Part 11:

The opaque world of Clearstream meets the SICO family affair

We just saw the extent to which the world’s financial system is wide open to exploitation, without oversight, for criminal business, drug-lords, tax-evaders, terrorists, and anyone looking to clean some dirty money. And we also saw how it was more than just banks like the now-notorious BCCI profiting from this trade. Through the use of offshore banks, correspondent accounts, and other tricky techniques virtually all major banks (and many minor ones) are playing a role by being diligently unaware of the nature of their clients’ business. And then there’s Clearstream. Clearstream, a clearinghouse for banks to trade European stocks and bonds, appears to be another one of those conduits. We’re going to spend probably more time and energy than we should attempting to piece together this messy set of scandals because Clearstream may have an interesting, and direct, link to 9/11.

You may have heard about the “Clearstream Affair” that has roiled French politics in recent years. It’s been called the “French Watergate” and involves spies, fraud, and corruption going back more than a decade. It’s pretty interesting as far as political scandals go, and it’s based on an earlier, more significant Clearstream affair. Significant, in that the first Clearstream affair was a money-laundering affiar.

The second Clearstream affair was primarily a political affair. And from a political and public awareness standpoint, the second Clearstream affair definitely made the bigger splash. In May of 2006 it was looking like Jacque Chirac’s chosen Presidential successor, Dominque de Villepin, might go down in scandalous flames over accusations that he framed his second-in-command and arch-Rival Nicolas Sarkozy through the fraudulent use of the Clearstream clearinghouse records. This second Clearstream political affair isn’t directly related to 9/11 or terrorist financing, but it’s come to define what the “Clearstream scandal” is, and it needs to be addressed. Oh, and it also appears to have propelled the French far-Right to a record popularity as the public soured over the protracted, messy scandal. To get an idea of the political shenanigans involved, let’s turn to an excellent May 2006 article in the Christian Science Monitor:

'Watergate' shakes Paris, but not voters

The 'Clearstream affair' implicates Chirac, Villepin in a smear campaign.

By Peter Ford | Staff writer of The Christian Science Monitor

PARIS - The scandal has all the elements of a thriller: backstabbing politicians, a shadowy spy-master, mystery informants, secret foreign bank accounts, multimillion-dollar arms sales and illegal bribes.

And it has been shaking Paris for nearly a month, as daily revelations add to the Byzantine complexity of the allegations swirling around President Jacques Chirac and his prime minister, Dominique de Villepin.

But though the "Clearstream affair" has been branded "the French Watergate," most French voters remain unmoved. The reasons why provide grounds for both hope and misgivings about the health of French democracy.

On the one hand, pollsters have found, most people wish their politicians would stop obsessing over the latest scandalous twist in the affair and offer instead some ideas about the grave issues facing French society, such as its economic decline, unemployment, and its place in the world.

"That is the good news," says Philippe Manière, head of the Montaigne Institute, a think tank in Paris. The bad news, he adds, is that "the French public has become as cynical as its political leaders."

The allegations of misdeeds at the pinnacle of government "do not interest people much because they see them as business as usual," Mr. Manière suggests.

Yep, “business as usual” in France of rampant political corruption and cancerous public apathy and cynicism is pretty similar to business as usual in the US society, the UK, and probably every other country on our most troubled planet.


Headwaters of the scandal

Clearstream is the name of a banking clearing-house in Luxembourg. In 2004, an anonymous informant provided French judges with alleged lists of secret Clearstream accounts that suggested senior French politicians had used them to stash illegal kickbacks from a 1991 sale of frigates to Taiwan - a deal that had already been under investigation for several years.

The Taiwan Frigate scandal involves some hundreds of millions of dollars worth of corrupt “commissions” from the 1991 sale of frigates to Taiwan. The scandal became intertwined with the Clearstream clearinghouse through allegations that secret accounts withing the clearinghouse were set up and moved funds to offshore banks accounts accessed by various French politicians and prominent citizens. The Taiwan frigate scandal isn’t just intertwined with the Clearstream scandal. It also has roots in the broader Elf-Acquitaine corruption scandal involving corruption within the then-state-owned French oil company (and occaisional arms dealer) Elf-Acquitaine.

One of the figures convicted in the Elf-Acquitaine scandal (given a 15 month suspended sentence which he is appealing) is Nadhmi Auchi, an Iraqi-born British Billionaire who is reported to have financial ties to Saddam Hussein’s regime. According to the London Guardian, Mr. Auchi is a former Baath Party activist who moved to London in the 80’s, making millions in commissions on arms sales to Iraq. The Guardian also reported his brother, Nazir, was an Iraqi Oil Minister who was executed in a deal-gone-sour with Saddam. Mr. Auchi’s alleged ties to the Egyptian telecom giant Orascom led to controversy over his potential profiting from the Iraqi reconstruction contracts. According to an Aprbil 2003 report in the New York Times, Nadhmi Auchi’s firm was one of the largest shareholders in BNP Paribas, the French bank that was the main repository for Iraq’s funds in the oil-for-food program. Wikipedia’s entry on the Clearstream affair also claims (as of November 24, 2006) that Mr. Auchi was involved in the Clearstream scandal, but that appears to be an unsourced claim and should be ignored.

For the record, Mr. Auchi asserted the following (in a private legal correspondence to this author via his law firm): 1. That his brother was never an Iraqi Oil Minister or had any involvement with the Iraqi government at all. 2. That he also flatly and categorically denies any wrongdoing in relation to the Elf scandal. 3. He was never involved in any arms sales to Iraq or at all. He has also not made millions from the reconstruction of Iraq and has no material business in this. 4. He has now knowledge or Clearstream and no involvement in it whatsoever of which he is aware. And finally, 5. He currently has no shares in BNP Paribas, and was a passive shareholder at the time, and that Mr. Auchi, nor any of his companies, were named in the United Nations’ “Report on the Manipulation of the Oil-for-Food Programme”.

And while Mr. Auchi nor his law firm does not assert the following, we would like to believe that Mr. Auchi just an all around great guy. Or, at the very least, it is entirely possible that many of the claims made about Mr. Auchi by various media outlets and governmental investigations could be false, which is an important consideration for any of the folks we’re discussing in these tangled topics.

Mr. Auchi’s London-based law firm, Carter-Ruck, has also recently represented a few other individuals mentioned in this series of essays. This includes Sheikh Yousef al-Qaradawi (as mentioned in Part 4), who was in a lawsuit brought by the families of the 9/11 victims, and Saudi billionaire Yassin al-Kadi, who we cover quite a bit Parts 12 and 13. So we would like to preemptively state, for the record, that both individuals have no ties to terrorism (regardless of their status as accused terrorist financiers and supporters in numerous media outlets), and are both, like, super-duper special awesome.



Among those politicians was Nicolas Sarkozy, now the interior minister, and - then as now - the daggers-drawn rival of Mr. Villepin, who is Mr. Chirac's favorite to succeed him as president at elections next April.

Judicial inquiries have found the lists of accounts to be faked. One question is who faked them, and why. The anonymous informant turns out to have been Jean-Louis Gergorin, vice- president of the European aerospace and weapons firm EADS and an old friend of Mr. Villepin's.

Evidence given to investigating judges, and then leaked to the press, also shows that in January 2004, Villepin - at the time foreign minister - asked a senior intelligence agent, Gen. Philippe Rondot, to privately investigate the possibility that Mr. Sarkozy held a secret foreign bank account. General Rondot's notes of his meeting with Villepin indicate that President Chirac had approved this request.

Rondot's investigation, and a subsequent investigation by the official domestic intelligence agency, concluded that the lists were bogus. Villepin, however, did not tell Sarkozy for 15 months - until late last year - that his name had been cleared.

The implication of the revelations is that Villepin, with Chirac's knowledge, tried to smear Sarkozy by secretly gathering damaging information about him, and then kept quiet when the information proved false. Sarkozy has since filed a suit for defamation against whoever concocted the Clearstream lists.

Here’s a bunch of details that you don’t really need to know, but might be curious about:

In May of 2006, EADS vice president Jean-Louis Gergorin admitted that he was the anonymous source that gave the first list of alleged Clearstream account holders to a French Judge investigating the corruption of Taiwan frigates sales. The first list of Clearstream account holders, sent in May of 2004, did not include Prime Minister Sarkozy’s name. The second list sent to the same judge the following month, did include Sarkozy’s name, and it’s that second list that is believed to have been fraudulently created via real lists of Clearstream’s accounts. Gergorin would not publicly admit that he was the source of the second list. Gergorin’s fellow EADS official, Imad Lahoud, is believed to have been the source of the second, fraudulent list. While Lahoud claimed to Gergorin that he was capable of hacking into the Clearstream’s systems to steal the files, it is now believed that he instead simply got the files from Arthur Andersen auditor Florian Bourges, who believed Lahoud was working for French intelligence. Questions about Lahoud’s background include his past ties to both French intelligence and the bin Laden family. But, to make things more complicated, it’s also belived that Lahoud didn’t exactly hack into Clearstreams database

On an interesting sidenote, EADS is the parent company of Airbus and the primary competitor of Boeing, although competitors don’t always compete. Sometimes they even merge, like, a lot.


Judges are still investigating the origins of those lists and the government has called for an investigation of the recent leaks of judicial evidence, particularly that provided by Rondot. It was the general's evidence, published at length in the daily Le Monde over the past month, that has heightened the scandal's profile and distracted politicians.

"This is no longer a government, it is a battlefield," opposition Socialist party leader François Hollande charged during a no-confidence motion he brought before parliament last week. Though the motion failed, the debate highlighted Villepin's isolation: more than 200 of his fellow party members ostentatiously stayed away from the chamber during the prime minister's speech.

French spy-master Phillipe Rondot, also refused to answer the judges’ questions, complaining about leaks to the press.


Possible boon for extreme right

Villepin's chances of becoming the ruling UMP's presidential candidate next year now appear slim, at best. But he is not the only one to have suffered a blow to his prestige. The whole political class, and especially those politicians currently in power, have been tarred with the Clearstream brush.

Among the general public the complexity of the case means "there is a vague sense that bad things have been happening, that people at the top have been misbehaving, but nobody really knows what has been going on or who is responsible," says Jean-Luc Parodi, who teaches politics at the Political Studies Institute in Paris.

"That plays against everyone who embodies politics or power," he adds. An opinion poll published last week found that 69 percent of the French trust neither the right nor the left to lead their country.

That has raised fears among mainstream politicians that outsiders such as extreme-right leader Jean-Marie Le Pen might take advantage of the scandal. President Chirac, condemning what he called a "dictatorship of rumors" last week, warned that the leaks risked making voters "despair of politics."

"Le Pen denounces all politicians as rotten, and everything we see seems to be going in that direction," says Paul Godt, a professor of politics at the American University of Paris. "It just seems to confirm Le Pen's analysis."

Within one month, from April to May of 2006, Jean-Marie Le Pen’s approval rating surged 5% to a record 22% of the populace that has a “favorable opinion” of him. And if you’re wondering how Le Pen got up to 17% by April of 2006, well, the French Muslim riots of 2005 sure didn’t hurt the anti-immigrant Le Pen. Viva la Fascism!

