Insider Trading

There…have been claims that al Qaeda financed itself through manipulation of the stock market based on its advance knowledge of the 9/11 attacks. Exhaustive investigations by the Securities and Exchange Commission, FBI, and other agencies have uncovered no evidence that anyone with advance knowledge of the attacks profited through securities transactions.[1]

That’s not all the 9/11 Commission’s final report has to say about allegations of insider trading prior to the terrorist attacks on the World Trade Center and Pentagon. There’s a footnote. It is quite lengthy, for a footnote. Still, one might imagine that any serious investigation into the mysterious trading might have ventured to offer a more sufficient explanation. If you don’t know what I’m talking about, it might be worthwhile to review the non-existent evidence that doesn’t indicate advance knowledge. Seven days after the attacks, Bloomberg Financial News reported the following:

Trading skyrocketed in options that bet on a drop in UAL [United Airlines] Corp. and AMR [American Airlines] Corp. stock in the days before terrorists crashed hijacked United and American airlines jets into the World Trade Center and the Pentagon. Morgan Stanley Dean Witter & Co., which occupied 22 floors of the 110-story 2 World Trade Center, and Merrill Lynch & Co., with headquarters near the destroyed twin towers, also experienced pre- attack trading of 12 times to more than 25 times the usual volume in so-called put options that profit when stock prices fall, according to Bloomberg data. Now, securities regulators in the U.S., Germany, Japan and Hong Kong say they are investigating whether terrorists raised money from insider trading on their knowledge of attacks that devastated New York’s financial district and closed U.S. stock markets for four days.[2]

The increased trades were in “put” options, which, the report explained, “profit when a company’s shares fall.” There were also reports of “short selling”, where stock is sold in the hopes that it can be bought back at a cheaper price after the price drops. In either case, the trader is betting that a stock will decline in value. Trades are monitored constantly for signs of insider trading.[3] One automated system, for example, called the CBOE Market Surveillance System records information on trades and is designed to identify inside traders.[4] Suspicions about the pre-9/11 trades led to investigations being launched in countries on three continents, including in the U.S., Japan, Germany, the U.K., France, Luxembourg, Hong Kong, Switzerland, and Spain.[5]

CBS News reported that “the afternoon before the attack, alarm bells were sounding over unusual trading in the U.S. stock options market”, involving at least 450,000 shares of American Airlines, of which more than 80 percent were put options. “Sources say they have never seen that kind of imbalance before,” the report continued, estimating a $5 million profit for those who made the trades. The Securities and Exchange Commission (SEC) was notified of the suspicious activity shortly after the attacks. “The same thing happened,” the report noted, “with United Airlines on the Chicago Board Options Exchange four days before the attack.” [6] On the Friday before the attacks, United options experienced eight times the normal level of trading in put options on the Chicago Exchange.[7]

The International Policy Institute for Counter-Terrorism (ICT), an Israeli think-tank headed by former intelligence officials, published a report entitled “Black Tuesday: The World’s Largest Insider Trading Scam”, which listed a number of indications “that some trades were almost certainly made based upon advance knowledge of the Black Tuesday attacks”. The evidence included the following:

  • Between September 6 and 7, the Chicago Board Options Exchange saw purchases of 4,744 put options on United Airlines, but only 396 call options.  Although there was no news at that time to justify so much “left-handed” trading, United Airlines stock fell 42 percent, from $30.82 per share to $17.50, when the market reopened after the attacks.  Assuming that 4,000 of the options were bought by people with advance knowledge of the imminent attacks, these “insiders” would have profited by almost $5 million.
  • On September 10, 4,516 put options on American Airlines were bought on the Chicago exchange, compared to only 748 calls.  Again, there was no news at that point to justify this imbalance; but American Airlines stock fell 39 percent, from $29.70 to $18.00 per share, when the market reopened.  Again, assuming that 4,000 of these options trades represent “insiders,” they would represent a gain of about $4 million.
  • No similar trading in other airlines occurred on the Chicago exchange in the days immediately preceding Black Tuesday.
  • Morgan Stanley Dean Witter & Co., which occupied 22 floors of the World Trade Center, saw 2,157 of its October $45.00 put options bought in the three trading days before Black Tuesday; this compares to an average of 27 contracts per day before September 6.  Morgan Stanley’s share price fell from $48.90 to $42.50 in the aftermath of the attacks.  Assuming that 2,000 of these options contracts were bought based upon knowledge of the approaching attacks, their purchasers could have profited by at least $1.2 million.
  • Merrill Lynch & Co., with headquarters near the Twin Towers, saw 12,215 October $45.00 put options bought in the four trading days before the attacks; the previous average volume in these options had been 252 contracts per day.  When trading resumed, Merrill’s shares fell from $46.88 to $41.50; assuming that 11,000 option contracts were bought by “insiders,” their profit would have been about $5.5 million.[8]

Just as importantly, it is possible to trace such trades. “We can directly work backwards from a trade on the floor of the Chicago Board Options Exchange,” Randall Dodd of the Economic Strategy Institute told CBS News. “The trader is linked to a brokerage firm. The brokerage firm received the order to buy that ‘put’ option from either someone within a brokerage firm speculating, or from one of the customers.”[9]

President of the German Deutsche Bundesbank, Ernst Welteke, told reporters that probes into the trading showed “that activities on international financial markets must have been planned and executed with the necessary knowledge.” German authorities were cooperating with the Federal Bureau of Investigation (FBI), Welteke added, but declined to identify which companies were being focused on by the German investigation. It was believed to have focused on Munich Re, the world’s biggest reinsurer, which saw double the normal volume of trading in the week before the attacks.[10]

“What we found,” Welteke said, “makes us sure that people connected to the terrorists must have been trying to profit from this tragedy”. He added that, besides the short-selling of airline and insurance stocks, there was an “inexplicable” rise in oil prices that oil contracts were bought and then re-sold for a much higher price, as well as suspicious movements in gold markets.[11]

Despite this, The New York Times reported on September 28 that “After almost two weeks of investigation, financial regulators around the world have found no hard evidence that people with advance knowledge of the terrorist attacks in New York and Washington used that information to profit in the international securities markets.” The report’s explanation for the irregularities was that “concerns about the airline industry had been growing for some time” and that “industry experts were predicting ‘a further deterioration’ in the airline industry’s financial performance.”[12] The report failed, however, to explain why, then, no other airlines experienced similar trading patterns. After all, the concerns were industry-wide and not specific to only American and United. Furthermore, from this explanation, one would expect a pattern of such trades to occur over time, not in a sudden sharp spike followed by a return to normalcy. The explanation was, simply put, insufficient to explain the irregularity.

