Bush Is No Good Trade

According to U.S. Securities and Exchange Commission records, on four separate occasions Gov. George W. Bush disregarded federal statutes by failing to file insider stock trade reports on a timely basis, back-dating one trade by some four months. Moreover, one key trade just a few weeks before Iraq invaded Kuwait -- but reported some eight months late after the Gulf War was over -- netted Bush close to $1 million in profit as he sold stock in Harken Energy, an oil company doing business in the Middle East wherein some of his father's largest contributors also maintained substantial positions.

The SEC under President Bush carried out an incomplete investigation of the younger Bush's pre-Gulf War trade in 1991 after key presidential advisor George Jr. claimed that he filed a report, but that the SEC had most likely lost it. (No one has really asked whether the governor bothered to use registered mail to verify receipt of the documents.)

According to an Oct. 28, 1991, Time Magazine report, SEC spokesman John Heine said, "as far as I know, nobody ever found the 'lost' filing." And, strangely, Bush refused comment to Time regarding either the incident or his involvement with Harken.

The governor also did not reveal the blatant conflicts of interest involved, since the chairman of the SEC was Richard Breedon, former lawyer with Houston firm Baker and Botts and deputy counsel to Bush's father when he was vice president. Breedon received his SEC appointment after the elder Bush became president.

The SEC investigation of George W. was led by general counsel James R. Doty who, according to a UPI report, mysteriously neglected to interview any of the Harken directors. Moreover, Doty had previously served as George W. Bush's personal lawyer in the deal involving his Texas Rangers purchase. So, in the end, the younger Bush was cleared of insider trade wrongdoing by his personal attorney and by his father's vice-presidential counsel, a virtual impossibility for the average U.S. citizen.

That the mainstream media has refused to question Bush regarding what voters might consider a mockery of the criminal investigative process is a story in and of itself -- especially considering it concerns how a possible future president might enforce U.S. laws if he had also broken those statutes.

Consider that Americans who currently hold stocks or mutual funds would never -- by virtually no stretch of the imagination -- be able to obtain access to corporate insider information that could turn a million dollars profit. But reporters following Bush have not broached the subject during the campaign.

Most reports involving Bush's insider oil stock trades refer only to his highly controversial June 22, 1990, million dollar trade made six weeks before Gulf War hostilities broke out in Kuwait -- a trade which was reported eight months later. However, SEC documents between 1986 and 1993 show that Bush acquired 212,152 shares of Harken stock on Nov. 1, 1986, at the time he merged his Spectrum 7 company with Harken. But the future governor did not report the transaction until April 7, 1987 -- more than five months later.

When Bush filed late on April 7,1987, SEC filings show he had purchased another 80,000 shares on March 10, 1987. But strangely, two weeks later, an April 22 filing noted that the 80,000-share purchase was backdated to Dec. 10, 1986. When questioned by the media, Bush's attorney said it was the same 80,000 shares but he could not explain the discrepancy regarding the purchase dates or why Bush even reported the trade two times.

Another SEC filing, this from June 6, 1989, showed that Bush purchased another 25,000 shares of Harken but again waited more than four months to report the transaction.

The Houston Post, recognizing Bush's late SEC filings, noted that he "took eight months to notify the government of his sale of stock in a company on whose board he served" and "also missed the filing deadline for reporting other insider trades involving Harken Energy."

Documents obtained by the Post showed "additional instances in which Bush ... ran afoul of the SEC rule requiring notification." And George W. described himself as a "small, insignificant" Harken stockholder; but news reports examining SEC documents identified Bush as the third largest non-institutional investor.

In October 1991, Time Magazine questioned why the tiny country of Bahrain would stake so much of its financial future on Harken Energy, which it labeled an "obscure, money-losing company with no refineries and no experience in offshore oil exploration." But the magazine also noted that oil-insiders speculated that Bahrain's rulers saw the arrangement as a way to gain influence with the Bush administration.

Mysteriously, primary reporters have also ignored what could point to a nexus regarding foreign policy and personal financial interests. Interestingly, the Village Voice in January 1991 reported that in 1990 the Bush administration signed an agreement with Bahrain that chose the small country as the permanent principal allied base in the Middle East, although it was some 200 miles away from the hostilities in Iraq and Kuwait.

The military-base deal came after Harken announced its Jan. 30, 1990, joint oil-drilling venture with Bahrain. So President Bush's key contributors and his son George W. were carrying on personal financial business with Bahrain at the same time decisions were being made regarding the possibility of a war in the Gulf.

And neither the president nor his adviser, George Jr., let the press know that Bahrain had been permitted to infuse $7.7 million in foreign cash to hire U.S. public relations firm Hill & Knowlton to lobby Congress and the American people; a stunning variety of opinion-forming devices and techniques were employed to inflame U.S. patriotic passions of war while personal financial interests were on the line.

On May 21, 1990, less than ten weeks before Saddam Hussein's troops invaded Kuwait to initiate the Middle East hostilities -- but just four weeks before Bush unloaded the bulk of his Harken stock -- a renegotiated corporate loan agreement featured an unusually high interest rate of 12 percent, less credit for acquisitions, a $750,000 debt fee and even requirements by some of Harken's major stockholders to guarantee $22.5 million in debt, according to Associated Press.

Did Bush know of impending losses when he sold his stock on June 22, 1990, since Federal securities law prohibits corporate insiders from trading "on the basis of" material information that is not publicly known? Bush denied the charge in spite of his positions on the Harken Energy board of directors, audit committee and stock restructuring panel. He added that he had no idea Harken was going to get an audit report full of red ink until weeks after he had made his stock sale.

But U.S. News & World Report said, "there is substantial evidence to suggest that Bush knew Harken was in dire straits. ... Harken's SEC filings make it clear that the company's directors knew radical steps were necessary." The magazine added that "one informed source says Harken's creditors had threatened to foreclose on the company if substantial debt payments were not made." Shortly thereafter, Bush cashed out of Harken.

The April 4, 1991,Wall Street Journal added that "Mr. Bush didn't return their phone calls seeking comment, and the Bush White House said 'it doesn't comment on the activities of the president's children.'"

According to the Washington Post, Harken's audit committee, of which Bush was a member, met with Mikel Faulkner and

auditors from Arthur Andersen & Co.

, Harken's accountants, on June 11, 1990 -- just 11 days before Bush sold his stock on June 22. When asked for a copy of the June 11 minutes or permission to inspect them, the company declined to make the records available.

Bush's insider transaction yielding a profit of $848,560 -- some 250 percent profit on the stock's original value -- came a week prior to the end of a quarter in which the company lost $23 million. The quarterly report was released just a few days after Iraq invaded Kuwait and the Harken stock plummeted. However, as reported in a 1992 Mother Jones report, Bush attended a meeting regarding a revised stock offering in May 1990 working with Smith Barney's financial consultants concerning corporate restructuring.

In an Oct. 11, 1994, UPI report, Bush also claimed that he was not aware of Harken's poor financial condition when he sold the stock, but UPI said that the Dallas Morning News reported on the same day that a corporate official who served with Bush on the audit committee at Harken felt otherwise; Stuart Watson told the Dallas paper that he and Bush were constantly made aware of the company's finances. "You bet we were," said Watson. "We were both trying to keep that company on the straight and narrow."

On March 16, 1992, U.S. News echoed Watson's statement, reporting that "according to documents on file with the Securities and Exchange Commission, his position on the Harken (restructuring) committee gave Bush detailed knowledge of the company's deteriorating financial condition."

Chuck McDonald, spokesman for Texas Gov. Ann Richards' campaign, said that SEC chief counsel in the Bush investigation -- James Doty, George W.'s former attorney -- never talked to George W., Watson or other Harken officials in its 1991 probe. He said, "Was this a real investigation, or was it a whitewash of an insider stock sale by the son of the sitting president?" UPI, which reported McDonald's statement, went on to note that "while Bush claims the SEC investigation absolved him of illegal insider trading, he has refused to release the investigation files."

Harken founder, Phil Kendrick, noted that the company's "annual reports and press releases get me totally befuddled. There's been so much promotion, manipulation and inside deal making." And even Harken chief executive Mikel Faulkner, an accountant, offered advice for those trying to decipher the financial statements: "Good luck. They're a mess."

Press accounts note that Bush requested a letter from the SEC, issued in October 1993, The letter, signed by SEC Associate Director Bruce A. Hiler, said that "the investigation has been terminated as to the conduct of Mr. Bush and that, at this time, no enforcement is contemplated with respect to him." But the letter also stated that "it must in no way be construed as indicating that the party has been exonerated or that no action may ultimately result."

On Oct. 18, 1993, the Bush administration SEC said it would not bring a case against George W. Bush.

Gov. Bush speaks about his outstanding business record on the campaign stump; however, in 1989, U.S. News & World Report said, "Harken Energy lost over $12 million against revenues of $1 billion." Harken President Mikel Faulkner said that in addition to Bush's position as a director at $2,000 per meeting, stock options worth $131,250, 5 percent loans and 40 percent discounts on stock purchases, he was also a consultant to Harken for "investor relations and equity placement" at a salary of $80,000 per year from 1986 until 1989, when his salary jumped to $120,000.

The board was equally generous to Bush in 1990 as "the company lost another $40 million and shareholder equity plunged to $3 million -- down from more than $70 million in 1988." Faulkner declined to say what services George W. has performed as a consultant.

