P
Patriot Games
Guest
http://www.newsmax.com/archives/articles/2007/8/12/125731.shtml?s=us
Italy Probe Unearths Huge Iraq Arms Deal
NewsMax.com Wires Sunday, Aug. 12, 2007
PERUGIA, Italy -- In a hidden corner of Rome's busy Fiumicino Airport,
police dug quietly through a traveler's checked baggage, looking for
smuggled drugs. What they found instead was a catalog of weapons, a clue to
something bigger.
Their discovery led anti-Mafia investigators down a monthslong trail of
telephone and e-mail intercepts, into the midst of a huge black-market
transaction, as Iraqi and Italian partners haggled over shipping more than
100,000 Russian-made automatic weapons into the bloodbath of Iraq.
As the secretive, $40 million deal neared completion, Italian authorities
moved in, making arrests and breaking it up. But key questions remain
unanswered.
For one thing, The Associated Press has learned that Iraqi government
officials were involved in the deal, apparently without the knowledge of the
U.S. Baghdad command - a departure from the usual pattern of U.S.-overseen
arms purchases.
Why these officials resorted to "black" channels and where the weapons were
headed is unclear.
The purchase would merely have been the most spectacular example of how Iraq
has become a magnet for arms traffickers and a place of vanishing weapons
stockpiles and uncontrolled gun markets since the 2003 U.S. invasion and the
onset of civil war.
Some guns the U.S. bought for Iraq's police and army are unaccounted for,
possibly fallen into the hands of insurgents or sectarian militias.
Meanwhile, the planned replacement of the army's AK-47s with U.S.-made M-16s
may throw more assault rifles onto the black market. And the weapons
free-for-all apparently is spilling over borders: Turkey and Iran complain
U.S.-supplied guns are flowing from Iraq to anti-government militants on
their soil.
Iraqi middlemen in the Italian deal, in intercepted e-mails, claimed the
arrangement had official American approval. A U.S. spokesman in Baghdad
denied that.
"Iraqi officials did not make MNSTC-I aware that they were making
purchases," Lt. Col. Daniel Williams of the Multi-National Security
Transition Command-Iraq (MNSTC-I), which oversees arming and training of the
Iraqi police and army, told the AP.
Operation Parabellum, the investigation led by Dario Razzi, anti-Mafia
prosecutor in this central Italian city, began in 2005 as a routine
investigation into drug trafficking by organized-crime figures, branched out
into an inquiry into arms dealing with Libya, and then widened to Iraq.
Court documents obtained by the AP show that Razzi's break came early last
year when police monitoring one of the drug suspects covertly opened his
luggage as he left on a flight to Libya. Instead of the expected drugs, they
found helmets, bulletproof vests and the weapons catalog.
Tapping telephones, monitoring e-mails, Razzi's investigators followed the
trail to a group of Italian businessmen, otherwise unrelated to the drug
probe, who were working to sell arms to Libya and, by late 2006, to Iraq as
well, through offshore companies they set up in Malta and Cyprus.
Four Italians have been arrested and are awaiting court indictment for
allegedly creating a criminal association and alleged arms trafficking -
trading in weapons without a government license. A fifth Italian is being
sought in Africa. In addition, 13 other Italians were arrested on drug
charges.
In the documents, Razzi describes it as "strange" that the U.S.-supported
Iraqi government would seek such weapons via the black market.
Investigators say the prospect of an Iraq deal was raised last November,
when an Iraqi-owned trading firm e-mailed Massimo Bettinotti, 39, owner of
the Malta-based MIR Ltd., about whether MIR could supply 100,000 AK-47
assault rifles and 10,000 machine guns "to the Iraqi Interior Ministry,"
adding that "this deal is approved by America and Iraq."
The go-between - the Al-Handal General Trading Co. in Dubai - apparently had
communicated with Bettinotti earlier about buying night visors and had been
told MIR could also procure weapons.
Al-Handal has figured in questionable dealings before, having been
identified by U.S. investigators three years ago as a "front company" in
Iraq's Oil-for-Food scandal.
