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The 'Swiss Connection' - from
Quatraro to CIA activity in Iraq under UN:
an exclusive JUST Response report from the Dougal Watt Dossier 'Whistleblower' Robert Dougal Watt speaks out
Evidence suggesting CIA activity under UN
auspices in Iraq
The evidence presented in the attached letter
[below] is summarised as follows:
1. Mr James Woolsey, President Clinton’s
Director of CIA, 1993-95, served his country in the period 1970-91 in a series
of increasingly high-profile military, diplomatic and legal roles, e.g. as a
member of the START negotiating team, 1983-86;
2. Between 1991 and 1993, Mr Woolsey worked in “private law practice”. All the companies which he represented were NATO-based arms manufacturers – with one exception: i.e; SGS Holding SA, a Swiss-based multinational company active in providing customs collection services for developing-world countries; 3. The dossier identifies three possible routes by which CIA influence could have been exercised over a board member and/or two substantial shareholders in SGS; 4. In 1994, SGS acquired an American family-owned company, Cotecna; 5. Between 1994 and 1996, executives of both SGS and Cotecna bribed Mrs Benazir Bhutto, then Prime Minister of Pakistan, in return for customs collection contracts; 6. In 1997, the office of the Bhutto family lawyer in Switzerland was burgled, and documents incriminating SGS, Cotecna and Bhutto were stolen; these were subsequently publicised by the private investigation firm, Jules Kroll Associates; 7. Jules Kroll Associates is based in the United States, and has worked frequently for US federal authorities. It is largely staffed by ex-FBI, ex-CIA and ex-Special Forces personnel – according to its Managing Director, “We’re like a private CIA”; 8. In 1997, SGS sold Cotecna back to its original owners, the Massey family. Despite the Bhutto scandal, the company has since obtained some high-profile contacts and contracts. It employs the son of Kofi Anaan (now indirectly, via his own consultancy firm). Cotecna is active throughout the developing world, verifying beneficiary states’ compliance with IMF/World Bank loan/grant conditions – a crucial role, since unsatisfactory verification results can jeopardise future loan/grant tranches; 9. Cotecna has the UN contract for verifying Iraq’s compliance with the UN “oil for food” programme. Cotecna inspectors are based throughout Iraq, and have provided information on air strikes on Government of Iraq installations.
The attached letter, addressed to the Secretary
General of the European Court of Auditors, constitutes part of my on-going
fight with my employer to acknowledge its own corruption (nepotism, venality,
mismanagement) and for an investigation into the cover-up by the European
Anti-Fraud Office (OLAF) of the murder in 1993 of a Commission official
suspected of mafia-related corruption, Dr Antonio Quatraro. I believe
the available evidence indicates that Dr Quatraro was only a minor - and
possibly coerced - player in a wider conspiracy; and that questions should
have been put to his superior, Director General Mr [X]. In the later
case discussed in my attached letter, OLAF refused to follow up evidence which
led senior Court auditors to believe that Director-General Mr [X] had received
a bribe from SGS, in return for approving a sale to China of agricultural
produce held in intervention. When compared with the Bhutto case:
same company, same time, same alleged method.
R Dougal Watt
Auditor European Court of Auditors 23 September 2002 [ATTACHED LETTER TO:-]
Mr Michel HERVÉ
Secretary General European Court of Auditors
Subject: further to my letters of 17 June
and 20 August
This letter provides additional evidence in
support of the central hypothesis set out in my letter of 17 June; and
develops further that hypothesis, upon the basis of the additional evidence
provided in my letter of 20 August and herein. The additional evidence
presented herein primarily relates to the Swiss-registered company, “SGS”
(Sociéte Générale de Surveillance), which is briefly referred to in my
letter of 17 June. My Team Leader identified evidence which led him to
believe that a “kick-back” may have been paid by SGS to Director General
Mr [X], DG-Agriculture, in return for his authorisation of an agricultural
produce export deal between the European Commission and China. This
evidence was sufficiently convincing to merit a visit to OLAF by my Team
Leader and then-Head of Division Walter Hubl. As described in my letter
of 17 June, OLAF refused to follow-up the case; as per its normal practice
when apparent evidence exists of high-level wrong-doing in general, and
wrong-doing by Director General Mr [X] in particular.
Sociéte Générale de Surveillance Holding SA is a diversified multinational corporation registered in Geneva, with 130 affiliated companies operating in over 140 countries and a world-wide staff of 30,000. It was established in the nineteenth century as a family business, certifying goods as a neutral expert at import/export for buyers/sellers party to long-distance and international commercial transactions. The company subsequently diversified into a range of related activities – including international purchase and sale of agricultural produce on its own account – and attracted inward investment capital. A key company activity for many years has been the certification, on behalf of developing-world states, of customs dues at point of import. This business area, encouraged since the 1980s by the IMF and World Bank, emerged as a ‘private sector’ solution to the problem of local-level customs service corruption in the developing world. Management of the company passed from the founder to his son, and in 1989 to the grand-daughter of the founder; the then 42-year-old Mrs Elisabeth Salina Amorini. The latter was initially supported by Swiss executives, in the traditional Swiss commercial manner; however, she subsequently introduced non-Swiss at top management level, in an endeavour to modernise SGS. The ‘founding families’ continue to hold about a quarter of the shares in the parent company.
Prior to 1989, SGS enjoyed both steady growth and
a spotless, blue-chip reputation for business integrity. Nine years
later, Mrs Salina Amorini and her entire board would resign, following the
revelation of company involvement in serious malpractice, and consequential
severe commercial damage to the reputation of the company. The following
items document company activities and allegations.
Chakravarthi Raghavan, “South advised to reduce
dependence on PSIs [Pre-shipment inspection services – i.e., private
operation of customs procedures]”, at on-line service, www.sunsonline.org,
4.8.98:
“The PSIs and the agencies and services providing such services for a fat fee to developing countries got passing grades at a technical seminar organised by the Commonwealth Secretariat here [Geneva] last week, with participants supporting the view that developing countries should be able to reduce their dependence on such services. Participants in the seminar included capital-based senior officials from the Commonwealth countries… the World Bank and the IMF, the World Customs Organisation, the Commonwealth Secretariat [etc.]… Since about 1960, developing country governments have been using the PSI services to inspect imported goods… Since the early 1980s, under their ‘reform policies’ and conditional lending, the IMF and World Bank encouraged developing countries to use such services… The biggest of the PSI companies is the Geneva-based Sociéte Générale de Surveillance… while the use of PSIs were encouraged and promoted in the past by the IMF and the World Bank, after the WTO accord, the two institutions are now having second thoughts… There have been recent reports that far from ending corruption in developing country customs administrations, and enhancing revenue collection, some pre-shipment inspection enterprises [PSEs] themselves have been charged with corrupt practices in making payments to political masters of countries to get contracts. The relationship of Pakistan and the SGS has figured in media reports. Pakistan officially announced that it had terminated its contract with the SGS, charging it with some illicit payments to the previous government (of Benazir Bhutto), a charge which SGS has denied (but got rid of some of its employees), as also Benazir Bhutto (against whom cases have been launched). There have been other cases involving other countries and PSEs cited in media reports… employment of PSI services has ‘sometimes been reported to be associated with special arrangements for high officials’… in some concluding remarks, Amb. P N Sinyinza of Zambia, Chairman of the Group of Commonwealth Developing Countries… said… some participants… pointed out that the pre-shipment companies often obtained contracts by resorting to unethical methods and, in a few cases, the integrity of officials from these companies working in countries using these services was also in doubt. ‘This had a demoralising effect on customs and was one of the reasons for the reluctance of customs to cooperate’. There was general support at the seminar for the view that countries using PSI services should gradually be able to reduce their dependence on such services…”.