In March 1992, U.S. News said that "Despite repeated requests for interviews, George W. declined to discuss Harken or the reason for his stock sale, saying through an assistant that he 'does not want to read about himself.'" But some might ask whether American voters have a right to know whether a possible president would strictly enforce federal statutes or appoint lenient attorneys with suspect ethical standards leading to fixed politically sensitive investigations.

Moreover, should Bush -- a director of the corporation -- be accountable when huge losses are reported over a period of time, especially as a presidential candidate purporting to have an outstanding entrepreneurial business record at every presidential campaign stop? The answers have real implications regarding presidential character, morality and personal ethics.

Author and commentator Kevin Phillips offered a perceptive look at the Texas governor in the February 2000 issue of Harpers magazine when he said, "We can fairly ask whether George W. Bush is anything more than another scion who has made a decent governor during a period of prosperity and easy growth, and whether the United States can afford nominees who are to presidential politics what legacies are to college fraternities."

The Family That Preys Together

Covert Action Quarterly
By Jack Colhoun
Issue No. 41, Summer, 1992

GEORGE JR.'S[George W.] BCCI CONNECTION

"This is an incredible deal, unbelievable for this small company," energy analyst Charles Strain told Forbes magazine, describing the oil production sharing agreement the Harken Energy Corporation signed in January 1990 with Bahrain.

Under the terms of the deal, Harken was given the exclusive right to explore for gas and oil off the shores of the Gulf island nation. If gas or oil were found in waters near two of the world's largest gas and oil fields, Harken would have exclusive marketing and transportation rights for the energy resources. Truly an "incredible deal" for a company that had never drilled an offshore well.

Strain failed to point out, however, the one fact that puts the Harken deal in focus: George Bush, Jr.[George W.], the eldest son of George and Barbara Bush of 1600 Pennsylvania Avenue, Washington, DC, is a member of Harken's board of directors, a consultant, and a stockholder in the Texas-based company. In light of this connection, the deal makes more sense. The involvement of Junior-George Walker Bush's childhood nickname-with Harken is a walking conflict of interest. His relationship to President Bush, rather than any business acumen, made him a valuable asset for Harken, the Republican Party benefactors, Middle East oil sheikhs and covert operators who played a part in Harken's Bahrain deal.

In fact, Junior's track record as an oilman is pretty dismal. He began his career in Midland, Texas, in the mid-1970s when he founded Arbusto Energy, Inc. When oil prices dropped in the early 1980s, Arbusto fell upon hard times. Junior was only rescued from business failure when his company was purchased by Spectrum 7 Energy Corporation, a small oil firm owned by William DeWitt and Mercer Reynolds. As part of the September 1984 deal, Bush became Spectrum 7's president and was given a 13.6 percent share in the company's stock. Oil prices stayed low and within two years, Spectrum 7 was in trouble.

In the six months before Spectrum 7 was acquired by Harken in 1986, it had lost $400,000. In the buyout deal, George "Jr." and his partners were given more than $2 million worth of Harken stock for the 180-well operation. Made a director and hired as a "consultant" to Harken, Junior received another $600,000 of Harken stock, and has been paid between $42,000 and $120,000 a year since 1986.

Junior's value to Harken soon became apparent when the company needed an infusion of cash in the spring of 1987. Junior and other Harken officials met with Jackson Stephens, head of Stephens, Inc., a large investment bank in Little Rock, Arkansas (Stephens made a $100,000 contribution to the Reagan-Bush campaign in 1980 and gave another $100,000 to the Bush dinner committee in 1990.)

In 1987, Stephens made arrangements with Union Bank of Switzerland (UBS) to provide $25 million to Harken in return for a stock interest in Harken. As part of the Stephens-brokered deal, Sheikh Abdullah Bakhsh, a Saudi real estate tycoon and financier, joined Harken's board as a major investor. *5 Stephens, UBS, and Bakhsh each have ties to the scandal-ridden Bank of Credit and Commerce International (BCCI).

It was Stephens who suggested in the late 1970s that BCCI purchase what became First American Bankshares in Washington, D.C. BCCI later acquired First American's predecessor, Financial General Bankshares. At the time of the Harken investment, UBS was a joint-venture partner with BCCI in a bank in Geneva, Switzerland. Bakhsh has been an investment partner in Saudi Arabia with Gaith Pharoan, identified by the U.S. Federal Reserve Board as a "front man" for BCCI's secret acquisitions of U.S. banks.

Stephens, Inc. played a role in the Harken deal with Bahrain as well. Former Stephens bankers David and Mike Edwards contacted Michael Ameen, the former chief of Mobil Oil's Middle East operations, when Bahrain broke off 1989 talks with Amoco for a gas and oil exploration contract. The Edwardses recommended Harken for the job and urged Ameen to get in touch with Bahrain, which he did.

"In the midst of Harken's talks with Bahrain, Ameen- simultaneously working as a State Department consultant-briefed the incoming U.S. ambassador in Bahrain, Charles Hostler," the Wall Street Journal noted, adding that Hostler, a San Diego real estate investor, was a $100,000 contributor to the Republican Party. Hostler claimed he never discussed Harken with the Bahrainis.

Harken lacked sufficient financing to explore off the coast of Bahrain so it brought in Bass Enterprises Production Company of Fort Worth, Texas, as a partner. The Bass family contributed more than $200,000 to the Republican Party in the late 1980s and early 1990s. *9 On June 22, 1990, George Jr. sold two-thirds of his Harken stock for $848,560-a cool 200 percent profit. The move was well timed. One week after Junior sold his stock, Harken announced a $23.2 million loss in quarterly earnings and Harken stock dropped sharply, losing 60 percent of its value over the next six months. On August 2, 1990, Iraqi troops moved into Kuwait and 541,000 U.S. forces were deployed to the Gulf.

"There is substantial evidence to suggest that Bush knew Harken was in dire straits in the weeks before he sold the $848,560 of Harken stock," asserted U.S. News & World Report. The magazine noted Harken appointed Junior to a "fairness committee" to study possible economic restructuring of the company. Junior worked closely with financial advisers from Smith Barney, Harris Upham & Company, who concluded "only drastic action could save Harken."

George "Jr."[George W.] also violated Securities and Exchange Commission (SEC) regulations which require "insider" stock deals to be reported promptly, in Bush's case by July 10, 1990. He didn't file the stock sale with the SEC until the first week of March 1991.

Meanwhile, a cloak-and-dagger aura surrounds Junior's business dealings. James Bath, a Texas entrepreneur who invested $50,000 in Arbusto Energy, may be a business cutout for the CIA. Bath also acted as an investment "adviser" to Saudi Arabian oil sheikhs, linked to the outlaw BCCI, which also has ties to the CIA.

Bill White, a former Bath partner, claims that Bath has "national security" connections. White, a United States Naval Academy graduate and former fighter pilot, charges that Bath developed a network of off-shore companies to camouflage the movement of money and aircraft between Texas and the Middle East, especially Saudi Arabia.

Alan Quasha, a Harken director and former chair of the company, is the son of attorney William Quasha, who defended figures in the Nugan Hand Bank scandal in Australia. Closed in 1980, Nugan Hand was not only tied to drug-money laundering and U.S. intelligence and mi- litary circles, but also to the CIA's covert backing for a "constitutional coup" in Australia that caused the fall of Prime Minister Gough Whitlam.

The Harken deal with Bahrain raises another troubling question: Did the Bahrainis and the BCCI-linked Saudi oil sheikhs use the production sharing agreement with Harken to curry favor with the Bush administration and influence U.S. policy in the Middle East? Talat Othman's sudden rise to prominence in Bush administration foreign policy circles is a case in point. Othman, who sits on the Harken board as Sheikh Bakhsh's representative, didn't have access to President Bush before Harken's Bahrain agreement. "But since August 1990, the Palestinian-born Chicago investor has attended three White House meetings with President Bush to discuss Middle East policy," the Wall Street Journal pointed out. "His name was added by the White House to a select list of 15 Arab-Americans chosen to meet with President Bush, [then White House Chief of Staff John] Sununu and National Security Adviser Brent Scowcroft in the White House two days after Iraq's August 1990 invasion of Kuwait."

PRESCOTT'S BIG ASIAN ADVENTURE
Prescott Bush, Jr., the president's older brother, also has a knack for nailing down "incredible deal[s]." Prescott took advantage of his brother's first presidential visit abroad in February 1989 to schedule a business trip to the same countries-China, Japan and South Korea.

Prescott arrived in Tokyo February 14, 1989, ten days before President Bush's stop in Japan, to drum up business for Prescott Bush Resources Ltd., a real estate and development consulting company. Prescott said he was dealing with four Japanese companies wanting to do business in the U.S.

From Japan, Prescott went to China, where he had a joint partnership with Akoi Corporation to develop an $18 million golf course and resort near Shanghai. Prescott had introduced the Tokyo-based Akoi to Chinese officials in 1988. With a 30 percent stake in the project, Prescott used his China connections to pave the way for capital-rich Akoi. Akoi had run into business obstacles in China because of lingering Chinese resentment over Japan's brutal occupation of China in the 1930s and 1940s.

Some of Prescott's most controversial business deals have been with Asset Management International Financing & Settlement Ltd., a Wall Street investment firm which has been in bankruptcy proceedings since fall 1991. Prescott was hired by Asset Management, which paid him a $250,000 fee for consulting in its joint venture with China to set up its internal communications network. Asset Management enlisted Prescott's services soon after President Bush imposed economic sanctions in June 1989 in response to Beijing's brutal crackdown on anti-government demonstrators in Tienanmen Square.