The Interior Ministry's need at that point for such a massive weapons
shipment is unclear. The U.S. training command had already reported it would
arm all Interior Ministry police by the end of 2006 through its own
three-year-old program, which as of July 26 has bought 701,000 weapons for
the Iraqi army and police with $237 million in U.S. government funds.
Negotiations on the deal progressed quickly in e-mail exchanges between the
Italians and Iraqi middlemen of the al-Handal company and its parent
al-Thuraya Group. But at times the discussion turned murky and nervous.
The Iraqis alternately indicated the Interior Ministry or "security
ministries" would be the end users. At one point, a worried Bettinotti
e-mailed, "We prefer to speak about this deal face to face and not by
e-mail."
The Italians sent several offers of various types and quantities of rifles,
with photos included. The negotiating focused on the source of the weapons:
The Iraqi middlemen said their buyer insisted they be Russian-made, but the
Italians wanted to sell AK-47s made in China, where they had better
contacts.
"We are in a hurry with this deal," an impatient Waleed Noori al-Handal,
Jordan-based general manager of the Iraqi firm, wrote the Italians on Nov.
13 in one of the e-mails seen by AP.
He added, in apparent allusion to the shipment's clandestine nature, "You
mustn't worry if it's a problem to import these goods directly into Iraq. We
can bring the product to another country and then transfer it to Iraq."
By December, the Italians, having found a Bulgarian broker, were offering
Russian-made goods: 50,000 AKM rifles, an improved version of the AK-47;
50,000 AKMS rifles, the same gun with folding stock; and 5,000 PKM machine
guns.
The Iraqis quibbled over the asking price, $39.7 million, but seemed
satisfied. The Italians were set for a $6.6 million profit, the court
documents show, and were already discussing air transport for the weapons.
At this point prosecutor Razzi acted, seeking an arrest warrant from a
Perugia court.
"The negotiation with Iraq is developing very quickly," he wrote the judge.
On Feb. 12, in seven locations across Italy, police arrested the 17 men,
including the four alleged arms traffickers: Bettinotti; Gianluca Squarzolo,
39, the man whose luggage had yielded the original clue; Ermete Moretti, 55,
and Serafino Rossi, 64. If convicted, they could be sentenced to up to 12
years in prison.
The at-large fifth man, Vittorio Dordi, 42, was believed to be in the
Democratic Republic of Congo, where he apparently is involved in the diamond
trade. Italian authorities were seeking information on him from the African
country.
In the parallel Libya case, the Italians allegedly paid two Libyan Defense
Ministry officials about $500,000 in kickbacks to speed that transaction for
Chinese-made assault rifles. It isn't known whether such bribes were a
factor in the Iraq deal. No Libyans or Iraqis are known to have been
detained in connection with the cases.
Al-Handal's operations have caught investigators' notice before. In
1996-2003, the company was involved as a broker in the kickback scandal
known as Oil for Food, the CIA says.
In that program, Iraq under U.N. economic sanctions bought food and other
necessities with U.N.-supervised oil revenues. Foreign companies, often
through intermediaries, surreptitiously kicked back payments to officials of
Saddam Hussein's Iraqi government in exchange for such supply contracts.
Those Iraqi middlemen also engaged in "misrepresenting the origin or final
destination of goods," said the 2004 report of the CIA's Iraq Survey Group,
which investigated both Iraq's defunct advanced weapons programs and Oil for
Food.
That report also alleged that during this period Al-Handal General Trading,
from its bases in Dubai and Jordan, secretly moved unspecified "equipment"
into Iraq that was forbidden by the U.N. sanctions.
Reached at his office in Amman, Jordan, Waleed Noori al-Handal denied the
family firm had done anything wrong in the Italian arms case.
"We don't have anything to hide," he told the AP.
Citing the names of "friends" in top U.S. military ranks in Iraq, al-Handal
said his company has fulfilled scores of supply and service contracts for
the U.S. occupation. Asked why he claimed U.S. approval for the abortive
Italian weapons purchase, he said he had a document from the U.S. Army "that
says, 'We allow al-Thuraya Group to do all kinds of business.'"
