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The W - Current Events & Politics - Banned Arms Flowed Into Iraq Through Syrian Firm
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Grimis
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Since: 11.7.02
From: MD

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Long LA Times article......Remember, Syria is supposedly innocent, and the UN can solve all of the worlds problems if we had only given them time!

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Banned Arms Flowed Into Iraq Through Syrian Firm

Files found in Baghdad describe deals violating U.N. sanctions and offer a glimpse into the murky world of weapons smuggling and the ties between 'rogue states.'
By Bob Drogin and Jeffrey Fleishman
Times Staff Writers

December 30, 2003

DAMASCUS, Syria — A Syrian trading company with close ties to the ruling regime smuggled weapons and military hardware to Saddam Hussein between 2000 and 2003, helping Syria become the main channel for illicit arms transfers to Iraq despite a stringent U.N. embargo, documents recovered in Iraq show.

The private company, called SES International Corp., is headed by a cousin of Syria's autocratic leader, Bashar Assad, and is controlled by other members of Assad's Baath Party and Alawite clan. Syria's government assisted SES in importing at least one shipment destined for Iraq's military, the Iraqi documents indicate, and Western intelligence reports allege that senior Syrian officials were involved in other illicit transfers.

Iraqi records show that SES signed more than 50 contracts to supply tens of millions of dollars' worth of arms and equipment to Iraq's military shortly before the U.S.-led invasion in March. They reveal Iraq's increasingly desperate search in at least a dozen countries for ballistic missiles, antiaircraft missiles, artillery, spare parts for MIG fighter jets and battle tanks, gunpowder, radar systems, nerve agent antidotes and more.

The Bush administration accused Damascus in March of sending night-vision goggles and other military equipment into Iraq, but U.S. officials now say the White House was unaware of the extent of the illicit weapons traffic.

Other gaps in Washington's efforts to stem the flow of black-market weapons and missile technology to outlaw states emerged this month when Libya revealed that it had procured medium-range missiles and prohibited nuclear technology despite U.S. and U.N. sanctions.

The Syrian Foreign Ministry did not respond to numerous faxes and telephone calls asking for clarification of SES's activities. SES also has not responded to requests by The Times for an interview. In an e-mail Monday, the company termed "false" any suggestion that it was involved in illicit trade but did not address any of the specific cases.

The White House previously has accused Syria of sheltering fugitives from the ousted Iraqi regime, of letting Islamic militants cross into Iraq to attack coalition forces, and of refusing to release at least $250 million that Hussein's regime stashed in Syrian banks.

Files from the Baghdad office of Al Bashair Trading Co., the largest of Iraq's military procurement offices, provide no new evidence about chemical, biological or nuclear weapons in Iraq. And not every contract for conventional weapons was filled.

But the successful deals — such as the delivery of 1,000 heavy machine guns and up to 20 million bullets for assault rifles — helped Baghdad's ill-equipped army grow stronger before the war began in March. Some supplies may now be aiding the insurgency against the U.S.-led occupation.

And the files reviewed by The Times — about 800 pages of signed contracts, shipping manifests, export documents, bank deposits, minutes of meetings and more — offer a rare glimpse into the murky world of international arms smuggling and the ties between countries such as Syria and North Korea, which the administration calls "rogue states," and the ousted Iraqi regime. The documents illustrate the clandestine networks and complex deceptions Iraq used to evade U.N. sanctions and scrutiny by U.S. intelligence. Those include extensive use of front companies, sham contracts, phony export licenses, kickbacks and money laundering schemes.

A three-month investigation by The Times has found:

• A Polish company, Evax, signed four contracts with Iraq and successfully shipped up to 380 surface-to-air Volga/SA-2 missile engines to Baghdad through Syria. The last batch was delivered in December 2002, a month after the U.N. Security Council warned Iraq that it faced "serious consequences" if it continued to violate U.N. resolutions.

• South Korea's Armitel Co. Ltd. shipped $8 million worth of sophisticated telecommunications equipment for what Iraqi documents said was "air defense." The company is now submitting bids to the U.S.-led occupation authority for contracts to improve telephone and Internet service from Baghdad to Basra.