Under the sanctions, United States export licenses were suspended for $300 million worth of Hughes Aircraft satellites, a key component of Asset Management's joint venture with the Chinese government. The satellites would beam television programming to broadcasters in China and provide telecommunications links for the country's far-flung provinces. In November 1989, Congress passed additional sanctions specifically barring the export of U.S. satellites to China unless the president found the sale "in the national interest."

On December 19, 1989, President Bush lifted the sanctions that blocked the satellite deal, citing "the national interest." Two months earlier, the Bush administration had granted Hughes Aircraft "preliminary licenses" to exchange data with Chinese officials to ensure that the satellites met the technical specifications of the Long March rockets which would launch them into space.

Meanwhile, Prescott was hard at work in the summer of 1989 as middleman in the takeover of Asset Management by West Tsusho, a Tokyo-based investment firm linked to one of Japan's biggest mob syndicates. Prescott, as head of

Prescott Bush & Co., received a $250,000 "finder's fee" from West Tsusho when the deal was closed and was promised an annual retainer of $250,000 over the next three years as a "consultant." Asset Management, however, went bankrupt in March 1991. In May 1992, West Tsusho filed a $2.5 million lawsuit against Prescott claiming that he reneged on his promise to protect the mob-linked firm's $5 million investment in Asset Management.

According to Japanese police, West Tsusho is controlled by the Inagawakai branch of the Yakuza, the Japanese equivalent of the Mafia crime syndicate. By the mid-1980s, the Yakuza were buying up real estate and investments in Japan and overseas to launder their ill-gotten profits from drug sales, prostitution, gambling and extortion. Yakuza's annual income is estimated at $10 billion.

Like George Jr.[George W.], Prescott combined business with secret operations. He offered his services to the covert operations of the Reagan-Bush campaign in 1980, and later to the Reagan administration. A September 3, 1980, letter from Prescott to James Baker indicates Prescott was part of the Reagan-Bush campaign's secret surveillance of the Carter administration's efforts to obtain release of U.S. hostages held in Iran. Prior to inauguration, the Reagan-Bush campaign recruited retired military and intelligence officers to monitor activities of the CIA, the Defense Department, the National Security Council, the State Department, and the White House. This operation later became known as the "October Surprise."

"Herb Cohen-the guy that offered help on the Iranian hostage situation-called me yesterday afternoon," Prescott wrote in a letter designated "PRIVATE AND CONFIDENTIAL." "Herb has a couple of reliable sources on the National Security Council, about whom the [Carter] administration does not know, who can keep him posted on developments."

Prescott continued, "He cannot come out now and say that Carter is going to do something on Iran in October because he said everything is a contingency plan that is loose and fluid from day to day.... Herb says, however, that if he and others in the administration who really care about the country and cannot stand to see Carter playing politics with the hostages, see Carter making a move to politicize the release of the hostages, he and they will come out at that time and expose him."

Prescott's covert associations continued while his younger brother was vice president. He appears to have aided the Reagan administration's clandestine support of the Nicaraguan Contras. In the 1980s, he served on the advisory board of Americares, the U.S.-based relief organization with ties to prominent right-wing Republicans and the intelligence community. Bush's other son, Marvin, also helped the family's pet charity and accompanied a flight of medical supplies to Nicaragua three days after Chamorro's inauguration. An undisclosed amount of the $680,000 in Americares aid to Honduras was delivered to Nicaraguan Miskito Indian guerrillas. Based in Honduras, they were aligned with the CIA-funded Contras, according to Roberto Ale- jos, a Guatemalan sugar and coffee grower who coordinated the Americares project in Honduras. In 1960, Alejos had permitted the CIA to use his plantations to train right-wing Cubans in preparation for the Bay of Pigs invasion of Cuba.

In 1985 and 1986, after Congress cut off U.S. aid to the Contras, Americares donated more than $100,000 worth of newsprint to the pro-Contra newspaper La Prensa in Managua. Americares supplied $291,383 in food and medicine and $5,750 in cash to Mario Calero, New Orleans-based quartermaster and arms purchaser for the Contras, and brother of Contra leader Adolfo Calero. In this same period, groups associated with Lt. Col. Oliver North's off-the-shelf Contra arms network provided covert support for La Prensa.

Jeb: Liaison to Anti-Castro Right
George Herbert Walker Bush's second eldest son, John Ellis or Jeb, was also linked to clandestine schemes in support of the Contras. Soon after congressional prohibition in late 1984, Jeb helped put a right-wing Guatemalan politician, Dr. Mario Castejon, in touch with Oliver North. Jeb acted as the Reagan administration's unofficial link with the Contras and Nicaraguan exiles in Miami.

Jeb was contacted in February 1985 by a friend of Castejon, who gave him a letter from Castejon to be passed on to then Vice President Bush. In his letter Castejon, a pediatrician and later an unsuccessful National Conservative Party presidential candidate, requested a meeting with George Bush to discuss a proposed medical aid project for the Contras. Jeb forwarded the letter to his father. In a March 3, 1985, letter, Vice President Bush expressed interest in Castejon's proposal to create an international medical brigade.

"I might suggest, if you are willing, that you consider meeting with Lt. Colonel Oliver North of the President's National Security Council Staff at a time that would be convenient for you," Bush wrote. "My staff has been in contact with Lt. Col. North concerning your projects and I know that he would be most happy to see you. You may feel free to make arrangements to see Lt. Colonel North, if you wish, by corresponding directly with him at the White House or by contacting Philip Hughes of my staff."

Castejon later met with North in the White House, where he also saw President Ronald Reagan. When Castejon returned to Washington for a second visit, he was introduced to members of North's secret Contra support network, including retired Maj. Gen. John Sing- laub and Contra leader Adolfo Calero. Castejon also met with a group of doctors working with Rob Owen, North's liaison with the Contras.

"He [Castejon] was offering us a pipeline into Guatemala," said Henry Whaley, a former arms dealer who said he was asked by his intelligence community connections to help Castejon. Whaley was optimistic about opening a new shipping route to the Contras through Guatemala. "If you can move Band-Aids," he reportedly said, "you can move bullets."

With Castejon, Whaley prepared a proposal to the State Department for the purchase of medical supplies for the Contras from the Department's newly established Nicaraguan Humanitarian Assistance Office. The document included requests for mobile field hospitals and light aircraft to evacuate wounded Contra guerrillas. Congress approved $27 million in "humanitarian" aid to the Contras in 1985. The Castejon proposal was hand-delivered to TGS International Limited in the Virginia suburbs of Washington. Whaley said he sent the report to TGS so it would be "quietly" forwarded to the CIA. TGS International is owned by Ted Shackley, who was CIA Associate Deputy Director of Operations when Bush Sr. headed the Agency in 1976-77.

Jeb had another Contra connection in his involvement with Miguel Recarey, Jr., a right-wing Cuban who headed the International Medical Centers (IMC) in Miami. In 1985 and 1986, Recarey and his associates gave more than $25,000 in contributions to political action committees controlled by then Vice President Bush. In 1986, Recarey hired Jeb, a real estate developer, to find a new headquarters for IMC. Jeb was paid a $75,000 fee, even though he never located a new building.

In September 1984, two months after IMC's $2,000 contribution to the Dade County Republican Party, which was headed by Jeb, the vice president's son contacted several top HHS (Department of Health and Human Services) officials on behalf of IMC. "Contrary to rumors, [Recarey] was a good community citizen and a good supporter of the Republican Party," one official of the HHC remembered Jeb telling him in late 1984. Jeb successfully sought an HHS waiver of a rule so that IMC could receive more than 50 percent of its income from Medicare.

Leon Weinstein, an HHS Medicare fraud inspector, worked on an audit of IMC in 1986; he has charged that IMC used Medicare funds to treat wounded Contras at its hospital. *31 The transaction was arranged by IMC official José Basulto, a right-wing Cuban trained by the CIA, who arranged for Contras to receive treatment in Miami. Basulto was praised for his commitment by Felix Rodriguez: "He has been active for a decade in supporting the Nicaraguan freedom fighters ever since the Sandinistas took power, and is constantly organizing Contra support among Miami's Cuban community. He has even been to Contra camps in Central America, helping to dispense humanitarian aid."

At the same time as Recarey was providing medical assistance to the Contras, he was embezzling Medicare funds. IMC, one of the largest health maintenance organizations in the United States, received $30 million a month for its Medicare patients, clearing $1 billion in federal monies from 1981 to 1987. While he headed IMC, Recarey's personal wealth jumped from $1 million to $100 million, U.S. investigators believe.

"IMC is the classic case of embezzlement of government funds," according to Robert Teich, the head of the Drug Enforcement Administration's Office on Labor Racketeering in Miami. Reich described IMC's skimming Medicare funds as a "bust-out" where money was "drained out the back door." A Florida state investigator concluded in a 1982 report that some federal funds IMC received "are being put in banks outside the country."

Recarey's links to the Mafia also raised eyebrows in Washington. "As far back as the 1960s, he had ties with reputed racketeers who had operated out of pre-Castro Cuba and who later forged an anti-Castro alliance with the CIA," the Wall Street Journal reported. The Journal added that the late Santos Trafficante, Jr., the Mafia boss of Florida, "helped out when Recarey needed business financing." Trafficante, a major drug trafficker, joined a failed CIA effort to assassinate Cuban President Fidel Castro in the early 1960s.

