Rosett and George Russell
Monday, September 20, 2004
Did Saddam Hussein use any of his ill-gotten
billions filched from the United Nations Oil-for-Food
program to help fund Al Qaeda?
Investigations have shown that the former Iraqi dictator
grafted and smuggled more than $10 billion from the program
that for seven years prior to Saddam's overthrow was meant
to bring humanitarian aid to ordinary Iraqis. And the Sept.
11 Commission has shown a tracery of contacts between Saddam
and Al Qaeda that continued after billions of Oil-for-Food
dollars began pouring into Saddam's coffers and Usama bin
Laden declared his infamous war on the U.S.
Now, buried in some of the United Nation's own
confidential documents, clues can be seen that underscore
the possibility of just such a Saddam-Al Qaeda link — clues
leading to a locked door in this Swiss lakeside resort.
Next to that door, a festive sign spells out in gold
letters under a green flag that this is the office of MIGA,
the Malaysian Swiss Gulf and African Chamber. Registered
here 20 years ago as a society to promote business between
the Gulf States and Asia, Europe and Africa, MIGA is a
company that the United Nations and the U.S. government says
has served as a hub of Al Qaeda finance: A terrorist chamber
In a recent interview, U.S. Assistant Treasury Secretary
Juan Zarate described MIGA as "a very good example of an
investment company that is used as a shell to hide and move
As is typical of terrorist financial webs, the details
surrounding MIGA quickly become bewildering — part of the
point being to camouflage the illicit flow of funds with
legitimate business. Part of the problem in finding the
truth is that cross-border transactions out of such
financial havens as Switzerland are smothered in banking
But even with that secrecy — and shortly after the
Sept.11, 2001, attacks on the United States — both MIGA and
its chief founder and longtime president, Ahmed Idris
Nasreddin, landed on the U.N. watchlist of entities and
individuals belonging to, or affiliated with Al Qaeda.
Nasreddin is a member of the terror-linked Muslim
Nasreddin's longtime business partner, Egyptian-born
Youssef Nada, also of the Muslim Brotherhood, likewise
appears on the U.N.'s Al Qaeda watchlist, as do a slew of
both Nasreddin's and Nada's enterprises. Former Treasury
Secretary Paul O'Neill in August 2002 described Nada and
Nasreddin as "supporters of terrorism" involved in "an
extensive financial network providing support to Al Qaeda
and other terrorist-related organizations."
Far less attention has been paid to the small, select
band of MIGA's other charter members. But one of them,
Iraqi-born Ahmed Totonji, set up shop years ago just outside
Washington, D.C., and is now
among those named by U.S. federal authorities in an
investigation into a cluster of companies and Islamic
non-profits based in Herndon, Virginia, suspected of having
funneled money to terrorist groups.
MIGA had other founders as well. One of them, who does
not appear on the U.N. terror list, is an Arab businessman
now in his early 60s, Abdul Rahman Hayel Saeed.
Described by an acquaintance as urbane, polite and fluent
in English, Hayel Saeed was born into one of Yemen's most
prominent business clans, owners of a family-held global
conglomerate based in the Yemeni capital of Taiz and named
for its founding patriarch: the Hayel Saeed Anam Group of
Companies, or HSA.
From Yemen, the HSA group boasts a far-flung business
empire, including a Yemen-based Islamic bank, and a host of
business subsidiaries, affiliates and regional trading
offices in places ranging from the United Kingdom to Egypt,
Morocco, Nigeria, Ethiopia, Malaysia, Indonesia, Russia and
Abdul Rahman Hayel Saeed sits on the HSA board of
directors, and ranks high in the management — he is
currently running HSA's regional office in Jeddah, Saudi
Arabia. In MIGA, Hayel Saeed holds a prominent spot, as one
of four co-founders who back in 1984 delegated power of
attorney to the terrorist-linked Nasreddin, giving him
authority to run the company.
Swiss registry documents show that Hayel Saeed has never
resigned from MIGA, nor revoked that power of attorney.
Queried about this link to MIGA, neither Hayel Saeed nor the
HSA Group's chairman of the board, Ali Mohamed Saeed, has
made any response.
HSA is unquestionably a company involved in legitimate
business. But given the involvement of Abdul Rahman Hayel
Saeed, it is striking that between 1996 and 2003, while the
United Nations ran its Oil-for-Food relief program in Iraq,
the HSA Group — via U.N.-approved Oil-for-Food contracts —
sold at least $400 million worth of goods to Saddam.