• Russia's Millenium Company Ltd. signed an $8.8-million contract in September 2002 to supply mostly American-made communications and surveillance gear to Iraq's intelligence service. The company's general manager in Moscow later wrote to suggest "the preparation of a sham contract" to deceive U.N. weapons inspectors, documents show.

• Slovenia's STO Ravne company, then a state-owned entity, shipped 20 large battle tank barrels identified as "steel tubes" to SES in February 2002. The next month, Slovenia's Defense Ministry blocked the company from exporting 50 more tank barrels to Syria. Overall, STO Ravne's secret contract called for delivering 175 tank barrels to Iraq.

• Two North Korean officials met the head of Al Bashair at SES offices in Damascus a month before the war to discuss Iraq's payment of $10 million for "major components" for ballistic missiles. U.S. intelligence agencies were unaware of the deal at the time, or of a meeting 10 months earlier in which Iraqi officials authorized a $1.9-million down payment to Pyongyang through SES.

• Massachusetts-based Cambridge Technology Inc. sold four optical scanners, which can be adapted to help divert laser-guided missiles, to a student in Canada. He had the equipment shipped to Amman, Jordan, and told the company he was donating it to a university whose name he now says he cannot remember. Without the U.S. company's knowledge, the real buyer was the Iraqi military.

Iraq's Al Bashair Trading Co. handled all those deals and scores of others. Its English-speaking director-general, Munir A. Awad, fled to Syria during the war and now is living there "under government protection," according to an intelligence report in Washington.

Filling an entire floor of a dingy downtown Baghdad office building, Al Bashair was the largest of 13 known companies, including an Iraqi intelligence operation called M-19, that Hussein's military used to evade the U.N. arms embargo and other sanctions, according to a confidential U.N. report on Iraq's procurement networks.

Al Bashair had special status, however. Hussein personally ordered the company to deal directly with foreign brokers and suppliers, the U.N. report notes. It estimated the value of Al Bashair's sanctions-busting deals at between $30 million and $1 billion a year in the 1990s. Al Bashair also served another key role: It helped launder and hide vast sums of cash for the Iraqi dictator and his closest aides.

Three Al Bashair contracts from 1993 to 1995, for example, indicated that Iraq had purchased $410 million, $500 million and $1.2 billion worth of sugar. U.N. inspectors found that most of the money was diverted to banks in Panama, the Bahamas and Monaco.

"The deals for sugar were a way to get money out of Iraq," said a former U.N. inspector who studied the scam. "They would pay $10,000 to a trade company for $100 of sugar. And the rest of the money went into offshore accounts."

The U.N. Security Council imposed comprehensive sanctions after Iraq invaded Kuwait in 1990. They included a full arms embargo, a trade ban and a freeze on Iraq's assets and financial dealings abroad. As a result, Iraq's regime became increasingly dependent on smuggling — and arms smugglers became increasingly creative at evading the sanctions.

When they returned to Iraq in late November 2002 after four years' absence, U.N. weapons inspectors thus focused on smuggling in their search for evidence of proscribed missiles and chemical, biological or nuclear weapons.

"We went one by one to every single [military] company we knew of in Iraq," said a senior U.N. inspector, who spoke on condition of anonymity. "Al Bashair was target No. 1 on that list."

On March 2, 30 inspectors from the U.N.'s International Atomic Energy Agency arrived without notice to check reports that Al Bashair had put public tenders out on the Internet to buy high-strength aluminum tubes. The CIA had insisted the tubes could be used to enrich uranium for nuclear weapons.

IAEA experts, customs experts, computer specialists and others locked the doors, unplugged phones and grilled Munir, the company's director, in his office. Before leaving, they copied 4,000 documents and downloaded data from office computers. They found no signs of nuclear-related procurement.

Five days later, a team from the U.N. Monitoring, Verification and Inspection Commission, the chief U.N. weapons hunting group, launched another surprise raid to check intelligence that Al Bashair had helped Hussein acquire mobile biological laboratories to churn out germ weapons. Again, they found no evidence.