The story was far from dead, and more questions continued to develop. The San Francisco Chronicle reported the following day that more than $2.5 million in profits made in trading on United options had not been collected by those responsible. “The uncollected money,” the Chronicle reported, “raises suspicions that the investors – whose identities and nationalities have not been made public – had advance knowledge of the strikes.” One explanation was that those responsible for the trades assumed they could collect the money without detection, but “now fear exposure, or that the account has been frozen” because “markets were closed for four days after the attack, giving investigators time to notice the anomalous trades.” The Chronicle also noted that an SEC spokesman “declined to comment on a New York Times report yesterday that the SEC had found ‘benign’ explanations for the trading activity”, but reiterated that they were “pursuing all credible leads.” Another significant lead reported by the Chronicle was that “Deutsche Banc Alex. Brown, the American investment banking arm of the German giant Deutsche Bank” was “the investment bank used to purchase at least some of the options.[13]

The SEC, in the course of its investigation, asked investment firms in the U.S. and Canada to review their records for evidence of unusual trading patterns, listing 38 companies affected by the 9/11 attacks, including tenants of the World Trace Center.[14] The Wall Street Journal reported that the SEC investigation was being joined by a Secret Service probe into unusual purchases of U.S. Treasury notes, including one $5 billion trade.[15]

More than a month after the attacks, Britain’s The Independent reported that $2.5 million in profits still remained unclaimed and that, “To the embarrassment of investigators, it has also emerged that the firm used to buy many of the ‘put’ options – where a trader, in effect, bets on a share price fall – on United Airlines stock was headed until 1998 by ‘Buzzy’ Krongard, now executive director of the CIA. Until 1997, Mr Krongard was chairman of Alex Brown Inc, America’s oldest investment banking firm. Alex Brown was acquired by Bankers Trust, which in turn was bought by Deutsche Bank.”[16]

In May, 2002, the FBI had raided the house of Amr Ibrahim Elgindy, who was held on charges of racketeering, extortion, and obstruction of justice. The prosecutor in the case suggested that he may “perhaps” have had “pre-knowledge of the Sept. 11 attacks”, since he had predicted a drop in the market and liquidated his children’s trust account. The judge disregarded the insinuation.[17] Perhaps of more significance, the New York Post reported that, according to the indictment, Elgindy had allegedly led a ring of inside-traders that included two FBI agents who “used confidential databases to give Elgindy inside information about publicly traded companies.”[18] Newsday reported that “classified information had been found during a search of possessions of a former FBI agent allegedly part of an insider trading conspiracy.”[19] While the entire episode may have had nothing to do with the attacks, it might perhaps be noteworthy that FBI agents were implicated in conspiracy involving insider trading.

In 2003, a Reuters report noted that German computer experts were “working round the clock to unlock the truth behind an unexplained surge in financial transactions made just before two hijacked planes crashed into New York’s World Trade Center on September 11.” The German firm Convar was working to recover records from computer hard drives found in the rubble of the WTC. The director of the company noted the possibility that “Americans went on an absolute shopping binge” that morning, but added, “Not only the volume but the size of the transactions was far higher than usual for a day like that. There is a suspicion that these were possibly planned to take advantage of the chaos.” A data retrieval expert at the company said that more than $100 million in illegal transfers might have been made and that “There is a suspicion that some people had advance knowledge of the approximate time of the plane crashes in order to move out amounts exceeding $100 million.” If so, he explained, “They thought that the records of their transactions could not be traced after the main frames were destroyed.”[20]

Two years after the attacks, the FBI announced that it had closed its investigation, which had turned up “absolutely no evidence” that anyone had inside knowledge that such an atrocity would occur.[21]

Returning to the 9/11 Commission, the footnote reads:

Highly publicized allegations of insider trading in advance of 9/11 generally rest on reports of unusual pre-9/11 trading activity in companies whose stock plummeted after the attacks. Some unusual trading did in fact occur, but each trade proved to have an innocuous explanation. For example, the volume of put options – investments that pay off only when a stock drops in price – surged in the parent companies of United Airlines on September 6 and American Airlines on September 10 – highly suspicious trading on its face. Yet, further investigation has revealed that the trading had no connection with 9/11. A single U.S.-based institutional investor with no conceivable ties to al Qaeda purchased 95 percent of the UAL puts on September 6 as part of a trading strategy that also included buying 115,000 shares of American on September 10. Similarly, much of the seemingly suspicious trading in American on September 10 was traced to a specific U.S.-based options trading newsletter, faxed to its subscribers on Sunday, September 9, which recommended these trades. These examples typify the evidence examined by the investigation. The SEC and the FBI, aided by other agencies and the securities industry, devoted enormous resources to investigating this issue, including securing the cooperation of many foreign governments. These investigators have found that the apparently suspicious consistently proved innocuous.[22]

The “institutional investor” who purchased “95 percent of the UAL puts on September 6”, we are told, has “no conceivable ties to al Qaeda”. But the question is not whether the traders had ties to al Qaeda, but whether they conceivably had knowledge of the impending attacks, the latter of which does not necessarily predicate itself upon the former. This may be indicative of the investigation itself. Undoubtedly, investigators were expecting the trail of evidence to lead in a particular direction. When the trail led them in a different direction than their preconceived notion thought it would, it was easy to conclude that it was a dead end. If the investigators employed a similar logic as the Commission, then rather than rigorously pursuing evidence of insider knowledge of an impending attack no matter where it led, the investigators assumed that if there was insider trading, it was from al Qaeda members. If the trail led them to people who were not al Qaeda members, then they couldn’t have had foreknowledge, according to this logic, which, needless to say, is fallacious.

