: A Wild Ride into the Secret Heart of BCCI, New York: Random House, 1993; Judicial Watch: Bush/Bin Laden Connection, October 6, 2001)

<:P>In sworn depositions, Bath said he represented four prominent Saudis as a trustee, one of whom was Saudi Sheik Salem bin Laden. In return, he said, he would receive a 5 percent interest in their deals.

<:P>Bath was named in a 1976 trust document as the business representative for Salem bin Laden who was killed in a private plane crash in Texas in 1988. White claimed that Bath was involved in a secret conspiracy to funnel Saudi money into the United States. He claimed that since 1976, Bath had worked as a CIA liaison to Saudi Arabia. White also claimed that Bath ran an aviation business and obtained several aircraft from the CIA. Bath operated Skyway Aircraft Leasing Ltd., an aviation business based in the Cayman Islands, which was owned by Saudi banker Khalid bin Mahfouz. In 1977, Mahfouz joined up with Saudi front man for BCCI, Ghaith Pharaon, and became an investor in the Main Bank of Houston, in which Bath also held a stake. In 1986, Bath filed 28 frivolous lawsuits against White, leading to White’s financial ruin and expulsion from Houston’s business community. White announced Bath’s relationship to the Saudis and Bush family.

3. THE BCCI CONNECTION. Bush’s third oil firm, Harken Energy, had ties to the notorious Bank of Credit and Commerce International (BCCI), a Middle Eastern banking concern. In 1988, the BCCI scandal broke with the exposure of Saddam Hussein, Manuel Noriega, terrorist leaders Abu Nidal, and the Medellin drug cartel. BCCI also laundered money that involved the Iran-Contra scandal. (Beaty, Jonathan and Gwynne, The Outlaw Bank: A Wild Ride Into the Secret Heart of BCCI, New York: Random House, 1993; Judicial Watch: Bush/Bin Laden Connection, October 6, 2001)

<:P>Mahfouz was chief operating officer of BCCI. He was fined $212 million to settle felony charges for stealing investors’ money. He was also barred from involvement in any American banking activity. The Wall Street Journal in 2000 reported that he provided financing to a “charitable front” that raised money for bin Laden. He was reportedly placed under house arrest in Saudi Arabia since at least March of 2000. (Wall Street Journal, September 28, 2000)

<:P>Another business partner of Bush was involved in BCCI. Sheikh Abdullah Bahksh of Saudi Arabia was a 16 percent shareholder in Harken Energy. Bahksh was a co-investor in BCCI, whose primary objective in the Middle East was to obtain political influence using oil money. Bahrain's prime minister, Sheik Khalifah bin-Sulman al-Khalifah, was a major investor in BCCI’s parent company, BCCI Holdings, of Luxembourg. Through its commodities affiliate, Capcom, BCCI was used as a money laundering service by drug traffickers and arms dealers. (Beaty, Jonathan and Gwynne, The Outlaw Bank: A Wild Ride into the Secret Heart of BCCI, New York: Random House, 1993; Judicial Watch: Bush/Bin Laden Connection, October 6, 2001; Wayne Madsen, In These Times, November 12, 2001; Center for Research on Globalization, February 28, 2002)

2. BUSH, BIN LADEN, AND THE CARLYLE GROUP

 

As President George Herbert Bush prepared for war in 1991, bin Laden urged the Saudi royal family to find an Arab solution, by raising an army on their own to fight Hussein. However, the Saudis sided with the Bush administration, allowing American bases on their soil from which to launch attacks. Subsequently, bin Laden was allowed to leave Saudi Arabia for Sudan with his fortune. In 1996, bin Laden joined al Qaeda in Afghanistan. (Beaty, Jonathan and Gwynne, The Outlaw Bank: A Wild Ride Into the Secret Heart of BCCI, New York: Random House, 1993; Judicial Watch: Bush/Bin Laden Connection, October 6, 2001)

