Rude Awakening

Major news organizations need to snap out of 9/11 emotionalism and ask impolite financial questions about Saudi elites and President Bush

Periodically, I get a phone call from some journalist or other, wanting to know what I know, from a prior journalistic lifetime, about George W. Bush's possible financial connections to this or that member of the Saudi Arabian elite. I enjoy the conversations, but usually offer the reporters rehashes of what's already been published on this score. Why would I give away information? Am I some kind of journalistic Santa Claus?

But it's become clear in the 53 weeks since the World Trade Center was made rubble that a globe-spanning investigative foray into Bush-Saudi links, such as they may be, is needed. It's also clear I am in no position to make it. Good reporters with long lead times and fat expense accounts really should be looking at the appearance of financial connection between Bush and his supporters and certain Saudi "persons of interest" (to use the current federal patois).

These apparent connections may, when run to ground, prove trivial. But national media organizations spent untold millions of dollars on an orgy of grief-mongering to commemorate the one-year anniversary of 9/11; it would be heartening, now, if some of those organizations redirected resources from the easy journalism of the boohoo beat to the less comfortable task of putting rude questions to powerful people.

The questions I am talking about really boil down to one. Although the query is fundamentally impolite, I'll try to state it in a respectful way:

Saudi Arabia is widely acknowledged as a source of significant financing for al Qaeda and Osama bin Laden; Saudi lack of cooperation in terror investigations is similarly well-known. Do the apparent financial connections of George W. Bush, his father, and his and his father's friends and associates to important Saudi figures, in and out of that country's government, in any way compromise our government's ability to investigate al Qaeda?

Here is part of a framework within which enterprising reporters might start looking for answers.


People sometimes ask me about Saudis and President Bush because a little more than a decade ago, when I was a daily newspaper reporter in Houston, I looked at possible connections between Houston business and political figures and the engagingly corrupt and corrupting Bank of Credit and Commerce International. Some BCCI figures have drawn new interest as investigators examine the worldwide financing of terror, in which BCCI is known to have played a role.

Shortly after the 9/11 tragedy, I wrote a column that borrowed from my earlier research into a Houston airplane broker named James Bath. Bath has represented, as a sort of business agent, at least four prominent and wealthy Saudi Arabian citizens, including Salem bin Laden, the favored son of the founder of a great Saudi construction empire and one of dozens of brothers of a man named Osama bin Laden. Among other things, I wrote, Bath also counted as a friend and minor business partner a man who, except for his family connections, was not then well known to the wider public: George W. Bush.

More than a decade ago, Bush said he met Bath in the 1970s when both were fighter pilots at an Air National Guard base near Houston and acknowledged they were friends, but insisted they had never been in business together. Subsequent stories disputed that contention. "Tax documents and personal financial records show that Bath personally had a 5 percent interest in Arbusto '79 Ltd., and Arbusto '80 Ltd., limited partnerships controlled by George W. Bush, [then-]President Bush's eldest son," the Houston Chroniclereported, adding, "Bath invested $50,000 in the limited partnerships, according to the documents. There is no available evidence to show whether the money came from Saudi interests."

Timemagazine, meanwhile, wrote that Bath "enjoyed unusual carte blanche to direct the U.S. investments of several wealthy Middle Easterners. Associates confirm that Bath has brokered more than $150 million in private plane deals in recent years, concentrated in sales and leases to Middle Eastern royalty and other influential figures."

My column last September described a poignant coincidence: Bath, friend of President Bush, represented financial interests of some members of the bin Laden family (but not, to my knowledge, Osama). My point, then, involved the importance of acting not on appearance, but on facts.

A year later, it's clear that some facts need to be established:

According to many news reports, Bush's financial fortunes rose as his drilling partnerships and firms foundered. At every fateful turn, it seemed, more investors or companies moved in to rescue Bush from financial disaster. Was the $50,000 Bath invested in George W. Bush's oil partnerships Bath's money, or was he a representative of another financial interest? Who were all the investors in Bush's various oil firms? How much, if any, Saudi investment was involved in this string of failure that ultimately proved so profitable for Bush?

It's also clear, now, that reporters ought to take a serious look at another prominent Saudi whose U.S. financial interests involved Jim Bath, friend and business partner of George W. Bush: Khalid bin Mahfouz, the wealthy former head of the National Commercial Bank of Saudi Arabia.


Khalid bin Mahfouz headed the National Commercial Bank -- an institution that has been quite close to the Saudi royal family for decades -- for many years, and then, late in the 1990s, he no longer did so. Some news outlets reported that an audit had been performed, and that suspicions of money being diverted from the bank to the support of al Qaeda had led to bin Mahfouz's ouster. A few news reports contended bin Mahfouz had been placed under detention at a Saudi military facility. This year, a representative of bin Mahfouz denied these contentions.

Still, two things seem to be true: Some apparently authoritative people have directly asserted that Khalid bin Mahfouz has been involved in the funding of al Qaeda. And James R. Bath, friend to and fellow fighter pilot with a man who became president, has helped Khalid bin Mahfouz in some business ventures in the U.S.

As head of a multibillion-dollar bank, bin Mahfouz -- or, as some knew him in Houston, Sheik Khalid -- of course had many business interests. Among other things, bin Mahfouz and his bank held a significant ownership in BCCI, in which he'd acted as chief operating officer and which was widely reputed to be a nest of fraud, corruption, and money laundering for a variety of unsavory interests, including terrorists. In fact, bin Mahfouz agreed in 1993 to pay a $225 million fine to settle felony fraud charges related to the BCCI debacle.