Interview in “American Shipper” with Michel
Danet, Secretary General of the World Customs Organisation, April 2002:
”Danet doesn’t believe customs administrations should outsource their operations to others. He’s easily angered by what he perceives to be some countries placing traditional customs processes, such as cargo inspection and duty collection, in the hands of private sector companies… Governments of developing countries often hire pre-inspection service providers to check cargo before it leaves exporting countries and to estimate duties to be collected once the goods arrive in their ports. Some of the biggest pre-inspection services are Service Generale de Surveillance,… [et al]… ‘Pre-inspection services are a scandal,’ Danet said, ‘Customs must remain a function of the state’”.
Financial Times; “Pakistan: Benazir Bhutto
scandal continues”, 4.6.98:
“A Swiss federal judge announced in June that he intended to indict Benazir Bhutto, the former Pakistani prime minister, and her husband Ali Zardari for money-laundering offences linked to contracts signed with Swiss companies. The same judge has indicted a senior executive of Societe Generale de Surveillance (SGS) on money-laundering charges in relation to contracts in Pakistan. The executive left the company after a corporate internal investigation into corruption linked to Ms Bhutto. The money transactions are alleged to be linked with bribes paid to the Bhuttos.”
On-line service, swissmoney.net:
“In 1998, Swiss authorities indicted Bhutto, Zardari, their Geneva lawyer, Jens Schlegelmilch, and two Swiss businessmen (who had worked for Societe Generale de Surveillance (SGS) and Cotecna, a former SGS subsidiary). All were charged with money-laundering in connection with kickbacks allegedly paid by the two companies to obtain Pakistan government contracts.”
J Gerth and Elizabeth G Olsen, “The New York
Times”, 9.1.98 – ‘Bhutto Clan Leaves Trail of Corruption in Pakistan’:
”During Bhutto’s first term, Pakistan entrusted preshipment ‘verification’ of all major imports to two Swiss companies with blue-ribbon reputations, Societe Generale de Surveillance SA and a subsidiary, Cotecna Inspection SA... In 1994, executives of the two Swiss companies wrote promising to pay ‘commissions’ totalling 9% to three offshore companies controlled by Zardari [Benazir Bhutto’s husband] and Nusrat Bhutto [her mother]. A Cotecna letter in June 1994 was direct: ‘Should we receive, within six months of today, a contract for inspection and price verification of goods imported into Pakistan,’ it read, ‘we will pay you 6% of the total amount invoiced and paid to the government of Pakistan for such a contract and during the whole duration of that contract and its renewal.’ Similar letters, dated March and June 1994, were sent by Societe Generale de Surveillance promising ‘consultancy fees’ of 6% and 3% to two other offshore companies controlled by the Bhutto family.”
Website, www.canterbury.cyberspace.org.nz,
New Zealand:
“Its [SGS’] greatest controversy has been in relation to the bribery scandal in Pakistan that led to the sentencing to five years jail of former Prime Minister Benazir Bhutto and her husband. In April 1999 she was found guilty of accepting kickbacks worth US$9m from SGS (6% of the contract), conditional on receiving a contract to improve Pakistan’s customs revenue. SGS was hired (without open contest) while she was Prime Minister. In 1997, SGS suspended Hans Fischer, a senior executive vice-president of the company, when the corruption allegations came to light. The ‘Financial Times’ quotes officials as saying that the contracts led to no substantial improvement in import tax revenues (‘Time’, 26.4.99, ‘Bhutto brought to book’, p45; ‘Financial Times’, 23.9.97, ‘Executive suspended in Bhutto probe’, p3). SGS acts as the customs authorisation authority for a number of third world countries including Guinea and Indonesia. It also does logging certification in a number of countries, for which it has come under criticism. In Gabon, it certified a French/German company in spite of the tropical forest in question being a reserve. In Cambodia, it was hired to perform pre-shipment inspections… However, SGS refused to help enforce Cambodia’s log export ban… causing a setback to the conservation measure… In another example, ‘Multinational Monitor’ (December 1993), reported that Nestle Lanka, a subsidiary of the multinational food firm, returned a 15-ton consignment of radioactive milk powder imported from Poland… The company spokesperson said the consignment had been certified by the Geneva-based Societe Generale de Surveillance as having the permissable amount of radioactive material before arriving in Colombo. [Locally in New Zealand, SGS] ran into controversy in Hawkes Bay in May 1998 when Alliance health spokesperson, Phillida Bunkle, tabled documents in Parliament that said SGS subsidiary, Medlab, was using inducements such as paying $5000 advertising account for a doctors’ group there, to send it their laboratory work…”.
On-line service, Asiaweek.com, 15.12.2000,
“Sultan of Spin” [Philippines]:
“Salvador ‘Bubby’ Dacer was PR consultant to the rich and powerful. Through his connections with influential figures in the media, he was able to elicit favorable press for his clients. A sampling of his top-tier customers:… Societe Generale de Surveillance. Dacer enabled this French customs surveillance company to maintain for many years a lucrative $100-million-a-year contract to certify shipments in and out of Manila’s international ports. He claimed that the huge fee the company was collecting was more than offset by a drop in smuggling and an increase in customs revenue…”.
Pav Jordan, Reuters News Service; “Mexico to
hire nuclear auditor within days”, 28.8.2000:
“Legislators will be making a decision in coming days between two companies… Greenpeace and the CFE [Federal Electricity Commission] have clashed repeatedly in recent months over whether to conduct an independent audit of safety conditions at Laguna Verde, a power plant in the Gulf Coast state of Veracruz which produced about 3.7% of Mexico’s nuclear power in the third quarter last year. Legislators are to decide between the Swiss company SGS… and a European group called TUV… Greenpeace Mexico Director Alejandro Calvillo contended the CFE has all but awarded the contract to SGS and called the selection process a farce… ‘The CFE never had any intention of allowing an independent audit of Laguna Verde’, Calvillo yelled…”.