But wait, wasn’t Le Pen also a friend of the Bank al-Taqwa Director and neo-Nazi-turn-radical-Islamist Ahmed Huber? Why yes he was. And perhaps what’s even more surprising is that Le Pen has been recently courting the French Muslim voters and been rather warmly recieved. So how has Le Pen’s out reach program gone down with his National Front base? Well, it appears to have created a split between the neo-Fascist wing that view Jews and the US as their primary enemies, and the anti-Muslim Christian hard-Rightists. As a result, Le Pen is facing increasing competition on the far-right from the anti-Immigrant Phillipe de Villiers. Viva la bi-Partisan Fascism!

Also, note how easy it is for someone like Le Pen to get support. He trashes all politicians, and then benefits from exposure of “business as usual”. One of the most troubling aspect of these troubled times is our tendency to not read history and then repeat it. And one of the most common preludes to dark chapters in history goes something like this: Things go wrong for whatever reason, the public says “ah, what the hell, I’m going to support [insert authoritarian extremist’s name]”, and then things go really wrong. This just keeps happening and it’s something we need to keep in mind while our leaders run us off a cliff because there may be fascists waiting at the bottom of that cliff (and, quite frankly, there may be fascists giving us a push at the top). Some cycles in history are the kind you’d prefer be only repeated on the History Channel.


Not a hot watercooler topic

French voters are confused by the Clearstream affair but so unsurprised by it that only 17 percent of them discuss the scandal over the watercooler, according to Stéphane Rozès, an analyst with the CSA polling firm.

That is partly because the French have always expected self-interest, not morality, to govern politics, he says. But more important, he adds, the lack of interest illustrates how "the French have recently started to expect more of their politicians. They want them to resolve questions about our social model, our place in the world, about change. They don't want to see political debate diverted to secondary issues, and they see this as a secondary issue."

"Social anxieties trump scandal," agrees Mr. Parodi. Especially, he adds, when the scandal "is neither comprehensible nor easily blamed on anyone in particular."

That’s the Second Clearstream affair: a secret list passed on to French officials, then anonymously given to a judge, then modified with names added, then re-anonymously given to the judge, then investigated, then declared a fraud, and finally treated liked political plutonium by the politicians involved as the scandal unravels, with plenty of leaks, lawsuits, far-Right good times and incomprehensibility to go around…unfortunate incomprehensibility. Moving on to the first Clearstream affair.

The First Clearstream Affair

The first Clearstream scandal of 2001 revealed Clearstream, one of Europe’s two major stock and bond clearinghouses, to be a possible nexus of international money-laundering. In 2001, Ernst Backes, a former top official in Clearstream, published a very revealing book detailing the dark side of Clearstream. Let’s take a closer look at this important book with an excellent 2002 “In These Times” article by money-laundering expert Lucy Komisar:

March 15, 2002

Explosive Revelation$

The world’s biggest banks and multinational corporations have set up a shadowy system to secretly move trillions of dollars—a system that can be exploited by tax evaders, drug runners and even terrorists.

By Lucy Komisar

In the tax haven of Luxembourg, a little-known outfit called Clearstream handles billions of dollars a year in stock and bond transfers for banks, investment companies and multinational corporations. But a former top official of this “clearinghouse” says Clearstream operates a secret bookkeeping system that allows its clients to hide the money that moves through their accounts.

In these days of global markets, individuals and companies may be buying stocks, bonds or derivatives from a seller who is halfway across the world. Clearinghouses like Clearstream keep track of the “paperwork” for the transactions. Banks with accounts in the clearinghouse use a debit and credit system and, at the end of the day, the accounts (minus “handling fees,” of course) are totaled up. The clearinghouse doesn’t actually send money anywhere, it just debits and credits its members’ accounts. It’s all very efficient. But the money involved is massive. Clearstream handles more than 80 million transactions a year, and claims to have securities on deposit valued at $6.5 trillion.

It’s also an excellent mechanism for laundering drug money or hiding income from the tax collector. Banks are supposed to be subject to local government oversight. But many of Clearstream’s members have real or “virtual” subsidiaries in offshore tax havens, where records are secret and investigators can’t trace transactions. And Clearstream, which keeps the central records of financial trades, doesn’t get even the cursory regulation that applies to offshore banks. On top of that, it deliberately has put in place a system to hide many of its clients’ transactions from any authorities who might come looking.

According to former insiders:

· Clearstream has a double system of accounting, with secret, non-published accounts that banks and big corporations use to make transfers they don’t want listed on the official books.

· Though it is legally limited to dealing with financial institutions, Clearstream gives secret accounts to multinational corporations so they can move stocks and money free from outside scrutiny.

· Clearstream carried an account for a notoriously criminal Russian bank for several years after the bank had officially “collapsed,” and clearinghouse accounts camouflaged the destinations of transfers to Colombian banks.

· Clearstream operates a computer program that erases the traces of trades on request from its members.

· Clearstream was used to try to hide a dubious arms deal between French authorities and the Taiwanese military.

Many of these charges were first made in a controversial book called Révélation$, written by Denis Robert, a French journalist, and Ernest Backes, a former top official at the clearinghouse who helped design and install the computer system that facilitated the undisclosed accounts. The book’s impact was explosive. Six European judges called it “the black box” of illicit international financial flows. Top Clearstream officials were fired. The scandal made headlines in big European newspapers; TV networks broadcast specials; the French National Assembly’s financial crimes committee held a hearing. Luxembourg authorities ordered an investigation, and then they effected a cover-up. Yet Révélation$ remains unpublished and relatively unknown in the United States.

Clearstream may possibly be a “the black box” of illicit international financial flows, but opaque “black boxes” aren’t limited to institutiolal structures. Sometimes the structure of financial arrangements themselves can create and effective “black box”. Just ask JP Morgan, insurance giant AIG, and the unfortunate non-recipients of affordable housing.


A bearded, heavyset man in his mid-fifties, Backes spoke with In These Times in Neuchâtel, Switzerland, where he’d gone to attend a conference on international crime, and explained how he’d started fighting “organized crime in banking.”

Ernest Backes was born in 1946 in Trier, Germany. (As he likes to joke, “There were two important people born in Trier; the other is Karl Marx.”) His father was a Luxembourg metal worker, his mother a German nurse. From 14, he worked on an assembly line to pay for school and joined the Young Catholic Workers. After a job in the Luxembourg civil service, he was hired in 1971 by Clearstream’s predecessor Cedel (short for “central delivery” office), set up the year before by a consortium of 66 international banks. Backes helped design and install Cedel’s computerized accounting system in the ’70s.

Cedel and its main competitor, Brussels-based Euroclear, were started to manage transfers of “eurodollars,” U.S. currency kept in banks outside the United States. According to Barbara Garson’s book Money Makes the World Go Around, eurodollars were invented in the ’50s by the Chinese and the Soviets so they would not have to put their assets in banks where the U.S. government could seize them. But others saw value in eurodollars, and they began to be traded for other currencies. Some banks attracted eurodollars with higher interest than was being paid in America, and U.S. corporations and individuals began using the accounts to avoid laws on domestic banks. The euromoney market was born. (By the ’90s, the Federal Reserve estimated that about two-thirds of U.S. currency was held abroad as eurodollars.)

As the defacto global reserve currency, the US Dollar is the prime currency choice for investors around the world. And for all our financial system’s faults, its way more regulated and sound than the most (which really isn’t saying much). The Eurodollar market, which isn’t subject to the relatively-strict US banking regulations, has become a hugely important post-War financial vehicle has both encouraged US business abroad and acted as source of pressure for further the deregulation of US financial markets.


Cedel and Euroclear eventually expanded into handling transfers of stock titles and other financial instruments. Their clients needed a system that would guarantee the creditworthiness of their trading partners and keep records of the trades. The clearinghouses provided speed, discretion, and a system that didn’t make the records of their deals and profits readily accessible to outsiders. Every few months, a list of members’ codes was distributed. For transfers, members just entered the codes, and Clearstream handled the deals with no further inquiries.

In 1975, several big Italian and German banks wanted to centralize their accounting and didn’t want other members of Cedel to send transfers through their numerous individual branches. The Cedel council of administration—its board of directors—authorized banks with multiple subsidiaries not to put all their accounts on the lists. Backes and Gerard Soisson, then Cedel’s general manager, set up a system of non-published accounts. A bank would send a transfer to the code of the headquarters bank, which would send it on to the non-published account of its subsidiary. The bank would regulate this operation internally.

Soisson authorized each non-published account, which would be known only by some insiders, including the auditors and members of the council of administration. As Cedel’s literature to clients explained: “As a general rule, the principal account of each client is published: the existence of the account, as well as its name and number, are published. … On demand, and at the discretion of Cedel Bank, the client can open a non-published account. The non-published accounts don’t figure in any printed document and their name is not mentioned in any report.”

Requests for non-published accounts came from some banks that weren’t eligible, but Soisson turned them down.

By 1980, Backes had become Cedel’s No. 3 official, in charge of relations with clients. But he was fired in May 1983. Backes says the reason given for his sacking was an argument with an English banker, a friend of the CEO. “I think I was fired was because I knew too much about the Ambrosiano scandal,” Backes says.

It sounds like Backes and Gerard Soisson ran a pretty honest ship at Cedel, so it would make sense they might fire him if he knew too much about the Banco Ambrosiano/Vatican Bank scandal.


Banco Ambrosiano was once the second most important private bank in Italy, with the Vatican as a principal shareholder and loan recipient. The bank laundered drug- and arms-trafficking money for the Italian and American mafias and, in the ’80s, channeled Vatican money to the Contras in Nicaragua and Solidarity in Poland. The corrupt managers also siphoned off funds via fictitious banks to personal shell company accounts in Switzerland, the Bahamas, Panama and other offshore havens. Banco Ambrosiano collapsed in 1982 with a deficit of more than $1 billion. (Unknown to many moviegoers, Banco Ambrosiano inspired a subplot of The Godfather Part III.)

Several of those behind the swindle have met untimely ends. Bank chairman Roberto Calvi was found hanged under Blackfriars Bridge in London. Michele Sindona, convicted in 1980 on 65 counts of fraud in the United States, was extradited to Italy in 1984 and sentenced to life in prison; in 1986, he was found dead in his cell, poisoned by cyanide-laced coffee. (Another suspect, Archbishop Paul Marcinkus, the head of the Vatican Bank, now lives in Sun City, Arizona with a Vatican passport; U.S. authorities have ignored a Milan arrest warrant for him.)

The arrest warrant for Paul Marcinkus in 1987 created an interesting standoff between the Vatican and Italy involving diplomatic immunity, since Marcinkus was still living at the Vatican City at the time. Marcinkus died in the United States in February of 2006.


Just two months after Backes’ dismissal in 1983, Soisson, 48 and healthy, was found dead in Corsica, where he’d gone on vacation. Top Cedel officials had the body returned immediately and buried, with no autopsy, announcing that he had died of a heart attack. His family now suspects he was murdered. “If Soisson was murdered, it was also related to what he knew about Ambrosiano,” Backes says. “When Soisson died, the Ambrosiano affair wasn’t yet known as a scandal. [After it was revealed] I realized that Soisson and I had been at the crossroads. We moved all those transactions known later in the scandal to Lima and other branches. Nobody even knew there was a Banco Ambrosiano branch in Lima and other South American countries.”

After leaving Cedel, Backes got a job in the Luxembourg stock market, and later became manager of a butchers’ cooperative. But he kept friends inside the clearinghouse and began to collect information and records about Cedel’s operations.