Recarey's access to Republican circles was probably one reason he was able to rip-off U.S. tax dollars for so long. He hired former Reagan aide Lyn Nofziger, the public relations firm Black, Manafort, Stone and Kelly, which was close to the Reagan White House, and attorney John Sears, a former Reagan campaign manager, to look out for his interests in Washington. Recarey fled the United States in 1987 to avoid a federal indictment for racketeering and defrauding the U.S. government. The Bush administration has made no effort to extradite him from Venezuela where he is currently living.

JEB LINKED TO SMUGGLERS AND THIEVES
Jeb Bush has also been linked to Leonel Martinez, a Miami-based right-wing Cuban-American drug trafficker. Martinez, who was linked to Contra dissident Eden Pastora, was involved in efforts to smuggle more than 3,000 pounds of cocaine into Miami in 1985-86. He was arrested in 1989 and later convicted for bringing 300 kilos of cocaine into the U.S. He also reportedly arranged for the delivery of two helicopters, arms, ammunition, and clothing to Pasto- ra's Costa Rica-based Contras.

Federal prosecutors in Miami have a photograph of Jeb and Martinez shaking hands but won't release the photo to the public. Whether Jeb was aware of Martinez's drug trafficking activities is not known, but it is known that Leonel and his wife Margarita made a $2,200 contribution to the Dade County Republican Party four months after Jeb became the chair of the local GOP.

It is also known that Martinez wrote $5,000 checks to then Vice President Bush's Fund for America's Future in both December 1985 and July 1986 and made a $2,000 contribution to the Bush for President campaign in October 1987.

Martinez's construction company gave $6,000 in October 1986 to Bob Martinez (no relation), the GOP candidate for governor in Florida; he was governor from 1987 to 1991. At that time, Vice President Bush was serving as head of the South Florida Drug Task Force and later as chair of the National Narcotics Interdiction System, both set up to stem the flow of drugs into the U.S. While Bush was drug czar, the volume of cocaine smuggled into the U.S. tripled.

President Bush later appointed Bob Martinez in 1991 head of the U.S. Office of National Drug Control Policy- the drug czar to succeed the controversial William Bennett.

JEB GETS IN ON THE BCCI ACTION
In 1988, Jeb was mentioned in a deposition taken by a Senate Foreign Relations subcommittee, chaired by Sen. John Kerry (D-Mass.), which was investigating drug money laundering operations in the U.S.

"I saw Jeb Bush two or three times over there with [Abdur] Sakhia," stated Aziz Rehman, a junior BCCI-Miami official in the 1980s. "This was all part of the bank's trying to cultivate public officials and prominent individuals." Rehman said BCCI's practice was to "bribe" government officials in the United States.

"Jeb Bush, V.P. George Bush's son," Sakhia noted in a 1986 BCCI document, was a "name…to be remembered."

Most of Rehman's testimony focused on his role in BCCI-Miami's money laundering operation. Rehman said it was his job, in the mid-1980s, to chauffeur and entertain BCCI-Miami's big clients when they came to the city from the Caribbean and Latin America. Rehman described how he deposited large amounts of cash for these clients, ranging from $100,000 to $2 million, in other Miami banks at which BCCI-Miami had accounts. To disguise the money trail, BCCI transferred the cash electronically from Miami to BCCI banks in Panama and the Grand Cayman Islands.

Jeb's name also shows up in a September 1987 BCCI document written by Amjad Awan, then a senior BCCI-Miami official. The memorandum planned a BCCI breakfast meeting with a senior level delegation from the People's Republic of China and high Florida state government officials, including Secretary of Commerce Jeb Bush. Among the Chinese delegation was Ge Zhong Xue, Deputy Division Chief of the Ministry of Public Security, a top police official.

Meanwhile, Jeb and his business partner Armando Codina profited handsomely when the Bush administration bailed out Broward Federal Savings and Loan in Sunrise, Florida, which went belly up in 1988. The Federal Deposit Insurance Corporation (FDIC) absorbed $285 million in bad loans, including a $4.6 million loan by the Bush-Codina partnership. According to the deal struck by federal regulators, the Bush-Codina partnership wrote a check for $505,000 to the FDIC, and the government paid off the remaining $4.1 million of the loan for an office building on which Jeb and Codina defaulted. As a result of the bailout, the Bush-Codina partnership retained possession of its office building at 1390 Brickell Avenue in Miami's posh financial district.

Currently, Jeb is involved in a number of joint ventures with Codina, a Miami real estate developer who is also a leader of the right-wing Cuban American National Foundation (CANF). The Brickell Avenue office building is owned by IntrAmerica Investments. Jeb was listed in business documents in 1985 and in 1986 as the president of IntrAmerica Investments, and the building is managed by one of Jeb's real estate companies. Codina owns 80 percent of the building, while Jeb owns the remaining 20 percent.

Jeb has acted as the Reagan and Bush administration's liaison with the politically influential Cuban exile community in South Florida. Jorge Mas Canosa, president of CANF, succinctly described Jeb's role as the ultra-right Cuban-American community's liaison with the White House: "He is one of us."

Jeb Asks Dad To Free Terrorist
As a link to that powerful and wealthy South Florida community, Jeb has been a tireless supporter of some of the most reactionary Cuban-American political causes -from promoting CANF projects like Radio and TV Marti & acute;, to lobbying for the release of anti-Castro terrorist Orlando Bosch from a Miami jail. TV propaganda broadcasts into Cuba, considered by legal experts a violation of the International Telecommunications Convention, are fully subsidized by U.S. taxpayers.

Anti-Castro terrorist Orlando Bosch was paroled in 1990 after Jeb lobbied the Bush administration for his release from prison in Miami. Bosch had been jailed in 1988 for jumping bail on a 1968 conviction for shooting a bazooka at a Polish freighter in the Miami harbor. He is better known as the mastermind of the explosion of a Cuban commercial airliner over Barbados on October 5, 1976, in which 73 passengers were killed. A U.S. District Court judge revealed in 1988 that secret U.S. documents concluded Bosch was a leader of the Coordination of United Revolutionary Organizations (CORU), which was responsible for more than 50 anti-Castro bombings in Cuba and elsewhere in the Western Hemisphere.

The Cuban government filed an order for his extradi- ction in May 1992.

"Tell Him...The Vice President's Son" Called
"There was no conflict of interest," third Bush son Neil told reporters after the Office of Thrift Supervision (OTS) in Washington issued a notice of intent in January 1990 to hold a hearing on the failure of Silverado Banking Savings and Loan. Neil had been a member of Silverado's board of directors from 1985 to 1988. *45 Federal regulators shut down Silverado shortly after George Bush was elected president in 1988. The federal bailout cost U.S. taxpayers $1 billion.

Neil was responding to charges made in an OTS report that he had "breached his fiduciary duty" to Silverado by engaging in unethical business deals while a board member of the Denver savings and loan. The report documented that Neil personally profited from questionable Silverado loans to his business partners, Ken Good and Bill Walters. Good and Walters later defaulted on $132 million in loans to Silverado, leaving the taxpayers to pick up the tab.

The OTS report alleged that Neil failed to disclose his business connections to Good and Walters when he voted to approve a $900,000 line of credit to Good International, Inc. Neil got Silverado to write a letter of recommendation to authorities in Argentina, where Good International, in partnership with Neil's JNB Exploration Company, was exploring for gas and oil. Good also gave the President's third son a $100,000 loan to invest in the commodities market, which Bush was never required to repay.

Neil failed to inform Silverado that Walters had contributed $150,000 to the initial capitalization of JNB Exploration, or that Walters' Cherry Creek National Bank in Denver extended a $1.5 million line of credit to JNB Exploration. Neil put up a paltry $100 in start-up funds in 1983 when he founded JNB Exploration, but over the next five years was paid $550,000 in salary drawn from the Cherry Creek National Bank line of credit.

Neil brought few business skills to his job at JNB Exploration but he was adept at cashing in on his family name. "Tell him Neil Bush called," Neil once told the secretary of a wealthy Denver oil entrepreneur. "You know, the vice president's son."

"Neil knew people because of his name," acknowledged Evans Nash, one of Neil's partners at JNB Exploration. "He's the one that got us going. He's the one that made it happen for us."

When Neil left JNB Exploration in 1989, the company had yet to discover a profitable gas or oil well.

Neil: The Sensitive One
Neil's business partners also included shady characters with ties to the world of covert operations. In 1985, Good received an $86 million loan from the Dallas Western Savings Association, which was tied to Robert Corson, a Texas developer and reputed CIA operative, and Herman Beebe, Sr., a convicted Mafia associate of Louisiana mob boss Carlos Marcello.

Neil profited from the Western Savings loan to Good, because the loan helped Good buy Gulfstream Land and Development, a Florida real estate company. Good made Neil a board member of one of Gulfstream's subsidiaries in 1988. Bush was paid $100,000 a year to attend occasional Gulfstream board meetings before it went out of business in 1990.

Investigative reporter Pete Brewton identified Corson as a CIA operative in a long Houston Post series on CIA links to organized crime and failed savings and loans. "One former CIA operative told the Post that Corson frequently acted as `a mule' for the agency, meaning he would carry large sums of money from country to country," Brewton wrote.