WRM Bulletin 35, June 2000:
“…the Intergovernmental Panel on Climate Change (IPCC) appointed a panel to put together a Special Report on Land Use, Land Use Change, and Forestry. The report, released in May, has disappointed many activists by giving a ‘scientific’ stamp of approval to a carbon market which would generate profits for a small number of mostly Northern companies and consultants [et al]… How was it possible for the IPCC to produce such a report? …some of the authors (and the companies they work for) will benefit financially from having drawn the conclusions they drew… [e.g.] Gareth Philips… works for Societe Generale de Surveillance Forestry of Geneva, which earns money from designing, monitoring and certifying carbon forestry projects, including quantifying carbon impacts. SGS certifies the Certified Tradeable Offsets offered by Costa Rica and hopes to expand its work elsewhere in the carbon forestry field. Philips and SGS thus have a vested interest in arguing that quantification of the climate effects of carbon forestry makes sense.”
J Gerth and Elizabeth G Olsen, “The New York
Times”, 9.1.98 – ‘Bhutto Clan Leaves Trail of Corruption in Pakistan’:
Elisabeth Salina Amorini, president of Societe Generale, said the Pakistan contracts had been the subject of an internal company inquiry [which] had shown ‘a number of inadequacies which enabled certain irregularities to take place’.
Neal H Cruz, Philippines Daily Inquirer, “A Peso
4.1 billion overprice at Customs?”, 12.2.2002:
“The most important question is why the amount recommended to be paid to the Societe Generale de Surveillance (SGS) increased from 1.5 billion pesos to 5.6 billion pesos – or an apparent overprice of 4.1 billion pesos! This happened when the head of the joint Bureau of Customs-SGS team reviewing the billings of SGS… Emma Rosqueta was suddenly and inexplicably replaced by an outsider… During the time Rosqueta was out as deputy commissioner, another deputy commissioner, Julieta Manahan, was appointed as head of a reconstituted joint BOC-SGS review team. In a matter of 14 days, Manahan came up with the recommendation to pay SGS 5.6 billion pesos, 4.1 billion pesos more than that recommended by Rosqueta. There was no explanation on how the team arrived at this amount… is the overpayment to SGS one source of [2004 election campaign] funds?”
It has not been suggested that Mrs Salina Amorini
was personally aware of certain corrupt deals engaged in by executives during
the period 1989-98. Indeed, the commitment of Mrs Salina Amorini to the
integrity and long-term success of the ‘family’ company – as evident
before, during and after the period of her stewardship – suggests it is
highly unlikely that the questionable business practices of certain of her
executives resulted from any ‘boardroom policy’, declared or undeclared.
However, it is evident that the period of Mrs Salina Amorini’s stewardship
of the company was a time of some top-level turbulence, with a high turnover
of top executives and – after the event of her departure – some
allegations of incompetence and high-handedness. Regardless of the
validity of such allegations – which may reflect the prejudices of a very
traditional business community, with regard to her relative youth, gender, and
endeavours to bring in new, non-Swiss managers – what is clear is that such
top-level turbulence and distraction of top-level management provided an
opportunity for unscrupulous executives to engage in unethical practices.
However, there may be more to these unethical practices than is immediately
apparent.
Official CIA website, www.cia.gov,
“earlier career” of R James Woolsey, CIA Director, 1993-95 [quoted in
full, re-ordered chronologically]:
“Captain, US Army, 1968-70; Program Analyst, Office of the Secretary of Defense, 1968-70; National Security Council Staff, 1970; Adviser with US Delegation to the Strategic Arms Limitation Talks I (SALT I), Helsinki and Vienna, 1969-70; General Counsel, Committee on Armed Services, US Senate, 1970-73; Associate, Shea Gardner law firm, 1973-77; Under Secretary of the Navy, 1977-79; partner, Shea Gardner, 1979-89; Delegate-at-Large, US-Soviet Strategic Arms Reduction Talks (START) and Nuclear and Space Talks (NST), Geneva, 1983-86; President’s Commission on Strategic Forces, 1983-84; President’s Commission on Defense Management, 1985-86; President’s Commission on Federal Ethics Law Reform, 1989; Ambassador and US Representative, negotiations on Conventional Armed Forces in Europe, 1989-91; partner, Shea Gardner, 1991-93”.
Sam Smith, “The Club: How Washington Really
Works”, p2, from “Shadows of Hope”, Indiana University Press, 1994:
“…hired by Clinton for his administration [in 1993]. Here are some examples:… R James Woolsey, CIA Director: sat on the board of British Aerospace Inc and Martin Marietta. Represented the Swiss company Societe Generale de Surveillance, McDonnell Douglas Corporation and General Dynamics…”
By 1991-93, when he ‘represented’ SGS, Mr
Woolsey had thus spent over twenty years serving his country either directly
(military, diplomatic, legal service) or indirectly (all the companies he
worked for, or represented, are substantial NATO-based arms contractors - with
one exception). For the United States, he therefore constituted a highly
valuable human resource; and in 1993, he would be appointed Director of the
CIA. Doubtless there is an innocent official explanation for why such a
valuable human resource should precede his directorship of the CIA with
service for a Swiss company which certifies imports and exports for third
world countries, and trades in agricultural produce on its own account.
Nevertheless, the facts are these: in 1989, a
young and inexperienced Mrs Salina Amorini assumed control of SGS, and quickly
ran into difficulties imposing her authority; in the period 1991-93, the
future Director of the CIA ‘represented’ the company; and in the period
1994-96, SGS and its subsidiary Cotecna (bought over in 1994, and sold back to
its original owners in 1997) engaged in corrupt deals which ended the career
of a politician long regarded with suspicion by the United States.