In Baghdad, the Interior Ministry wouldn't discuss the AK-47 transaction on
the record. But a senior ministry official, speaking on condition of
anonymity because of the matter's sensitivity, acknowledged it had sought
the weapons through al-Handal.
Asked about the irregular channels used, he said the ministry "doesn't ask
the supplier how these weapons are obtained."
Although this official refused to discuss details, he said "most" of the
105,000 weapons were meant for police in Iraq's western province of Anbar.
That statement raised questions, however, since Pentagon reports list only
161,000 trained police across all 18 of Iraq's provinces, and say the
ministry has been issued 169,280 AK-47s, 167,789 pistols and 16,398 machine
guns for them and 28,000 border police.
A July 26 Pentagon report said 20,847 other AK-47s purchased for the
Interior Ministry have not yet been delivered. Iraqi officials complain that
the U.S. supply of equipment, from bullets to uniforms, has been slow.
A Pentagon report in June may have touched on another possible destination
for weapons obtained via secretive channels, noting that "militia
infiltration of local police remains a significant problem." Shiite Muslim
militias in Iraq's civil war have long been known to find cover and weapons
within the Interior Ministry.
In fact, in a further sign of poor controls on the flow of arms into Iraq, a
July 31 audit report by the U.S. Government Accountability Office said the
U.S. command's books don't contain records on 190,000 AK-47s and other
weapons, more than half those issued in 2004-2005 to Iraqi forces. This
makes it difficult to trace weapons that may be passed on to militias or
insurgents.
The Pentagon, meanwhile, has described the Interior Ministry's accounting of
police equipment as unreliable.
Here in Italy, Razzi expressed puzzlement at the Iraqi officials'
circumvention of U.S. supply routes.
"It seems strange that a pro-Western government, supported by the U.S. Army
and other NATO countries on its own territory, would seek Russian or Chinese
weapons through questionable channels," the anti-Mafia prosecutor wrote in
seeking the arrest warrant that short-circuited the complex deal.
Italy Probe Unearths Huge Iraq Arms Deal
NewsMax.com Wires Sunday, Aug. 12, 2007
PERUGIA, Italy -- In a hidden corner of Rome's busy Fiumicino Airport,
police dug quietly through a traveler's checked baggage, looking for
smuggled drugs. What they found instead was a catalog of weapons, a clue to
something bigger.
Their discovery led anti-Mafia investigators down a monthslong trail of
telephone and e-mail intercepts, into the midst of a huge black-market
transaction, as Iraqi and Italian partners haggled over shipping more than
100,000 Russian-made automatic weapons into the bloodbath of Iraq.
As the secretive, $40 million deal neared completion, Italian authorities
moved in, making arrests and breaking it up. But key questions remain
unanswered.
For one thing, The Associated Press has learned that Iraqi government
officials were involved in the deal, apparently without the knowledge of the
U.S. Baghdad command - a departure from the usual pattern of U.S.-overseen
arms purchases.
Why these officials resorted to "black" channels and where the weapons were
headed is unclear.
The purchase would merely have been the most spectacular example of how Iraq
has become a magnet for arms traffickers and a place of vanishing weapons
stockpiles and uncontrolled gun markets since the 2003 U.S. invasion and the
onset of civil war.
Some guns the U.S. bought for Iraq's police and army are unaccounted for,
possibly fallen into the hands of insurgents or sectarian militias.
Meanwhile, the planned replacement of the army's AK-47s with U.S.-made M-16s
may throw more assault rifles onto the black market. And the weapons
free-for-all apparently is spilling over borders: Turkey and Iran complain
U.S.-supplied guns are flowing from Iraq to anti-government militants on
their soil.
Iraqi middlemen in the Italian deal, in intercepted e-mails, claimed the
arrangement had official American approval. A U.S. spokesman in Baghdad
denied that.
