04 August 2003

Senate Probes Administration about Saudi Financial Links to Terrorism

FBI, Treasury officials testify before Senate hearing July 31

By Phil Kurata
Washington File Staff Writer

Washington -- The U.S. Senate has pressed the Bush administration for information about possible Saudi Arabian financial links to terrorism following the release of a controversial report about the causes of the September 11, 2001 terrorist attacks.

At a hearing of the Senate Governmental Affairs Committee July 31, senators probed two senior administration officials, one from the Federal Bureau of Investigation, the other from the Treasury Department's Office of Foreign Assets Control, on cooperation by the Saudi government to investigate terrorist acts and to cut off financing to terrorist groups by Saudi charitable organizations and non-governmental organizations.

The Senate convened the hearing after the release July 24 of the "Report of the Joint Inquiry into the Terrorist Attacks of September 11, 2001" by the House Permanent Select Committee on Intelligence and the Senate Select Committee on Intelligence, in which the Bush administration ordered that 28 pages be deleted. The report can be found at: http://www.access.gpo.gov.

The deleted pages are reported to deal with Saudi Arabia's links to terrorism. Saudi Foreign Minister Saud al-Faisal visited President Bush in Washington July 29 and said the deleted pages should be released to the public so that the Saudi government can address the allegations.

Fifteen of the 19 hijackers in the September 11 attacks were from Saudi Arabia, but the Saudi government has declared it had no involvement in the attacks.

President Bush said he ordered the pages deleted in order not to compromise an investigation into the attacks.

"If people are being investigated, it doesn't make sense for us to let them know who they are," Bush said July 29.

The chairwoman of the Government Affairs Committee, Susan Collins (Republican from Maine), said even the published portions of the inquiry raise serious questions about Saudi Arabia's role in the September 11 attacks.

"Last month the general counsel of the Treasury Department testified before the Terrorism Subcommittee of the Judiciary Committee that in many cases Saudi Arabia is the epicenter of terrorist financing," Collins added.

"The Council on Foreign Relations report [in 2002] found that for years individuals and charities based in Saudi Arabia have been the most important source of funds for al-Qaida, and that for years Saudi officials have turned a blind eye to this problem," Collins said.

Senator Carl Levin (Democrat from Michigan) said the former chairman of the Senate Intelligence Committee, Richard Shelby, viewed the withheld information as merely embarrassing but not endangering to national security if published.

Collins and Levin pressured the head of the Treasury Department's Office of Foreign Assets Control, Richard Newcomb, to release the names of individuals and groups that Newcomb's office had recommended the U.S. government publicly identify as terrorist financers.

Newcomb said the administration's Policy Coordination Council, which takes into account multiple views from the State Department, the Justice Department, the Federal Bureau of Investigation, the Central Intelligence Agency and others, is responsible for accepting or rejecting the recommendations.

Senator Arlen Specter (Republican from Pennsylvania) said the Saudi role in providing financing for terrorists has become an issue of enormous importance following the publication of the joint inquiry with the missing pages.

"There has been a decision by the Executive Branch not to release those pages, and I believe that puts a greater responsibility on Congress in oversight," Specter said.

Specter said individuals and groups in Saudi Arabia reportedly contribute about $4 billion or $5 billion annually to "so-called charities, which have dual uses."

"This is a real challenge for the United States government, and congressional oversight is a very, very important part," Specter said.

While professing to be cooperative, Specter said, Saudi authorities in fact have been uncooperative in tracking terrorists. He said Saudi lack of cooperation was evident in the 1995 car bombing in Riyadh that killed Americans and the 1996 Khobar Towers bombing that killed 19 U.S. troops.

"Questions linger to this day as to whether some of those who were involved in the Khobar Towers might have been involved in 9/11," Specter said.

Collins said there is evidence that enormous sums of money flow from Saudi individuals and charitable organizations to al-Qaida, the Palestinian terrorist group Hamas, and other terrorist organizations.

Collins said that Saudi authorities have announced some changes in its banking system and charity laws, but it is unclear how effective those reforms will prove to be.

"The key question now is whether the Saudi government is doing enough to stop the flow of this money," Collins said. "And if not, what actions the U.S. government should take to prompt the Saudis to take more effective action."

Levin said that in addition to obstructing investigations, the Saudi government was one of the few governments in the world that supported the Taliban in Afghanistan despite the Taliban's link to terrorists. He said that while working to strengthen ties with the United States, Saudi authorities funded extreme Muslim clerics and Islamic schools in Pakistan that provided recruits for the Taliban.

Saudi government officials and prominent Saudi citizens routinely contributed huge sums to Muslim charities, which supported terrorism, including support for families of terrorists, Levin said. The United States finally shut down several of those charities, which were operating in the United States, Levin said.

The Michigan senator said that in terms of rhetoric, the Saudi authorities have been with the United States in the war against terrorism, but in actions, they have often been against the United States.

The FBI acting director for counterterrorism, John Pistole, said the Saudi government has shifted its attitude dramatically since the terrorist attacks in Riyadh on May 12, 2003.

"... post-May 12, the Saudis have had a wake-up call and we've had unprecedented cooperation with them in virtually every area," Pistole said.

Describing what he meant by "unprecedented," Pistole said the Saudis have allowed U.S. investigators to interview Saudi citizens who were eyewitnesses and given the investigators direct access to evidence and rights to transport it back to the United States for analysis. Pistole said Saudi cooperation is only lacking in the issue of terrorist financing.

Pistole attributed the change in attitude to the terrorist attacks against the Saudi royal family.

"I think that the royal family, in particular, see themselves as being vulnerable to al Qaida efforts in the kingdom, and that no longer is this simply an entity that is focusing on Western interests, but has now turned on the kingdom and the royal family that represents the kingdom," Pistole said. "[T]hey see themselves in the struggle for survival at this point."

The Treasury Department's Newcomb said the United States and Saudi Arabia have achieved a number of successes together in the fight against terrorism. He cited as an example the joint designation of two branches of the al-Haramain charitable organization in Bosnia and Somalia as well as an individual who affiliated with one of the organizations.

He also noted that the Saudi government has announced the creation of a ministry specifically for the oversight of the charities, and the Jeddah Chamber of Commerce, at the urging of the United States, has implemented a code of conduct relating to standards for charitable giving.

Pistole said it is clear that money has flowed to terrorists through Saudi charitable organizations, but investigators have not found a verifiable financial link between the Saudi government and a particular terrorist.