J Gerth and Elizabeth G Olsen, “The New York
Times”, 9.1.98 – ‘Bhutto Clan Leaves Trail of Corruption in Pakistan’:
”…Starting from a cache of Bhutto family documents bought for $1 million from a shadowy intermediary, the investigators have detailed a pattern of secret payments by foreign companies that sought business favors during Bhutto’s two terms as Pakistan’s prime minister… a leading Swiss company hired to curb customs fraud in Pakistan paid millions of dollars between 1994 and 1996 to offshore companies controlled by Zardari [Bhutto’s husband] and Bhutto’s widowed mother, Nusrat Bhutto… the documents provided an extraordinarily detailed look at high-level corruption in Pakistan… The Pakistani investigators say their key break came last summer [1997], when an informer offered to sell documents that appeared to have been taken from the Geneva office of Jens Schlegelmilch, whom Bhutto described as the family’s attorney in Europe for more than 20 years, and as a close personal friend. Pakistani investigators have confirmed that the original asking price for the documents was $10 million. Eventually the seller travelled to London and concluded the deal for $1 million in cash. The identity of the seller remains a mystery. Schlegelmilch… declined to say anything about Zardari and Bhutto, other than that he had not sold the documents. ‘It wouldn’t be worth selling out for $1 million’, he said… When Sharif [Bhutto’s opponent] won a landslide election victory earlier this year, the corruption inquiry appeared, again, to fizzle. But a few days before the election, the caretakers hired Jules Kroll Associates, a New York investigative agency, to look for evidence of corruption abroad. The Kroll investigators put out feelers in Europe; Sharif’s aides said it was one of these that produced the offer to sell the Bhutto family documents…”
David Helvarg, “All the President’s PIs”,
MoJo Wire, at www.motherjones.com,
24.3.98:
“President Bill Clinton’s use of private investigators… has re-opened the issue of PIs in politics… The Nixon White House [used] PIs James McCord, Bernard Barker, and others along with ex-FBI and CIA agents in its bungled Watergate burglary… Among the major players in today’s world of bluechip private investigation firms: Kroll Associates… Kroll, a former aide to Senator Robert Kennedy, has tracked stolen loot for the House Foreign Affairs committee, the Federal Deposit Insurance Corporation, and foreign governments from Port-au-Prince to Moscow. With extensive international resources including 300 licensed PIs and hostage negotiating teams made up of former spooks [intelligence officers] and army Delta Force commandos, Kroll’s managing director has boasted, ‘We’re like a private CIA’. He’s not wrong.”
HM Sweeney, “The Professional Paranoid”, Feral
House, Venice, California, 1992, p24:
“Langley (home to the CIA’s headquarters in Virginia) would never directly do something that had a chance of giving them a black eye. This means the CIA will never be caught meddling in your affairs [author’s emphasis]. The trouble is, they don’t have to do it themselves. They have others to do it for them… the myriad network of CIA “proprietaries”, or fronts, - and there are literally hundreds of these documented… representing a mere fraction of the total, according to former CIA agents.”
Claire Sterling, “Crime Without Frontiers”,
Little Brown, London, 1994:
”Every secret service has its own private agenda… Whether Eastern or Western, they all use criminals to serve their ends: in the drug trade, the arms trade, the laundering business, the manipulation of international politics.”
J Gerth and Elizabeth G Olsen, “The New York
Times”, 9.1.98 – ‘Bhutto Clan Leaves Trail of Corruption in Pakistan’:
“Bhutto described the investigation as a persecution. At one point she attacked the Clinton administration, saying it had ignored her plight while deploring the treatment of Daw Aung San Suu Kyi, the Burmese opposition leader… ‘It is shocking to see that the Clinton administration talks so much about Burma, when this is happening to a woman who leads the opposition here’…”
Isobel Shaw, “Pakistan Handbook”, Moon
Publications, California, 1998, p46-7:
Zulfikar Ali Bhutto, father of Benazir, was elected Prime Minister 1970, “pursuing a policy popular with the urban masses and the rural poor… He nationalised basic industries, banks and insurance, began to democratise the civil service and initiated reform of the health and education systems. He also strengthened ties with China in an attempt to balance the threat from India”. Bhutto was deposed in 1977, and subsequently hanged, by army commander Zia, who imposed martial law: “Under martial law there was steady economic growth favouring the private sector… Zia’s regime was greatly helped by the Soviet invasion of Afghanistan in December 1979, after which the USA donated vast amounts of military equipment and aid to Pakistan…”. However in August 1988 Zia was killed in a plane crash; “Elections were held as scheduled in November, and the Pakistan People’s Party was returned to power with Benazir Bhutto as Prime Minister, but after 20 months, in August 1990, she was accused of corruption and dismissed. Elections two months later put an Islamic Democratic Alliance in power with Mian Nawaz Sharif… as Prime Minister. This government was in turn dismissed for corruption in June 1993, and Benazir Bhutto and the Pakistan People’s Party were re-elected to power the following October. In early November 1996, President Ahmed Khan Leghari dismissed Benazir Bhutto’s government, again for corruption, and new elections were held in February 1997, where Mian Nawaz Sharif was re-elected as Prime Minister.”
J King, B Mayhew and D St Vincent, “Pakistan”,
Lonely Planet, Hawthorn, Australia, 1998 edition, p23-4:
“The last Soviet troops left Afghanistan in February 1989, but the war continued, the USSR aiding Kabul and the USA arming the guerillas with the help of Pakistani military intelligence… Revelations began to surface [from 1992] that military intelligence had taken a hand in the IDA’s electoral victory and earlier PPP legislative defeats.” In 1993, upon the re-election of Bhutto, “Benazir’s second time around was a much rougher ride. US-urged crackdowns on fundamentalist groups and on drug gangs made little headway and there was increased opposition from religious parties. She ultimately managed to alienate nearly everybody… Afghanistan saw in 1996 the meteoric rise of the Taliban, a ferociously fundamentalist student militia, allegedly aided and financed by Pakistani military intelligence.”
I Akhund, “Trial and Error: The Advent and
Eclipse of Benazir Bhutto”, Oxford University Press, 2000 (memoir of
Bhutto’s former Adviser on National Security and Foreign Affairs):
p-ix; “The legacy left by her father, Zulfikar Bhutto, was a double-edged legacy – popularity with the masses and distrust and suspicion among the establishment and key foreign powers like the USA and Britain… [p256] The American reaction to Benazir was a mixture of fascination and, especially in official circles, of wariness… they had hoped that the 1988 elections would lead to a Junejo [i.e., military-endorsed] government… When I spoke to an editor of ‘The Wall Street Journal’ about a critical article concerning the PPP government, she said bluntly, ‘Why does your government expect sympathetic treatment from American newspapers given that Benazir is known to be anti-American?’… American officials had worked closely for more than a decade with Zia and admired and appreciated him… When [President] Ghulam Ishaq Khan dismissed the PPP government in 1990, there was no great stir in Washington.” [Akhund does not confirm the portrayal of the Harvard-educated Bhutto as, ‘anti-American’.]
B Bhutto, “Daughter of the East”, Mandarin,
1988, p204-5:
“I suspected that the CIA was deeply involved in Pakistan’s role in the war in Afghanistan. But I didn’t realise the extent of the CIA’s stake in maintaining Zia and his regime until years later when I read ‘Veil: The Secret Wars of the CIA’ by American journalist Bob Woodward…”. [This is the only reference to the CIA in Bhutto’s autobiography.]