With Soisson out of the way, there was nothing to stop the abuse of the system. Whereas Soisson had refused numerous requests to open non-published accounts (from such institutions as Chase Manhattan in New York, Chemical Bank of London and numerous subsidiaries of Citibank), Cedel opened hundreds of non-published accounts in total irregularity—especially after the arrival of CEO André Lussi in 1990. No longer were they just sub-accounts of officially listed accounts, Backes charges. Some were for banks that weren’t subsidiaries or even official members of Cedel. At the start of 1995, Cedel had more than 2,200 published accounts. But in reality, according to documents obtained by Backes, Cedel that year managed more than 4,200 accounts, for more than 2,000 clients from 73 countries.

Clearstream was formed in 1999 out of the merger of Cedel and the compensation company of Deustche Börse (the German stock exchange). “No accounts are secret,” insists spokesman Graham Cope. “We are controlled by the local authorities … who have access to information on all accounts. The term ‘secret’ is misused again and again. Our customers choose to have unpublished accounts, which simply means—like a telephone number—they choose not to display the name and number in our publications. Customers often have many unpublished accounts, which they use for their own internal management purposes to ensure there is no confusion between their accounts.”

But Backes thinks otherwise. “I discovered an increasing number of unpublished accounts,” he says. “There were more unpublished than published accounts, and a [large] proportion were not sub-accounts of a principal account, which is what the system was supposedly for. The owners of these accounts were not inscribed on the official list of the clients of the firm.”

When Clearstream executives dismissed Backes’s claims in 2001, they cited the fact that accounting giant KPMG audited their activities. Granted, earlier that year Clearstream admitted to overstating its assets by $1.5 trillion, but that’s no reason to suspect further shenanigans. In 2005, KPMG admitted that it engaged in fraudulent tax shelters for “high net worth” clients that allowed them to evade $2.5 billion in taxes. KPMG was also the auditor during the period that mortgage giant Fannie Mae engaged in billions in “accounting errors”. KPMG is one of the Big Four Accounting firms which audit about 80% of US publicly traded firms. It used to be “Big 5” until Arthur Andersen got “Enronitis”.

Also, in 2002 the Deutsche Borse (German stock exchange) purchased the remaining half of Clearstream from Cedel.


How does the system work? Backes explains, for example, that a bank with a published account could open an unpublished account for a branch in the Cayman Islands, an offshore tax haven. A drug trafficker easily could have the Cayman branch debit cash from his personal account to buy stocks on Wall Street. The transaction would be handled by Clearstream, which would transfer the money electronically to a New York bank that had its own clearinghouse account. Soon the shares could be sold to buy real estate in Chicago with “clean” money. But regulators or investigators, depending only on published accounts, would find it nearly impossible to trace the money. Backes says Clearstream employees joke that the company name means “the river that washes.”

While clearinghouse clients may want to keep transactions secret, detailed information on every transfer, including those via non-published accounts, is listed on daily “security statements”—records to prove that the stock or cash has been sent. These statements are stored on microfiche and, under Luxembourg law, must be kept 10 years’ for commercial enterprises and 15 years for banks. A Clearstream insider gave Backes 10 years worth of these records. “The documents are a mine of information for any financial inquiry,” Backes says. “The archives of the clearinghouses can contribute to retracing where funds have gone. The knowledge of the list and the codes relative to non-published accounts, until now guarded secrets, offer immense possibilities.”

Backes notes that similar records exist for the other big clearinghouses, Euroclear and Swift, also based in Brussels. “It is possible,” he explains, “when one knows the date of an operation and the bank of entry, to reconstitute inside the clearing companies the voyage of the money and stocks or bonds—to follow the tracks.”

In June of 2006 it was reported that the United States was engaged in secret, and possibly illegal, surveillance of the above-mentioned Swift clearinghouse. Swift, the Society for Worldwide Interbank Financial Telecommunication, is a Belgian-based consortium that facilitates millions of transactions a day between thousands of banks, including virtually every major bank.


Révélation$ charges that Cedel/Clearstream further violated its own statutes by setting up unpublished accounts for industrial and commercial companies. With accounts in their own names, companies could avoid passing through banks or exchange agents to use the clearinghouse. They thus skirted mandated due diligence and record-keeping. When Siemens was proposed for membership, Backes says, some Cedel employees protested that this violated Luxembourg law. However, management told them that Siemens’ admission had been negotiated at the highest level.

Among the major companies with secret accounts, Backes discovered the Shell Petroleum Group and the Dutch agricultural multinational Unilever, one of whose accounts was associated with Goldman Sachs. On the French TV broadcast “Les dissimulateurs” (“The Deceivers”) in March 2000, Clearstream President Lussi simply denied the accounts existed. “Only banks and brokers are eligible for membership,” he said, “as it has always been the case. No private company accounts, no commercial or industrial companies.”

But his own spokesman contradicts this claim. “Customers of Clearstream can be banks or, exceptionally, corporate clients who have their own treasury departments the size of banks,” Cope wrote in an e-mail to In These Times. “We cannot accept CEOs of multinationals or terrorists and have strict account-opening procedures to prevent such problems.”

So that’s Clearstream for you: a clearinghouse that allegedly facilitated secret transfers of assets by keeping a secret set of accounts and which may have even enabled some corporate clients to bypass the financial system altogether.

But there’s more to the Clearstream affair, so let’s turn to part 2 of Lucy Komisar’s excellent 2002 In These Times article:

Features > March 25, 2002

Explosive Revelation$, part 2.

By Lucy Komisar

By 2000, according to Backes, Clearstream managed about 15,000 accounts (of which half were non-published) for 2,500 clients in 105 countries; most of the investment companies, banks and their subsidiaries are from Western Europe and the United States. Most of the new non-published accounts were in offshore tax havens. The banks with the most non-published accounts are Banque Internationale de Luxembourg (309), Citibank (271) and Barclays (200).

Barclays may have had the 3rd most non-published account in 2000, which doesn’t exactly put them in the best light, but on the plus side the Barclays brother recently waged a Human Rights campaign. Yes, they courageously fought for the right to leave their castle and island to all four of their children, instead of just the eldest son as prescribed by the rules of the Island of Sark. Chalk one up for human rights.


Backes found numerous discrepancies in the lists he obtained of the secret accounts. For example, code No. 70287 on the published list belongs to Citibank NA-Colombia AC in Nassau, and code No. 70292 is that of the Banco Internacional de Colombia Nassau Ltd. But on the non-published list, the numbers both belong to Banco Internacional de Colombia in Bogota. There’s no mention of Citibank. Based on the published list, members may think they are dealing with two banks in the Bahamas, one of which is a subsidiary of Citibank, but anything sent to these establishments goes directly to the country of cocaine cartels. On the April 2000 Clearstream list, there are 37 Colombian accounts, of which only three are published. (Richard Howe, spokesman for Citicorp in New York, declined repeated requests for comment. Cope declined to talk about any individual customers or accounts, citing Luxembourg banking secrecy laws.)

Not that it’s proof that Citibank used Clearstream to launder Colombian drug profits, but it’s worth recalling that in 2004, years after Revelation$ was published, Citibank was forced to shut down its “Private Banking” operations in Japan due to money-laundering charges.


Clearstream’s dealings with Russian banks are another area of concern. Menatep Bank, which had been bought in a rigged auction of Soviet assets and has been linked to numerous international scams, opened its Cedel account (No. 81738) on May 15, 1997, after Lussi visited the bank’s president in Moscow and invited him to use the system. It was a non-published account that didn’t correspond to any published account, a breach of Clearstream’s rules. Menatep further violated the rules because many transfers were of cash, not for settlement of securities. “For the three months in 1997 for which I hold microfiches,” Backes says, “only cash transfers were channeled through the Menatep account.”

“There were a lot of transfers between Menatep and the Bank of New York,” Backes adds. Natasha Gurfinkel Kagalovsky, a former Bank of New York official and the wife of a Menatep vice president, stands accused of helping launder at least $7 billion from Russia. U.S. investigators have attempted to find out if some of the laundered money originated with Menatep, which they believed had looted Russian assets. (The Justice Department declined to comment on the investigation.)

Menatep Bank, which was created by the formerly-powerful Russian oligarch Mikhail Khodorkovksy, was yet another player in the IMF-Russian money-laundering scandal of 1999. Before Natasha Gurfinkel Kagalovksy’s husband, Konstantine Kagalovksy, was Menatep’s vice president, he was Russia’s representative at the IMF. He left the organization in 1994 to join Menatep and allegedly spent the next three years funneling billions of IMF money meant for the Russian people through a series of banks, including the Bank of New York. The Kagalovsky’s are the second husband and wife team involved in the affair (recall the husband and wife team of Lucy Edwards and Peter Berlin that we saw in the last essay).


Even though Menatep officially failed in 1998, it oddly remained on the non-published list of accounts for 2000. (Clearstream also lists 36 other Russian accounts, more non-published than published.) Kathleen Hawk, a U.S. spokeswoman for Clearstream, says that was “a mistake.” But Cope contradicts her: “Closed accounts remain on our files and systems even though they’re non-active because we don’t reuse numbers. We keep the records for many years so there is no future confusion from reused numbers.”

But Backes explains that there’s no systematic rule about delisting canceled accounts. He found that “some that didn’t exist any longer were on the list. Others were delisted when they didn’t exist. And still other accounts were delisted, when we knew they existed, though the numbers no longer appeared.”

Régis Hempel, a computer programmer who worked for Clearstream, says some dormant accounts were activated for special transactions. “Such an account can be opened in the morning, used for a transaction, and closed to appear as delisted in the evening,” Backes explains. “Only the guy who gave the order to open it in the morning knows about the transaction. An investigator or auditor would not look at such an account because it doesn’t appear on the accounts list.”

He said such requests came every two or three days.

Hempel volunteered to help Luxembourg prosecutor Carlos Zeyen investigate Clearstream. But Hempel says local authorities seem more interested in blocking an investigation than in exercising oversight. Zeyen responded that the inquiry into Hempel’s charges hadn’t produced any evidence and dismissed claims that Hempel had been prevented from seeing relevant files as “rubbish.” In a July 2001 public statement, Zeyen said the investigation would continue.

Luxembourg sources say Zeyen was looking into how Menatep used the system and also into improper ways André Lussi might have gained personally. In January, a French judge took depositions about Menatep corruption. According to Luxembourg journalist Marc Gerges, writing in the local newspaper Land, the FBI and the German BKA are also interested in what might be revealed about the role of Menatep in the diversion of IMF funds. Gerges says investigators are also looking to implicate Lussi in suspected financial swindles conducted through holding companies and trusts in the offshore financial havens of Guernsey or Jersey. (Lussi could not be located; his attorney did not respond to phone and e-mail requests for comment.)

In June of 2001, Clearstream hired former ex-“Big Five” auditor Arthur Andersen to conduct an internal investigation the claims in Revelation$. Note Mr Backes’s claim that the secret temporary accounting system enables traceless transfers of assets that even an auditor wouldn’t find, and recall also that it was Arthur Anderson auditor Florian Bourges that copied and retained the list of accounts that were later allegedly given to Imad Lahoud and modified to frame Sarkozy. Does this mean that even the data the Second Clearstream affair was based on (i.e. the pre-forged lists) would have been unable to discover the utilization of any of the of secret accounts that Mr Backes describes? It’s an interesting question that’s probably answered somewhere…in French. Calling all French speakers!