Corson's Vision Banc Savings in Kingsville, Texas, loaned about $20 million to Mike Atkinson, a Corson associate, for a Florida land deal put together by Lawrence Freeman. Freeman, who laundered money for Santos Trafficante, Jr., was also tied to veteran CIA operative Paul Helliwell. In the Bahamas, Helliwell set up Castle Bank and Trust Ltd., which was the CIA's primary financial front in Latin America and the Caribbean during the 1960s and 1970s. Castle laundered funds for the Agency's covert operations against Cuba.

Walters had ties to Richard Rossmiller, a Beebe associate. In the mid-1970s, Walters was a part-owner with Rossmiller, of Peoples State Bank in Marshall, Texas, at the same time as Rossmiller was doing business with Beebe.

Wayne Reeder, another Beebe associate, a big borrower from Silverado, defaulted on a $14 million loan. Reeder was involved in an unsuccessful arms deal with the Contras. Reeder accompanied his partner, John Nichols, in 1981 to a weapons demonstration attended by Contra leaders Eden Pastora and Raul Arana, both of whom were interested in buying military equipment from Nichols.

"Among the equipment were night vision goggles ... and light machine guns," according to the book, Inside Job: The Looting of America's Savings and Loans. "Nichols ... had a plan in the early 1980s to build a munitions plant on the Cabezon Indian Reservation near Palm Springs, California, in partnership with Wackenhut, the Florida security firm. [But] the plan fell through."

There was another Silverado-Contra connection, however, that didn't fall through. E. Trine Starnes, Jr., the third largest Silverado borrower, was a major donor to the National Endowment for the Preservation of Liberty (NEPL), directed by Carl "Spitz" Channell, which was a part of Oliver North's Contra funding and arms support network. A NEPL document, "Top 25 Contributors as of October 3, 1986," showed Starnes contributed $30,000 to NEPL's Central America Freedom Program. Starnes closed a deal with Silverado on September 30, 1986, for three business loans totaling $77.5 million, on which Starnes later defaulted.

The Central America Freedom Program was a propaganda effort in conjunction with the Reagan administration's campaign in 1986 to win congressional support for resuming arms aid to the Contras. When the administration wooed potential NEPL donors, Starnes was invited to a January 30, 1986, White House briefing, which included Reagan, National Security Adviser John Poindexter, White House Chief of Staff Donald Regan and Assistant Secretary of State Elliott Abrams. Congress resumed U.S. arms aid to the Contras in mid-1986.

In a final ironic Silverado-Contra connection, NEPL banked at the Palmer National Bank in Washington, a bank with ties to Vice President Bush and Herman Beebe. Palmer National was also linked to North's Contra arms network.

Palmer National was established in 1983 by Stefan Halper and Harvey McClean, Jr., two former aides in Bush's unsuccessful presidential campaign in 1980. Halper, who had links to the intelligence community, became deputy director of the State Department's Bureau of Politico-Military Affairs in the Reagan administration. McClean was a Beebe associate. Beebe supplied the majority of the capitalization for the start-up of Palmer National.

"Palmer National lent money to individuals and organizations that were involved in covert aid to the Nicaraguan Contra rebels," Brewton wrote in the Houston Post. "Money was channeled through Palmer National to a Swiss bank account used by . . . North to provide military assistance to the Contras."

Bushed Out
George Herbert Walker Bush is the first former CIA director to serve as president. The implications for U.S. politics of Bush's move from CIA headquarters to the White House are profound and chilling, but seldom the subject of mainstream political discussion. The corruption of the Bush family, however, is a good introduction.

The Bushes' shadowy business partners come straight out of the world in which the CIA thrives-the netherworld of secret wars and covert operators, drug runners, mafiosi and crooked entrepreneurs out to make a fast buck. What Bush family members lack in business acumen, they make up for by cashing in on their blood ties to the former Director of Central Intelligence who became president. In return for throwing business their way, the Bushes give their partners political access, legitimacy, and perhaps protection. The big loser in the deal is the democratic process.

[END OF ARTICLE]

Hunting Bin Laden - Financial and Family History - Salem Bin Laden

George W. Bush's Dubious Friends
"Texas governor George W. Bush's campaign to become the Republican candidate in this November's presidential ballot could shortly run into turbulence because of new information about his past. Indeed, among the figures Bush dealt with indirectly when he ran oil companies was Saudi banker Khaled Bin Mahfouz who, Intelligence Newsletter has learned, is currently under house arrest in a hospital in Taef at the behest of the American authorities. The latter are looking into contributions Mahfouz is said to have made to welfare associations close to terrorist Ussama Bin Laden.

...In 1987 Mahfouz's representative in the U.S., Abdullah Taha Bakhsh, acquired an 11.5% stake in a company in which the Bush was a shareholder, director and adviser, Harken Energy.

...An American banker named Jacksen Stephens who was to also be deeply involved in the BCCI affair moved in 1987 to invest $ 25 million in Harken. The transaction took place in Geneva with the money was paid through a joint venture set up between the Union des Banques Suisses and the Geneva branch of the BCCI; the financial accord was signed by both Stephens and Bakksh. Other links between Bush and Mahfouz can be found through investments in the Carlyle Group, an American investment firm managed by a board on which former president George Bush himself sat. The younger Bush personally held shares in one of the components of the Carlyle group, the Caterair company, between 1990-94. And Carlyle today ranks as a leading contributor to Bush's electoral campaign. On Carlyle's advisory board figures the name of Sami Baarma, director of the Pakistani financial establishment Prime Commercial Bank that is based in Lahore and owned by Mafouz."
[End of partial transcript]

Family Ties: How Oil Firm Linked To a Son of Bush Won Bahrain Drilling Pact
Harken Energy Had a Web Of Mideast Connections
In the Background: BCCI Entree at the White House

The Wall Street Journal - Page A1
Thomas Petzinger Jr., Peter Truell
and Jill Abramson
December 6, 1991

Two years ago, Talat Othman didn't have the president's ear. But since August 1990, the Palestinian-born Chicago investor has attended three White House meetings with President Bush to discuss Middle East policy.

Mr. Othman's political access coincides with the remarkable ascendance of a little Texas oil company on whose board he serves alongside George W. Bush, the president's oldest son. That company, Harken Energy Corp. -- though it had never drilled a single well overseas or in water -- recently won the rights to drill potentially lucrative offshore wildcat wells in a contract bestowed by the government of Bahrain.

When the Harken deal was announced in January 1990, it attracted only perfunctory notice. More recently, a number of publications have written about the case, raising questions about whether Bahrain might have chosen Harken in part because a presidential son sat on its board.

Now, George W. Bush is emerging as a principal adviser to his father. He was a lead player in the campaign to oust White House Chief of Staff John Sununu, and was cited by his father yesterday as among those who will play "key roles in the reelection effort." Thus, the issues surrounding the Harken deal take on fresh importance.

The White House says there is nothing questionable in this story of petroleum, politics and the presidential son. "There is no conflict of interest, or even the appearance of conflict, in these business arrangements," says spokesman Marlin Fitzwater. The matters had been reviewed and disclosed, he said, adding, "They are legitimate business undertakings."

Indeed, an investigation by this paper has not revealed evidence of wrongdoing or influence-peddling by George W. Bush or anyone else connected to Harken. Yet what does emerge is a complex pattern of personal and financial relationships behind Harken's sudden good fortune in the Middle East, raising the question of whether Bahrainis or others in the Middle East may have hoped to ingratiate themselves with the White House. Even more intriguing, there are numerous links among Harken, Bahrain and individuals close to the discredited Bank of Credit & Commerce International, a banking empire that used Mideast oil money to seek ties to political leaders in several countries.

The mosaic of BCCI connections surrounding Harken Energy may prove nothing more than how ubiquitous the rogue bank's ties were. But the number of BCCI-connected people who had dealings with Harken -- all since George W. Bush came on board -- likewise raises the question of whether they mask an effort to cozy up to a presi- dential son.

Among those relationships:

-- Sheik Khalifah bin-Salman al-Khalifah, the prime minister of Bahrain and a brother of the country's ruling emir, is identified on an October 1990 shareholder list as one of the 45 investors who own parent company BCCI Holdings (Luxembourg) S.A. The emir played a role in approving the Harken transaction.

-- Sheik Abdullah Bakhsh, a major Harken shareholder represented by Mr. Othman on the company's board, has been a co-investor in Saudi Arabia with alleged BCCI front man Ghaith Pharaon, and used Khalid bin-Mahfouz, until recently a principal BCCI shareholder, as his banker.

-- Harken's investment bankers helped BCCI gain its foothold in U.S. banking, and they also arranged for a Swiss bank to help rescue Harken from its debt woes in 1987 -- a Swiss bank that was at the time a joint-venture partner with BCCI.

-- Harken's consultant on the Bahrain deal counts Kamal Adham, a principal owner of BCCI, as a close friend and has had a long acquaintance with BCCI's Mr. Pharaon.

As a candidate and later in the White House, President Bush vowed to avoid even the appearance of any conflicts of interest in his administration. He instructed Secretary of State James Baker to cable all U.S. embassies to warn against the appearance of preferential treatment for Bush family investments overseas. The president has also moved to distance himself from the BCCI scandal, denouncing a former aide who recently went to work as a lawyer for BCCI's Mr. Adham, and who resigned in the ensuing furor.

George W. Bush, a managing partner of the Texas Rangers baseball team, declined to be interviewed. He did provide brief responses to written questions through an intermediary. Asked whether his involvement with the Dallas energy company lent it added credibility in the Arab world, he said to "ask the Bahrainis."