Carlyle had ownership stakes in 164 companies which employed more than 70,000 people and generated $16 billion in revenues in 2000. About 450 institutions -- mainly large pension funds and banks -- were Carlyle investors. The California state pension fund invested $305 million with Carlyle, and the Texas teachers pension fund -- whose board was appointed when George W. Bush was governor -- gave Carlyle $100 million to invest in November.” (New York Times, March 5, 2001)

In 1990, Carlyle placed George W. Bush on the board of directors of one of its subsidiaries, Caterair, an airline catering company. Charles Lewis, executive director of the Center for Public Integrity, commented, “George Bush is getting money from private interests that have business before the government, while his son is president. And, in a really peculiar way, George W. Bush could, some day, benefit financially from his own administration’s decisions, through his father’s investments.”

After leaving the White House in January 1993, George Herbert Bush accepted a post as adviser to Carlyle. He helped to strengthen Carlyle’s ties to the Saudi royal family. Other high-level officials at Carlyle included former Reagan administration Defense Secretary Frank Carlucci and former senior Bush administration Secretary of State James A. Baker III. (The Texas Observer, Andrew Wheat, The Bush-bin Laden Connection, November 9, 2001)

The Saudi Binladin group ran a $5 billion business, built by family patriarch Mohammed largely from Saudi government construction contracts. In the 1990s, the Binladin group invested $2 million in the Carlyle Group. (Wall Street Journal, September 17, 2001)

In 1996, the head of Saudi intelligence, Turki bin Faisal, and Khalid bin Mahfouz met in Paris with a representative of al Qaeda. They agreed to extend the earlier arrangement made between the Saudi royal family and bin Laden, whereby in return for cash, al Qaeda agreed not to attack inside Saudi Arabia. The CIA produced an internal report that documents the numerous Saudi charities that funded terrorists. Bin Laden’s name was included. (Beaty, Jonathan and Gwynne, The Outlaw Bank: A Wild Ride Into the Secret Heart of BCCI, New York: Random House, 1993; Judicial Watch: Bush/Bin Laden Connection, October 6, 2001)

While serving as governor of Texas, George W. Bush met with high-level al Qaeda leaders, hoping to get support to build a pipeline across Afghanistan. (Michael Moore, Dude, Where’s My Country?) Four months into his presidency, he rewarded the Taliban by handing over $43 million in May 2001, only six months before the 9/11 terrorist attacks.

George Herbert Bush worked with the bin Laden family business on at least two occasions. In August 2001, George W. Bush received a detailed and lengthy presidential daily briefing from the CIA, stating that bin Laden and al Qaeda’s objective was to launch an attack against the United States. One month later -- on the morning of the 9/11 terrorist attacks -- George Herbert Bush met with bin Laden’s own brother at the Ritz Carlton Hotel in Washington D.C. (Wall Street Journal, September 27, 2001, Michael Moore, Dude, Where’s My Country?)

3. BUSH ALLOWS BIN LADENS TO LEAVE THE U.S.

 

All airlines in the United States were grounded for two days after 9/11. One of bin Laden’s brothers frantically called the Saudi Arabian Embassy in Washington looking for protection. Saudi’s King Fahd sent an urgent message to his embassy in Washington pointing out that there were “Bin Laden children all over America” and ordered, “Take measures to protect the innocents,” the ambassador said.

Two days after the 9/11 attacks, the White House authorized Saudi jets to fly 140 Saudi citizens, 24 of whom were immediate relatives of Bin Laden, to Saudi Arabia. Meanwhile, all other airplanes were grounded in the United States. The members of the bin Laden family were never questioned by United States authorities. Government records showed that the FBI played a very active role in helping Saudis to leave the United States immediately after 9/11. The FBI gave personal airport escorts to two prominent Saudi families who fled the United States, and several other Saudis were allowed to leave the country without first being interviewed. (Craig Unger, House of Bush; House of Saud; New York Times, March 27, 2005)

The Saudi families, in Los Angeles and Orlando, requested the FBI security, since they were concerned for their safety in the wake of the attacks. The FBI immediately reciprocated, arranging to have agents escort them to their local airports. (New York Times, March 27, 2005)

A small jet landed at Tampa International Airport and picked up three young Saudi men, one of whom was believed to be a member of the Saudi royal family. He plane flew to Lexington, Kentucky where the passengers changed planes and flew out of the United States.