In short, highly suspicious trades set off investigations in numerous countries across the globe. The investigations, we are told, found no evidence that members of al Qaeda were responsible for the trades. The trail of the investigation, as it turned out, simply did not lead to where it was supposed to, and so was terminated. It’s entirely possible that it was all just a coincidence. It’s also entirely possible that we have not been told the whole truth of what was learned through the investigation. There is another prominent example of precisely that.

The 9/11 Money Trail

Were the trades really so “innocuous” as the 9/11 Commission would have us believe? Was it all really just a strange coincidence? Or are these just more of the questions left unanswered by official investigations into the events surrounding 9/11?

In fact, it is not merely that questions have been left unanswered. On the contrary, evidence of a massive government cover-up is hard to ignore. Take, for instance, the Commission’s conclusion that “we have seen no evidence that any foreign government – or foreign government official – supplied any funding.”[23] It is simply not plausible that the Commission remained, through the course of its investigation, unaware of reports that the head of Pakistan’s Inter-Services Intelligence Directorate (ISI), Mahmud Ahmad, directed $100,000 to be wired to hijacker Mohammed Atta.

On October 1, just weeks after the attacks, The Guardian reported that “US investigators believe they have found the ‘smoking gun’ linking Osama bin Laden to the September 11 terrorist attacks, with the discovery of financial evidence showing money transfers between the hijackers and a Bin Laden aide in the United Arab Emirates.” The man who was said to have been responsible for wiring money to Mohammed Atta and other hijackers was “Sheikh Saeed, also known as Mustafa Mohamed Ahmad”. The report also said that Deutsche Bank had “provided investigators with information on accounts linked to members of Osama bin Laden’s family.” According to the report, this was not due to the investigation into insider trading, but rather to assist with investigations into “links between the Bin Laden organization and suspected terrorist cells in Germany”. Information on the Bin Laden accounts was reportedly among “a list of less than 10 accounts it suspected were linked to terrorists or terrorist activities”.[24]

A CNN account said that “As much as $100,000 was wired in the past year from Pakistan to Mohammed Atta”.[25] Another CNN report, several days later, said that “Sheik Syed, using the alias Mustafa Muhammed Ahmad, sent more than $100,000 from Pakistan to Mohammed Atta”. Notice that the CNN account has the transfer originating in Pakistan, not the United Arab Emirates, where, by both accounts, the leftover money was returned. Atta, the CNN report continued, returned “thousands of dollars – believed to be excess funds from the operation – back to Syed in the United Arab Emirates in the days before September 11.”[26]

On October 8, a report appeared in the Pakistani paper, Dawn, that that Lt. Gen. Mahmud Ahmed, director of the ISI, had been “replaced after FBI investigators established credible links between him and Umar Sheikh”. According to the report, “Informed sources said there were enough indications with US Intelligence agencies that it was at Gen Mahmud’s instruction that Sheikh had transferred 100,000 US dollars into the account of Mohammed Atta”.[27] The report was briefly noted by James Taranto in the Opinion Journal, the online Wall Street Journal editorial page, but without mention of the money trail linking Sheikh to the 9/11 attacks. [28] The report received no other mention in the American media.

The next day, The Times of India reported that US authorities sought the removal of Mahmud Ahmed “after confirming the fact that $100,000 were wired to WTC hijacker Mohammed Atta from Pakistan by Ahmad Umar Sheikh at the instance of Gen Mahmud.”[29] The Opinion Journal ran a short follow up, this time noting the connection to 9/11, which was difficult to ignore, and quoting the Times of India report at length.[30] Other press accounts mentioning Mahmud Ahmed being relieved of his duties explained it away as “part of General Musharraf’s plan to consolidate his hold on power”[31] or due to disagreements over “Musarraf’s decision to dump the Taliban as an ally”, leaving out all mention of his connection to the 9/11 hijackers.[32] An exception to the rule, Agence France-Presse picked up the report and followed up, reporting that a “highly-placed government source told AFP that the ‘damning link’ between the general and the transfer of funds to Atta was part of evidence which India has officially sent to the US.”[33]

While the money trail was considered to be a “smoking gun” when it was believed to lead to Osama bin Laden, it became a non-story when evidence revealed the involvement of Pakistan’s intelligence agency. Once again, the trail of evidence had gone in the wrong direction, to a place it was not supposed to go. The evidence, therefore, as the 9/11 Commission Report’s silence clearly demonstrates, became non-evidence. In short, when the evidence didn’t tell investigators what they wanted to hear, it was a simple matter to ignore the evidence, to pretend it never existed in the first place.

CNN did a follow up story on Saeed Sheikh, mentioning his role in financing the attacks and reporting that he had been jailed in 1994 for kidnapping tourists in India in an attempt to exchange them for jailed Islamic militants. At the time, according to his arresting officer, he admitted that “he was supported by the Pakistan government’s intelligence service, the ISI.” A spokeswoman from India also said that he had “received support from the ISI. And after he release, it was very clear that he was provided protection and save haven in Pakistan with the direct support, with the knowledge and – obviously, with the connivance of the Pakistani intelligence.” [34] But his connections with the ISI are portrayed as past history, and no mention is made of Mahmud Ahmed.

The American media then forgot all about Ahmed Omar Saeed Sheikh until he later became the prime suspect in the murder of Wall Street Journal reporter Daniel Pearl, who had been writing about ISI connections with radical Islamists. According to Newsweek, American law-enforcement and intelligence officials speculated that “Sheikh has been a ‘protected asset’, of Pakistan’s shadowy spy service, the Inter-Services Intelligence, or ISI.”[35] Subsequent reports focused on his involvement in the kidnapping of Pearl, downplaying his involvement in the 9/11 attacks. The Guardian reported that “the Pakistani intelligence agencies as well as several leading militants knew exactly who he was and were embarrassed by his work,” and noted Saeed Sheikh’s “links with al-Qaida and the ISI”, but made no mention whatsoever of his role as the 9/11 money man.[36] A story in Vanity Fair made much of his past connections with the ISI, noting that at the time of his 1994 arrest, “ISI paid for a lawyer”, but noting only briefly that he “had wired more than $100,000 to hijacking ringleader Mohammed Atta”. TIME reported on Saeed Sheikh in 2003, after the Pearl kidnapping, but mentioned only in passing that “U.S. investigators say” that Saeed Sheikh “was a chief architect of the 9/11 attacks”.[37]

In short, Saeed Sheikh’s role as the 9/11 “money man” had gone from “smoking gun” to footnote.