That might be unremarkable, had the United Nations ran
Oil-for-Food with enough integrity and transparency to
prevent Saddam and many of his business partners from
plundering oil earnings meant to help the people of Iraq.
The original United Nations plan was to let Saddam sell oil
solely to buy humanitarian goods such as food and medicine,
with the U.N. Secretariat collecting a 2.2 percent
commission on Saddam's oil sales to supervise the integrity
of this process.
As the Oil-for-Food program actually worked, however, the
United Nations let Saddam choose his own business partners.
The world body also kept secret the details of those
contracts and the identities of the contractors, and it let
Saddam graft at least $4.4 billion out of the program
through manipulated contract prices, by estimates of the
U.S. General Accountability Office.
Saddam's standard scam was to underprice oil sales and
overpay for relief supplies, thus generating fat profits for
his business partners. Many of those contractors would kick
back part of the take to Saddam's regime — or divert it to
whatever uses Saddam might fancy. By various accounts, those
uses ranged from building palaces to buying arms to
supplying Saddam's sadistic son Uday with equipment for
torturing Iraqi athletes.
One of the big questions is whether any of the money
skimmed from Oil-for-Food also slopped into
terrorist-financing ventures such as MIGA.
It's important to note that in tracking terrorist
financing, the simplest starting points are the visible
links, the potential connections through which money might
most easily have flowed. Proving that funds actually coursed
through those conduits is far more difficult.
In the case of Hayel Saeed, MIGA and the HSA Group, there
is no public information available about the precise flow of
funds, and no proof that Saddam's money made its way to MIGA.
But in looking for patterns that beg for further
investigation — especially by authorities with access to
detailed U.N. records and information on MIGA accounts —
some items here stand out.
Most simply, there is the question of why HSA was among
those companies favored by Saddam for such a fat slice of
business. It is increasingly clear that Saddam did not, on
average, choose his contractors either at random, or because
they were the most cost-efficient suppliers of relief for
the people of Iraq. While some of the deals may have been
entirely legitimate, many melded payments for humanitarian
goods with illicit kickbacks and payoffs. In such cases, it
was a lucrative privilege to be tapped as an Oil-for-Food
contractor by Saddam's regime.
The lingering question, for any individual case, becomes:
Was there a quid pro quo?
For reasons still unknown, Saddam clearly smiled upon the
HSA Group. Not only does HSA account for the bulk of all
Saddam's business with Yemen, but dozens of deals that
appear in the United Nation's generic public records to
originate elsewhere were in fact signed with HSA companies
in countries such as Egypt, Malaysia and Indonesia.
Within that HSA empire, one company in particular stands
out: A trading house called Pacific Interlink, based in
Kuala Lumpur, Malaysia. Abdul Rahman Hayel Saeed also sits
on Pacific Interlink's board of directors.
From leaked copies of secret U.N. Oil-for-Food records,
it appears that Pacific Interlink alone accounted for more
than half the HSA group's sales of relief supplies to
Saddam, with contracts for such goods as soap, ghee and
construction materials totaling at least $246 million.
Pacific Interlink also belonged to the select set of
companies chosen by Saddam and approved by the United
Nations as authorized to buy Iraqi oil under Oil-for-Food —
though whether Pacific Interlink actually got any of
Saddam's fat oil contracts is something the United Nations
has so far managed to keep secret. FOX News attempted to
reach Pacific Interlink for comment, but to date has
received no reply.
And though there is no public proof that Pacific
Interlink took part in Saddam's kickback scams, there is an
intriguing item in a study of Oil-for-Food pricing methods
released last year by the U.S. Defense Contract Management
Just after Saddam fell, the DCMA, together with the U.S.
Defense Contract Audit Agency, looked at the terms of 759
sample contracts out of the tens of thousands of deals done
by Saddam's regime under Oil-for-Food. In that sample,
Pacific Interlink pops up as a purveyor of $20 million worth
of palm oil to Saddam, via a contract approved by the United
Nations under Oil-for-Food in mid-2001. By DCMA estimates,
Saddam overpaid Pacific Interlink on that contract, to the
tune of about 15 percent above market price, which would
work out to some $3 million in funds diverted from relief on
that deal alone.