Yet, the Bush administration -- as well as aviation and law enforcement officials -- insisted the flight never took place and denied published reports about the flight. Finally in June 2004, the Tampa International Airport acknowledged the flights happened. (Wall Street Journal, September 27, 2001; Judicial Watch, March 5, 2001, September 28, 2001; CNews, September 30, 2003; St. Petersburg Times, June 9, 2004; Michael Moore, Dude, Where’s My Country?; Beaty, Jonathan and Gwynne, The Outlaw Bank: A Wild Ride Into the Secret Heart of BCCI, New York: Random House, 1993; Judicial Watch: Bush/Bin Laden Connection, October 6, 2001)

Eighteen days after 9/11, Saudi Arabia decided to allow American troops and planes stationed on its soil to participate in military action against bin Laden’s cells. Not only were the Saudi bases important militarily, but cooperation from the Islamic Saudi monarchy gave the United States a more solid footing in the Arab and Muslim world.

4. THE SAUDI-U.S. RELATIONSHIP

 

Five extended families in the Middle East owned about 60 percent of the world’s oil. The House of Saud controlled more than a third of that amount. (Atlantic Monthly, May 2003)

Despite Saudi Arabia’s dismal human rights record, the United States remained cozy with the oil-rich Saud family:

* Saudi Arabia controlled the largest share of the world’s oil and served as the market regulator for the global petroleum industry.

* No country consumed more oil, and is more dependent on Saudi oil, than the United States.

* The United States and the rest of the industrialized world were absolutely dependent on Saudi Arabia’s oil reserves.

* If Saudi oil exports were cut off by terrorism or by political revolution, the effect on the global economy, and particularly on the economy of the United States, would be devastating.

* Saudi oil was controlled by an increasingly bankrupt, criminal, dysfunctional, and out-of-touch royal family that was hated by its citizenry and by the nations that surrounded its kingdom. (Atlantic Monthly, May 2003)

The Saudis used that leverage on several occasions, increasing surplus production capacity to stabilize the international oil market.

1. Saudi Arabia increased production to break the OPEC embargo in 1974.

2. They used it again during the protracted Iran-Iraq war, to keep oil flowing to the industrialized West.

3. They used it during the Gulf War, in 1990-1991, by producing an extra five million barrels a day. That made up for the loss of Iraqi and Kuwaiti oil.

4. Saudi Arabia increased its oil exports one day after the 9/11 attacks in 2001. The House of Saud exported nine million barrels of oil to the United States for two weeks. The result was that the United States experienced only a slight inflation spike in the wake of the most devastating terrorist attack in history. (Atlantic Monthly, May 2003)

The United States Strategic Petroleum Reserve could support the domestic market for only about seventy days. And if Saudi Arabia’s contribution to the world’s oil supply were cut off, crude petroleum could quite realistically increase by 400 to 500 percent. (Atlantic Monthly, May 2003)

Even after the 1998 attacks on the United States embassies in Kenya and Tanzania -- which were organized by bin Laden -- the House of Saud continued to aid the Taliban and its main supporter in the region, Pakistan. Over a period of about 10 years, the United Nations Security Council reported that Saudi Arabia transferred $500 million to al Qaeda. (Atlantic Monthly, May 2003)

Saudi Arabia sent as many as 150,000 barrels of oil a day to Afghanistan and Pakistan in off-budget foreign aid that had a value of something like $2 million a day. Furthermore, the United States had known since 1994 that the Saudis were supporting Pakistan’s nuclear development program, ultimately contributing upwards of a billion dollars. (Petroleum Intelligence Week, July 2000)

The hidden relationship between the Bush family and the house of Saud began in the mid-1970s, when the oil-rich House of Saud struck out for America during the OPEC oil embargo and soaring oil prices. Saudi Arabia needed American military protection, access to American political power, and a place to invest its staggering cash flow, which within 5 years reached $16 million an hour. (Craig Unger, House of Bush; House of Saud)