Mr. Mahmud Goes to Washington

Needless to say, the 9/11 Commission Report makes no mention of Mahmud Ahmed and his reported role in financing the hijackers. Neither, for that matter, does the Joint Inquiry report by the Senate Select Committee on Intelligence and House Permanent Select Committee on Intelligence on the 9/11 attacks, which was chaired by Bob Graham and Porter Goss. This is perhaps made more curious by the fact that Graham and Goss were having breakfast with Mahmud Ahmed in Washington on the morning of September the 11th.[38]

The day before the attacks, a Pakistani paper reported noted that “ISI Chief Lt-Gen Mahmood’s [Mahmud] week-long presence in Washington has triggered speculation about the agenda of his mysterious meetings at the Pentagon and National Security Council.” While in Washington, he met with his counterpart, CIA Director George Tenet, who had visited Islamabad not long before, and with U.S. Under Secretary of State for Political Affairs Mark Grossman. “That this is not the first visit by Mahmood in the last three months,” the story continued, “shows the urgency of the ongoing parleys.”[39]

The ISI chief “happened” to be in Washington “on a regular visit of consultations” when the attacks occurred, according to one account in the American media, and so was invited to the State Department two days after the attacks to meet with Deputy Secretary of State Richard Armitage.[40] He likely also spoke with Colin Powell. Bob Graham, for instance, said of the ISI chief, “He was marooned here, and I think that gave Secretary of State Powell and others in the administration a chance to really talk with him.”[41] Chairman of the Senate Foreign Relations Committee Sen. Joseph Biden also met with Mahmud Ahmed, who, according to the senator, pledged Pakistan’s cooperation in the war on terrorism.[42]

Graham and Goss, formerly a CIA case officer, had traveled to Pakistan just two weeks before, in late August, where they met with President Pervez Musharraf and reportedly talked about Pakistani cooperation in extraditing Osama bin Laden, as well as Pakistani tensions with India. Now they were having breakfast with the ISI chief, reportedly discussing, among other things, Osama bin Laden, when an aide handed Goss a note informing the men that a plane had just hit the World Trade Center. A second note informed them that a second plane had struck.[43]

The two chairmembers of the 9/11 Joint Inquiry were sitting with the man who reportedly ordered $100,000 to be wired to “ringleader” Mohammed Atta when the planes crashed into their targets on that Tuesday morning – and then mentioned not a word of the ISI chief’s suspected role in their report. The silence, as already noted, was echoed by the 9/11 Commission.

On May 16, 2002, a reporter from a foreign news agency asked National Security Advisor Condoleezza Rice the following: “Dr. Rice, are you aware of the reports at the time that the ISI chief was in Washington on September 11th, and on September 10th, $100,000 was wired to Pakistan to this group here in this area? While he was here meeting with you or anybody in the administration?” Rice replied, “I have not seen that report, and he was certainly not meeting with me.”[44]

“The lady doth protest too much, methinks.”

Curiously, the transcript on the White House website wipes “ISI chief” from the record (“…reports at the time that – was in Washington…”). Graham and Goss’ Joint Inquiry played along. So did the 9/11 Commission members. Just as “ISI chief” was excised from the White House transcript of the press briefing, so was the knowledge of Mahmud Ahmed’s involvement in the attacks on the World Trade Center and Pentagon excised from the “official” historical record.

The Soviet-Afghan War: a CIA-ISI Joint Venture

So the 9/11 Commission tells us that the unusual trading before the attacks was perfectly “innocuous”. But their report also tells us that there is “no evidence that any foreign government – or foreign government official – supplied any funding”, while it was reported that the government of India sent the U.S. very specific evidence linking Pakistan’s ISI to the hijackers. The Commission doesn’t set out to debunk these reports – it simply doesn’t mention them at all. They don’t exist. It’s more non-evidence, perhaps not unlike the apparent insider trading that took place days before September 11th. So what can we make of this? The 9/11 Commission concluded that the failure to prevent the attacks was a failure to “connect the dots” and a “failure of imagination”. Let us, therefore, connect a few dots and stretch our imaginations, and see where it may lead us.

The CIA formed a cozy relationship with the ISI during the Soviet-Afghan war, when the ISI was used to provide military support and funnel arms to the mujahideen, the radical Islamists fighting the U.S.’s proxy war against the Soviet Union. The official history has it that President Jimmy Carter signed a “presidential finding” on Afghanistan authorizing covert assistance to the mujahideen in 1980, in response to the Soviet invasion. But in an interview, Carter’s National Security Advisor Zbigniew Brzezinski admitted that the official history was bogus, suggesting that cause and effect were actually reversed. It was July 3, 1979 when “President Carter signed the first directive for secret aid to the opponents of the pro-Soviet regime in Kabul.” Moreover, Brzezinski bragged that he wrote a note to Carter “in which I explained to him that in my opinion this aid was going to induce a Soviet military intervention.”[45]

Indeed, Soviet documents reveal that the USSR was aware of the U.S. covert support. “Bands of saboteurs and terrorists, having infiltrated from the territory of Pakistan, trained and armed not only with the participation of Pakistani forces but also of China, the United States of America and Iran, are committing atrocities in Herat.” One participant at a high-level meeting said, “We may assume with full justification that all these events, not only in Afghanistan but in the neighboring governments, including those in China, are being directed by the hand of the U.S.A.” Still, the Soviet leadership was hesitant to intervene militarily in support of the government of Afghanistan, recognizing that “we will be labeled as an aggressor.” [46]

But by December the situation had changed. In his book “The Tragedy and Valor of Afghan”, Alexander Lyakhovsky cited among the “reasons justifying the necessity” of Soviet intervention the operations “undertaken by the CIA of the USA” and the fear of the creation of “a ‘new Great Ottoman Empire,’ which would have included the Southern republics of the USSR”. The “stationing of the American missiles of the ‘Pershing’ type in Afghanistan…would threaten many vital Soviet objects” and “Afghan uranium deposits could be used by Pakistan and Iraq for building nuclear weapons”.[47] Not only did U.S. covert aid contribute to the Soviet Union’s reasons for invading, but it also greatly prolonged the war. According to Lyakhovsky, Soviet leaders were reluctant to withdraw because they believed that “withdrawal of troops would have meant a concession to the aggressive policy of the United States”.[48]