The evidence is therefore consistent with the
conclusion that Bhutto was the victim of a CIA-inspired “sting”; set up
using the blue-chip, ‘neutral’, Swiss-registered SGS as the vehicle.
The extended hypothesis therefore is: the corrupt offer by SGS executives was
inspired by the CIA, and deliberately designed to obtain documentary evidence
of Bhutto’s corruption; the removal of such documentation from the safe of
Bhutto’s lawyer was an undercover CIA operation, performed with knowledge
aforehand of the likely contents of the safe; and the release into the public
domain of evidence of Bhutto’s corruption was designed by the CIA to
discredit her internationally, and thus terminate her domestic political
career in Pakistan.
Mrs Bhutto’s first term as Prime Minister,
1988-90, was cut short by dismissal following allegations of corruption.
This did not end her political career in Pakistan. As the memoir of her
aide Mr Akhund makes clear, corruption is endemic in Pakistan at all levels of
society, and the electorate may be tolerant of a certain level of abuse;
provided the abuse is not too great, and political leadership is effective.
In order to terminate Mrs Bhutto’s career within Pakistan, it would
therefore be necessary to undermine her international credibility, in the eyes
of the Pakistani political elite and the populace.
The interests of the United States are served in
two ways by the political demise of the Bhutto dynasty. Firstly, Mrs
Bhutto is not a soldier. As Akhund observes [p255], “the main channel
for American influence and intervention in Pakistan has always been the
army”. During the period of Zia’s rule, the US found it could
work effectively with the Pakistani military to secure its own strategic
interests (at that time, to evict the Soviet Union from Afghanistan).
During the 1980s, Islamabad housed the largest CIA office in the world.
Government by the military, or military-sponsored government, therefore
maximises the strategic influence of the United States over Pakistan.
Secondly, as the foremost representative of a political dynasty with
widespread and enduring popular support in Pakistan, a Benazir Bhutto returned
to power would be a much more substantial ‘diplomatic partner’ for the
United States than would be any general, vulnerable to US machinations within
the military. Indeed, a return to power of Benazir Bhutto would bring
with it the possibility, if not the likelihood, of a third Bhutto generation
dominating Pakistani politics; the US would then find itself dealing with a
domestically-secure, independent-minded leadership in Pakistan.
By contrast, securing Pakistan within the US orbit
represents a major foreign policy success for the United States.
Pakistan since independence has had close links with China; and it has immense
strategic significance, owing to its location – bordering Afghanistan
(crucial to future oil exports from the Central Asian republics of the former
USSR), Iran (sworn enemy of the United States) and India (formerly close to
the Soviet Union, historically a key democratic state in the non-aligned
world, and now something of a loose cannon in the US-led ‘New World
Order’). Endeavouring to secure the demise of the Bhutto dynasty,
would therefore surely represent an appropriately worthwhile deployment of
such a valuable US ‘asset’ as the next Director of the CIA.
In particular, the role in the Bhutto scandal of
the company Cotecna SA, subsidiary of SGS, merits close examination in this
context. From its establishment in Geneva in 1975 until 1994,
Swiss-registered Cotecna was an independent operator; and in 1997 it was sold
back by SGS to its original owners (see SGS website). The press
references to Cotecna executive “Hans Fischer”, and its Geneva
headquarters, may give the impression that this is/was a company of Swiss
nationals. In fact, Mr Fischer seems to be an American citizen (see www.tradeport.org;
in 1999, “The Colombian Civil Aeronautics Department completed a master
development plan for the Cali airport with the assistance of Hans Fischer Co.,
a US consultant…”). Cotecna is owned by an apparently American
family, Massey, and seems to employ numerous Americans. Mr Robert
Massey, Vice-President, was also indicted by the Swiss magistrate, at the same
time as Mr Fischer, et al (i.e., Procedure Nr.P/11105/1997, www.lib.virginia.edu,
Dawn Wire Service). Mr Robert Massey remains with Cotecna, at the same
level. And despite the damage to its reputation caused by the Bhutto
scandal, the again-independent Cotecna has secured some remarkably
high-profile contacts and contracts:
Website, UN Wire: An Independent News Briefing
About the UN:
“The son of UN Secretary-General Kofi Annan works for the company that won a UN contract worth £6 million, the London ‘Telegraph’ reported yesterday. Kojo Annan was until 13 months ago a senior staff member at the Swiss company Cotecna Inspection, which last week won the contract to monitor the UN oil-for-food program in Iraq. He is now ‘a partner in his own consultancy company, which Cotecna employs’. UN spokesperson John Mills said the UN contracts committee had not been aware of the connection and that Cotecna’s bid was ‘the lowest by a significant margin’. Kojo Annan insisted his links with Cotecna had not helped it win the contract, saying: ‘I would never play any role in anything that involves the United Nations, for obvious reasons.’ Cotecna won a similar contract in 1992, before Kofi Annan was named UN Secretary-General and before Kojo Annan came to work for the firm.”
The company currently has staff in Iraq:
“…[UN] Approved contracts are… filled by the supplier and shipped to
Iraq, where they are inspected on arrival by an agency called Cotecna.
When the agency certifies the goods have arrived, the supplier is paid from
the oil cash in the Bank of New York” (website, www.counterpunch.org).
A Cambridge University archive of military strikes on Iraq, at www.cam.ac.uk,
records the following; “14.3.99, twenty kilometres north of Mosul two
Cotecna inspectors observed two aircraft carrying out bombing on a possible
Government of Iraq military installation located 2/3 kilometres east of their
location.”
The activities of the company are certainly
diverse; in July 2002, Ms Lina Paola Cifuentes (“Cotecna Inspection
SA/Universidad del Rosario, Columbia”) presented a paper at a conference on,
“The Americas after September 11: Hemispheric Integration and Human
Security” (see www.robarts.yorku.ca).
Cotecna is also active in the developing world on
behalf of the ‘Bretton Woods Institutions’ (i.e., IMF, World Bank, etc.,
which provide development finance) in verifying beneficiary states’
compliance with lenders’ conditions (e.g., loan/grant tranches are often
conditional upon beneficiary states keeping public expenditure and inflation
within pre-set parameters). The verification task is crucial to the
stability of developing world states, since unfavourable verification results
can lead to delay or annulment of finance essential to beneficiary state
stability. Furthermore, a substantial number of EC-administered European
Development Fund assistance programmes – in particular, the widely-applied
‘structural adjustment’ measures – demand that beneficiaries satisfy BWI
verification procedures, before grants are payable. Verification in
practice involves regular, if not continuous, verifier presence in beneficiary
states; and full access to documents, systems and the most senior
administrative and political figures in those states. It is difficult to
over-emphasise the importance, and the sensitivity, of the BWI verifiers’
role for many of these states.