The Saudis began looking for investments in the United States. High-level Saudi officials cozied up to Presidents Ronald Reagan, George Herbert Bush, and George W. Bush, as well as to Secretary of State James Baker, Vice President Dick Cheney, and the entire United States intelligence apparatus. (Craig Unger, House of Bush; House of Saud)

Since the 1980s, the Bushes and Saudis conferred on a number of issues: war, oil, funding for bin Laden’s Afghan Arabs supporting the Mujahideen in the Afghanistan War, illegal arms deals, banking, and private matters. By the time George W. Bush was elected, the House of Saud transferred large amounts of money to the House of Bush in deals involving dozens of companies. At least $1.4 billion in investments and contracts went to companies in which the Bushes and their allies held prominent positions. (Craig Unger, House of Bush; House of Saud)

Bush received a plethora of gifts from members of the Saud family. In fact, Ambassador Bandar, the Saudi minister to the United States, had an open invitation to visit Bush at any time. (Michael Moore, Fahrenheit 9/11) On June 3, 2003, Crown Prince Abdullah of Saudi Arabia gave the Bush family a diamond-and-sapphire jewelry set that was valued at $95,500; two sets of diamond and white gold jewelry by the exclusive Italian jeweler Bulgari; and an $8,500 mantle clock elaborately detailed in silver and gold vermeil. (Knight Ridder, August 5, 2004)

Other Abdullah’s gifts included ornamental daggers with ivory handles, worth $1,500, for Chief of Staff Andrew Card and National Security Adviser Rice; a miniature silver sword for Secretary of State Powell, worth $1,500; and a small golden statue of a horse for Defense Secretary Rumsfeld, worth $700. (Knight Ridder, August 5, 2004)

5. THE SAUDI-BIN LADEN CONNECTION

 

The relationship between the bin Ladens and the Saudi royal family was exceptional. It was one of trust, of friendship and of shared secrets. This was particularly the case with regard to the group’s present-day leaders and the Soudairi clan.

Sheik Mohammed bin Laden became the official contractor of Kin Abdul Aziz as well as his friend and confidant. That friendship was handed down to their children. The Bin Laden sons went to the same schools as the numerous offspring of King Abdul Aziz, and they all followed the same path.

In 1972, four years after the death of Sheik Mohammed, the bin Laden organization was given a group structure in order meet the needs of its expanding activities. Named Binladen Brothers for Contracting and Industry, the group was headquartered in the Saudi Arabia city of Jiddahh. They had offices in the Saudi Arabia cities of Riyadh and Damman as well as in the neighboring capital cities of Beirut, Cairo, Amman, and Dubai.

Binladen Brothers rebuilt Mecca and then extended its activities to include the building of the Mecca-Medina highway as well as tens of thousands of housing units. It also entered into agriculture, irrigation, and representation of foreign groups which included Porsche and the Dutch Heras Hekwerk group. In the early 1980s, Binladen Brothers became associated with the British firm Hunting Surveys Limited which performed prefab construction and with the Dutch Pander Projects group for distribution of luxury products.

In 1996, the CIA first began tracking bin Laden and asked the Saudi government for copies of his passport, birth certificate, bank records, and other relevant materials. But the Saudis refused to cooperate with American officials. (James Risen, State of War)

Beginning in the 1990s, the National Security Agency (NSA) began collecting electronic intercepts of conversations between members of the Saudi Arabian royal family. The intercepts depicted a regime increasingly corrupt as well as one that was alienated from the country’s religious rank and file. King Fahd’s royalty seemed so weakened and frightened that it channeled hundreds of millions of dollars in what amounts to protection money to fundamentalist groups that hoped to overthrow it. (The New Yorker, October 19, 2001)