Every individual involved denies any influence peddling. Mr. Othman, George W. Bush and people involved in setting up the White House meetings on the Mideast say the president's son had nothing to do with Mr. Othman's being included among the Arab-Americans invited. "Not by any stretch of the imagination," Mr. Othman says.

And Harken investor Mr. Bakhsh rejects any suggestion that his links, past and present, to Messrs. Pharaon and binMahfouz mean he is in any way associated with BCCI. He says through his New York lawyer that he bought Harken stock (in 1987) because it looked like a good investment in a depressed industry.

Harken officials say they resent any suggestion their company somehow has ties to BCCI. They dismiss the circumstantial links to it as purely random and say they were shocked to learn of them. And, in fact, BCCI has proved adept at insinuating itself into centers of influence without the knowledge of those occupying the seats of power.

Harken says it won the Bahrain drilling deal purely on merit, through painstaking geological research and deft negotiating. It says Mr. Bush played no role in clinching the deal.

As for Bahrain, it says it chose tiny Harken partly because it didn't believe a large company would be so fully committed to the project. Other Harken officials, while denying that the Bush name played any specific role, acknowledge that having him on their board is an asset. "You'd have to be an idiot not to say it's impressive," says Alan Quasha, former Harken chairman and its second-largest shareholder. (The largest, with 24.5%, is a Harvard University investment fund.)

Mr. Bush's affiliation with Harken came at the end of a failed attempt to follow in the footsteps of his father. Like him, George W. launched a career in the oil business in Midland, Texas, and like his father he chose a Spanish name for it: Arbusto Energy Inc. "Arbusto" is Spanish for " bush"; the president's company was Zapata Petroleum Co.

Among George W.'s investors was James R. Bath, a Houston aircraft broker who had a flourishing aviation business with sheiks of the Saudi peninsula. Mr. Bath owned a piece of a Houston bank in which Mr. Pharaon, the BCCI front man, had been a controlling shareholder.

Mr. Bath also invested money in the U.S. for Mr. bin-Mahfouz, the Saudi banker who would go on to become a leading shareholder in BCCI. According to Mr. Bath's personal financial statements, produced in unrelated litigation, Mr. Bath invested $50,000 with George W. Bush, becoming a 5% partner in Arbusto. Mr. Bush says he was aware Mr. Bath was representing Saudi investors but that at the time "had never heard of BCCI."

In the oil-patch depression of the mid1980s, Mr. Bush's company merged with another concern, becoming Spectrum 7 Energy Corp. But its fortunes didn't improve. "We lost a lot of money in the oil business," says Philip Uzielli, a director of Spectrum 7 and friend of Mr. Bush . "We had a lot of dry wells. . . . Things were terrible. It was dreadful."

Finding a buyer wasn't easy. But in September 1986, Harken Energy swapped some of its own shares for the shares of Spectrum 7. Mr. Bush's cut was worth roughly $600,000. "Getting Harken stock at that point turned out to be very good," Mr. Uzielli recalls. In addition to becoming a Harken stockholder, Mr. Bush became a director and a consultant at $120,000 a year, later reduced to $50,000. (In mid-1990, Mr. Bush sold two-thirds of his Harken holdings at a significant profit; his remaining stake could still be worth millions if Harken hits a gusher in Bahrain.)

What looked like a dull investment soon looked brighter. The company needed a cash infusion, and Mr. Bush, whose consulting contract listed "equity placements" among his duties, was there when Harken officials got together with Little Rock's Stephens Inc., one of the largest U.S. investment banks outside of Wall Street.

He needed no introduction to Jackson Stephens, having known him since the 1980 Reagan-Bush campaign. Mr. Stephens's wife, Mary Anne, would soon become Arkansas co-chairman of the Bush for President campaign, while Mr. Stephens would donate $100,000 to Team 100, a GOP group that collected money for the campaign. Stephens Inc. kicked in another $100,000 to the Bush dinner committee last May.

But on that spring day in Little Rock, cash for Harken was the topic. Ultimately, Stephens put a rescue plan in motion: Union Bank of Switzerland, which ordinarily didn't invest in small U.S. firms, would make an exception, giving Harken $25 million in exchange for a stock interest.

At the time, UBS was a joint-venture partner with BCCI in a Geneva-based bank. And although Harken officials, including Messrs. Bush and Quasha, say they were unaware of it, Mr. Stephens was also well acquainted with BCCI. In fact, he suggested to BCCI in the late 1970s that it try to take over what is now Washington, D.C.'s biggest bank company, First American Bankshares Inc., according to court records produced in connection with the takeover attempt. Mr. Stephens was among the defendants in that suit, aimed at preventing a First American takeover by BCCI founder Agha Hasan Abedi, BCCI principal Kamal Adham and Abdullah Darwaish, chief financier for the royal family of Abu Dhabi. Mr. Stephens declined to be interviewed for this article.

The Harken financing Stephens was arranging hit a last-minute snag. To comply with U.S. banking laws, the deal assumed a complex new structure, and UBS decided to unload its shares to a third party at the first chance, according to Mr. Quasha. UBS says it planned to sell the shares all along. In any case, Stephens brought in a new patron: a real-estate magnate from Jedda, Saudi Arabia, who bought most of Union Bank's Harken shares. He was Abdullah Bakhsh.

Mr. Bakhsh for several years was chairman of Saudi Finance Co., a Luxembourg-based holding company for Swiss and French financial enterprises. He sold his interest in 1983. Who bought it isn't clear, but corporation records in Geneva show that by 1989 it had come partly under the control of the Gokal family, Pakistani shipping magnates who were early BCCI shareholders and who, according to BCCI's auditors, have failed to service more than $700 million of borrowings from BCCI.

Mr. Bakhsh has had business dealings with some of the most prominent people in Saudi Arabia, including, according to a friend, former Saudi oil minister Ahmed Zaki Yamani and current oil minister Hisham Nazer. One of his co-investors in the U.S. says he believes the sheik has also invested with members of the Saudi royal family.

But Mr. Bush, Mr. Quasha and other Harken officials evidently knew little about their new partner. Mr. Quasha did a background check and says he found that Mr. Bakhsh was a very private person of great integrity who had already received regulatory approval for other U.S. investments.

Mr. Bakhsh, though listed as Harken's third largest stockholder with a 17.6% stake, has met with company officials on only a few occasions, and George W. Bush says through his intermediary he has never spoken to him. Instead, Harken officials deal with him through Mr. Othman, who sits on the Harken board.

In the wake of the company's new Persian Gulf backing came a much bigger Gulf breakthrough. It might be called the Dream Deal.

Bahrain, a small emirate with strong ties to Saudi Arabia, hadn't made a significant new oil find since 1932. But high-tech seismic surveys detailed a large geological formation under the sea, between two of the greatest oil and gas fields on the planet. The company picked to drill exploratory wells would have to put up a lot of cash -- $12.7 million just for the first of several wells. But it would get a lucrative share of any oil found. The payoff could total in the billions.

Amoco, vitally interested, started negotiating with the Bahrainis in 1987. (Three other companies also entered into talks, according to Bahrain, which didn't identify them.) As negotiations advanced, Amoco grew hopeful of a contract. Then, in January 1990, it heard startling news: The contract had just been awarded to tiny Harken. "We were disappointed," says Patricia Wright, an Amoco spokesman. "We thought we might get this one."

Why did Harken get it instead? "It was not some sort of fix," says Mr. Quasha, the former Harken chairman.

Harken says George W. Bush didn't play any role in clinching the deal, and even expressed doubts that Harken had the financial resources for it. Mr. Quasha also points out that all the connections in the world won't help Harken find oil in Bahrain, which the Bahrainis know as well as anyone. "I don't see where they gain from dealing with a relative of George Bush's who futzes up."

Bahrain says the Bush connection couldn't have been a factor. "We were not aware when Harken was chosen of any prominent American or Arab who was connected with the company," says Bahrain's oil minister, Yousuf Shirawi.

However, Monte Swetnam, Harken's exploration chief, says, "I'm sure they were aware" of Mr. Bush's involvement with the company. "I talked about our exploration advisory board and our board of directors. George's name comes up twice. It wasn't a secret."

So, then, why Harken?

Harken officials, in extensive interviews, maintain that Bahrain wanted a small company that would devote full attention to the project, a point Bahraini Oil Minister Shirawi confirms. To find one, he turned to a longtime friend, Michael Ameen, a Houston oil consultant who had worked in the Mideast for Mobil Corp. and Arabian American Oil Co. (Aramco).

Mr. Ameen represents yet another BCCI notation in the Harken story. As the head of government relations for Aramco, he says he had close-up dealings for years with the Saudi royal family and its advisers, including Mr. Adham, the BCCI principal, who is also a former Saudi intelligence chief. Mr. Ameen was close enough to the Pharaon family that he recalls meeting a young Ghaith on his graduation from college.

Mr. Ameen had been a friend for 25 years of Mr. Bakhsh, the large Harken shareholder. But he says that when faced with having to recommend to Bahrain one small oil company out of the hundreds to choose from, he chose Harken out of pure serendipity. Within 10 minutes of discussing the matter by phone with Bahrain's oil minister, Mr. Ameen says, he got a call from one of Harken's investment bankers at Stephens in Little Rock.