From what the intelligence community terms,
“open sources”, it is possible to identify at least three possible routes
by which the CIA could secure the aid of SGS/Cotecna in incriminating Benazir
Bhutto: via Mr Jaime Carvajal Urquijo, board member of SGS Holding SA; via
Umberto and/or Giovanni Agnelli, substantial indirect shareholders in SGS;
and/or via Baron August von Finck, substantial direct shareholder in SGS.
Mr Jaime Carvajal Urquijo is one of Spain’s most
important industrialists. He is President of Ford Spain, Iberfomento,
Dresdener Kleinwort Benson Espana, Ericsson Espana, et al. Mr Carvajal
Urquijo is also Chairman of the US-Spain Council; “a bilateral organisation
whose membership includes high ranking government officials and the leading
corporations in Spain (e.g., Banco Santander, Telifonica, Spanair, Freixenet,
Lladro, etc.) and the US (e.g., Boeing, Bankers Trust, Microsoft, Lucent,
etc.” (website, www.becker-poliakoff.com,
legal counsel of US-Spain Council). On the US side, some members of the
Council also hold membership of the Council on Foreign Relations (the
highest-level foreign policy ‘think tank’/association of senior
politicians/pressure group in the US, of which Mr Woolsey is an active member
– see www.cfr.org).
For example, US-Spain Council Vice-Chair Eusebio
Mujal Leon, CFR, is an American academic. Mr Mujal Leon of Georgetown
University has also worked in the Center of International Studies, Princeton,
and the Woodrow Wilson International Center for Scholars (www.data.georgetown.edu).
Georgetown University is so close to the intelligence community that in 1995
it even had an official CIA “officer in residence” (www.intellit.muskingum.edu).
At Princeton, in February 2001 the Center of International Studies
co-sponsored a conference on Cold War Intelligence, with the CIA’s Center
for the Study of Intelligence; indeed, “throughout the 1960s, and possibly
longer, at least five Princeton professors worked secretly as high-level
consultants for the CIA, according to previously undisclosed documents
contained in the personal papers of former CIA director, Allen W Dulles” (www.cia-on-campus.org;
‘Dulles Papers Reveal CIA Consulting Network’). James Billington,
Director of the Woodrow Wilson International Center for Scholars, 1973-88, was
also a CIA asset, beginning his career as an assistant of Dulles, and ending
his career as an adviser to Ronald Reagan (www.princeton.edu)
.
Mr Carvajal Urquijo is also a member of the
Steering Committee of the Bilderberg Group, 1989-98: a group of top
politicians, international bankers and multinational industrialists from the
US and Europe, which meets annually for a three day period to discuss
strategic concerns of mutual interest. He is also a member of the
Trilateral Commission; dubbed ‘son of Bilderberg’, this
similarly-constituted group also includes representatives from Japan.
The latter organisations are extremely secretive, and succeed in securing
minimal publicity for their activities, despite the high profiles of their
members – e.g., prime ministers, heads of state, and top corporate
executives. The media is discouraged from reporting the occurrence of
such meetings, and the content of discussion is never revealed. The
Bilderberg Group may also be considered to have played a crucial role in the
formation of the European Community. Since Bilderberg and the Trilateral
Commission are so little known, yet so important, two lengthy background
documents are quoted below.
M Peters, Leeds Metropolitan University, “The
Bilderberg Group and the project of European unification”:
“The so-called ‘Bilderberg Group’… is one among a number of little-publicised institutions which have played an important role… co-ordinating strategic policy at an international level. Other such bodies on this trans-national scale include the Council on Foreign Relations (CFR) in the USA, with its sister UK organisation, the Royal Institute of International Affairs (RIIA), and the Trilateral Commission (which itself grew out of Bilderberg meetings and has been essentially a more globalist version of the latter, since it incorporates Japanese representatives)…”
“The official version of the history of the
creation of the Atlantic system reads like the ‘lives and teachings of the
saints’. In these school textbook accounts, each of the pillars of the
post-war world order has its great founding father [e.g.] the European
Community is the work of Jean Monnet (with his faithful disciple, Schuman).
These are not just myths; they are, in intelligence parlance, more like
‘cover stories’… To trace the origin of the movement for European
unification, however, requires that we go back to May 8 1946 and an address
given at Chatham House [home of the RIIA] by a Pole named Joseph Retinger.
In this talk he outlined a plan for a federal Europe in which the states would
relinquish part of their sovereignty. At the time, Retinger was
secretary general of the Independent League for European Co-operation
(ILEC)… Shortly after this speech, Retinger was invited by the US
Ambassador, Averall Harriman, to the USA to secure American support for ILEC.
[From Retinger’s biography:] ‘I found in America a unanimous approval for
our ideas among financiers, businessmen and politicians. Mr Leffingwell,
senior partner in J P Morgan’s [bank], Nelson and David Rockefeller, Alfred
Sloan [chair of General Motors], Charles Hook, President of the American
Rolling Mills Company, Sir William Wiseman, [British Secret Intelligence
Service and] partner in Kuhn Loeb [New York investment bank], George Franklin
and especially my old friend Adolf Berle Jr [CFR], were all in favour, and
Berle agreed to lead the American section [of ILEC]. John Foster Dulles
also agreed to help.’ Thus was formed the European Movement, which
received substantial contributions from US government secret funds as well as
private sources via the American Committee for a United Europe (ACUE).