Intercepts by the NSA indicated that Saudi money was supporting al Qaeda and other extremist groups in Afghanistan, Lebanon, Yemen, and Central Asia, and throughout the Persian Gulf region. The Saudis helped finance the religious schools and Mujahedeeen training camps in Pakistan and Afghanistan. These were the same Saudis who protected their oil from Iraq ten years earlier in the Gulf War. While protecting its massive wealth, the monarchy ruthlessly repressed its nation’s poor. Bin Laden was a member of one of Saudi Arabia’s richest families. His money from the Saudi elite sustained a terrorist network. And the Saudi government refused to cooperate fully with the United States in investigating these links or seizing terrorist assets. (Los Angeles Times, October 16, 2001)

The Saudi-al Qaeda connection also reached into the inner circle of the country’s judiciary. Sheik Saleh al Luhaidan, chief justice of Saudi Arabia's Supreme Judicial Council, speaking at a Saudi Arabian mosque in October 2004, encouraged young Saudis to go to Iraq to wage war against the United States. The sheik also inspired Saudis to send money to fight the Americans. (NBC Nightly News, April 26, 2005)

In 1997, the Saudis detained Sayed Tayib al-Madani who was a key financial aide to bin Laden who was living in Sudan. The CIA repeatedly asked the General Intelligence Directrorate (GID), the main arm of Saudi intelligence, if they could question al-Madani about al Qaeda’s finances. The Saudis repeatedly refused. (James Risen, State of War)

That same year, the CIA station chief assigned to the bin Laden case sent a memo to CIA Director George Tenet, saying the Saudi intelligence agency was a “hostile service” on the issue of al Qaeda. The CIA suspected that some of the intelligence it had shared with the Saudis were passed on to al Qaeda. For example, the CIA had given the Saudis copies of NSA communications intercepts that included conversations among suspected al Qaeda operatives in Saudi Arabia. But after the CIA provided this classified information to the Saudis, the suspects quickly stopped using the communications that the NSA had been monitoring. (James Risen, State of War)

By 1998, bin Laden likely did not know that the CIA was tracing his steps. In May 1998, a delegation of CIA officials, including Tenet, met with Saudi Crown Prince Abdullah. Tenet asked if the Saudis would help deal with bin Laden. Abdullah agreed but only under the condition that the United States keep it secret and not ask to bring bin Laden to the United States for trial. Soon thereafter, the CIA dropped this proposal. (James Risen, State of War)

Even after bin Laden turned against the United States in the 1990s, he still maintained close contact with key Saudi figures including Prince Turki al-Faisal, the powerful intelligence chief and brother of King Fahd..

NSA intercepts made clear that Crown Prince Abdullah was insistent on restraining the corruption. In November 1996, Abdullah complained about the billions of dollars that were being diverted by royal family members from a huge state-financed project to renovate the mosque in Mecca. He urged the princes to get their off-budget expenses under control. A few months later, according to the intercepts, Abdullah blocked a series of real-estate deals by one of the princes, enraging members of the royal family. Abdullah further alarmed the princes by issuing a decree declaring that his sons would not be permitted to go into partnerships with foreign companies working in the kingdom. (Newsweek, December 9, 2002)

Abdullah was viewed by Sultan and other opponents as a leader who could jeopardize the kingdom’s most special foreign relationship -- someone who was willing to penalize the United States, and its oil and gas companies, because of Washington’s support for Israel. In an intercept dated July 13, 1997, Prince Sultan called Bandar in Washington, and informed him that he had told Abdullah “not to be so confrontational with the United States.” (Newsweek, December 9, 2002)

Intercepts by the NSA also indicated that Saudi money supported al Qaeda and other extremist groups in Afghanistan, Lebanon, Yemen, and Central Asia, and throughout the Persian Gulf region. An American intelligence official told reporter Laura Flanders, “Ninety-six is the key year. Bin Laden hooked up to all the bad guys -- it’s like the Grand Alliance -- and had a capability for conducting large-scale operations. ... (The Saudi regime had) gone to the dark side.” (Newsweek, December 9, 2002)

One of the top officials of the International Islamic Relief (IIRO) was Mohammed Jamal Khalifa, who founded the IIRO branch in the Philippines in the mid-1990s. He was bin Laden’s brother-in-law. State Department cables in 1994 first identified Khalifa as a “known financier of terrorist operations.” FBI documents obtained by terrorism expert Rita Katz later linked Khalifa to the plotters of the 1993 bombing of the World Trade Center in New York. (Newsweek, December 9, 2002)