The publication of Révélation$ brought forward others with stories about how Cedel/Clearstream had facilitated corruption. Joël Bûcher, former deputy general director of the Taiwan branch of the bank Société Générale, wrote Zeyen volunteering to testify that SG used the clearinghouse to hide bribes and to launder money. In his deposition for Zeyen—which is cited in Denis Robert’s new book on the Clearstream saga, The Black Box—Bûcher said he had worked for the bank for 20 years, but quit in 1995 out of disgust at its rampant money-laundering. He said much of that occurred though a Luxembourg affiliate working through non-published accounts at Cedel. “Cedel didn’t ask any questions about the origin of funds that would have appeared suspect to any beginner,” he told Robert. “[As a result] we directed our clientele with funds of doubtful origin to Luxembourg.”

In June of 2006, top executives at Societe Generale and Barclays were amongst those forced to testify in a French court over money-laundering charges in the “Sentier II” case. Their case involved allegations of billions of euros laundered between France and Israel. Société Générale denies the charges.


In the early ’90s, Bûcher contends, Cedel was used to launder $350 million in illegal “commissions” on a contract for the sale by Thomson-CSF, a French government arms company, of six French frigates to Taiwan. He said that the money, handled by an SG subsidiary, was paid as a registered securities transfer to a “nominee”—a stand-in for the real beneficiary—and that Thomson (now known as Thales) didn’t appear in the transaction except in the Cedel archives.

The kickbacks were exposed after the 1993 murder of a naval captain named Yin Ching-feng, who had written a critical report on the purchase and its inflated $2.8 billion price. Bûcher told Taipei authorities that a third of the kickbacks went to Taiwanese generals and politicians, while the rest was pocketed by French officials. Taiwan courts sentenced 13 military officers and 15 arms dealers to between eight months and life in prison for bribery and leaking military secrets.

In November of 2000, an advisor to Taiwan’s president alleged that the French firm Thomson-CFS was implicated in the death of Taiwanese naval captain Yin Ching-feng that came not long after his scathing report on the performance of the French-made frigates. Mr. Bucher, though, claimed that Taiwanese authorities were not interested in actually getting in getting to the bottom of the case (1).

And finishing our look at Lucy Komisar’s In These Times article…

In March, Bûcher will testify before a French court examining French complicity. “SG is very much implicated,” he told In These Times.Taipei police searches found many records of transfers of commissions” relating to the frigates and also to the sale of French Mirage fighter planes. In New York, SG spokesman Jim Galvin denies that the bank had any involvement in the arms deal.

There has been no legal action by the Luxembourg prosecutor based on any of his investigations. However, Clearstream Banking, Lussi and others have filed 10 lawsuits for libel in Luxembourg, France, Belgium and Switzerland against Backes, Robert and their publisher, Les Arenes. The first case, Clearstream v. Backes went to court in March in Luxembourg. Another case began its first hearings in Paris a few days later. With no sense of irony, the liquidator of Russia’s notorious Menatep Bank is also suing the authors and publishers for damage to its reputation. (Mikhail Khodorkovsky, the Russian oligarch who controlled Menatep, did not respond to a request for comment.)

Backes’ knowledge and records make him a valuable investigative partner, and he cooperates with numerous authorities, though he prefers not to say in which countries. But his agenda is larger than that. Backes is lobbying for oversight by an international public body. Unlike banks, Clearstream has no effective outside surveillance. It is audited by KPMG, one of the “big five” international accounting firms, which either has been ignorant of or has overlooked the non-published accounts system. KPMG announced last year it found “no evidence” to support the allegations made in Révélation$, though its report was not made public.

Local officials’ attempts to defend financial secrecy are not surprising. Luxembourg’s multi-billion-dollar financial sector brings in 35 percent of GNP and gives the inhabitants a per capita income of more than $44,000, the highest in the world. (Next on the list are Liechtenstein, Switzerland and Bermuda, all money-laundering centers, with the United States fifth.) For years, local officials have refused to provide bank information to other countries.

But Luxembourg authorities have turned their sights on Backes. Using a March 2001 judicial order based on a complaint made by Lussi before he was fired, police raided Backes’ house on September 19 in search of records. He says they seized unimportant documents and diskettes; he keeps the microfiches outside the country as “life insurance.” “The raid was organized to impress [others] not to repeat what this dangerous guy Ernest Backes has done,” he says. “Those who know me well know I am not at all impressed by such a raid.”

In March of 2004, a Paris court ruled in favor of Clearstream in one of the libel cases against it, finding the evidence that Clearstream kept secret accounts on behalf of their clients was unconvincing and ordering Denis Robert to pay fines. Later that year the Luxembourg court closed the probe on Clearstream, absolving them of wrongdoing, although it was apparently due to the expiration of the statue of limitations. Instead, prosecutors have focused their investigations on former Clearstream director Andre Lussi, who is alleged to have actually maintained the secret accounts. That investigation in Luxembourg is still ongoing.

So case closed and all’s well that ends well on the Clearstream affair, right? Well, not quite. First off, as we saw in the last essay, modern day money-laundering takes place within the largest financial institutions in the world and they simply are not prosecuted. The same goes for most major corporations unless they implode - ala Enron - and the public cries howls for justice. A Clearstream scandal would have been on an Enron scale. It’s one of two major clearinghouses of its type for the European market and the banking and corporate clients that appear to have taken advantage of its secret off-the-books system include many of those same financial and corporation giants that have proven to be effectively untouchable in the past.

In other words, the Clearstream scandal was much bigger than Clearstream itself. Due to its unusual position as one of a handful of clearinghouses dealing with moving European stocks and bonds, Clearstream had the potential to be a concentrated nexus of money-laundering. If Clearstream went down, it would mean its clients like Shell Petroleum, Siemans, and Citibank would possibly face charges of illegal activities as well. Not that these giants would actually face any serious repurcussion if they did face those charges, but even the untouchables prefer to remain unbemirched.

On February 9, 2004, just weeks before Luxembourg let Clearstream off the hook and decided to focus its ongoing probe on Clearstream’s CEO Andre Lussi (2), the European Commission chastised six countries for failing to implement the European Unions money-laundering laws of 2001: Italy, Portugal, Greece, Sweden, Luxembourg, and France (3). So perhaps even more than protecting powerful companies, the Luxembourg and France were trying to protect their own reputations. On an interesting sidenote, and guess who’s Clearstreams current CEO: Jeffrey Tessler, a 25 year employee of the Bank of New York (Clearstream has been poaching quite a few BofNY employees lately).

Standing on the outside looking in, it’s difficult to say how much the dropped charges are due to Ernst Backes and Denis Robert not giving enough information to prove their claims, and how much is just plain old money and protective politics. Either way, what is clear is that the Clearstream affairs are unfinished affairs.

Bin Laden’s Clearstream Connection

The Clearstream affairs are unfinished affairs beyond the fact that many of the investigations are still ongoing. Some areas have been largely untouched, at least publicly. And guess which Muslim Brotherhood international financial network is involved in one of the those areas of inquiry that has, at least publicly, been largely untouched. Yes, according to Ernst Backes, even the al-Taqwa network has played in the Clearstream playground.

Clearstream’s connection to al-Taqwa has been a minor sidenote in the War on Terror. Perhaps appropriately, so was this rather stunning revelation in Part 2 of Lucy Komisar’s 2002 most excellent article on Clearstream in “In These Times”. Let’s take a closer look at this sidebar o’ terror:

Banking with Bin Laden

Following the September 11 attacks on the World Trade Center and the Pentagon, the United States started focusing its investigation on the financial trail of Osama bin Laden and the al-Qaeda network.

Like any other large, global operation, international terrorists need to move large sums of money across borders clandestinely. In November, U.S. authorities named some banks that had bin Laden accounts, and it put them on a blacklist.

One was Al Taqwa—“Fear of God”—registered in the Bahamas with offices in Lugano, Switzerland. Al Taqwa had access to the Clearstream system through its correspondent account with the Banca del Gottardo in Lugano, which has a published Clearstream account (No. 74381).

Correspondent accounts: Is there anything they can’t do?


But bin Laden may have other access to the unpublished system. In what he calls a “spectacular discovery,” Ernest Backes reports that in the weeks before CEO André Lussi was forced to leave Clearstream last May, a series of 16 unpublished accounts were opened under the name of the Saudi Investment Company, or SICO, the Geneva holding of the Saudi Binladen Group—which is run by Osama’s brother, Yeslam Binladen (some family members spell the name differently).

Yeslam Binladen insists that he has nothing to do with his brother, but evidence suggests SICO is tied into Osama”s financial network. SICO is associated with Dar Al-Maal-Al-Islami (DMI), an Islamic financial institution also based in Geneva and presided over by Prince Muhammed Al Faisal Al Saoud, a cousin of Saudi King Fahd, that directs millions a year to fundamentalist movements. DMI holds a share of the Al Shamal Islamic Bank of Sudan, which was set up in 1991 and partly financed by $50 million from Osama bin Laden.

Furthermore, one of SICO’s administrators, Geneva attorney Baudoin Dunand, is a partner in a law firm, Magnin Dunand & Partners, that set up the Swiss financial services company SBA—a subsidiary of the SBA Bank in Paris, which is controlled by Khaled bin Mahfouz. Mahfouz’s younger sister is married to Osama bin Laden.

First off, Khalid bin Mahfouz is not married to Osama bin Laden’s wife. That bit of info has been published in numerous press reports based on the testimony of former CIA director James Woolsey (see the correction for the article). But as we’ve already seen, the often-mention Khalid bin Mahfouz has shown up repeatedly in our look at the shadow world or terror financing. On top of appearing on the “Golden-Chain” list of early al-Qaeda financiers (4), Mr Mahfouz was a major shareholder in BCCI. And he also has a number of interesting ties to SICO, the bin Laden family’s Geneva-based investment company.

And what, if anything, are we to make of the allegation by Ernst Backes that SICO set up 16 unpublished Clearstream accounts in May of 2001. It’s certainly not conclusive proof that Osama bin Laden was moving money through Clearstream via SICO. After all, the bin Laden family is one of the wealthiest in Saudi Arabia, with businesses across the globe. And it’s commonly said that the family also severed ties with their zealous brother years ago.

Except, like so much we’ve seen, things might not always be that simple. Yeslam bin Laden’s French offices were raided in March of 2002 on suspicions of money-laundering on the orders of the same French Judge, Judge Renaud van Ruymbeke, that began investigating the Taiwan frigate scandal in 2001 and received the Clearstream lists in 2004. On Christmas Day, 2004, Judge Rumbeke expanded the probe of Yeslam. It is still ongoing. So let’s take a closer look SICO, the Saudi Investment Company.

The SICO Family Affair

We just saw how SICO possibly relates back to 9/11 from a financial standpoint but its SICO’s relationship to the larger milieu of Swiss millionaires, Saudi billionaires, far-Right friends of Francois Gendoud, and, of course, the Bush family, that is of particular interest to us. Lot’s of crazy twist-turns await us, so let’s get started with an excerpt from PBS’s Frontline on the bin Laden family’s massive global empire:

Financial Activities

The bin Laden family has been present in international finance for many years. With regard to France, this was the case with the Banque Al Saoudi, whose vicissitudes in recent years are common knowledge. Shored up by Banque de France in 1989 to avoid bankruptcy, it was partially taken over by Banque Indosuez, becoming Banque Francaise pour l'Orient, which has just merged with Rafik Hariri's Mediterranee group.