The war began less than two weeks later. Days after U.S. troops entered Baghdad in April, Christoph Reuter, an investigative reporter for the German newsmagazine Stern, removed selected files from the abandoned Al Bashair office. He later provided the records and cooperated with The Times, which had the documents translated from Arabic and verified their contents with interviews in more than a dozen countries.

The Iraqi weapons files provide the first public evidence of Syria's extensive arms trade with Hussein's regime.

Most of Iraq's known arms smuggling schemes in the 1990s went through Jordan. Many involved "one man, one fax" offices set up by Iraqi agents or local businessmen for a specific deal. By 1998, U.N. inspectors had identified 146 Jordanian companies operating as fronts for Iraq.

Heavy pressure from Washington and other capitals finally forced Jordan's government to crack down.

Neighboring Syria, in contrast, had fought with the U.S.-led coalition against Iraq in the 1991 Persian Gulf War, and had no known role supporting Iraq in the 1990s. Neither SES nor any other Syrian company is listed in confidential U.N. records that identify more than 350 companies from 43 nations that U.N. inspectors suspect helped supply prohibited unconventional weapons materiel to Iraq prior to 1998.

But the crippling of Iraq's smuggling rings in Jordan coincided with a dramatic change in Syria. The country's strongman, Hafez Assad, had been a bitter rival of Hussein for most of his three-decade reign. But the Damascus dictator died in June 2000 and his son, Bashar Assad, assumed power. Syria's long-frozen relations with Iraq soon began to thaw.

In November 2000, a newly repaired pipeline from Basra in southern Iraq began carrying 150,000 to 200,000 barrels a day of discounted oil to Syria. Another pipeline to Syria from northern Iraq opened in 2002 to carry another 60,000 barrels a day.

The flow was outside the U.N.-run "oil for food" program, which allowed Iraq to export oil to buy food, medicine and humanitarian items. Experts say Syria kept the contraband Iraqi oil for domestic use, sold its own oil at higher prices on world markets and pocketed profits of up to $1 billion a year.

In return, diplomats and intelligence experts say, Baghdad got easy access to weapons and so many smuggled goods that it opened a trade office in Tartus, Syria's chief port. Baghdad also got access to the outside world: Iraqi officials, often holding counterfeit passports, increasingly used the airport in Damascus to fly abroad.

"Syria became the most important ally for Iraq in the region, and helped it come out of its global isolation," said a Washington-based diplomat. "Damascus became the gateway for Iraq."

Experts say money may have mattered more than politics in the new alliance.

"It was purely a matter of opportunity" for Syria, said an intelligence official in the region. "I don't think empathy for Iraq came into it. It was like, 'This is going to make me lots of money and I don't mind if it hurts the Americans a little bit either.' "

Among those who prospered was SES International Corp., a conglomerate of nine aviation, construction, oil, car and other divisions based in an industrial area on the northeast outskirts of Damascus.

SES was founded in 1980. According to company documents, it has about $80 million in annual revenue and 5,000 employees. It is run by a small group of businessmen and other powerful figures with family or clan ties to the Assad regime.

Prominent among them is the president's cousin Asef Isa Shaleesh, the general manager of SES. He is the son of the late dictator's half sister. Another relative, Maj. Gen. Dhu Himma Shaleesh, heads the elite security corps that protects the president. He recently told Western diplomats that he had sold his stake in SES, but they were unable to confirm his claim.

Records reviewed by The Times show Asef Isa Shaleesh, the SES manager, made at least four trips to the Al Bashair offices in Baghdad between September 2001 and August 2002 to sign or update more than 50 SES contracts to supply Iraq's military.

Contract #23/A/2001, for example, was for SES delivery to Iraq of Russian-designed heavy machine guns.

"The Iraqis have confirmed their reception of 1,000 pieces, according to the contract," meeting notes from Nov. 11, 2001 read. "The Iraqi side is in the process of paying the Syrians for a second delivery of 500 pieces of Machines Gun BKC."