The names mentioned above are significant in the present context: Leffingwell
preceded John McCloy and David Rockefeller as CFR chair, 1946-53, and had been
a CFR director since 1927, while Franklin was executive director of the CFR
1953-7 and was later a Trilateral Commission Co-ordinator; also, incidentally,
an in-law of the Rockefellers… As for ACUE, its chair was William Donovan
(who ran OSS – forerunner of the CIA during the war) and its vice-chair was
Allen Dulles (who was a leading figure in the CFR War and Peace Study Group
during the early part of the war, and later director of the CIA); and it was
run in Europe by another CIA executive, Thomas W Braden…”
“‘Bilderberg’ takes its name from the hotel,
belonging to Prince Bernhard of the Netherlands [a German by birth, and during
the war an officer in the SS], near Arnhem, where in 1954 the first meeting
took place of what has ever since been called the Bilderberg Group… Prince
Bernhard [had] set off for the USA in 1952 to visit his old friend Walter
Bedell Smith, director of the newly-formed CIA. Smith put the
organisation of the American end into the hands of Charles D Jackson (special
assistant for psychological warfare to the US President), who appointed John S
Coleman, who in turn briefly became US chair of Bilderberg. Charles
Jackson… ran the CIA-financed Radio Free Europe in Germany… the first
conference… consisted of the Belgian and Italian prime ministers, Paul van
Zeeland and Alcide De Gasperi, from France both the right wing prime minister
Antoine Pinay and the socialist leader Guy Mollet; diplomats like Pietro
Quaroni of Italy and Panavotis Pipinelis of Greece; top German corporate
lawyer Rudolf Miller and the industrialist Otto Wolff von Amerongen and the
Danish foreign minister Ole Bjorn Kraft; and from England came Denis Healey
and Hugh Gaitskell from the Labour Party, Robert Boothby from the Conservative
Party, Sir Oliver Franks from the British state, and Sir Colin Gubbins, who
had headed the Special Operations Executive during the war. On the
American side, the members of the first Bilderberg assembly included: George
Ball, who was head of Lehman Brothers, a former high State Department
official, where he was architect of the policy of Atlantic Partnership, and
later member of the Trilateral Commission. Ball was closely associated
with Jean Monnet, owing to his work as the legal counsel for the ECSC and the
French delegation to the Schuman Plan negotiations. David Rockefeller
was the key American member of Bilderberg… head of the Chase Manhattan Bank,
member of the CFR, member of the Business Council, the US council of the
International Chamber of Commerce, and… founder of the Trilateral
Commission. Dean Rusk: US Secretary of State 1961-69, earlier President
of the Rockefeller Foundation 1952-60, having succeeded John Foster Dulles,
himself an earlier Secretary of State and – this is not at all a coincidence
– a close personal friend of Jean Monnet whom he had first met at Versailles
in 1918 as well as of Dean Acheson, Truman’s Secretary of State and the true
author of the Marshall Plan… The possible significance of this group may be
gleaned from the status of its participants… virtually all the European
institutions we take for granted today, or treat as if they ‘emerged’ as a
matter of course, from the ECSC, EEC and Euratom down to the present European
Union, were conceived, designed and brought into existence through the agency
of the people involved in Bilderberg [‘The Treaty of Rome, which brought the
Common Market into being, was nurtured at Bilderberg meetings’ – George
McGhee, former US ambassador to West Germany]...”
“Monnet himself, who mentions neither Retinger
nor Bilderberg in his memoirs, cannot have been unaware of the activities of
these crucial constituents of his programme. However much he may be
portrayed in the hagiographies as a far-sighted idealist, Monnet was, first
and foremost, an international financier, with an extensive network of
connections on both sides of the Atlantic… his network centred around the
New York investment banks Lazard Freres (run by Andre Meyer who was also on
the board of Rockefeller’s Chase International Bank) and Goldman Sachs,
which, after the war gravitated into the Rockefeller orbit. Monnet’s
right-hand man, Pierre Uri, was European director of Lehman Brothers; and
Robert Marjolin, one of Monnet’s assistants in the first modernisation plan,
subsequently joined the board of Chase Manhattan Bank. Uri and Marjolin
were also active in Bilderberg…”
“I will draw attention very briefly to the role
played by secretive and unaccountable organisations of members of the European
economic and political elites. One little-reported group, for example,
which seems to wield immense influence is the European Round Table of
Industrialists (ERT)… [e.g.] Jacques Delors… had spent the autumn of 1984
searching for a ‘Big Idea’ to re-launch the EEC. That Autumn, in
Brussels, Delors had met a group of officials and industrialists brought
together by Max Kohnstamm, who had been Monnet’s chief assistant.
After Monnet’s death in 1979, Kohnstamm had become one of the guardians of
the sacred flame of federalism. The Kohnstamm group advised Delors to
make the internal market his priority and to lay down a timetable of eight
years (the life of two Commissions) for its achievement… At the same time
Wisse Dekker, the chairman of Philips, made several speeches calling for the
EEC to remove its internal barriers by 1990… This ERT comprises the
chairs/CEOs of the leading European multinational corporations and it… is an
extremely powerful body… its reports feed directly into the European
Commission decision making process. One of its first reports, for
example, entitled ‘Missing Links’, urged the immediate construction of a
series of large-scale transport projects, including the Channel Tunnel.
As well as Dekker of Philips, other leading figures in the ERT are Agnelli of
Fiat, Gyllenhammer of Volvo, and Denys Henderson of ICI…”
“[Bilderberg’s] almost completely secretive
character is neither incidental nor superficial but integral to its
functioning… The lengths to which the organisers go are quite astonishing.
An entire hotel is taken over in advance and a whole caravanserai, including
special catering staff and armed security guards, descend on the site several
days in advance… On one of the few occasions when Bilderberg meetings were
mentioned in a major British newspaper, the outcome was quite interesting.
In the ‘Lombard’ column of the Financial Times, C Gordon Tether wrote on
May 6 1975: ‘If the Bilderberg Group is not a conspiracy of some sort, it is
conducted in such a way as to give a remarkably good imitation of one.’
In a column written almost a year later, Tether wrote: ‘The Bilderbergers
have always insisted on clothing their comings and goings in the closest
secrecy… the total ban on the reporting of what went on has remained in
force… Any conspiratologist who has the Bilderbergers in his sights will
proceed to ask why it is that, if there is so little to hide, so much effort
is devoted to hiding it’. This column never appeared; it was censored
by the Financial Times editor Mark Fisher (himself a member of the Trilateral
Commission), and Tether was finally dismissed from the ‘Lombard’ column in
August 1976…” [Bilderberg has subsequently been discussed on a
number of occasions in the European press.]
Armen Victorian, “The Bilderberg Group – The
Invisible Power House”, in “Nexus Magazine”, Volume 3 No 1, 1995/96:
“There are usually 115 participants in each annual meeting. Eighty are from Western Europe and the remainder from North America. From this mixture, one third are from government and politics, and the remaining two thirds from industry, finance, education and communications… Chair of the Commission Romano Prodi was a Steering Committee Member of the Bilderberg Group in the 1980s… Wim Duisenberg was the then Treasurer. What is noticeable is that Prodi has limited the declarations of his Commissioners to ten years, something not done in the previous Commission, and so has allowed himself not to declare this former highly sensitive role… Mario Monti has now formally declared that he was a former Steering Committee member of Bilderberg (’83-’93)… he said in an European Parliamentary answer that he was a member of the Executive committee of the Trilateral Commission… Erikki Liikanen attended Bilderberg last June in Sintra, Portugal… Frits Bolkenstein is to remain a member of the Royal Institute of International Affairs… He does not mention his participation in the Bilderberg Group in Toronto in 1996… Pedro Solbes Mira declares his membership of the Trilateral Commission since 1996, but fails to mention that he is on the steering committee… or his participation in Bilderberg last year… Gunther Verheugen doesn’t mention his participation in Bilderberg in 1995 in Burgenstock, Switzerland… Chris Patten says that while he was Governor of Hong Kong he had many memberships of charitable organisations, but we cannot regard his membership of the Trilateral Commission in this way (he is on their official list from March ’98), and he doesn’t list it as a current membership either… Antonio Vitorino does not declare that he attended Bilderberg in 1996…”. Agriculture Commissioner Franz Fischler attended the 2001 meeting of Bilderberg.
