Posted on 12/21/2006 10:26:18 AM PST by Ancesthntr
JERUSALEM – An Israeli businessman who says he served as a broker in a multimillion-dollar Iraqi collection deal by the law firm of former Secretary of State James Baker now charges in a WND interview Baker's firm tried to cover up the alleged transactions, concerned about exposure after the Sept. 11, 2001, attacks.
The deal was structured to bypass U.S. sanctions on Iraq, according to the middleman, Nir Gouaz, president of Caesar Global Securities in Israel.
Gouaz claimed Houston-based Baker Botts made about $30 million collecting funds owed to a South Korean company by the Iraqi government at the peak of American sanctions imposed against Baghdad.
He claimed Baker was directly involved in the deal.
Gouaz told WND today Jeffrey Stonerock, a senior partner at Baker's firm, contacted him in November 2001 inquiring whether he had any documents related to the purported Iraqi deal.
Gouaz said he told Stonerock he still had a few papers.
He said Stonerock asked him to destroy all remaining documents related to the matter and sign a nondisclosure form pledging not to discuss the alleged deal.
"He told me to just sign the nondisclosure and forget about what happened," Gouaz told WND.
Gouaz said he refused to sign the nondisclosure agreement. He said he decided to retain all documents in his possession he said were related to the deal. The documents were obtained by WND yesterday.
"When they asked me to destroy the papers I became a bit skeptical," said Gouaz. "They were clearly worried about exposure after the 9-11 terror attacks."
Baker Botts today refused to comment on Gouaz's latest allegations.
As WND reported yesterday, Gouaz said he was tapped in 1998 by Baker Botts senior partner Stonerock to serve as a middleman in the collection of $1.65 billion in debt owned to Korea's Hyundai Engineering by the Iraqi government.
Hyundai had completed a series of major infrastructure projects in Iraq, including the construction of roads, railways and power plants and was supposed to be paid in Iraqi government bonds, but in the wake of the Gulf War, Saddam suspended payments to suppliers.
Gouaz said Iraq's failure to pay threatened the future of Hyundai.
Gouaz said he was asked to mediate the collection efforts to evade American sanctions on Iraq, which did not apply to Israelis.
He said he met initially with Baker and that the former secretary of state was involved in the collection deal.
Gouaz said he was asked by Baker's firm to meet with Shaiker Tawfik Fakoury, the president of the Bank of Jordan, which agreed to purchase the Iraqi government bonds from Hyundai at a lowered rate and resell them to the Iraqis at a profit in exchange for oil.
He said the Jordanian bank in July 2000 bought the Iraqi bonds from Hyundai using the services of Baker's firm at the price of $272 million. The Bank of Jordan, he claimed, then resold the bonds to Iraq for about $450 million in oil.
Gouaz said he estimated the Baker Botts law firm made about $33 million in fees for its services in the transactions.
He said it was "clear" from his communications with all parties involved that Baker's firm established the bonds exchange through Jordan using an Israeli middleman to bypass sanctions on Iraq.
"The point of involving me and setting up the collection as it was done was to get around the sanctions," Gouaz said.
Gouaz would not disclose how much money he personally made in the deal.
He first spoke out last weekend in an interview with Israel's Maariv daily newspaper during which he passed a polygraph lie detector test.
Gouaz provided WND with a copy of a letter dated July 11, 2000, from Hyundai executives thanking him for his efforts in mediating the collection deal. He also gave WND a copy of an Iraqi government bond from 1989 for $11 million he said was part of Hyundai's collection efforts.
Gouaz told WND he decided to come forward with details of the alleged transactions after the release earlier this month of a report by the Iraq Study Group, a commission headed by Baker that recommended an eventual U.S. withdrawal from Iraq and dialogue with Iran and Syria.
The report also urged Israel to withdraw from the West Bank and eastern sections of Jerusalem, and to sign a deal with Syria in which the Jewish state would vacate the Golan Heights, strategic mountainous territory twice used by Damascus to launch ground invasions into Israel.
"As a citizen of Israel I cannot just sit by and watch the hypocrisy being spewed by Baker," said Gouaz. "If Baker was still a private citizen I could keep his business dealings private, but now he is involved in diplomacy that sells out Israel. People need to understand he is acting out of economic considerations."