Before long, Mr. Ameen was leading Harken delegations to London and Bahrain, where, according to the company, Harken officials displayed keen knowledge of the region's geology and disarmed the Bahrainis with their open negotiating style.

In the midst of Harken's talks with Bahrain, Mr. Ameen -- simultaneously working as a State Department consultant -- briefed the incoming U.S. ambassador to Bahrain, Charles Hostler. Mr. Ameen ultimately received a fee of about $100,000 from Harken.

Ambassador Hostler, a San Diego real-estate investor who is a $100,000 Republican contributor, says through an embassy official that he never discussed the Harken deal with authorities in Bahrain. Harken officials say they met with him only after their contract was secured. Mr. Hostler does say that he has long known, and from time to time given financial counsel to, Mohammad Hammoud, who was described in recent Senate testimony as a "flexible front for BCCI." Mr. Hammoud is also listed as a significant BCCI shareholder.

Once negotiated, the Harken contract was reviewed and approved by several Bahraini officials, including, lastly, Sheik Isa bin-Sulman al-Khalifah, the ruling emir. His younger brother, Prime Minister Sheik Khalifah bin-Sulman al-Khalifah, appears in BCCI records as a shareholder, along with Mr. Adham, several members of Persian Gulf royalty, and others.

"His highness the emir has no personal opinions" about Harken or anyone else associated with the transaction, says Mr. Shirawi, the oil minister. "There is a possibility he's a shareholder, but we never heard of it," a Bahrain embassy spokesman says. If the prime minister does have BCCI holdings, the spokesman points out, the shareholding isn't large.

The drilling deal went through even though Harken admitted it couldn't begin to finance the exploration on its own. Bahrain agreed to let Harken bring in a partner. It was the hottest ticket in town; two dozen oil companies expressed interest in coming into the deal. Harken chose Bass Enterprises Production Co. of Fort Worth, Texas, a company controlled the politically active billionaire Bass family. Members of the Bass family have contributed more than $200,000 to the GOP in recent years. A Bass company official declines comment.

At the signing ceremony in January 1990, a celebratory delegation from Harken traveled to Bahrain, including Mr. Quasha, Mr. Othman and another Harken executive. The first well broke ground last month and is scheduled for completion by the end of January.

Within six months Mr. Othman saw his political status, as well as his company's position, enhanced. His name was added by the White House to a select list of 15 Arab-Americans chosen to meet with President Bush, Mr. Sununu and National Security Adviser Brent Scowcroft in the White House two days after Iraq's August 1990 invasion of Kuwait.

Mr. Othman and others involved in setting up the White House meeting say his three invitations are explained by his membership in the Arab-American Council on the Middle East, a group of business and political leaders who are close to ousted Chief of Staff Sununu. "Talat was recommended to us by many people in the Arab-American community," says one administration official. Mr. Othman was most recently present at a White House gathering last month of President Bush and Arab-American leaders.

"George W. Bush has nothing to do with it," Mr. Othman says of the White House meetings. "This is an invitation from the White House."

--- Who's Who in the Harken Deal

AT HARKEN

ABDULLAH TAHA BAKHSH -- A Saudi investor who controls about 17% of HArken's stock, he has extensive business interests in Saudi Arabia and the U.S.

GEORGE W. BUSH -- The President's eldest son, he is a director, consultant and shareholder in Harken Energy. Runs the Texas Rangers baseball club and may play a role in father's re-election campaign.

TALAT OTHMAN -- Middle Eastern-born director and shareholder in Harken, he helps manage investments for Sheik Abdullah Bakhsh, a major Harken shareholder, and is a member of the Arab-American Council on the Middle East.

ALAN QUASHA -- A Harvard-educated lawyer and corporate restructuring expert, he controls about 20% of Harken's stock and served as chairman from 1983 until last February.

MONTE SWETNAM -- Harken's exploration chief, he led the team that developed the winning drilling program for Bahrain.

DEAL MAKERS

MICHAEL AMEEN -- A Houston oil consultant, he forged close associations with wealthy Arabs while serving as top Mideast official for Mobil Corp. and Aramco. Received a $100,000 fee from Harken.

JACKSON STEPHENS -- Arkansas-based investor whose Stephens Inc. played a critical role in fund raising for Harken. Former Stephens staffers also represented Harken in Bahrain deal, earning a $100,000 fee.

IN BAHRAIN

CHARLES HOSTLER -- The U.S. ambassador, he met with Harken officials after they clinched the drilling contract.

YOUSUF SHIRAWI -- Minister of industry and development for the island nation, he has responsibility for Bahrain's oil industry.

KHALIFAH BIN-SULMAN AL-KHALIFAH -- Prime minister of Bahrain and younger brother to the island's ruling emir, he is a BCCI shareholder.

SAUDI MONEY MEN

KAMAL ADHAM -- A shareholder in BCCI and former Saudi intelligence chief, he is also listed as a borrower from BCCI.

KHALID BIN-MAHFOUZ -- A bank owner in Saudi Arabia who previously held a significant stake in BCCI.

GHAITH PHARAON -- Alleged BCCI front man in secret dealings in U.S. and elsewhere.

Dallas Attorney Named Ambassador To Saudi Arabia

He represented Bush in SEC case over sale of Harken Energy stock

The Dallas Morning News
By G. Robert Hillman
Article Source
July 21, 2001

WASHINGTON – President Bush has chosen as ambassador to Saudi Arabia a Dallas attorney who represented him against insider trading allegations arising from his sale of stock in Harken Energy Co. 11 years ago.

Robert Jordan, a founding partner of the Dallas law office of Baker Botts, represented Mr. Bush during a Securities and Exchange Commission inquiry into the allegations involving Mr. Bush's lucrative sale of stock in Harken, where he had been a director.

The SEC found no merit in the charges. Critics have noted that Mr. Bush's father was president during the investigation and a longtime supporter, Richard Breeden, was the commission's chairman.

Mr. Bush has said he needed to sell his 212,000 shares of Harken stock for nearly $850,000, which later plummeted in value, in order to finance his purchase of an interest in the Texas Rangers baseball club.

He invested about $600,000 in the team and earned nearly $15 million when it was sold in 1998.

If confirmed by the Senate, Mr. Jordan would represent the United States in the capital of one of its key allies in the Middle East.

"He understands the important relationship that exists between the United States and Saudi Arabia, and I am confident he will be an outstanding ambassador," Mr. Bush said in announcing his selection.

In a brief telephone interview Friday, Mr. Jordan said he was honored by the appointment, but could not discuss it in any detail until he is confirmed.

In the Senate, Allison Dobson, a spokeswoman for Sen. Paul Wellstone, D-Minn., whose foreign relations subcommittee will screen Mr. Jordan's nomination, said a staff review had just begun and any hearing was weeks off.

At the White House, deputy press secretary Scott McClellan said Mr. Bush has confidence in Mr. Jordan and foresaw no problems with his Senate confirmation.

"The president believes Mr. Jordan will do an outstanding job representing the United States," Mr. McClellan said.

Early in the new Bush administration, there have been reports of strained relations between the United States and Saudi Arabia over the continued violence between Israel and the Palestinians.

Just last week, it was reported that former President George Bush had called Saudi Crown Prince Abdullah to reassure him that his son was determined to "do the right thing" in the region.

Mr. Jordan, 55, is a director of the State Bar of Texas and a past president of the Dallas Bar Association.

He is a Navy veteran and a graduate of Duke University. He also has a master's degree in government and international relations from the University of Maryland and a law degree from the University of Oklahoma.

A corporate lawyer familiar with the courtroom, Mr. Jordan has handled a wide range of domestic and international cases. His Houston-based firm, Baker Botts, deals heavily with energy and technology issues and has a branch office in the Saudi capital of Riyadh.

James Baker, who was secretary of state in the administration of Mr. Bush's father and treasury secretary under President Ronald Reagan, also is a partner in the firm.

Although the White House has announced Mr. Jordan's selection, his nomination has not been formally submitted to the Senate. Mr. Jordan said he is still working on the voluminous personal and financial disclosures that are required for such appointments.

Bush advisers cashed in on Saudi gravy train

Our Friends the Saudis - Two Saudi princes had been paying, on behalf of the kingdom, what amounts to protection money to Osama bin Laden since 1995

Princely payments: Saudi royalty, it is claimed, make out like bandits on U.S. deals

U.S. ties to Saudi elite may be hurting war on terrorism

Former CIA director: Saudis partially to blame for 9/11

Saudis financed terror ship

SAUDIS TELL U.S. FORCES TO GET OUT

A FAVOR FROM THE SAUDIS

U.S. Withdrawal From Saudi Arabia Is Not on the Cards: U.S. Official.

Saudi denounces US agenda behind bombing campaign

Saudi Money Aiding Terrorist bin Laden

USA Today
By Jack Kelley
October 28, 1999

WASHINGTON - More than a year after the U.S. Embassy bombings in East Africa, prominent businessmen in Saudi Arabia continue to transfer tens of millions of dollars to bank accounts linked to indicted terrorist Osama bin Laden, senior U.S. intelligence officials told USA TODAY.

The money transfers, which began more than five years ago, have been used to finance several terrorist acts by bin Laden, including the attempted assassination in 1995 of Egyptian President Hosni Mubarak in Ethiopia, the officials said.

Secretary of State Madeleine Albright is expected to raise the issue with Prince Sultan, the Saudi defense minister, during his visit to Washington next week. Saudi Arabia, the main U.S. ally in the Persian Gulf, has pledged to fight terrorism.

