Author Favors Probe Into Link Between Former BCCI Officials, UBL 'Network'
New Delhi The Pioneer (Internet Version-WWW) in English 22 Dec 04
[Article by Wilson John: "Who paid for AQ Khan network?"]
A year ago, around this time, startling revelations were tumbling forth
from Washington about how a Pakistani rogue nuclear scientist, Mr AQ Khan,
had set up a global chain of illegal nuclear trade with branch offices in
Dubai, Malaysia, Germany, US, UK, Tripoli, Tehran, Baghdad and Pyongyang.
The investigations carried out by the US intelligence agencies and officials
of the International Atomic Energy Agency (IAEA) revealed the involvement of
several people dispersed across the globe, and raised the spectre of
terrorists tapping into the nuclear blackmarket chain. What the US
agencies and the media failed to focus on was that the American taxpayer
bankrolled the nuclear underworld.
A report prepared by Observer Research Foundation, a New Delhi-based
public policy think tank, on the AQ Khan's network, reveals how the CIA was
aware that "Pakistan was diverting a large portion of its foreign aid to
nuclear development programme". In 1993, testifying before the Senate
Committee on Government Affairs, the agency said Pakistan had received $19
billion in aid from foreign countries and donor agencies like the
International Monetary Fund. In a written response, the agency said out of
$19 billion, $2.7 billion was not designated for any specific purpose, thus
enabling Pakistan to spend it on its nuclear programme. Even if these
figures are to be taken as real, they fail to explain the total amount spent
by Pakistan on its nuclear development programme between 1974 and
1993--$19.85 billion.
There could only be two explanations for this accounting difference.
First, Pakistan spent the aid it received from various donor agencies and
countries--about $19 billion according to CIA--almost entirely on the
programme. This is highly unlikely, given Pakistan's critical foreign
exchange reserves, a burgeoning defence budget and a perpetual and desperate
need to find money to initiate development programmes, especially in water
resource management. Add to all this, the scourge of corruption. Second,
the money came from a more anonymous source, considering no less a crucial
fact that $19.85 billion (1993) was only the official figure. It does not
take into account the missile-to-nuke barter Pakistan had entered into with
North Korea. Nor the money routed through the network to set up front
companies in Europe, the US, Dubai and Britain, pay agents to procure
nuclear materials and know-how illegally, and thereby more expensively, and
ship them to Pakistan through various cut-outs and routes to avoid
detection.
The question is how did the money reach the Khan Research Laboratory,
the nuclear facility set up by the Pakistan and run by Mr AQ Khan. Most of
the funds were parked with two less-known entities--the Ghulam Ishaq Khan
Institute of Science and Technology, set up in Islamabad to honour President
Ghulam Ishaq Khan and Attock Cement Private Ltd (APCL), a factory off Dera
Ghazi Khan owned by Ghaith Pharaon, a Saudi billionaire who owns, besides
the cement unit, two oil refineries and a software firm in Pakistan. Both
these organisations had a common link: Bank of Credit and Commerce
International [BCCI]. The Institute was set up with a grant of $10 million
from the Bank. The Institute's first director was AQ Khan, a close ally of
President Khan from the days of Bhutto. Pharaon, declared a fugitive by
the US authorities, was a close friend of Abedi who helped BCCI to secretly
buy an American bank, First American, and introduce Abedi to the power
brokers in Washington DC.
An independent investigation carried out by a US Senate Committee in
1992 would pin down the Institute and the cement factory as the conduits for
the BCCI to fund Pakistan's secret programme for nuclear deals through the
Black Network. Senator John F Kerry headed the Senate Committee, which
unravelled the web of a powerful, anonymous financial underworld that
stretched from the lanes of Karachi to the White House. The BCCI was not an
ordinary bank. Nor was its owner, Agha Hassan Abedi. By 1977, the BCCI
was the world's fastest growing bank, operating from 146 branches (including
45 in the United Kingdom) in 43 countries including Africa, the East Asia
and the Americas.
From assets worth $200 million, the bank, by the mid-1980s, was
operating from 73 countries with assets over $22 billion. Its rise was
phenomenal and of the several reasons, the most crucial was Abedi's
friendship with some of the most powerful personalities--President Zia,
President Ghulam Ishaq Khan, President Jimmy Carter, the ruling families of
Saudi Arabia and United Arab Emirates, billionaires like Ghaith Pharaon,
Khalid bin Mahfouz and Saudi intelligence chief Kamal Adham, a key liaison
man between the CIA and Saudi Arabia.
Among those who allegedly benefited from the BCCI were US Ambassador to
the United Nations Andrew Young, Bert Lance, Jesse Jackson, former British
Prime Minister James Callaghan, then United Nations Secretary General Javier
Perez de Cueller, Jamaican Prime Minister Edward Seaga, Antiguan Prime
Minister Lester Byrd; a large number of African heads of state; and many
Third World central bank officials. An example of Abedi's influence could
gauged from the fact that he lent his corporate jet to Carter after his
retirement, donated $500,000 to help establish the Carter Centre at Emory
University in Atlanta and donated heavily to Carter's Global 2000
Foundation.
It was the John Kerry Committee that, perhaps for the first time, hinted
at the possibility of BCCI funding the nuclear smuggling network. In its
exhaustive report (available at www.fas.org), the committee quoted a CIA
memorandum which stated that "the Agency did have some reporting (as of
1987) on BCCI being used by Third World regimes to acquire weapons and
transfer technology". In its conclusion, the Senate report said there was
"good reason to conclude that BCCI did finance Pakistan's nuclear programme
through the BCCI Foundation in Pakistan, as well as through BCCI-Canada in
the Parvez case. However, details on BCCI's involvement remain
unavailable. Further investigation is needed to understand the extent to
which BCCI and Pakistan were able to evade US and international nuclear
non-proliferation regimes to acquire nuclear technologies." Years later, an
Inter Services Intelligence (ISI) officer, Major Ikram Sehgal, would write
(Gulf News, November 24, 2001) about the mysterious, daily remittances of
$100,000 made by BCCI in Karachi to bank accounts in Canada till mid-1988.
With the collapse of the bank following the Senate investigations and
death of Abedi in 1998, many of those who ran the BCCI escaped prosecution
and vanished from the headlines but only to emerge later as honourable
businessmen, high-profile bankers and traders, a few as key financiers of
Osama bin Laden's network of terror. A 70-page intelligence report
prepared by French authorities in October 2001 said Laden's network of
investments was quite similar to the one set up by the BCCI "often with the
same people (former directors and staff of the bank and its affiliates, arms
merchants, Saudi investors)". The report identified dozens of companies
and individuals who were involved with the BCCI and were found to be dealing
with the bin Laden network after the bank collapsed.
This link has not been probed indepth and needs to be investigated
thoroughly, given the recent disclosure by a former Al Qaeda senior leader
about Osama bin Laden getting access to nuclear material.
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