Evidence collected by the FBI during the investigation of the 1998 embassy bombings in Africa included several IIRO business cards found in the possession of Wadih El-Hage, bin Laden’s onetime appointments secretary, who was later convicted in the embassy-bombing plot. In March 2002, a team of United States Customs agents raided the suburban Washington office of the IIRO. No charges were filed. (Newsweek, December 9, 2002)

FBI agents pursued an investigation into alleged al Qaeda financing in 1998. They ran across a money trail of a Chicago chemical firm that was suspected of laundering money for Hamas. The Palestinian terrorist group had received a $1.2 million cash from the International Relief Organization, the American branch of one of the world’s largest Islamic charities. Subsequently, the FBI traced some of the charity’s funding to the Saudi embassy in Washington. (Newsweek, December 9, 2002)

However, some Justice officials appeared worried that any inquiries into the operations of the Saudi embassy could jeopardize United States-Saudi relations. A court affidavit indicating $400,000 in money transfers to the organization was carefully edited, omitting any reference to the Saudi cash. Instead, the document referred to the funds from an unidentified “embassy of a foreign government.” The president of the chemical firm was later convicted of fraud. But charges were never filed against the Saudi-financed charity. (Newsweek, December 9, 2002)

In the months before 9/11, the GID, the Saudi intelligence agency, continued to refuse to cooperate with the United States, even though reports circulated that bin Laden was planning a major terrorist attack. In the summer of 2001, a team of CIA officials traveled to Saudi Arabia to complain about the lack of cooperation. They argued that the United States was sharing more classified information with them about suspected terrorists. Once again, the Saudis declined to help. (James Risen, State of War)

In a PBS Frontline interview broadcast on October 9, 2001, Prince Bandar, asked about the reports of corruption in the royal family, was almost upbeat in his response. The family had spent nearly four hundred billion dollars to develop Saudi Arabia, he said. “If you tell me that building this whole country ... we misused or got corrupted with fifty billion, I’ll tell you, ‘Yes.’ ...So what? We did not invent corruption, nor did those dissidents, who are so genius, discover it.” (Laura Flanders, The New Yorker, October 19, 2001)

After 9/11, the International Relief Organization (IIRO) -- and several other Saudi-backed charities, foundations and businesses -- became the center of the Justice Department’s investigation into the terror-financing network. Officials suspected that millions of dollars that were donated by the Saudi government and wealthy Saudis were diverted by mainstream Islamic charities to al Qaeda, Hamas, and other terrorist groups. In some cases, United States investigators believed, Saudi funds might have bankrolled specific terrorist acts, including the 1998 bombings of two American embassies in Africa. (Newsweek, December 9, 2002)

Princess Haifa al Faisal, daughter of King Faisal and wife of the Saudi ambassador to Washington, allegedly aided two of the hijackers. The money, possibly coming from the Saudi government, was used to provide financial assistance to Nawaq al-Hamzi and Khalid al-Midhar for them to pay their rent in San Diego. The FBI received information about the possibility that some of the money of Saudi ambassador Bayoumi came indirectly from Saudi government officials. FBI agents had found the phone number of an employee of the Saudi Embassy in her apartment. Embassy officials confirmed that the FBI had questioned two employees of the embassy’s Islamic affairs section about calls from Bayoumi. (Newsweek, November 25, 2002)

The Saudis insisted there was no link between any Saudi government employee and Bayoumi, and that they had no knowledge of Bayoumi’s activities in California. A Saudi spokesman said it was his understanding the FBI had closed the matter. The FBI and other senior government officials said that they had found no convincing link to the Saudi government. (Washington Post, November 23, 2002)