According to a Saudi government audit acquired by U.S. intelligence, five of Saudi Arabia's top businessmen ordered the National Commercial Bank (NCB), the kingdom's largest, to transfer personal funds, along with $3 million diverted from a Saudi pension fund, to New York and London banks.

The money was deposited into the accounts of Islamic charities, including Islamic Relief and Blessed Relief, that serve as fronts for bin Laden.

The businessmen, who are worth more than $5 billion, are paying bin Laden "protection money" to stave off attacks on their businesses in Saudi Arabia, intelligence officials said. Bin Laden, whose family runs the largest Saudi construction firm, has called for the overthrow of the Saudi government.

The money transfers were discovered in April after the royal family ordered an audit of NCB and its founder and former chairman, Khalid bin Mahfouz, U.S. officials say. Mahfouz is now under "house arrest" at a military hospital in the Saudi city of Taif, intelligence officials said.

His successor, Mohammad Hussein Al-Amoudi, also heads the Capitol Trust Bank in New York and London, which U.S. and British officials are investigating for allegedly transferring money to bin Laden. Amoudi's Washington lawyer, Vernon Jordan, could not be reached for comment.

Mahfouz's son, Abdul Rahman Mahfouz, is on the board of Blessed Relief in Sudan. Suspects in the Mubarak attack are linked to the charity.

Bin Laden faces U.S. criminal charges for allegedly masterminding the 1998 bombings of U.S. embassies in Kenya and Tanzania that killed 224 people. Bin Laden, who is in Afghanistan, denies the charges.

Saudi Ambassador Prince Bandar bin Sultan declined to comment on the reports.

The White House Connection: Saudi `Agents' Close Bush Friends

Boston Herald.com
By Maggie Mulvihill, Jonathan Wells and Jack Meyers
Source Article
Tuesday, December 11, 2001

A powerful Washington, D.C., law firm with unusually close ties to the White House has earned hefty fees representing controversial Saudi billionaires as well as a Texas-based Islamic charity fingered last week as a terrorist front.

The influential law firm of Akin, Gump, Strauss, Hauer & Feld has represented three wealthy Saudi businessmen - Khalid bin Mahfouz, Mohammed Hussein Al-Amoudi and Salah Idris - who have been scrutinized by U.S. authorities for possible involvement in financing Osama bin Laden and his terrorist network.

In addition, Akin, Gump currently represents the largest Islamic charity in the United States, Holy Land Foundation for Relief and Development in Richmond, Texas.

Holy Land's assets were frozen by the Treasury Department last week as government investigators probe its ties to Hamas, the militant Palestinian group blamed for suicide attacks against Israelis.

Partners at Akin, Gump include one of President Bush's closest Texas friends, James C. Langdon, and George R. Salem, a Bush fund-raiser who chaired his 2000 campaign's outreach to Arab-Americans.

Another longtime partner is Barnett A. ``Sandy'' Kress, the former Dallas School Board president who Bush appointed in January to work for the White House as an ``unpaid consultant'' on education reform.

In September, a federal grand jury issued subpoenas for Holy Land records around the same time terrorist investigators froze the assets of a North Texas Internet firm hired by Holy Land.

Holy Land shared office space with that firm, InfoCom Corp., which was raided by police on Sept. 5, just days before the World Trade Center and Pentagon attacks.

Holy Land has denied any link to Hamas.

According to Akin, Gump, the firm represents Holy Land in a federal lawsuit filed against the charity and another suspected Hamas entity by the parents of a man allegedly murdered by Hamas operatives in the Middle East.

In a statement issued Friday, Akin, Gump said it decided last week to decline a request to represent Holy Land in its defense of terrorism-related charges made by the U.S. Treasury Department.

Akin, Gump, which maintains an affiliate office in the Saudi capital of Riyadh, is also a registered foreign agent for the kingdom. It was paid $77,328 in lobbying fees by the Saudis during the first six months of 2000, public records show.

In addition to the royal family, the firm's Saudi clients have included bin Mahfouz, who hired Akin, Gump when he was indicted in the BCCI banking scandal in the early 1990s. In 1999, the Saudi's placed bin Mahfouz under house arrest after reportedly discovering that the bank he controlled, National Commercial Bank in Saudi Aabia, funneled millions to charities believed to be serving as bin Laden fronts.

A bin Mahfouz business partner, Al-Amoudi, was also represented by Akin, Gump. When it was reported in 1999 that U.S. authorities were also investigating Al-Amoudi's Capitol Trust Bank, Akin, Gump released a statement on behalf of their client denying any connections to terrorism. One year earlier, the firm had co-sponsored an investment conference in Ethiopia with Al-Amoudi.

Akin, Gump partner and Bush fund-raiser Salem led the legal team that defended Idris, a banking protege of bin Mahfouz and the owner of El-Shifa, the Sudanese pharmaceutical plant destroyed by U.S. cruise missiles in August 1998.

The plant was targeted days after terrorists - allegedly on the orders of bin Laden - bombed two U.S. embassies in Africa. The U.S. Treasury Department also froze $24 million of Idris' assets, but Akin, Gump filed a lawsuit and the government later chose to release the money rather than go to court. Idris, who insists he has no connection whatsoever to bin Laden or terrorism, is now pursuing a second lawsuit with different attorneys seeking $50 million in damages from the United States.

Charles Lewis, executive director of the Center for Public Integrity, a Washington, D.C.-based non-partisan political watchdog group, said Akin, Gump's willingness to represent Saudi power-brokers probed for links to terrorism presents a unique ethical concern since partners at the firm are so close to the president.

The concern is more acute now, Lewis said, because Bush has faced stiff resistance from the kingdom in his repeated requests to freeze suspected terrorist bank accounts.

``The conduct of the Saudis is just unacceptable by international standards, especially if they are supposed to be one of our closest allies,'' Lewis said.

Speaking of Akin, Gump partner Kress' office in the White House, Lewis added: ``That's not appropriate and frankly it's potentially troublesome because there is a real possibility of a conflict of interest. Basically you have a partner for Akin, Gump . . . inside the hen house.''

But another longtime Washington political observer, Vincent Cannistraro, the former chief of counter-intelligence at the Central Intelligence Agency, said the political influence a firm like Akin, Gump has is precisely why clients like the Saudis hire them.

``These are cozy political relationships . . . If you have a problem in Washington, there are only a few firms to go to and Akin, Gump is one of them,'' Cannistraro said.

Cannistraro pointed out that Idris hired Akin, Gump during the Clinton presidency, when Clinton confidante Vernon Jordan was a partner at the firm. ``He hired them because Vernon Jordan had influence . . . that's a normal political exercise where you are buying influence,'' he said.

Akin, Gump is not the only politically wired Washington business cashing in on the Saudi connection.

Burson-Marsteller, a major D.C. public relations firm, registered with the U.S. government as a foreign agent for the Saudi embassy within weeks of the Sept. 11 terror attacks.

One of Burson-Marsteller's first public relations efforts for the Saudis was to run a large advertisement in the New York Times reading: ``We Stand with You, America.''

The Washington chairman for Burson-Marsteller, which also maintains an office in Saudi Arabia, is Craig Veith, who ran communications for the Republican Party in the 1996 elections.

Other GOP heavyweights who have held top positions at the PR giant include Sheila Tate, the campaign press secretary for the elder George Bush; Leslie Goodman, deputy director of communications for the 1992 Bush-Quayle campaign; Craig L. Fuller, chairman of the 1992 Republican National Convention and elder Bush's vice presidential chief-of-staff.

Bush's Terrorist Buddy

Bush's terrorist buddy
Bush's terrorist buddy, Part 2

Senator Says Bin Laden Had Accounts in Bank Shut Down in Worldwide Fraud Scandal - BCCI

ASSOCIATED PRESS
September 26, 2001

WASHINGTON --Investigators have learned that Osama bin Laden was among those with accounts in a bank shut down in 1991 in one of the world’s biggest banking scandals, Sen. John Kerry said Wednesday. The Bank of Credit and Commerce International was closed after bank regulators around the globe linked it to fraud, theft, secret weapons deals, terrorist financing and drug-money laundering. Investigators didn’t know it at the time, but it turns out bin Laden had accounts at BCCI, said Kerry, a Massachusetts Democrat who led an investigation into the Third World bank. The BCCI-bin Laden tie was first reported by MSNBC.com's Christopher Byron Tuesday.

WE HAVE LEARNED SINCE from law enforcement and intelligence that when we shut it down, we dealt him a very serious economic blow because of the size of those accounts and his dependency on that flow,” Kerry said.

Saudi Arabian multimillionaire bin Laden and his al-Qaida network are the prime suspects in the Sept. 11 hijackings of four U.S. commercial jetliners and attacks on the World Trade Center and Pentagon.

U.S. officials are trying to trace the money behind bin Laden’s network, leading to a renewed push by Kerry and other lawmakers for tougher money laundering laws.

Kerry commented on BCCI’s link to bin Laden at a Senate Banking Committee hearing on money laundering legislation.

Arab terrorist Abu Nidal and Colombian cocaine cartels also were among the bank's 1.3 million customers. Depositors lost millions of dollars when authorities seized BCCI's assets. Arab terrorist Abu Nidal and Colombian cocaine cartels also were among the bank’s 1.3 million customers. Depositors lost millions of dollars when authorities seized BCCI’s assets.

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