It is interesting to note that the bank's honorary chairman was none other than Prince Mohammed Ben Fahd, and its board of directors included Sheik Salem bin Laden, Sheik Bogshan and Khalid Ben Mahfouz. Banque Al Saoudi and Indosuez' special connections in the Middle East were instrumental in financing a portion of the weapons contracts of the `70s and `80s.

Banque Al Saoudi was 75%-owned by the Paris-based Saudi Arab Finance Corporation, which also controlled a number of other companies: 75% of Saudi Finance Corporation (Saudifin), headquartered in Geneva and in turn controlling the Saudi Arab Finance Corporation and the Arab Finance Corporation International, both in Luxembourg..

Generally speaking, the same set of shareholders was involved: Salem bin Laden, Khalid Ben Mahfouz, Salam Ahmed Bogshan, Saad Khalil Al Bahjat, Taha Baksh, etc.

Other than the well-established business and financial ties between the Bush family and the bin Ladens, three of the people here should also be noted for the business dealing with the Bushes and other US politicians: Khalid bin Mahfouz, Rafiz Hariri, and Abdullah Taha Baksh.

Let’s look a little more about the first fine fellow, Khalid bin Mahfouz. A Saudi billionaire and scion of one of the wealthiest families in Saudi Arabia, Mr. Mahfouz shows up repeatedly in everything from terror financing (especially with the various Saudi charities involved), to US-Saudi covert operations (think Iran Contra and BCCI), and numerous Bush family dealings. One of Khalid bin Mahfouz’s close associates in the US is long-time Bush-family friend James R Bath. James R Bath is another man of mystery in his own right, and even became the US business representative for both Salem bin Laden and Khalid bin Mahfouz.

Like the bin Laden family’s virtual monopoly on state construction spending in the kingdom, the bin Mahfouz’s are a favored family of the Saudi monarchy in the area of finance. Khalid’s father, Salem bin Mafouz, won the right to open the first, and largest, interest-charging bank in Saudi Arabia back in 1951 (interest-charging banking is consider un-Islamic, but was deemed necessary for Saudi Arabia to function in the modern world). In spite of his extensive ties to a number of terror-related individuals and institutions, Mr. Mahouz has absolutely, positively no connections in any way whatsoever to terrorism.

The next individual of interest is former Lebanese Prime Minister Rafiq Hariri, whose 2005 assassination shocked many and was widely blamed on Syria (although questions remain). The Hariri family is another example of the long-arm of the Saudi’s wealth-based diplomacy (See Footnote 1), and the often cozy connections between US politicans and Middle Eastern money. For instance, Rafiq Hariri was involved in the purchase of the Texas Commerce Bank Tower (now the JPMorgan Chase Tower) back in 1985 for what was considered a princely sum of $200 million. The price was princely because 1985 was the year of crashing real estate prices for the oil-soaked Houston market and the tower cost $140 million to build just a few years earlier. Amongst the beneficiaries of this purchase was the family of James Baker, founders of the Texas Commerce Bank. And who else was in on this purchase? Why none other than Khalid bin Mahouz (5). Another example of his extreme (and bi-partisan) generosity is his 1989 purchase of Democratic Senator Bill Nelson’s Viriginia home. The purchase price for then-Congressman Nelson’s home was $2 million more than the assessed value, which was used to finance Nelson’s unsuccessful gubenatorial bid (6).

And finally, tied into this milieu is Abdullah Taha Baksh (also “Taha Baksh” and “Abdullah Taha Bakshs”), another well-connected fellow. It was Mr Baksh who stepped in and saved a failing Harken Energy with new capital. Like James R. Bath, Mr. Baksh falls into the orbits of the bin Mahfouz and bin Laden empires. He was both a US representative of the bin Laden family’s interests from 1976-1982 (8), and the Middle Eastern representative of the bin Mahfouz family interests. He was also tied into the world of BCCI, through his association with Khalid bin Mahfouz, and his chairmanship of the Saudi Finance Corporation, which was partially controlled by BCCI shareholders (9).

Continuing with the article…

In London, the bin Laden group also controls the Abdoulla brothers' Evered Holdings.

Since 1980, the bulk of the bin Laden group's international activities are routed through the Geneva offices of Saudi Investment Company (SICO), which was established on 19 May 1980 and whose capital was increased to SF100 million on 30 April 1991.

Located at 13 rue Ceard, the company is chaired by Yeslam bin Laden. Board members are Beatrice Dufour, Baudoin Dunant and Tilouine el Hanafi.

Beatrice Lafour (sic) is Yeslam bin Laden's sister-in-law. She is of Iranian origin and is married to a Swiss financier.

Note: Beatrice Dufour is actually the ex-sister-in-law of Yeslam bin Laden. Her sister, Carmen Dufour, divorced Yeslam bin Laden in 1988. Carmen’s daughter, Wafah Dufour (also “Wafah bin Laden”), is both an aspiring pop-star.


Baudoin Dunant, one of French-speaking Switzerland's leading lawyers, is on the boards of over twenty companies in Geneva, Fribourg, Morges, Nyons, etc. He received international publicity in 1983, when he represented Swiss banker Francois Genoud. Genoud, an admirer of Hitler and heir to the rights to Geobbels' writings, had helped finance the FLN during the Algerian Ward and was on trial for participation in international terrorism.

This unseemly publicity did nothing to shake the confidence of Yeslam bin Laden, doubtless an indication that the lawyer is top-notch in his profession (he is also counsel to the financial group of William Kazan , who is currently liquidating a major portion of his banking investments).

According to fascism historian Kevin Coogan, Baudoin Dunand (also spelled “Baudoin Dunant” and “Beaudoin Dunand”) was more than just a lawyer for the notorious Francois Genoud. The two were close friends.

Continuing …

During the `80s, the board of directors also included members of the Swiss Wyss family, a branch of which controls the Holderbank Company, which has just signed a $100 million contract with Qatar National Cement. Also on the board were members of the Shakarshi family, whose name is linked to a money-laundering scandal and drug trafficking in Zurich. A Shakarshi family member was also a director of the SICO London branch.

As a result of these scandals and bent on avoiding any publicity, the bin Ladens decided that it was necessary to break publicly with the Shakarshis. In actual fact, the Shakarshis were never overly troubled and it appears that the Zurich company was just another CIA front used to finance the Afghan resistance.

The tie between Yeslam bin Laden and the Shakarshi family would thus seem quite consistent with both family and royal policy. Our information tells us that Yeslam bin Laden continues to maintain relations as usual with the Shakarshi group.

One might also note that the chairman of board of the Zurich Shakarshi company was Dr. Hans Kopp. Kopp is an important lawyer (his wife was then Justice Minister, since resigned) known for his international activities, particularly with the American [intelligence?] services (since the `60s), and is close to the Swiss defense industry (Oerlikon-Buhrle/Contraves).

The presence of the Shakarchi family (also spelled “Shakarshi” or “Shakarki”) on the board of SICO is significant for a number of reasons: As noted, Dr Hans Kopp sits on the board of the Zurich Shakarchi company. And, in an eerie prequel to al-Taqwa’s own high-level connections between Carla del Ponte and Pier Felice Barchi, Hans Kopp’s wife is Elizabeth Kopp, the former Swiss Justice Minister (aka Attorney General). Elizabeth Kopp was forced to resign in 1989 when it was revealed that she warned her husband to leave the board of Shakarchi Trading after finding out that it was part of a drug-money laundering investigation by US and Swiss authorities. Ironically, Ms. Kopp was drafting legislation targeted at preventing drug traffickers and other criminals from utilizing the Swiss banking secrecy laws (9). But this wasn’t just any drug money-laundering scandal because, as the article indicates, Shakarchi Trading was known as “just another CIA front used to finance the Afghan resistance”. And so we have Shakarchi Trading, the company of a family closely connected with the bin Ladens, as part of the CIA’s web of front companies used to funnel money to the Afghan Mujahedeen, during a time when Osama bin Laden was also a logistical and financial operative working with the CIA.

The interesting connections don’t end there. The “Lebanese Connection” money-laundering operation that led to Mrs Kopp’s resignation was primarily a gold-based one and centered around a pair of Lebanese brothers. It was actually two massive drug money-laundering rings: One involving Colombian drug money, and the other Syrian-Lebanese-Turkish drugs rings. Money flowed into Zurich, was converted to gold buillion, and flowed back out (much like Metalor USA, which we looked at earlier) . As we’ve already seen so many times, gold, diamonds and drugs, are the mediums-of-choice for laundering, transporting, and hiding illicit wealth for criminal syndicates whether they’re drug lords, organized criminals, or terrorists. And guess what: the Shakarchi family just happens to own the largest gold refiney in Switzerland (10) (and apparently haven’t the left the gold industry).

And finally, it’s worth noting that one of main conduits for BCCI’s money laundering, Capcom, also had some dealings with Shakarchi Trading in relation to the “Lebanese Connection” scandal (See footnote 2). The Lebanese Magharian brothers told investigators that some $36 million of the money they laundered came from Los Angeles and was derived from cocaine profits. Given the investigations into the West Coast cocaine/money-laundering rings implicated in the Iran Contra scandal (as laid out by Gary Webb’s 1996 “Dark Alliance” series we looked at earlier), the presence of LA drug money being laundered through a BCCI affiliate should come as no surprise.


The Geneva-based SICO is the parent house for the Group's international financial activities and investments, with branches in London and Curacao. The Curacao branch, established in 1984, manages the bin Laden group's partnership with the American Daniels Realty Corporation (Duspic), part of the Fluor Corporation conglomerate. It is partly through the bin Ladens' influence that the Fluor group was one of the major recipients of reconstruction contracts in Kuwait.

The SICO-London branch, which is controlled by the Cayman Islands-based Falken Ltd., is another example of both the transnational nature of these entities (and really, the modern global economy). And as more examples of overlapping nature of the persons running these firms, Falken Ltd, established in 1984, is directed by Beatrice Dufour. It also controls SICO-Great Britain, which, itself, was created under the directions of Baudoin Dunant (11).

SICO-Curacao, directed by Yeslam bin Laden, also includes Saleh bin Laden and US Real Estate Developer Charles Tickle on its board of directors (as of 1999) (12). Tickle is also the CEO of Daniels Corporation, a player in the international real estate markets (See footnote 3). SICO-Curacao’s partner in managing family of Daniels Reality companies, the Fluor Corporation, is one of the largest engineering firms in the world, making it a leading government contractor, including in Iraq and Afghanistan, along with Halliburton’s Kellogg Brown & Root, Bechtel, and the Saudi bin Laden Group (SBG). Like Halliburton and Bechtel, Fluor has a long relationship with the Saudi government (having provided engineering services to Saudi Arabia when it was developing its oil industry in the early 1950’s) that continues today.

Fluor was also amongst the politically connected companies to receive no-bid contracts after Hurricane Katrina.

And finishing off our look at the PBS Frontline article…

Despite a few recent attempts (particularly with the Swiss Contraves group), the bin Laden family has never been directly involved in weapons contracts and has never been bent on adding this activity to its portfolio.