If similar arrangements went on within other Pacific
Interlink Oil-for-Food contracts, which totaled close to a
quarter of a billion dollars, then even at the more modest
rate of what has been widely described as Saddam's typical
10 percent over-pricing scam, that would suggest well over
$20 million diverted from relief.
If so, where did it go? The question is vitally
important, because much of the money grafted out of
Oil-for-Food by Saddam remains unaccounted for.
Both HSA's and MIGA's offices overlap in locations that
are hubs of normal commerce, but also served as hotspots of
Al Qaeda meetings and finance, such as Dubai (where Hayel
Saeed reportedly ran an HSA company, Frimex, in the late
1990s) or Kuala Lumpur (where some of the Sept. 11 hijackers
gathered for a planning conference in January 2000). Pacific
Interlink boasts offices or agents in places thick with
terror networks, such as Algeria, Sudan, and Syria. MIGA, on
its Lugano sign, lists offices in places such as Italy,
Turkey, Syria, Nigeria and Kuwait, and both HSA and MIGA
list offices in Morocco, Malaysia and Jeddah, Saudi Arabia,
where Hayel Saeed is now based.
MIGA is now under active investigation by the U.S.
Treasury and prosecutors in Switzerland and Italy. But there
is no sign that any of these investigations have been
tracking funds specifically via Oil-for-Food contracts or
that any of the multiple investigations into Oil-for-Food
have zeroed in on possible terror connections. It's not even
clear that the United Nations has allowed terrorist-tracking
authorities full access to its records.
And though MIGA's door in Lugano may be locked, and its
president and some of his associates posted on the U.N.
terror watchlist, none of these figures has been arrested.
Nasreddin, long a resident in Lugano and neighboring Milan,
Italy, is believed by Italian investigators to have moved
about two years ago to Morocco. From there, says an Italian
state investigator who asked to stay anonymous, Nasreddin
maintains a global business network that includes some 2,000
links so far identified to businesses and individuals
worldwide, some tied to terror, and some not.
It is precisely that mix of legitimate and sinister
business that makes it so difficult to prosecute Nasreddin,
or shut down his businesses, says this Italian investigator.
Among Nasreddin's holdings, for instance, is a four-star
hotel in Milan, Hotel NASCO, which opened — ironically
enough — in September 2001, at the same address as
Nasreddin's longtime residence. That is also the same
address used by a precursor of MIGA, an outfit called the
Arab Gulf Chamber. Hotel NASCO remains open for business,
serving tea and crescent-moon shaped sugar cookies at its
non-alcoholic lobby bar. MIGA remains active in the Lugano
business registry, and listed in the Lugano phone book.
A recent phone call to MIGA's shuttered office in Lugano,
Switzerland, was answered by someone who picked up the phone
in Milan, Italy — in the Hotel NASCO. MIGA's network, it
seems, migrates as needed.
partner, Al Qaeda-linked Youssef Nada, still lives in his
plush hillside villa in a small Italian enclave on Lake
Lugano, just a short drive from MIGA's office. Right next
door to MIGA's Lugano office, on the same floor of the same
building, is the Islamic Center of the Canton of Ticino,
founded by Nasreddin in 1992 - and operated initially out of
his former Lugano residence a few blocks away. The Islamic
Center later moved next door to MIGA.
Swiss registry documents show that in 2003, after Nasreddin
made it onto the U.N. terror watchlist and moved to Morocco,
he resigned as president of his Lugano Islamic center. He
was replaced this year by the center's current president, a
man called Ali Ghaleb Himmat, who attended one of MIGA's
founding meetings 20 years ago, and since 2002 has been
designated by the United Nations as affiliated with, or
belonging to Al Qaeda.
At that Lugano Islamic Center,
which also serves as a mosque, a spokesman denies that the
center has any links to Al Qaeda, and says of Nasreddin: "He
was a Muslim rich man, and he prays, and he loved God, and
that's it." Just down the road, Swiss businessman Fulvio
Passardi, who at one point served as corporate secretary for
MIGA, says he knew nothing about the chamber, saying it was
"an empty box."
According to U.S. officials and the United Nations
itself, MIGA is less an "empty box" than a container of Al
Qaeda-related mysteries. One of those mysteries appears to
be Abdul Rahman Hayel Saeed, with his charter MIGA
membership and his prominent part in a Yemen conglomerate
doing hundreds of millions worth of business with Saddam.
Unraveling the mystery requires much greater access to
Oil-for-Food records than the United Nations currently