Baker Botts released a statement to WND yesterday saying the firm has "no knowledge" of whether the purported transaction described by Gouaz ever occurred.
The statement said Baker Botts' role in the supposed transactions as described by Gouaz and the payment Gouaz said the firm received are inaccurate.
Mike Cinelli, a public relations manager at Baker Botts, denied Baker was involved in the purported transactions Gouaz described.
Cinelli pointed to a press release on Hyundai's website from 2005 stating the company did not yet receive funds owed by the Iraqi government.
But Gouaz supplied WND with pictures of what he said was the signing ceremony in 2000 in which Hyundai's Iraqi government bonds were sold.
Baker's envoy role conflict of interest?
In 2003, President Bush appointed Baker as special envoy to aid in the recovery of debt from Iraq. He was specifically tasked with trying to persuade the international community to forgive large sums of debt.
A number of media reports pointed out Baker simultaneously was working with commercial companies trying to recover money from Iraq and that the former secretary of state might have conflicts of interest with his role as envoy.
Baker's firm represents the government of Saudi Arabia, the country claiming the largest amount of debt from Iraq. Also according to London's Guardian newspaper and the Nation magazine in New York, the Carlyle Group is involved in efforts to recover nearly $27 billion on behalf of the Kuwaiti government. Baker was a partner at Carlyle until last year.
Baker has publicly brushed aside the criticism, saying he has agreed to forego earnings from clients with obvious connections to the Iraqi debt.
No whispering online. :>)
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How much stock should we put in this article? It is WND.
LOL!
About as much as the NYSlimes, huh?
Yes, but what was it that you were going to say in Post #2?
Supposedly this was a violation of US sanctions on Iraq. How could business between Korea and Iraq qualify as violating US sanctions?
I know enough about James Baker to know that whatever makes him the most money is something he's for. THAT gives this article a lot of credibility in my mind. The guy has represented Arab governments in one form or another for well over 40 years - he knows where his bread is buttered, and the conclusions of the Iraq Surrender Guys that
...urged Israel to withdraw from the West Bank and eastern sections of Jerusalem, and to sign a deal with Syria in which the Jewish state would vacate the Golan Heights, strategic mountainous territory twice used by Damascus to launch ground invasions into Israel.
is simply the last in a long line of examples of what Baker is all about. Heck, the Saudi government probably couldn't have written those aspects of the ISG Report any better (Jimmie's paid to do that stuff, anyhow).
Face it, the guy is corrupt, while being about as self-righteous as the other James (the one who left his Holy Hand Grenade at home, thereby opening himself up to an attack by a savage rabbit). Just ask Baker - anything that he thinks is good for the US also (just coincidentally, mind you) makes him a fortune.
As for Baker and Carter both, if they were on fire I wouldn't piss on them to douse the flames.
Here's the quote from the article:
"Gouaz said he was asked to mediate the collection efforts to evade American sanctions on Iraq, which did not apply to Israelis.
He said he met initially with Baker and that the former secretary of state was involved in the collection deal."
I'm no expert on the sanctions, or even on the facts presented in this article, but I think that the actions and involvement of a U.S.-based firm and a U.S. resident (Baker - hawk, spit) to help Iraq get money (to pay its debts) was the violation. Clearly, Hyundai had a legal right to get its debt collected, so that's not an issue.
Let me tell you something. You boys need to think twice before you start burning bridges.
Ah. Never made the connection between James Baker and the Iraq Study Group. This suddenly seems 100 times more credible.
Can you please clarify a couple of things for me? First, who are "you boys?" Second, what bridges are being burned?
I'll be very happy to comment when I understand what you're talking about.
As for me and the 2 Jimmies, I can't stand either one (just in case you couldn't tell). I can say that I won't commit any illegal act, help anyone else do so, or even recommend that anyone else do so, regarding either of them. But neither will my reluctance for doing any such stupid things (and thereby earning a long stay in the Graybar Hotel) influence me to be any less happy when they take a dirt nap.
High Volume. Articles on Israel can also be found by clicking on the Topic or Keyword Israel. or WOT [War on Terror]
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Baker should have hired Sandy Berger.
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