Syria's Foreign Ministry helped SES at least once, according to minutes of meetings between Asef Isa Shaleesh and Munir, the Al Bashair director, on April 7-8, 2002.

Four precision metal lathes from HMT Machines International Ltd. in Bangalore, India, had "arrived in Baghdad," the notes said, but customs officials in Malta had seized others destined for Iraq. Documents show that Syria was listed as the final destination, and do not indicate that HMT knew the lathes were headed for Iraq's military. It's unclear what Syria's government knew.

But meeting notes said SES contacted the Syrian Ministry of Industry to intervene with Maltese authorities to release the lathes. "The reply was given by the Foreign Ministry of Syria to authorities in Malta saying the machines belonged to the Syrian company SES," the notes said.

The Syrian regime came up again later in the same set of meetings. "The Iraqi side requests the Syrian side to accelerate getting the approval for the visit of two Iraq experts to enter Syria for the purpose of learning about Kornet antitank missiles from Russia, which are available with the Syrian Ministry of Defense," the notes read.

The documents do not indicate whether Syria approved the request. But a Russian company, KBP Tula, had sold 1,000 portable, laser-guided Kornet missiles to Syria.

The Clinton administration imposed sanctions against the company in 1999 under a statute that bars weapons sales to Syria and other nations that the State Department lists as state sponsors of terrorism.

"Russia's foreign minister called the grounds for imposing the sanctions farfetched back then," said Leonid B. Roshal, deputy director of KBP Tula, in an interview in Moscow. "I was never taught these diplomatic niceties, so I was much more straightforward and said, 'The dog may bark, but the caravan will proceed.' "

Reached by telephone, Asef Isa Shaleesh, the general manager of SES, initially invited a Times reporter visiting Damascus to his office for an interview the next day. But an aide said the next day that Shaleesh "had unexpectedly gone to Romania" and later went to Russia. He has not replied since to numerous telephone calls, e-mails and faxes.

Western intelligence had traced some of the SES deals by mid-2002, two years after they began, With reports indicating illicit transfers into Iraq, the U.S. Embassy complained to the government in Damascus that summer. Assad replied that Syria would not violate U.N. sanctions.

"The president said, 'If you know of any cases, tell us,' " a Western official recalled. When evidence was provided, he added, "the Syrians would allege that that's been stopped."

No evidence has surfaced to show that Assad approved the SES deals with Iraq. But "sanctions-busting at this level would have been hard to keep from the president," a Western intelligence official said. An official from another government agreed. "We think it very unlikely that Bashar was not aware of this," he said.

He noted that two North Koreans flew to SES headquarters in Damascus in February 2003, a month before the war, to meet Munir, the director of Al Bashair.

"A North Korean is not a tourist," the official said. "Either Syria gave direct approval. Or it turned a blind eye."

IAEA inspectors reconstructed a report of the meeting from an erased computer hard drive that they had downloaded at Al Bashair in March. The sit-down at SES apparently focused on Pyongyang's inability to deliver $10 million of sophisticated ballistic missile technology — and its flat refusal to return the $10 million.

"The North Koreans said, 'It's too hot to refund your money,' " an official familiar with the report said.

The Times also reviewed a report on another meeting with the North Koreans ten months earlier. On April 8, 2002, Al Bashair approved payment of $1,975,517 to SES "as down payment in favor of the North Korean side. Ten percent of the sum is deducted for the Syrian side."

U.S. intelligence was unaware until this fall of North Korea's deal with Iraq. In the end, Iraq got neither the missiles nor its refund.

Western intelligence reports allege that several Syrian officials or their adult children were involved in shipments of tank engines, treads for armored personnel carriers, fuel pumps for missiles and other military equipment to Iraq.

One Syrian named in an intelligence report as a "key player" is Firas Tlass, head of MAS Economic Group, a business conglomerate based in Damascus. In an interview, Tlass said his companies had shipped textiles, computers and steel bars to Iraq since the late 1990s. But he said Israeli intelligence had spread false reports that he also sold weapons.