At most, it might be said that the activities of Salem bin Laden in the context of Irangate and Contragate, or of Yeslam bin Laden within his association with the Shakarshi family, have placed the family at the center of these negotiations, but solely as a guarantor or as a representative of the interests of the royal family. The real contracts have been signed directly by members of the royal family: Prince Mohammed Ben Fahd or Prince Saud Ben Nayef.

The PBS article also makes the important point that what the bin Laden family did with regard to arms trafficking or money-laundering networks in support of the contras, it did with the permission of the Saudi royal family. The same was true for the bin Mahfouz clan. Both are worth billions primary because of their relationship with the Saudi royal family, and neither is likely to engage in clandestine activity of that nature independently. The bin Ladens and the bin Mahfouzes are, in many respects, proxy clans whose responsibilities to their Saudi benefactor include facilitating proxy wars.

There are other figures within the SICO orbit that tie back to the Iran Contra years…and possibly 9/11. Just as SICO’s opening of 16 unpublished Clearstream accounts in the summer of 2001 is cause for suspicion, so are the financial figures, institutions, and transactions that we’re going to look at next in an excerpt from Kevin Coogan’s excellent 2002 “Report on Islamists, the Far Right, and Al Taqwa”:

The idea that there remained close ties between bin Laden and his family was most put forth about Yeslam bin Laden who has spent the past 20 years in Switzerland. It is the Swiss author Richard Labeviere in his 1999 book Dollars for Terror that challenged the official version that there was a clean break between Osama and the rest of the family in 1994. Labeviere says that SICO has played a key role in money laundering but Yeslam bin Laden refuses to respond to the charges and said that it would be a great mistake to respond, as it would only serve as further advertisement for the book. Yet after 9/11 a French report came out with the same information accusing SICO of ties to bin Laden. It essentially notes that SICO has so many offshore structures that it can elude financial supervision. Five months after investigators of the French toll unit Tracfin assembled evidence regarding illicit transactions. The director of the investigation, Renaud van Ruymbeke, discussed suspicious transactions between France, England and the British Virgin Islands. Almost on the exact day of this announcement two months later the homes and apartments as well as Yeslam bin Laden’s company were searched.

Perhaps it’s a coincidence, but the March 2002 raid on Yeslam bin Laden’s office was right around the same time as the Operation Greenquest raids on the SAAR network in the United States.

Also, if you haven’t noticed yet, this series of essays is based quite on bit the information in “Dollars for Terror”. The book by Swiss investigative journalist Richard Labeviere is a most excellent read and highly recommended.


Yeslim bin Laden knows his life is now under the microscope. Why did he fly, for example, nine times to Milan? Each stop was so short, reports a member of the maintenance team at the private Forlanini airport that it couldn’t be for shopping. Six times bin Laden came to Milan from his domicile in Cannes and because of EU regulations these flights were considered domestic and no list of passengers was required to be filed. But three times he flew in from Zurich and Italian border police have copies of the passenger list. Here there is a puzzle as one name is "Carlos Rochat" but there is no Carlos Rochat known to investigators. However there is a Charles Rochat who is on the SICO advisory board. Is this a typo or is there someone else using a false passport? They can’t get an answer from Yeslam bin Laden who is silent on this matter.

It is equally possible that bin Laden’s silence about Rochat is meant to avoid other problems that might arise. Such as why Charles Rochat and Baudoin Dunand, two members of the SICO advisory board who are attorneys, on May 21, 2001 liquidated the business Tyndall Trust that had first been registered in Villars-sur-Glane near Fribourg in January 1986. They fulfilled the same function for a sister society of the Tyndall Trust that shared the same name and that was opened up in 1990 in Geneva and liquidated in January 2001. One of the top managers of the Tyndall Trust since its founding was the American tax attorney Willard Zucker who lives in Geneva. Zucker also controls the Lake Geneva-registered Compagnie de Service Fiduciaires (CSF). And CFS had, along with participation from Tyndall Trust, assumed financial management for a corporate group named Enterprise.

Enterprise, however, had nothing to do with successor company to the 1983-founded successor to the Albert Hakim and U.S. General Richard Secord-founded Stanford Technologies Trading Group International (STTGI), which later changed its name to Enterprise and administered secret and illegal weapons shipments with Iran and the Contras. The same Willard Zucker arranged payments from the Enterprise account for Oliver North. In 1986 the Syrian Monsar al-Kassar was paid from an Enterprise account for a weapons deal with the Contras. But al-Kassar was not only one of the world’s great weapons dealers. He also had close ties with Islamic fundamentalist and terrorist groups in the Mid East. Al-Kassar also worked with an international group interested in sending toxic and atomic waste materials by ship to Mozambique.

As for Zucker, he has constantly denied that any of his activity on behalf of the Enterprise group from America infringed on Swiss or U.S. law

So in addition to the SICO’s ties to the Shakarchi’s, who have their own Iran-Contra shenanigans, we have two members of the boards of directors liquidating a business trust that was set up in 1986 and managed by Willard Zucker, one of Oliver North’s money-men during the Iran Contra affair. There is much more on the involvement of the Richard Secord/Albert Hakim/ Willard Zucker trio’s Enterprise group (which happened to be quite active in 1986), in Chapter 8 of the highly under-appreciated Walsh Report on the Iran Contra scandal.

Recall too from our look in the last essay at Edmond Safra, the banker that died in a suspicious fire following the implication of his Republic National Bank in the Menatep/IMF Russian money-laundering scandal. Not only did Secord, Hakim, and Zucker make “cash drops” using Safra’s Republic National Bank back in the mid 80’s, but Ernst Backes asserted that Clearstream was also used to launder money for Menatep via Clearstream’s unpublished accounts.

Trying to make sense of the SICO/Osama/Clearstream connections

Let’s attempt to summarize and relate the information we have here: According to Kevin Coogan’s report, we have two of SICO’s board members liquidating the Tyndall trust on May 21 of 2001. The liquidation of Tyndall trust would presumably involve transfer and/or selling its assets. Clearstream, as we’ve seen, is an institution with a reported penchant for secretly moving assets. Ernst Backes asserts SICO opened unpublished accounts with Clearstream just weeks before Clearstream executive Andre Lussi stepped aside in mid May of 2001, and therefore just weeks before the liquidation of the twin Tyndall trusts. So just weeks before the Tyndall trust was liquidated by SICO board members, SICO opens unpublished accounts with a clearinghouse that we have reason to believe would have the means and willingness to secretly move those assets.

On top of that, Tyndall Trust and another company, Compagnie de Service Fiduciaires (CSF), co-manage a corporate group named “Enterprise”. Enterprise shared its name with an earlier business that was used by the Richard Secord/Albert Hakim/Willard Zucker weapons-trafficking network set up by Oliver North. CSF was also in charge of managing that earlier Iran-Contra-soaked Enterprise group. One of the main managers of both CSF and the Tyndall Trusts is Willard Zucker. SICO’s manager during most of the 80’s was Salem bin Laden. Salem reportedly played a role in sending some $34 million to the Nicaraguan contras and was extremely close to Saudi Arabia’s king.

Also sitting on SICO’s board is are members of the Shakarchi family. The Shakarchi family is charged with involvement in drug-trafficking and money-laundering. The former director of the Zurich Shakarchi company is Hans Kopp, a figure associated with US intelligence. Hans Kopp’s wife is Elizabeth Kopp, the former Attorney General of Switzerland. She was forced to resign after she tipped off her husband to leave the Shakarchi’s company when it was about to come under investigation for drug-money laundering. In that particular case of money-laundering, one of the companies that played a role - albeit a small role - in funneling the money was Capcom. And Capcom was a major laundering conduit for the money-laundering/arms-trafficking/whatever-the-client-wants criminal bank, BCCI, itself and important institution in both the Iran-Contra affair and the Afghan Mujahedeen effort.

So it appears that in May of 2001, the bin Laden family’s international investment firm, which has a number of interesting historic ties to both the Iran-Contra and BCCI scandals, set up unpublished accounts in an alleged asset-laundering clearinghouse, and then had two of its board members liquidate a trust with surprisingly close ties to figures and companies directly linked with the Iran-Contra affair.

And then there are the two SICO lawyers involved: Charles Rochat and Boudoin Dundant. According to Kevin Coogan’s report, Charles Rochat has a name eerily similar to an unknown “Carlos Rochat” that showed up on Yeslam bin Laden’s flight passenger lists in multiple, unusual, flights into Milan that Yeslam was unwilling to discuss (at least, as of late 2002). And Boudoin Dundant was both a lawyer for and a friend to Francois Genoud, the Swiss nazi-banker who became an important figure in postwar Islamic militant groups. Genoud is believed to have played a role in the founding of the Bank al-Taqwa, a component of the Muslim Brotherhood’s International financial network that is also believed to help finance a great number of militant groups, including al-Qaeda. And Bank al-Taqwa also had access to Clearstream through its correspondent account with Banca del Gottaro. Now that is what we call an interesting web of connections!

But how meaningful are these connections? That is difficult to say. We are forced to view these kinds of business and personal associations from the standpoint of people on the outside looking in. We have plenty of insider insight in the totality of witness testimonies to the execution of these large-scale actions. But we don’t know all the details of the investigations into these institutions, nor do we know all the unacknowledged, internal investigations that may have taken place. And nor do we know whether or not any investigations would be allowed to be pursued in the justice system and revealed to the public. There are deep political machinations taking place within these powerful institutions and networks.

Unfortunately, when we’re talking about today’s deep politics, we’re talking about deeply corrupt politics. When we look at SICO, we are looking at an institution run by a family intimately related to the political and business elites of the world. The bin Laden family is not simply the group of Osama bin Laden’s relatives. It is one of the primary proxy families for the Saudi monarchy and the Saudi monarchy is one of the most important families on the globe today. The Saudi monarchy has absolute control over a country that possesses immense quantities of this age’s vital resource (which, unfortunately, is also a toxic resource), and a deep historic relationship with the world’s super-power, the United States. And the Saudi monarchy, the bin Laden family, the bin Mahfouzes, the al-Rajhis and others have deep commercial and personal ties with the political and business elites of the United States, in particular the Bush dynasty. And the political and business elites of both the Unites States and Saudi Arabia have deep historical, political and business ties with the political and business elites of countries all over the world. That’s just how it is in today’s world and we cannot and should not expect that investigations into companies like SICO are going to be as open and honest as is ideal.

So what are we to make of all of this? Well, we can conclude without too much ambiguity that the bin Laden family has a great number of interesting connections to the Iran-Contra affair and the Iran-Contra affair was deeply intertwined in the same kind of clandestine channels used today to foster and supply militant forces. In addition to the far-Right/Nazi-connected Nicaraguan Contras, the myriad of Muslim Brotherhood-backed Islamists militant groups are also beneficiaries of this global trafficking trade. And that includes al-Qaeda. So how close is the bin Laden family with its notorious relative and what incentives might it have to continue playing a support role in larger Jihadist movement? That’s what we’re going to examine next.