Bin Mahfouz's name has popped up here and there in connection with alleged funding of al Qaeda and/or Osama bin Laden. The most direct such charges came in a lawsuit filed this summer on behalf of survivors of hundreds of people killed in the 9/11 attacks. Three Saudi princes, numerous Islamic financial institutions and "charities," and bin Mahfouz and the National Commercial Bank were named as defendants. Citing the U.S. Senate testimony of a CIA counterterrorism expert, the lawsuit claims "there is little doubt that a financial conduit to bin Laden was handled through the National Commercial Bank," which bin Mahfouz ran and in which he owned a controlling interest. The suit also alleges that bin Mahfouz set up charities around the world that were "linked to al Qaeda and involved in the financing of Osama bin Laden operations."

A report for the French National Assembly titled "The Economic Environment of Osama bin Laden" also lays out a maze of apparent ties between the bin Mahfouz financial empire -- which, the report says, was estimated at $2.4 billion in 2001 and said to control some 70 businesses and charities around the world -- and the finances of Osama bin Laden.

Jim Bath represented bin Mahfouz in regard to some financial investments in Texas, including, according to published reports, an airplane brokering firm and a private airport. In the late 1980s and early 1990s, bin Mahfouz also appeared to have had a significant connection with an institution that was then a central power in Houston finance, and particularly in Republican finance, Texas Commerce Bank. (For the preceding two decades, Texas Commerce had often counted as board members James Baker III, who would become George H.W. Bush's secretary of state, and Robert Mosbacher Sr., a Bush père commerce secretary and campaign fund-raiser extraordinaire.) One former TCB executive explained the relationship this way: "It was a very important relationship for us to have. The bank was profitable, well-regarded and had important ties to the [Saudi] royal family."

So, a decade or so ago, bin Mahfouz was a player in elite Republican circles of Houston, the claimed home of ex-President Bush and a city where large numbers of Saudi petrodollars were recycled regularly. Last fall, a French legislative report said that, in addition to the National Commercial Bank, the bin Mahfouz financial empire is composed of two main holding companies: the Saudi Economic Development Co. Ltd, or SEDCO, a subsidiary of which, the report claimed, has been involved with donations to Osama bin Laden; and Nimir Petroleum Ltd., an international oil exploration firm involved in numerous and massive joint ventures with large American oil companies that are among President Bush's staunchest political supporters and campaign contributors.


Yes, I know: None of the above constitutes evidence of wrongdoing, and to ask questions about Bush family connections to Saudi elites without definitive proof is to invite being labeled a conspiracy freak. Actually, though, I am far from alone in asking about the connections. It's just that, so far, questions about President Bush and Saudi notables have been raised in a sidelong, incoherent, overly polite manner; the issue is never addressed head-on and settled, one way or another.

For example, in a column this summer in the New York Times, Frank Rich broached the Saudi connection while commenting on Harken Energy. Bush has come under fire recently for failing to report a sale of Harken stock in a timely fashion more than a decade ago -- and for failing to fully explain the reporting lapse now.

Here's what Rich ultimately concluded: "What is the president hiding? Clearly the story here is not merely a hard-to-prove case of insider trading. ... Most likely it also involves the mystery first raised by The Wall Street Journal and Time in 1991. Back then, their investigative journalists ... tried to learn what various Saudi money men, some tied to the terrorist-sponsoring Bank of Credit and Commerce International, may have had to do with Harken while the then-president's son was in proximity."

Just last month, meanwhile, the staid and careful Associated Press focused on another connection among Bush-ites and the Saudis, the Carlyle Group, noting that the Bush administration was getting advice on how to deal with Iraq from Republican luminaries with business interests that might be affected by Middle East policy, among them former Bush pèreSecretary of State James Baker III.

"A Houston lawyer, Baker is senior counselor to the Carlyle Group, a Washington-based international investment group that is one of the nation's largest defense contractors and which has Saudi Arabian investors and banking ties to the ruling House of Saud," AP reporter Tom Raum wrote. "The first President Bush and former British Prime Minister John Major are also on Carlyle's payroll as advisers. The group's defense interests could possibly benefit from increased military spending."

New York Timescolumnist William Safire, a former speechwriter for President Nixon and hardly anti-Bush, has repeatedly denounced the Saudi government's failure to help investigate al Qaeda, and the U.S. government's unwillingness to confront the Saudis. In fact, Safire wrote a blistering column about one of the U.S. government's most shameful post-9/11 acts -- the decision to let 14 members of the bin Laden family flee the U.S. for Saudi Arabia in the immediate aftermath of the Sept. 11 bombings. "[T]he royal family wanted its and bin Laden's relatives yanked home, [Saudi Prince] Bandar said 'Jump,' and the U.S. replied, 'How high?'" is how Safire put it.

He was right to be aghast. Letting the bin Ladens -- people with intimate information about a serial mass murderer -- flee the jurisdiction, supposedly because they might be in danger, runs counter to the most basic tenets of criminal investigation. Safire suggested that the Bush administration rolled over for the Saudis in regard to the bin Ladens because the administration doesn't want to push Arab governments out of the anti-terror coalition.

I don't know why we rolled, and continue, apparently, to roll, when it comes to pressing the Saudis for cooperation in finding al Qaeda members, and the people who fund them. But before the next 9/11 sobfest, I hope U.S. media organizations with international reach will have remembered that good journalism is necessarily rude and have gone on to determine whether our government's Saudi softness is, or isn't, a product of global presidential cronyism.

Show Pages
 
My Voice Nation Help
0 comments
 
©2014 SF Weekly, LP, All rights reserved.
Loading...