The result of U.S. and Soviet interference was a decade-long war that left over one million dead, with millions more – one-third of the country’s population – becoming refugees.[49]

By1985, the CIA was supplying the mujahideen with satellite reconnaissance data. Training was provided for the use of C-4 plastic explosives, sabotage, and guerilla warfare.[50] The decision to provide the mujahideen with Stinger antiaircraft missiles was credited with turning the tide of the war.[51] The joint CIA-ISI effort was supported in part by the drugs trade, resulting in massive opium cultivation and heroin production in Pakistan’s northern region and across the border in Afghanistan.[52]

That legacy of the conflict remains. According to a report in 2001 by the South Asia Analysis Group, “Pakistan’s illegal heroin economy has kept its legitimate State economy sustained since 1990 and prevented its collapse.” Furthermore, “many senior officers of the Army and the ISI benefited from the heroin dollars”, including Brig. Imtiaz, the former head of the ISI (he was replaced when Gen. Pervez Musharraf took power in a coup in 1999), who kept much of the wealth he acquired through the heroin trade in an account with Deutsch Bank.[53]

There are other conspicuous links to the Deutsch Bank. As noted previously, “Buzzy” Krongard was, until 1998, when he became executive director of the CIA, the head of Bankers Trust, owned by Deutsche Bank. Bankers Trust, in turn, owned Alex Brown Inc., through which many of the put options were purchased before September 11th. Also noted previously, Deutsche Bank had given investigators a list of accounts suspected of being linked to terrorist activities, including accounts held by the bin Laden family. Moreover, a French investigation into bin Laden’s financial network led to the questioning of Yeslam bin Laden, who manages some of the assets of the Saudi Binladin Group (SBG) and heads the Saudi Investment Company (SICO). He denied having any contact with his half-brother, Osama, but a private investigation by Jean-Charles Brisard revealed that the two shared a joint account. “Yeslam,” Reuters reported, citing Le Monde, “told French investigators in September that he had omitted to mention the existence of that account, while still insisting he had not mixed with his half-brother”. Brisard also noted a large transfer that was “made to Pakistan in 2000 from an account belonging to a company called Cambridge, a SBG subsidiary, that was opened at Deutsche Bank in Geneva”. According to the report, “U.S. authorities are aware of the existence of those funds, which they believe were transferred into an account belonging jointly to Osama bin Laden and someone of Pakistani nationality”.[54]

The BCCI Affair Remembered

Osama bin Laden also once held accounts in the Bank of Credit and Commerce International (BCCI), founded in Pakistan.[55] That was not known, of course, at the time the bank was shut down in 1991, after investigations had revealed that it was a hub of criminal conspiracy. A Congressional inquiry was launched into its affairs, spearheaded by Senator John Kerry, which produced a report on the bank’s criminal activities. According to the Senate Foreign Relations Committee report:

BCCI’s criminality included fraud by BCCI and BCCI customers involving billions of dollars; money laundering in Europe, Africa, Asia, and the Americas; BCCI’s bribery of officials in most of those locations; support of terrorism, arms trafficking, and the sale of nuclear technologies; management of prostitution; the commission and facilitation of income tax evasion, smuggling, and illegal immigration; illicit purchases of banks and real estate; and a panoply of financial crimes limited only by the imagination of its officers and customers.

The corrupt bank “relied on relationships with, and as necessary, payments to, prominent political figures in most of the 73 countries in which BCCI operated”. The report criticized what it called the “errors” or “mistakes” of the CIA in not sharing what it knew about the bank’s criminal activities, adding that “After the CIA knew that BCCI was as an institution a fundamentally corrupt criminal enterprise, it continued to use both BCCI and First American, BCCI’s secretly held U.S. subsidiary, for CIA operations.”

The report also stated that “Former CIA officials, including former CIA director Richard Helms and the late William Casey…float in and out of BCCI at critical times in its history, and participate simultaneously in the making of key episodes in U.S. foreign policy”, including “the arming of Iran as part of the Iran/Contra affair.” The bank was “incontestably used by key Iran/Contra figures to finance arms shipments to Iran in connection with the secret Reagan Administration initiative.”

Also, “former Secretary of Defense Clark Clifford and his law partner, Robert Altman, were central figures in BCCI’s acquisitions and management of U.S. banks.” Clifford testified, denying any knowledge of the banks criminal activities. “Apparently,” he said, “we were deceived.”[56]

We’ve already seen several examples of top CIA men with close-knit connections with banking, including William Casey and A.B. “Buzzy” Krongard. But many other top CIA officials have also had close connections with Wall Street. John Foster and Allen Dulles were partners in the Wall Street firm of Sullivan Cromwell. Bill Casey was a Wall Street lawyer, stockbroker, and Chairman of the Securities and Exchange Commission. John Deutch is on the board at Citigroup. Needless to say, there is a distinct pattern throughout the agency’s history. [57]

BCCI is not the only bank caught in such activities. In 2001, the U.S. Senate released a report on banking entitled “A Gateway for Money Laundering” that noted a widespread pattern. The report stated that “U.S. banks, through the correspondent accounts they provide to foreign banks, have become conduits for dirty money flowing into the American financial system and have, as a result, facilitated illicit enterprise, including drug trafficking and financial frauds.” The investigation, led by Carl Levin, documented “numerous instances of money laundering”, including the laundering of “illicit proceeds” and facilitation of crime “by accepting deposits or processing wire transfers involving funds that the high risk foreign bank knew or should have known were associated with drug trafficking”.[58]

The Informant and the Senator

Kevin Ingram was a senior investment banker with Deutsche Bank from 1996 until 1999. In June, 2001, he was arrested in Florida “after agreeing to launder $2.2 million that had been described to him as proceeds from arms shipments”, The New York Times reported.[59] The $2.2 million was in addition to an initial $350,000 Ingram was accused of laundering for two men who said they were acting on behalf of a former military official in a foreign country.[60] A federal agent testified in court that there was a concern the arms were destined for the Taliban in Afghanistan, possibly even Osama bin Laden.[61]

Ingram was caught in a sting operation in which an informant named Randy Glass played the key role.