Ba Ba Black Sheep, have you any bin Laden blood

In a previous essay, we looked at Part 1 of an excellent article in Der Spiegel and saw how the “bin Laden brothers” were members of the “Golden Chain” list of early al-Qaeda sponsors, only to renounce Osama as a “black sheep” in 1994. To get an idea of just how real that renouncement was, let’s take a closer look at the bin Laden family’s ties with its black sheep brother with Part 2 of this excellent 2005 Spiegel article in Der Spiegel. But first, let’s quickly review the final segment of Part 1 of the series:

In 1990, after his triumph in Afghanistan, OBL offered the Saudi royal family the use of his troops to battle Saddam Hussein, whose forces had invaded Kuwait. But King Fahd decided instead to bring in American forces. The decision proved to be a financial coup for the family business, which helped build military bases for the outsiders, but it was turning point in Osama's life. Embittered, he went to Sudan in 1992, where he built training camps and organized attacks with his al-Qaida group, especially against "infidels" from the United States. He also made sure that the planning of terrorist activities remained in the family. His brother-in-law, Mohammed Jamal Khalifa, was involved in the first terrorist attack on the World Trade Center in 1993. On his visa application for the United States, he had listed his occupation as an "employee of the Saudi Binladin Group." Khalifa was briefly detained in the United States, but was then deported to Jordan, where he was released because of formal legal errors. In the past, he had also been implicated as a financial backer of the Philippine Abu Sayyaf terrorist organization.

Yes, as we’ve already seen, Osama bin Laden’s immediate post-Afghanistan years were spent in Sudan while his brother-in-law, Mohammed Jamal Khalifa, was involved in carrying out the 1993 WTC attack while also carrying the al-Qaeda torch to South East Asia.

And continuing on to Part 2 to the Der Spiegel article:

Meet The Bin Ladens, Part II

Tracking Osama's Kin Around the World

By Erich Follath and Georg Mascolo

Osama bin Laden's family has disavowed itself from its terrorist "black sheep," but the discrepancies are considerable. In interviews with his family that took our reporters to Paris, Arlington, Virginia, Geneva and the furthest-flung corners of Pakistan, we take a closer look and the ties he may or may not still have to his relatives.

Editor's Note: This is the second in a two-part series. You can read the first installment here.

Osama also stayed in touch with his friends from the Saudi intelligence agency, even after Libya issued a warrant for his arrest, charging bin Laden with alleged involvement in the murder of two Germans -- an official working for Germany's Federal Office for the Protection of the Constitution and his wife. Prince Turki sent Osama's mother, Hamida, and his brother Bakr to the Sudanese capital, Khartoum, several times to convince Osama to abandon his terrorist activities. The visits were so frequent that Israel's intelligence agency, the Mossad, believed at the time that Osama was a Saudi spy. Washington increasingly came under pressure to do something about OBL, especially after his involvement in attacks in Somalia and Yemen. The US government met with Saudi officials behind the scenes, confronting them with satellite images of al-Qaida training camps in northern Sudan. In April 1994, King Fahd finally revoked Osama bin Laden's Saudi Arabian citizenship. The bin Laden family followed suit, issuing a sparse, two-sentence statement, signed by Bakr, disowning Osama.

Recall that FBI agents tried to investigate two of Osama’s brothers in the mid 90’s for their close ties with the World Assembly of Muslim Youth (WAMY), but were not allowed to.


Despite these actions, OBL was still far from being a "black sheep" with no ties to his native country. Saudi intelligence chief Prince Turki visited bin Laden several times after he had moved from Sudan to Afghanistan to join forces with the radical Taliban. Turki allegedly brought along expensive gifts to Kandahar, in the form of dozens of pickup trucks. According to a former member of the Taliban intelligence service, Prince Turki and OBL made a deal: The Saudis would support al-Qaida financially, but only under the condition that there would be no attacks on Saudi soil. (Prince Turki, now Saudi Arabia's ambassador to Great Britain, has denied these claims, telling SPIEGEL that they are "nothing but fantasy.")

Recall too that Prince Turki ended his career of over two decades as the Saudi intelligence chief just weeks before 9/11.


On Jan. 9, 2001, OBL attended his son Mohammed's wedding in Kandahar, accompanied, according to CIA sources, by his mother and two of his brothers. The CIA also claims that "two of Osama's sisters traveled to Abu Dhabi" a month later, where they met with an al-Qaida agent at the Gulf emirate's airport to deliver large sums of cash.

In mid-January 2005, New York federal judge Richard Casey wrote, in his grounds for allowing the civil suit against SBG filed by the families of 9/11 victims, that "the Saudi Binladin Group maintained close relationships with Osama bin Laden at certain times," and that it remains "unclear" whether these ties continued when OBL became involved in terrorism.

Can this global company, with its close ties to the Saudi royal family, truly be brought to trial, or will the US government, officially allied with Riyadh in its "war on terror," work behind the scenes to have the case dismissed? SBG has already demonstrated its willingness to work with the West by entering into joint ventures with Motorola and a deal with Disney, and has also been Porsche's official agent in the kingdom. Moreover, SBG is developing new airport security equipment in Saudi Arabia, as well as building housing for US managers working in the oil industry.

During that same January of 2005 ruling, Judge Richard Casey also declared the Saudi government and the al-Rajhi Banking and Investment Corporation immune from the lawsuit. Recall that the al-Rajhi’s financed the SAAR network of charities and institutions we looked at earlier AND were on the “Golden Chain” list of early al-Qaeda financiers, so things could certainly be looking worse for the SBG.


In Kazakhstan, the Saudi Binladin Group is helping build the country's new capital, Astana. In Syria, SBG and a Spanish company jointly operate the country's biggest olive oil processing plant. And in Dubai, the family company has just submitted a bid for a portion of the construction of what will be the world's tallest building. Next to aircraft, it seems, the bin Ladens see towers as a special challenge.

An interesting flying fun fact: Yeslam once paid for pilot lessons for an acquaintance at the Huffman aviation school in Venice, Florida.


PARIS, AVENUE MONTAIGNE, NEAR THE CHAMPS-ELYSÉES AND THE LUXURY HOTEL "PLAZA ATHÉNÉE". A dinner appointment with Yeslam bin Laden at one the French capital's most expensive and exclusive restaurants.

When Yeslam was six, his mother sent him to a school in Beirut, because it was far more liberal there than in Saudi Arabia. He later attended schools and universities in Sweden and England. Although he spent his vacations at home, he saw his father "rarely," and his "half-brother Osama no more than three or four times, the last time in 1987 or thereabouts." He says that his only clear memory of Osama is of his strict condemnation of music, and his religious fanaticism, which struck Yeslam as odd. Yeslam himself believes religion is a personal matter, and he refuses to take responsibility for others. "Am I my brother's keeper?" he asks, calling himself an "enlightened Muslim," clearly alluding to the biblical story of Cain and Abel.

In July of 2004, Yeslam more or less said that he wouldn’t turn in Osama if the opportunity hypothetically arose.


After living in the United States, Yeslam spent more than a decade and a half in Saudi Arabia -- from 1977 to 1984 -- where he was one of the leading executives in the family company in Jeddah. After a dispute with his brothers over SBG's finances, Yeslam went to Geneva, where he founded an investment company that specialized in managing large fortunes. There were soon rumors that Yeslam had reconciled with Bakr and was involved once again in business dealings with the bin Laden family. He dreamed of the birth of a son, and probably of rising to the top of SBG management in Jeddah.

When Yeslam's third daughter was born in April 1987 and he began spending long periods away from home, his marriage failed. According to his wife Yeslam, worried about his business, he became increasingly tense. Members of the Saudi royal family were now traveling to Geneva regularly and demanding his attention, especially the influential Prince Mishal. Yeslam bin Laden's divorce developed, as he himself says, into a bitter "War of the Roses." But in 2001, after years of troubles, he was finally successful on another front when he was granted Swiss citizenship. What is Yeslam's relationship with his brother Osama, who, as he claims, he last saw 18 years ago?

"9/11 was a tremendous shock for me," says Yeslam, now an upstanding citizen of Geneva who has also donated many thousands of dollars to the local film festival. "Osama had long since become a stranger to me, nothing but a name one reads in the newspaper," he says. "I felt that I was being held responsible for the crimes of a relative." The offices of his Geneva-based Saudi Investment Company (Sico) and his properties near Cannes were searched by the authorities, "just like that, on the strength of suspicion," he says. In early 2001, he registered the name "Bin Laden" as a trademark. He planned to establish a fashion house that would sell Bin Laden jeans but then, heeding the advice of friends, he abandoned the idea after 9/11: "After the incidents in New York, it would have been seen as a label in poor taste."

He developed a new business idea in the fall of 2004, a line of perfume. It's named "Yeslam," after its inventor and, according to its advertising, marries the scents of jasmine and lilies of the valley with an underlying note of sandalwood. In ads for the perfume, this combination of scents produces "a penetrating but gentle message for those who yearn for inner peace." The company plans to sell 60,000 bottles to its peace-loving customers.

Everything could work out for the best in Yeslam's world -- if only these new, hateful accusations would go away. A shadow lies over the man who tries to be pro-American and anti-Osama with every fiber of his being. In late December 2004, the French paper Le Monde reported that examining magistrate Renaud von Ruymbeke plans to investigate the bin Laden family's allegedly dubious financial dealings.

Recognize the judge who opened the investigation? It’s the same Renaud von Ruymbeke who investigated the Taiwan Frigate affair in 2001, had Yeslam bin Laden’s office’s raided on the same day as the Operation Greenquest raids of March 20, 2002, and later become embroiled in the Second Clearstream affair.


At the center of the investigation is an account that brothers Omar and Heidar bin Laden opened in 1990 with Swiss bank UBS with an initial deposit of $450,000. According to documents presented to the court, this account was still in existence in 1997, and only two people were authorized to conduct transactions: Yeslam and Osama bin Laden. The French court also intends to investigate information suggesting that €241 million were funneled from Switzerland to shadowy bank accounts in Pakistan through Akberali Moawalla, a former business partner of Sico and an acquaintance of Yeslam. Could all this have occurred with Yeslam's involvement or knowledge?

"I am not involved in money-laundering, and especially not with al-Qaida," says Yeslam bin Laden, his voice becoming slightly hoarse and edgy. He says that he never used the alleged UBS account and, probably for this reason, forgot about it. He takes pains to point out that he has not been charged with anything, neither by the New York court nor the French judge. He says that he is "innocent until proven guilty" -- another Western concept that this man living between cultures values, knowing full well that it carries no particular weight in his native country.

Recall that Omar bin Laden, who was involved with the US branch of WAMY, was allowed to leave in US the mysterious flights in the wake of the 9/11 attacks.

In November of 2005, Yeslam testified regarding a $300 million transfer to Pakistan allegedly made by one of his companies in 2001. In March of 2006, UBS officials were grilled in the US Congress for a variety of issues, including holding an account for Osama bin Laden, helping Saddam bust sanctions, and assisting Iran’s nuclear program. That particular investigation later concluded UBS was guilty of these charges.


ARLINGTON, VIRGINIA, HOME OF THE AMERICAN CEMETERY FOR WAR HEROES AND "HARRY'S TAP ROOM". It's a relatively inconspicuous burger-and-seafood restaurant conveniently located halfway between the White House and CIA headquarters in nearby Langley, Virginia. We are here for a meeting with the CIA agent who hunted down Osama, tried to shed light on the bin Laden family's business dealings, and probably knows a great deal about the mysterious departure of more than a dozen bin Laden family members from the United States after 9/11. This is the man who published the bestseller "Imperial Hubris" last year under the nom de plume "Anonymous."