More evidence of a link between the Saudis and al Qaeda surfaced in 2002. German authorities charged Mounir el-Motassadeq, a Moroccan citizen, with assisting Muhammad Atta and other members of the “Hamburg cell” that organized the 9-11 attacks. A German police official testified that when authorities raided el-Motassadeq’s apartment, they found the business card of Muhammad Fakihi, chief of Islamic affairs at the Saudi Embassy in Berlin. Even more awkward for the Saudis was evidence that surfaced in a Hamburg courtroom. German authorities charged Mounir el-Motassadeq, a 28-year-old Moroccan citizen, with assisting Muhammad Atta and other members of the “Hamburg cell” that organized the attacks. (Newsweek, December 16, 2002)

German police memos, first reported in the weekly Die Zeit, showed German officials twice sought to question Saudi officials about Fakihi and whether el-Motassadeq visited him during a trip to Berlin two months after the terrorist attacks. But the Saudis never responded to written questions. (Newsweek, December 16, 2002)

Furthermore, the Saudis also refused to explain phone records showing repeated calls from el-Motassadeq’s apartment to the Riyadh office of Sheikh Safar al-Hawali, a radical imam who helped set up a charity that United States officials alleged assisted an Al Qaeda cell that bombed the United Stateas Embassy in Kenya. Al-Hawali was jailed by Saudi authorities in the early 1990s for inciting violence, but was released in 2000 on Prince Nayef’s orders. El-Motassadeq’s phone records showed he began calling the office of al-Hawali and other radical Saudi clerics in December 2000 -- about the time Atta and two other Hamburg cell members were finishing flight training in the United States. That was also when, officials suspect, most of the 15 Saudis who served as “muscle” in the attacks were first recruited. (Newsweek, December 16, 2002)

Another potential problem for the Saudis emerged when federal agents searched the Massachusetts office of Ptech, a computer-software firm. The agents were looking for evidence linking the company to Yassin al-Qadi, a Saudi businessman who United States officials charged had helped finance Islamic terrorist groups. The National Security Council ordered United States Customs to investigate the firm after discovering that Ptech has software contracts with government agencies including the FBI and the Pentagon. Al-Qadi allegedly arranged initial financing for Ptech but sold his stake in the firm in 1999. (Washington Post, May 18, 2003)

In May 2003, weapons were seized at an al Qaeda safe house and were traced to national guard stockpiles, according to the Saudi government. A group of officers in the national guard were involved in illicit gun sales for years. They sold weapons, including automatic rifles, to anyone willing to pay prices well above their market value. Saudi officials emphasized that the motivation of the officers selling the weapons was money, not ideology, and did not indicate any al Qaeda involvement. (Washington Post, May 18, 2003)

Saudi Arabian Defense Minister Sultan bin Abdul Aziz was one of the defendants in a $1 trillion lawsuit brought by relatives of victims from 9-11. The plaintiffs charged that Aziz made large donations to Islamic charities that supported the 9-11 hijackers. The Saudi Press Agency, a wing of the Ministry of Information, listed $266,000 donated by Sultan to the International Islamic Relief Organization as a “personal” contribution. United States and Canadian authorities linked this charity to terrorism. (Time, May 12, 2003)

On June 12, 2004, four al Qaeda operatives, led by Abdulaziz al-Moqrin, kidnapped American contractor Paul Johnson. These four said al Qaeda was responsible for abducting and killing Johnson and that they were aided by sympathizers in the Saudi security forces. They boasted that Saudi security forces provided uniforms and police cars to its militants who then set up a fake checkpoint to kidnap Johnson. The militants said they posed as police to stop Johnson’s car, anesthetized him, and carried him to another car. (ABC News, June 20, 2004; New York Times, June 20, 2004)

After Johnson was beheaded, Saudi security forces hunted down the al Qaeda terrorists and killed them in a gun battle. Immediately, Al Qaeda announced it had replaced al-Moqrin with Saleh Mohammad al-Oufi, a former Saudi police officer. Al-Oufi was born in Medina. He later joined terrorist networks in Afghanistan and Bosnia, and returned to Saudi Arabia in 1995. Al-Oufi operated secret al Qaeda camps in Saudi Arabia and was essentially responsible for training, recruitment, and logistics. (Daily Times of Pakistan, June 22, 2004)