"Iraqi officials did not make MNSTC-I aware that they were making
purchases," Lt. Col. Daniel Williams of the Multi-National Security
Transition Command-Iraq (MNSTC-I), which oversees arming and training of the
Iraqi police and army, told the AP.
Operation Parabellum, the investigation led by Dario Razzi, anti-Mafia
prosecutor in this central Italian city, began in 2005 as a routine
investigation into drug trafficking by organized-crime figures, branched out
into an inquiry into arms dealing with Libya, and then widened to Iraq.
Court documents obtained by the AP show that Razzi's break came early last
year when police monitoring one of the drug suspects covertly opened his
luggage as he left on a flight to Libya. Instead of the expected drugs, they
found helmets, bulletproof vests and the weapons catalog.
Tapping telephones, monitoring e-mails, Razzi's investigators followed the
trail to a group of Italian businessmen, otherwise unrelated to the drug
probe, who were working to sell arms to Libya and, by late 2006, to Iraq as
well, through offshore companies they set up in Malta and Cyprus.
Four Italians have been arrested and are awaiting court indictment for
allegedly creating a criminal association and alleged arms trafficking -
trading in weapons without a government license. A fifth Italian is being
sought in Africa. In addition, 13 other Italians were arrested on drug
charges.
In the documents, Razzi describes it as "strange" that the U.S.-supported
Iraqi government would seek such weapons via the black market.
Investigators say the prospect of an Iraq deal was raised last November,
when an Iraqi-owned trading firm e-mailed Massimo Bettinotti, 39, owner of
the Malta-based MIR Ltd., about whether MIR could supply 100,000 AK-47
assault rifles and 10,000 machine guns "to the Iraqi Interior Ministry,"
adding that "this deal is approved by America and Iraq."
The go-between - the Al-Handal General Trading Co. in Dubai - apparently had
communicated with Bettinotti earlier about buying night visors and had been
told MIR could also procure weapons.
Al-Handal has figured in questionable dealings before, having been
identified by U.S. investigators three years ago as a "front company" in
Iraq's Oil-for-Food scandal.
The Interior Ministry's need at that point for such a massive weapons
shipment is unclear. The U.S. training command had already reported it would
arm all Interior Ministry police by the end of 2006 through its own
three-year-old program, which as of July 26 has bought 701,000 weapons for
the Iraqi army and police with $237 million in U.S. government funds.
Negotiations on the deal progressed quickly in e-mail exchanges between the
Italians and Iraqi middlemen of the al-Handal company and its parent
al-Thuraya Group. But at times the discussion turned murky and nervous.
The Iraqis alternately indicated the Interior Ministry or "security
ministries" would be the end users. At one point, a worried Bettinotti
e-mailed, "We prefer to speak about this deal face to face and not by
e-mail."
The Italians sent several offers of various types and quantities of rifles,
with photos included. The negotiating focused on the source of the weapons:
The Iraqi middlemen said their buyer insisted they be Russian-made, but the
Italians wanted to sell AK-47s made in China, where they had better
contacts.
"We are in a hurry with this deal," an impatient Waleed Noori al-Handal,
Jordan-based general manager of the Iraqi firm, wrote the Italians on Nov.
13 in one of the e-mails seen by AP.
He added, in apparent allusion to the shipment's clandestine nature, "You
mustn't worry if it's a problem to import these goods directly into Iraq. We
can bring the product to another country and then transfer it to Iraq."
By December, the Italians, having found a Bulgarian broker, were offering
Russian-made goods: 50,000 AKM rifles, an improved version of the AK-47;
50,000 AKMS rifles, the same gun with folding stock; and 5,000 PKM machine
guns.
The Iraqis quibbled over the asking price, $39.7 million, but seemed
satisfied. The Italians were set for a $6.6 million profit, the court
documents show, and were already discussing air transport for the weapons.
At this point prosecutor Razzi acted, seeking an arrest warrant from a
Perugia court.
"The negotiation with Iraq is developing very quickly," he wrote the judge.