Randy Glass was a jeweler, as well as “the consummate con man”. When he was caught, facing a lengthy prison sentencing, he offered to use his skills as an informant, becoming what one prosecutor described as “one of the most prolific informants the world has ever seen.”[62] In an attempt to lessen his sentencing, Glass offered to become an informant for the Bureau of Alcohol, Tobacco, and Firearms (ATF), claiming to know an illegal arms dealer named Diaa Mohsen. Glass told Mohsen that he could get weapons from the U.S. military. Mohsen, in turn, introduced Glass to Mohammed “Mike” Malik, who said he was seeking weapons on behalf of buyers from Pakistan, who were particularly interested in Stinger missiles, and wondered if Glass would accept a heroin as payment. A meeting was set up on January 21st, 1999, so the buyers could inspect Glass’s goods, which were provided by the ATF. Glass took a picture of Mohsen with a Stinger missile, which he took as proof that Glass could get the weapons he said he could. Glass taped his conversations throughout the operation. Ingram became involved when the question of how Glass would dispose of the money arose. Mohsen then recommended Ingram, who had an office at the World Trade Center.[63]

In August, 2002, Dateline NBC ran a report about Randy Glass and the sting operation, playing segments from the recordings Glass made. In the tapes, Mohsen tells Glass that his buyers could be found on “the border between Afghanistan and Pakistan”, were “very connected to the Taliban”, and even that “they are terrorists.” The tapes also reveal that he told Glass that Osama bin Laden financed them:

Mohsen: Do you know who supplies them with money?

Glass: Who?

Mohsen: Osama bin Laden.[64]

Malik introduced Glass to a man named “R. G. Abbas”, whom he met with in New York on July 22nd, 1999. Abbas was represented to Glass “as being an ISI agent.” Glass said, “He told me that Americans were the enemy. And he looked around the restaurant and he said, ‘We would have no problem with blowing up this entire restaurant.’” Abbas also talked about acquiring components for nuclear weapons. Dick Stoltz, an ATF agent who worked the case with Glass, confirmed his account. “We did confirm through various sources that – that Abbas and Malik did have links to weapons trafficking groups and – militant operations.”[65]

Another meeting was set up, and this time Abbas and the brokers flew to Florida to see the weapons. There, Abbas said again that he wanted to acquire components for nuclear weapons, including “heavy water”, used to make weapons-grade plutonium. He said he wanted to bring a Pakistani nuclear scientist to America to inspect the materials. Abbas gave Stoltz the scientist’s name, and Stoltz confirmed that he did exist and worked for the Pakistani government.[66]

By October, 2000, there was an agreement wherein the buyers would pay $32 million over several years. But the money never came. In June, 2001, federal agents arrested Mohsen and Malik. Mohsen pleaded guilty to charges of illegal arms dealing. But Malik remained free and the documents regarding his case have been sealed.[67] “One reason,” The Washington Post reported, citing “informed sources”, was that “prosecutors, in an unusual step, removed references to Pakistan from public findings because of diplomatic concerns.”[68] Stoltz told Dateline that he was surprised that the case hadn’t generated more interest at the highest levels of law enforcement and pursued more aggressively. “Quite frankly,” he said, “I was always wondering when maybe the case would be taken away from ATF.”[69]

But the story didn’t end there. In October, 2002, The Palm Beach Post reported that Glass had reached out to Sen. Bob Graham and Rep. Robert Wexler. “He said he told staffers for both lawmakers that a Pakistani operative named R.G. Abbas had made three references to imminent plans to attack the World Trade Center during the probe, which ended in June 2001. At one meeting at New York’s Tribeca Grill caught on tape, Abbas pointed to the World Trade Center and said, ‘Those towers are coming down,’ Glass said.” Glass talked to Florida state Sen. Ron Klein, who said he didn’t recall any information specific to the World Trade Center, but did take it seriously enough to forward to Graham’s office. Graham acknowledged that he had contact with glass before September 11th in a news conference.[70]

In that news conference, a reporter began by saying that Graham’s office had received information before September 11th from Randy Glass, who had “advised your office of terrorist intentions to bring down the World Trade Center”. Graham nodded and acknowledged that the information was correct. The reporter then asked “why did no one from the [Senate Intelligence] Committee follow up with Mr. Glass to pursue this?” Graham then responded that it was “the responsibility of the FBI if it’s a domestic matter, or the CIA if it’s foreign”, saying that he had forwarded the information to “the agency that we felt was the most appropriate”, but declining to specify which agency.

But according to Randy Glass, nobody from any intelligence agency had contacted him. And Graham later issued a letter denying that Glass provided any information prior to September 11th “that needed to be pursued by intelligence agencies.”[71]

Connecting the Dots

The U.S. government, we are told, failed to prevent the attacks of 9/11 because nobody could “connect the dots”. Above all, the Commission tells us, there was a “failure of imagination”.

There are dots all over the place. They can be connected between insider trading and Deutsche Bank, and between Deutsche Bank and the bin Laden family, including Osama bin Laden. There are connections between Deutsche Bank and the CIA, between the CIA and the ISI, and between the ISI and the 9/11 hijackers. There are connections between the CIA and money laundering and arms dealing. There are connections between the 9/11 Joint Inquiry chairs, Bob Graham and Porter Goss and the CIA and the ISI and Randy Glass’ reported foreknowledge of the attacks, and between Kevin Ingram and Glass, and between Ingram and Deutsche Bank. There are connections between the ISI and CIA and the heroin trade, and between the heroin trade and arms dealing, and between arms dealing and the Taliban and Osama bin Laden.

There are dots all over the map, and they are not difficult to connect, but the picture that emerges is a complicated web of circumstantial links that will inevitably be explained away as strange coincidences. But if we apply the lesson given by the 9/11 Commission and use our imaginations, there’s certainly no shortages of conclusions that could be drawn. One of the more important of those conclusions is that the Commission, far from helping us to further understand the terrorist attacks, was actively involved in helping to ensure that certain information remained concealed from the American public, and from the world. At the very least, we may conclude, with great confidence, that despite the best efforts of the 9/11 Commission, many unanswered questions remain.