"I'm the son of the Syrian defense minister and we're Israel's enemy and they want to discredit the Syrian government and my father," Tlass said. "The only offer my company ever made to the Iraqi military was camouflage field jackets and they turned us down."

Syria's arms trade hit the headlines in March this year when Defense Secretary Donald H. Rumsfeld publicly accused Damascus of smuggling night-vision goggles and other military supplies to Iraq. He said Washington viewed "such trafficking as hostile acts and would hold the Syrian government accountable."

Syria's foreign minister called the charge "unfounded" and "an attempt to cover up what his forces have been committing against civilians in Iraq."

Damascus has sought to repair relations. Washington has praised Syria's assistance in rounding up suspected members of Al Qaeda since the Sept. 11 attacks. But President Bush signed a bill Dec. 12 barring export of military and dual-use items — equipment that could have civilian and military uses — to Syria until the White House certifies that Damascus has withdrawn troops from Lebanon, has cut support for Hamas and other terrorist groups, has stopped proscribed missile and chemical and biological weapons programs, and has acted to prevent militants from entering Iraq to attack coalition forces.

In contrast, the companies that knew the weapons and other sensitive supplies they sold to SES actually were destined for Iraq — a clear violation of U.N. sanctions — have faced little pressure. South Korea's Armitel Co. Ltd. is an example.

A 1998 spinoff from giant Samsung Electronics, Armitel develops and manufactures digital microwave systems for wireless communications. It is based in a high-tech industrial complex south of Seoul.

Armitel had signed contracts in 2001 and 2002 with SES totaling $23,431,487, the Iraqi files said.

On April 7, 2002, for example, Armitel's chairman inked a $1,859,862.18 contract with SES for "optical transmission, channel bank and auxiliary items."

But records labeled "secret" in the Al Bashair files show the Armitel equipment was "connected with the supply of air defense" and that the real buyer was the Salahaddin Co., based in northern Iraq, which was trying to develop a radar system to detect U.S. stealth bombers.

In an interview, Lee Dae Young, the 50-year-old chairman of Armitel, said he knew his equipment was headed to Iraq despite U.N. sanctions. But he said he thought he was helping Baghdad upgrade telephone and Internet service.

"We sold Iraq an optical cable system," Lee said. "Actually, now that this is over, I can tell you. We sold it to Syrians and they took it to Iraq."

Armitel had sent $8 million worth of equipment to Syria when U.S. intelligence got wind of the shipments in mid-2002. After the U.S. Embassy in Seoul complained, South Korea's Ministry of Commerce ordered Armitel to stop further shipments. An investigation was begun but Armitel was not charged. The company recently submitted proposals to the U.S.-controlled Coalition Provisional Authority in Baghdad for contracts to build a telecommunications network from Baghdad to Basra.

Another supplier to Iraq's military was Slovenia's RTO Ravne. The state-owned company, then an arms manufacturer, agreed in the fall of 2001 to supply 175 tank barrels — called "steel tubes" in the documents — to the Saddam Co. near Fallouja, one of Iraq's largest producers of artillery, armored vehicles and other heavy military equipment. The $6.3-million deal had a twist. On paper, the "tubes" went to the Al Heeti Co. in Jordan. In reality, SES handled the deal.

On March 7, 2002, the fourth shipment of five tank barrels arrived at Tartus from Slovenia aboard the Diane A, an Italian ship. Munir, the Al Bashair chief in Baghdad, immediately sent an urgent letter to SES, asking the Syrian company to "take the necessary steps to take over the container and forward it to us as soon as possible."

Later that month, Slovenia's Ministry of Defense announced it had blocked the export by RTO Ravne of 50 smoothbore barrels for the Syrian army's T-72 main battle tanks.

RTO Ravne has since been broken up and privatized. It's unclear how many of the tank barrels ultimately got through to Iraq. Dusan Pahor, the STO Ravne quality control manager whose signature appears on the specification documents, declined to comment on the deal. His supervisor, who identified himself as Mr. Studancik, confirmed the contracts for "tubes" were a sham. "Yeah, yeah, it was tank barrels," he said. "That is correct."