On Feb. 12, in seven locations across Italy, police arrested the 17 men,
including the four alleged arms traffickers: Bettinotti; Gianluca Squarzolo,
39, the man whose luggage had yielded the original clue; Ermete Moretti, 55,
and Serafino Rossi, 64. If convicted, they could be sentenced to up to 12
years in prison.
The at-large fifth man, Vittorio Dordi, 42, was believed to be in the
Democratic Republic of Congo, where he apparently is involved in the diamond
trade. Italian authorities were seeking information on him from the African
country.
In the parallel Libya case, the Italians allegedly paid two Libyan Defense
Ministry officials about $500,000 in kickbacks to speed that transaction for
Chinese-made assault rifles. It isn't known whether such bribes were a
factor in the Iraq deal. No Libyans or Iraqis are known to have been
detained in connection with the cases.
Al-Handal's operations have caught investigators' notice before. In
1996-2003, the company was involved as a broker in the kickback scandal
known as Oil for Food, the CIA says.
In that program, Iraq under U.N. economic sanctions bought food and other
necessities with U.N.-supervised oil revenues. Foreign companies, often
through intermediaries, surreptitiously kicked back payments to officials of
Saddam Hussein's Iraqi government in exchange for such supply contracts.
Those Iraqi middlemen also engaged in "misrepresenting the origin or final
destination of goods," said the 2004 report of the CIA's Iraq Survey Group,
which investigated both Iraq's defunct advanced weapons programs and Oil for
Food.
That report also alleged that during this period Al-Handal General Trading,
from its bases in Dubai and Jordan, secretly moved unspecified "equipment"
into Iraq that was forbidden by the U.N. sanctions.
Reached at his office in Amman, Jordan, Waleed Noori al-Handal denied the
family firm had done anything wrong in the Italian arms case.
"We don't have anything to hide," he told the AP.
Citing the names of "friends" in top U.S. military ranks in Iraq, al-Handal
said his company has fulfilled scores of supply and service contracts for
the U.S. occupation. Asked why he claimed U.S. approval for the abortive
Italian weapons purchase, he said he had a document from the U.S. Army "that
says, 'We allow al-Thuraya Group to do all kinds of business.'"
In Baghdad, the Interior Ministry wouldn't discuss the AK-47 transaction on
the record. But a senior ministry official, speaking on condition of
anonymity because of the matter's sensitivity, acknowledged it had sought
the weapons through al-Handal.
Asked about the irregular channels used, he said the ministry "doesn't ask
the supplier how these weapons are obtained."
Although this official refused to discuss details, he said "most" of the
105,000 weapons were meant for police in Iraq's western province of Anbar.
That statement raised questions, however, since Pentagon reports list only
161,000 trained police across all 18 of Iraq's provinces, and say the
ministry has been issued 169,280 AK-47s, 167,789 pistols and 16,398 machine
guns for them and 28,000 border police.
A July 26 Pentagon report said 20,847 other AK-47s purchased for the
Interior Ministry have not yet been delivered. Iraqi officials complain that
the U.S. supply of equipment, from bullets to uniforms, has been slow.
A Pentagon report in June may have touched on another possible destination
for weapons obtained via secretive channels, noting that "militia
infiltration of local police remains a significant problem." Shiite Muslim
militias in Iraq's civil war have long been known to find cover and weapons
within the Interior Ministry.
In fact, in a further sign of poor controls on the flow of arms into Iraq, a
July 31 audit report by the U.S. Government Accountability Office said the
U.S. command's books don't contain records on 190,000 AK-47s and other
weapons, more than half those issued in 2004-2005 to Iraqi forces. This
makes it difficult to trace weapons that may be passed on to militias or
insurgents.
The Pentagon, meanwhile, has described the Interior Ministry's accounting of
police equipment as unreliable.
Here in Italy, Razzi expressed puzzlement at the Iraqi officials'
circumvention of U.S. supply routes.
"It seems strange that a pro-Western government, supported by the U.S. Army
and other NATO countries on its own territory, would seek Russian or Chinese
weapons through questionable channels," the anti-Mafia prosecutor wrote in
seeking the arrest warrant that short-circuited the complex deal.