[1] The 9/11 Commission Report: Final Report of the National Commission on Terrorist Attacks Upon the United States (W.W. Norton and Company, New York) p. 171-172

[2] Judy Mathewson and Michael Nol, “U.S., Germany, Japan Investigate Unusual Trading Before Attack” Bloomberg Financial News, September 18, 2001

[3] “Bin Laden ‘share gains’ probe”, BBC News, September 18, 2001

http://news.bbc.co.uk/1/hi/business/1548118.stm

[4] Dave Eberhart, “Still Silence From 9-11 Stock Speculation Probe”, NewsMax, June 3, 2002

http://www.newsmax.com/archives/articles/2002/6/2/62018.shtml

[5] NewsMax, June 3, 2002

[6] “Profiting From Disaster?”, CBS News, September 19, 2001

http://www.cbsnews.com/stories/2001/09/19/eveningnews/main311834.shtml

[7] Christian Berthelsen, “New scrutiny of airlines options deals”, San Francisco Chronicle, September 19, 2001

http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2001/09/19/BU184559.DTL

[8] Don Radlauer, “Black Tuesday: The World’s Largest Insider Trading Scam?”, The International Policy Institute for Counter-Terrorism (ICT), September 19, 2001

http://www.ict.org.il/articles/articledet.cfm?articleid=386

[9] CBS News, September 19, 2001

[10] “Germans Probe Pre-Terrorism Trading”, Bloomberg News, September 23, 2001

http://www.newsday.com/ny-bzbund232380730sep23,0,2864727.story

[11] William Drozdiak, “’Insider trading’ by terrorists is suspected in Europe”, Miami Herald, September 24, 2001

http://web.archive.org/web/20011109160700/www.miami.com/herald/special/news/worldtrade/digdocs/099922.htm

[12] Kurt Eichenwald and Edmund L. Andrews, “Regulators Find No Evidence That Advance Knowledge of Attacks Was Used for Profit”, The New York Times, September 28, 2001

http://www.cooperativeresearch.org/archive/2001/nytimes092801.htm

[13] “Suspicious profits sit uncollected: Airline investors seem to be lying low”, San Francisco Chronicle, September 29, 2001

http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2001/09/29/MN186128.DTL

[14] Marcy Gordon, “Pre-attack trading probed”, Associated Press, October 3, 2001

http://www.detnews.com/2001/business/0110/03/b03-308879.htm

[15] Cited in: “Stock-trading probe expands to Canada”, San Francisco Chronicle, October 3, 2001

http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2001/10/03/BU187948.DTL; and Barry Grey, “Suspicious trading points to advance knowledge by big investors of September 11 attacks”, World Socialist Web Site, October 5, 2001

http://www.wsws.org/articles/2001/oct2001/bond-o05.shtml

[16] Chris Blackhurst, “Mystery of terror ‘insider dealers’”, The Independent, October 14, 2001

http://www.independent.co.uk/story.jsp?story=99402

[17] “Lawyer: Accused Man Knew of Attacks”, Associated Press, May 24, 2002

[18] David K. Li and Kati Cornell, “Shady Trader Eyed For 9/11 Tip”, New York Post, May 25, 2002

[19] Anthony M. DeStefano, “Feds: Ex-Agent Had Key Data”, Newsday, May 29, 2002

[20] Erik Kirschbaum, “German Firm Probes Final World Trade Center Deals”, Reuters, August 6, 2003

http://www.reuters.com/news_article.jhtml?type=search&StoryID=458677

[21] David Roeder, “9/11 – Investigations, Official: No profiteering on terror attacks”, Sun Times, September 19, 2003

http://www.suntimes.com/output/terror/cst-fin-fbi19.html

[22] The 9/11 Commission Report, p. 499

[23] The 9/11 Commission Report, p. 172

[24] Julian Borger and John Hooper, “Trail links Bin Laden aide to hijackers”, The Guardian, October 1, 2001

[25] “Sources: Suspected terrorist leader was wired funds through Pakistan”, CNN, October 1, 2001

http://www.cnn.com/2001/US/10/01/inv.pakistan.funds/

[26] “Suspected hijack bankroller freed by India in ‘99”, CNN, October 6, 2001

[27] “Gen Mahmud’s exit due to links with Umar Sheikh”, Dawn, October 8, 2001

http://www.dawn.com/2001/10/09/top13.htm

A similar report appeared in the Indian press: “ISI Chief Asked to Quit; Had Links with IA Plane Hijacker”, Press Trust of India, October 8, 2001

[28] James Taranto, “Best of the Web Today: Our Friends the Pakistanis”, Opinion Journal, October 9, 2001

http://www.opinionjournal.com/best/?id=95001294

[29] “India helped FBI trace ISI-terrorist links”, The Times of India, October 9, 2001

http://timesofindia.indiatimes.com/articleshow/1454238160.cms

[30] James Taranto, “Best of the Web Today: Our Friends the Pakistanis”, October 10, 2001

[31] Zahid Hussain, “Musharraf Ousts Three Hardliners”, The London Times, October 9, 2001

[32] Luke Harding, “Musharraf dismisses two Islamist generals”, The Guardian, October 9, 2001

http://www.guardian.co.uk/international/story/0,3604,565966,00.html

[33] “India Accuses Ex Pakistan Spy Chief Of Links to US Attacker: Report”, Agence France-Presse, October 10, 2001

[34] Kyra Phillips and Maria Ressa, “Saeed Sheikh Believed to Have Abetted Terrorists”, CNN, October 28, 2001

[35] Daniel Klaidman, “Federal Grand Jury Set to Indict Sheikh”, Newsweek (Web Exclusive), March 13, 2002

http://msnbc.msn.com/id/3067249/

[36] Rory McCarthy, “Underworld where terror and security meet”, The Guardian, July 16, 2002

http://www.guardian.co.uk/Archive/Article/0,4273,4462107,00.html

[37] Tim McGirk, “Who Killed Daniel Pearl?”, TIME Asia, February 3, 2003

[38] James Risen, “Rifts Plentiful as 9/11 Inquiry Begins”, The New York Times, June 3, 2002

http://www.nytimes.com/2002/06/04/politics/04INQU.html?todaysheadlines;