Anonymous now has a name and a face. His name is Mike Scheuer, and a gray beard partially covers his finely-chiseled academic face. He resigned from the CIA after 22 years of service, because he was no longer able to remain anonymous. Journalists were on the verge of uncovering his identity, and his book was facing harsh criticism from the White House. "That was when I did what had to be done," says Scheuer, 52, before taking a bite of his hamburger. He leaves his French fries untouched, glancing at his stomach. Being overweight isn't exactly part of the image someone wants to convey who, as a CIA field agent, helped arm the mujahedeen to fight the Russians in Afghanistan and who, in 1996, was placed in charge of "Alec," the top-secret unit authorized by former President Bill Clinton to hunt down bin Laden.

It was the first time an entire CIA station focused on a single man. Scheuer headed the special unit for three years until his superiors, angered by his complaints that the hunt for the world's top terrorist was being conducted half-heartedly, reassigned him for the first time. But he was brought back after Sept. 11, 2001, when it became clear that his bleak predictions had come true. But Scheuer's criticism of the Iraq war ultimately destroyed his good standing with the White House. "Bush strengthened the terrorists with his invasion, but it was a truth that they didn't want to hear."

On July 4, 2006 it was reported that the CIA shut down “Alec” in late 2005 and distributed its analysts elsewhere within the agency.


Scheuer's axis of evil differs markedly from the president's. He believes that Pakistan and, even more so, Saudi Arabia are the epicenters of global violence. "Many Saudis support the terrorists in Iraq to this day - but we're the ones who are putting up the money -- by paying $50 for a barrel of oil and making ourselves dependent on oil imports."

Scheuer, an experienced intelligence expert, doubts that the entire bin Laden family has severed ties with Osama: "I haven't seen anything in the last 10 years that's convinced me that would be the case." In his view, SBG still derives some of its profits from business dealings in the Islamic world that can be linked to the family's supposed "black sheep." "He's treated as a hero almost everywhere over there," says Scheuer.

The CIA came close to capturing OBL several times. On one occasion, during the al-Qaida leadership's hasty retreat from the Afghan city of Kandahar in the fall of 2001, family passports were inadvertently left behind. Saad, a son of Osama bin Laden, was supposedly sent back to al-Qaida headquarters to make sure the documents wouldn't fall into the hands of the Americans. When he realized he had forgotten the combination for the safe, he used a cell phone to get the information, directly violating his father's strict instructions. Several different intelligence agencies picked up the call, but by then it was too late to act.

In August of 2005 a book written by the CIA’s field commander during the battle at Tora Bora asserted that Donald Rumsfeld’s unwillingness to commit the appropriate resources to the battle (such as special forces), led to bin Laden slipping away.


According to Scheuer, members of the bin Ladin family who were doing business in the United States or studying at US universities were almost completely inaccessible. "My counterparts at the FBI questioned one of the bin Ladens," the former CIA agent recalls. "But then the State Department received a complaint from a law firm, and there was a huge uproar. We were shocked to find out that the bin Ladens in the United States had diplomatic passports, and that we weren't allowed to talk to them."

Scheuer believes that these diplomatic privileges also helped the bin Ladens get out of the United States quickly after September 11, in a bizarre episode that has even been probed by the US Congress and an investigative commission.

Only two days after the attacks, when the US government had just reopened US air space, charter jets began taking off from various cities. Nine pilots flew 142 Saudi Arabians back to the kingdom. On Sept. 20, 2001, the "bin Laden jet" took off from St. Louis, making stops in Los Angeles, Orlando, Washington and Boston. At each stop, the plane picked up more half-brothers, nephews, nieces and cousins of public enemy number one. At that point, the FBI had already begun investigating two of the bin Ladens who were flown out of the country. They both lived in Falls Church, a suburb of Washington, and were officials in the "World Assembly of Muslim Youth."

Richard Clarke, for many years the chief of counterterrorism at the White House, has revealed that he was responsible for the flights. He says that he granted his approval after having been asked to handle the issue. And by whom? Perhaps by Bush's chief of staff, Andrew Card, after coordinating the plan with Saudi ambassador Prince Bandar, a close friend of the First Family? "I would be happy tell you, but I don't remember," Clarke told a Senate investigating panel -- few believe he was telling the truth.

Craig Unger, author of House or Bush House of Saud, wrote a lengthy 2003 Vanity Fair piece on the bin Laden flights out of the US, flights that included the two bin Laden brothers that FBI agents were not allowed to investigate in the mid 90’s for terrorism ties. One of the interesting fun facts in Mr Unger’s article (available here) is that Haifa al-Faisal, the wife of Saudi ambassador Prince Bandar, gave thousands of dollars in charitable contributions to a San Diego-based charity run by a Saudi business man that ended up being funneled to two of the 9/11 hijackers.

And finishing our look at Part 2 of the Der Spiegel article (there is more to Part 2 that we will not be looking at, but it’s worth reading)…

Of course, former CIA agent Scheuer is well aware that the bin Ladens, as investors in and customers of the Carlyle Group, an investment company, had common business interests with the Bushs. In fact, until October 2003 George W.'s father and predecessor in the White House still worked as an "advisor" for Carlyle, which is also involved in the defense sector. Although Scheuer is no wild-eyed conspiracy theorist, he also believes that the US government was "unusually" accommodating to the bin Ladens. Does he regret leaving the CIA, and does he dream of returning? Scheuer, a father of four, says: "I liked my job. I wanted to protect the country against its enemies -- but not the president against his critics."

Yes, Mr. Scheuer is no “wild-eyed conspiracy theorist”. The former head of the ex-Osama-tracking unit at the CIA merely appears to believe that Up is Down when it comes to a lot of what were told about the War on Terror and doesn’t enjoy using silence as a shield for the president. Combined with the “usually” accommodating behavior towards the bin Ladens and other prominent Saudi nationals after 9/11, one can easily imagine the frustration some in Scheuer’s position might feel. After all, the fact that the bin Ladens were investors in the Carlyle Group and were set up to profit from any post-9/11 wars is no secret. The uber-connected Carlyle Group, a private equity firm filled with ex-Presidents and Prime Ministers, has been buying low, selling high, and using its influence in to make big bucks in politically sensitive industries for years, and that includes the defense industry especially after 9/11 (although some of its most egregious excesses have been stopped). On the day of 9/11, Shafiq bin Laden was attending a Carlyle conference in Washington DC, along with fellow Carlyle shareholders George HW Bush and James Baker. All pieces of the same puzzle of just how amazingly interconnected the leading families of the world are with the sources of so many of the world’s conflicts.

Back in the fourth essay “An American Brotherhood”, we took a look at the SAAR network of Saudi-funded and Muslim Brotherhood run charities and institutions and their strangely close ties to the GOP. We also saw how former-Nazi hunter John Loftus forced US authorities to make the Operation Greenquest raids of March 20, 2002 by exposing this close-knit network and its supporters. So what exactly happened to Operation Greenquest? After all, Operation Greenquest was well-positioned to answer many of the questions we should have regarding the relationship between Middle Eastern elites, their ties to financing terror, and the complicity of the West in ignoring those ties. We’re going to finish off this series of essays by finishing our look at Operation Greenquest and some of the other post-9/11 investigations. Get ready for plenty of more disturbing discoveries and keep reading!!!!!!!!!!!


(1) A kind of Saudi “financial protectorate”, Lebanon is the destination of a great deal of Saudi money and influence. All of the great Saudi families have a strong economic presence in Beirut. Lebanese newspapers, which are some of the main pan-Arab newspapers, are also under Saudi financial control. And former Prime Minister Rafiq Hariri also owed a great deal of his person fortune to the Saudi monarchy. Similar to the bin Laden family’s construction monopoly, the Saudis gave Hariri a qausi-monopoly over the construction and maintenance of palaces and major public works projects. This kind of financial generosity is usefull in countering Iranian influence in Lebanon, and an example of how Saudi monarchy uses money, as opposed to arms (they have Pakistan and the US for that), to conduct their diplomacy in the region (13).

(2) As John Kerry’s BCCI investigation laid out, Capcom was a London and Chicago based commodities futures firm that operated from 1984-1988. Heavily staffed by former BCCI bankers and infused with a great deal of captial from BCCI, Capcom served as money-moving vehicle for BCCI during a time of massive losses for the criminal bank when the collapse of oil prices no longer allowed BCCI to hide the massive fraud and mismanagement that was taking place. The money-laundering that took place was due, in part, to the mechanics of the commodity futures market and its ability to generate a massive volume of trade with little oversite, making it a kind of predecessor to the massive commodity futures fraud of Enron. Interestingly, one of the directors of Enron, Wendy Gramm, was the head of the Commodity Futures Trading Commission, the US Government body that oversees this activity. During her tenure at that agency, Ms. Gramm, along with her husband Texas Senator Phil Gramm, helped remove the regulatory safeguards that enabled Enron’s massive looting.

(3) An interesting note on Charles Tickle: According to his Daniel’s Realty profile, Mr Tickle is the Director of the “Boy Scouts of America, Greater Alabama Council”. Now, back in early 2005, a Greater Alabama Council internal audit revealed that there was significant inflation of the number of new scouts taking place, apparently under pressure from the Greater Alabama Council. One of the primary reasons given for this quiet urging was for the purposes of soliciting additional funds from donors, the most prominent being the United Way of Central Alabama, which provided the Greater Alabama Council $1 million in 2004. And referring back to Mr Tickle’s profile we find that not only is Mr Tickle a Director of the Greater Alabama Council, but also a Director of the United Way of Central Alabama. While it is unclear what, if any, role Mr Tickle may have played in these shenanigans, it certainly is an interesting coincidence.

Offline References

(1) TAIWAN INVESTIGATORS STALLING ON FRIGATE SALE CASE:FRENCH BANKER”, Asia Pulse, July 19, 2001 Thursday, Northern Territory Regional, PARIS, July 18

(2) “Investigation Stepped Up Against Andre Lussi”, Financial News (Daily), February 22, 2004, A20040302E7-769B-GNW

(3) “Commission Chases Six Member States for Not Transposing Money-Laundering Directive”, European Report, February 11, 2004, No. 2842,

(4) “Al Qaeda List Points to Saudi Elite” by Glenn R. Simpson; Wall Street Journal March 18, 2003

(5) The Outlaw Bank: a Wild Ride Into the Secret Heart of BCCI, by Jonathan Beaty & S.C. Gwynne; Beard Books; Copyright 1993; ISBN 1-58798-146-7; p355

(6) ibid p356

(7) Forbidden Truth; Jean-Charles Brisard & Guillaume Dasquie; Copyright 2002 [SC]; Thunder’s Mouth/Nation Books; ISBN 1-56025-414-9; p. 136

(8) House of Bush/House of Saud; by Craig Unger; Scribner [HC]; Copyright 2004 by Craig Unger; ISBN 0-7432-5337-X; p120-121

(9) Mark Lombardi: Global Networks; by Mark Lombardi, Robert Carleton Hobbs, and Judith Richards; Copyright 2003; Independent Curators Inc; ISBN 0916365670; p104

(10) “Lebanese family takes a long-term view on gold: Michael Prest looks at Shakarchi which owns Switzerland’s largest independent refinery” The Independent, August 8, 1989. Business and City, p 19

(11) Dollars for Terror: The United States and Islam; by Richard Labeviere; Copyright 2000 [SC]; Algora Publishing; ISBN 1-892941-06-6; p111

(12) Ibid p111

(13) ibid p248