Two Russian companies also had clandestine deals with SES as the war approached. Moscow-based Millenium Co. Ltd. signed an $8.8-million contract on Sept. 14, 2002 to provide radio frequency equipment, transmitters, mobile eavesdropping systems and other surveillance gear to SES. The contract specified that Millenium would supply equipment from such U.S. companies as Hewlett Packard, Cisco Systems and MITEQ, as well companies in Germany, Canada, France and Japan.

Al Bashair records show, however, that the Millenium representative in Baghdad had met on July 25 with two "representatives of the Intelligence Service" in order to "come to agreement on concluding the contract."

On Sept. 29, the general director of Millenium, an Iraqi exile named Hasam Khalidi, signed a letter advising Al Bashair of the need to "consider the preparation of a sham contract" to conceal the deal "in case other authorities, including United Nations inspectors, want to see a copy of the contract…. The services and materials to be delivered should look as for civilian use so they will not attract attention of those authorities."

In an interview, Khalidi denied writing the letter, denied dealing with SES, and denied that his company had done anything to evade or violate U.N. sanctions. Khalidi argued instead that he had a legitimate business deal to sell bugging equipment to Iraq's Interior Ministry.

"I didn't see anything immoral in it," he said.

"Someone in Iraq is going to be surprised about a monitoring system? I could have stood up and said, 'Aren't you ashamed!' "

In the end, he said the war intervened and the deal collapsed. "Nothing ever happened," he said. "It's a pity."

Al Bashair records also show that a Russian company called TsNIIM-Invest, an offshoot of a state-run science center, signed several agreements with SES between August and December 2001 to supply $1.7 million worth of large "tubes" suitable for artillery and an "electro-chemical workshop" to the Saddam Co. near Fallouja.

Valentin Petrovich Kuznetsov, the technical director of TsNIIM-Invest in Moscow, declined an interview request.

"As for the tubes, I can tell you that this thing never materialized," he said. "It just didn't happen. There was a lot of fuss about it. But nothing was proven. That is all I can tell you now."

Iraqi officials also made 15 visits before the war to a Russian company called Aviakonversiya. The Moscow-based company specializes in producing GPS jammers, portable units that distort signals used by satellite-based navigation systems. During the war, U.S. aircraft struck several sites where the jammers' radio frequency was detected.

But Oleg Antonov, general director of Aviakonversiya, said the jammers weren't his because the Iraqi delegations looked but never bought.

"Frankly, I would have had no qualms selling this stuff to Iraq," Antonov said. "We wouldn't have sold this to them directly. We would have done it the way everybody was doing it. We would have sold it to some third country."

Antonov added that he would be "happy and proud" if he "knew for sure that our equipment was used in Iraq and was a success there…. It would be the best advertisement for our production."




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CRZ
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Since: 9.12.01
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Y!:
#2 Posted on | Instant Rating: 8.65
Quick poll:

Did ANYBODY read that from beginning to end?

You too, Grimis. :)



©CRZ™
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Since: 9.12.01
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#3 Posted on | Instant Rating: 8.83
I did.



Willful ignorance of science is not commendable. Refusing to learn the difference between a credible source and a shill is criminally stupid.
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Since: 28.1.02
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#4 Posted on | Instant Rating: 6.33
    Originally posted by CRZ
    Quick poll:

    Did ANYBODY read that from beginning to end?

    You too, Grimis. :)


uh, no...



Rasslin' republicans - visit it soon
Grimis
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Since: 11.7.02
From: MD

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#5 Posted on | Instant Rating: 7.29
    Originally posted by CRZ
    Quick poll:

    Did ANYBODY read that from beginning to end?

    You too, Grimis. :)
Yup



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Lexus
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Since: 2.1.02
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#6 Posted on | Instant Rating: 6.02
I did, and I'm the village idiot.





Kane gets flustered that he didn't get to do something silly this week. Ho hum.
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Well a good thing if you are of the opinion that both the major party choices suck: http://techcentralstation.com/101404A.html an interesting read, even if far fetched.
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