“A Cloak But No Dagger”, The Washington Post, May 18, 2002

http://www.washingtonpost.com/ac2/wp-dyn/A36091-2002May17?language=printer;

Jake Tapper, “Spying eyes and ears”, Salon, September 14, 2001

http://dir.salon.com/politics/feature/2001/09/14/human_spies/index.html

[39] Amir Mateen, “ISI Chief’s Parleys continue in Washington”, The News (Pakistan), September 10, 2001

[40] Jane Perlez, “Powell Says It Clearly: No Middle Ground On Terrorism”, The New York Times, September 13, 2001

[41] Frank Davies, “Pakistan Will Struggle To Keep Commitment, Lawmakers Say”, The Miami Herald, September 16, 2001

[42] “Bush gives historic scope to attacks”, The Associated Press, September 13, 2001

[43] Salon, September 14, 2001; “Congressional Action”, PBS NewsHour, September 14, 2001 http://www.pbs.org/newshour/bb/terrorism/july-dec01/congress_9-14.html;

The Miami Herald, September 16, 2001; The Washington Post, May 18, 2002; The New York Times, June 3, 2002

[44] Press Briefing by National Security Advisor Dr. Condoleezza Rice, The White House, May 16, 2002

http://www.whitehouse.gov/news/releases/2002/05/20020516-13.html;

Michel Chossudovsky, “Political Deception: The Missing Link behind 9-11”, Centre for Research on Globalisation, June 20, 2002

http://globalresearch.ca/articles/CHO206A.html

Chossudovsky notes that both the White House and CNN excised “ISI chief” from their transcripts, unlike the Federal News Service transcript, which provides confirmation that it was Mahmud Ahmed who was being referred to.

[45] “Interview with Zbigniew Brzezinski, President Jimmy Carter’s National Security Adviser”, Le Nouvel Observateur, January 15-21, 1998

http://www.globalresearch.ca/articles/BRZ110A.html

[46] “Deterioration of Conditions in the Democratic Republic of Afghanistan and Possible Responses From Our Side”, Transcript of the Meeting of the Politburo of the Central Committee of the Communist Party of the Soviet Union, March 17-18, 1979

http://www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB57/r1.pdf

[47] Alexander Lyakhovsky, The Tragedy and Valor of Afghan, (GPI Iskon, Moscow, 1995), pp. 109-112 [Translated by Svetlana Savranskaya, The National Security Archive.]

http://www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB57/r8.doc

[48] Lyakhovsky, p. 176-177

[49] Steve Galster, “Afghanistan: The Making of U.S. Policy, 1973-1990”, GWU National Security Archive, October 9, 2001

http://www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB57/essay.html

[50] Steve Coll, “Anatomy of a Victory: CIA’s Covert Afghan War”, The Washington Post, July 19, 1992; Page A1

[51] “Impact of the Stinger Missile on Soviet and Resistance Tactics in AF [Afghanistan]”, Commander, U.S. Army Operations Group, Ca. 1987

http://www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB34/18-01.htm

[52] Rahul Bedi, “Washington’s Pakistani Allies: Killers and Drug Dealers”, Sydney Morning Herald, September 27, 2001

[53] B. Raman, “Heroin, Taliban & Pakistan”, South Asia Analysis Group, August 6, 2001

http://www.saag.org/papers3/paper288.html

[54] “French Magistrate Widens Bin Laden Finance Probe”, Reuters, December 25, 2004

[55] David Sirota and Jonathan Baskin, “Follow the Money”, Washington Monthly, September 2004

http://www.washingtonmonthly.com/features/2004/0409.sirota.html

[56] Senator John Kerry and Senator Hank Brown, “The BCCI Affair: A Report on the Committee on Foreign Relations”, United States Senate, December 1992

http://www.fas.org/irp/congress/1992_rpt/bcci/

[57] Michael Ruppert, “Suppressed Details of Criminal Insider Trading Lead Directly Into the CIA’s Highest Ranks”, From the Wilderness, October 9, 2001

http://www.fromthewilderness.com/free/ww3/10_09_01_krongard.html

[58] Minority Staff of the Permanent Subcommittee on Investigations Report on Correspondent Banking: A Gateway for Money Laundering, U.S. Senate, February 5, 2001

http://www.senate.gov/~gov_affairs/psi_finalreport.pdf

[59] Amanda Riddle, “Former Bond Trader Sentenced”, The Associated Press, December 1, 2001

http://www.washingtonpost.com/ac2/wp-dyn/A42846-2001Dec1?language=printer;

Terry Pristin, “Former Rising Star on Wall Street Is Arrested in Arms Sale Inquiry”, The New York Times, June 16, 2001

http://www.nytimes.com/2001/06/16/nyregion/16GUNS.html?ex=1127707200&en=acf2b09738832743&ei=5070

[60] Jon Burstein, “Former Wall St. Bond Trader Cuts Plea Deal, Will Testify in Arms-trading Case“, The South Florida Sun-Sentinel, August 23, 2001

[61] Leah Nathans Spiro, “Wall St.’s Soldier of Fortune – Kevin Ingram”, Talk, November, 2001

http://www.findarticles.com/p/articles/mi_m0KNK/is_3_3/ai_80206454/print

[62] John Pacenti, “Taliban Showed Interest in Boca Snitch”, The Palm Beach Post, September 29, 2001

[63] Talk, November, 2001; John Mintz, “U.S. Reopens Arms Case In Probe for Taliban Role”, The Washington Post, August 2, 2002; Page A01

http://www.washingtonpost.com/ac2/wp-dyn/A33797-2002Aug1?language=printer;

Chris Hansen and Ann Curry, “Trail of Terror”, Dateline NBC, August 2, 2002

[64] Dateline NBC, August 2, 2002

[65] Ibid.

[66] Ibid.

[67] Ibid.

[68] The Washington Post, August 2, 2002

[69] Dateline NBC, August 2, 2002

[70] John Pacenti, “Intelligence Panel Hears from Glass”, The Palm Beach Post, October 17, 2002

[71] WPTV (NBC) Florida, October 7, 2002

http://www.yirmeyahureview.com/archive/911/randy_glass_video.htm

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