Bilderberg, the Trilateral Commission, the Council
on Foreign Affairs, the Royal Institute of International Affairs – none
wields formal power: but the stratospheric level of their political,
commercial and financial membership; the secrecy of their deliberations; and
the informality of their gatherings – all suggest that the influence of
these groups in shaping subsequent developments is considerable. Such
groups permit the elites of the United States, Europe and Japan – “the
North”, in geopolitical terms – to converse and debate issues of mutual
concern. The influence of such groups may be observed from the
subsequent careers of those attending meetings: Arkansas Governor Bill
Clinton received his party’s nomination for the Presidency shortly after he
attended Bilderberg; and Pat Cox was nominated for the Presidency of the
European Parliament after he attended Bilderberg. None of this is to
suggest that the ‘Bilderberg Group’ or ‘Trilateral Commission’ are in
any way improper; or – with particular reference to the issue at hand –
that group decisions were taken to topple Mrs Bhutto. It is simply to
observe that fora exist for the covert and confidential transmission of a
request from the United States, directly to a figure senior in both
Bilderberg, and the company, SGS: Mr Jaime Carvajal Urquijo.
The second possible route for such a request
involves a substantial, and in recent years growing, shareholder in SGS
Holding SA; the French-registered company, Worms & Cie. This company
is associated with the famous French banking family, Worms. However, the
founding family currently holds less than a quarter of the shares in the
company. More than half the shares in Worms & Cie are held by
‘Groupe Ifil’ – a company which operates as the investment vehicle for
the Italian industrial/finance/media family, Agnelli (see website, “This Is
Money”, 22.5.00: ”Worms has shares listed in Paris but is controlled
by the Agnelli family, which controls the FIAT group”; and website, www.standard.net,
“Ifil… is an investment vehicle for the wealthy Agnellis… [who own]
about 30% of the automaker [Fiat]”. Umberto Agnelli is a member of the
Board of Directors of Worms & Cie (website, ‘Business Wire’, 22.5.00).
Umberto Agnelli has regularly attended the
Bilderberg Group meetings since 1991, and Giovanni Agnelli has also attended
frequently in recent years. Umberto Agnelli is also a member of the
Trilateral Commission. The family has identified opportunity in
servicing what President Eisenhower dubbed the American “military-industrial
complex”, and this interest has been recognised (see www.kcl.ac.uk;
King’s College London, Liddell Hart Centre for Military Archives, Reports on
Missile Defence, archive listing: “MENAUL: 3/667-8, 21.11.85 – Speech by G
Agnelli, Chairman of Fiat, Brussels, on the economic opportunities offered by
the Strategic Defense Initiative. MENAUL: 3/668, 3.12.85 – Lt Gen
Daniel O Graham to the Hon Jesse Helms US Senate. Covering letter
originally attached [to copy of Mr Agnelli’s speech]”). See also, CM
Santoro, “Diffidence and Ambition: The Intellectual Sources of US Foreign
Policy”, Westview, San Francisco, 1992 – one in a series published by the
Trilateral Commission – which features within the dedication, “This
publication was made possible through… a Giovanni Agnelli Foundation
program”.
In the midst of the scandal during the early 1990s in Italy of tangentopoli (literally, “Kick-back City”), Gianni Agnelli admitted to paying bribes to secure valuable contracts. (See also Pino Nicotri, “FIAT: Fabbrica Italiana Automobili e Tangenti”, Kaos Press, which identifies a Swiss dimension to Agnelli corruption.) Further information on the tangentopoli phenonemon is given below. V Bufacchi and S Burgess, “Italy since 1989:
Events and Interpretations”, revised edition, Palgrave, New York, 2001, p84:
ed S Grundle and S Parker, “The New Italian
Republic: From the Fall of the Berlin Wall to Berlusconi”, Routledge,
London, 1996, p131 and 229:
“His [Berlusconi’s] first fortune was made in construction around Milan. Such a business is exquisitely political since it depends on building permits and zonal decisions, as well as on borrowing money from the state-owned banks and selling the completed buildings to government organisations… the politicised economy… thrived in the 1970s and 1980s. Berlusconi’s membership of the subversive P2 freemasons’ lodge fitted this pattern, because the P2, which combined rather vague plans for a right-wing coup with very precise projects for enriching its members, was an organic expression of the manipulation of the market by political power.” “An observation that has frequently emerged in the course of this research is that political corruption requires special outlets wherein to mediate interests, or organise business, other than the institutional ones... In effect, the system of corruption seems to be interwoven with the creation – or the solidification – of secret associations, where decisions are taken far from prying eyes. It seems to be more than a coincidence that in our research the ‘corrupt’ administrators showed a high propensity to participate in masonic lodges… Freemasonry’s greater than average concentration of power… provoked complaints of degeneracy even from within the associations themselves. In the secrecy of some lodges, the ‘corrupt’ and the ‘corrupters’ could meet and organise their deals… In conclusion it should be noted that in the long run, the system of corruption has also shown its own inherent weakness. Its expansion dynamics in fact imply a constant waste of both material resources and legitimacy.”
Patrick Richter, “Italian foreign minister
resigns”, www.wsws.org, 19.1.02:
“Legal proceedings against Berlusconi threaten to result in a guilty verdict with a possible custodial sentence… In the present corruption trial being held in Milan, Berlusconi stands accused of having bribed a judge at the end of the 1980s.. Berlusconi is utilising the weight of the government machinery to do everything to halt the legal proceedings. Amongst other things, he is accused… of intervening directly in the proceedings… Milan State Attorney Francesco Saverio Borelli has accused the government of wanting to hobble the independence of the judiciary, rejecting claims that it is ‘pure coincidence’ that the bodyguards afforded to the state attorneys in the Berlusconi case have been withdrawn. Borelli was Chief State Attorney in 1992, when corruption proceedings against various politicians and business figures were launched. The work of the pool of judges involved in the ‘mani pulite’ (‘clean hands’) led to the fall of the government at that time. Berlusconi… is systematically trying to eliminate any democratic control of his mafia-like scheming. Meanwhile, the leading politicians in Europe’s capitals close their eyes…”.
ed. P Agee and L Wolf, “Dirty Work: The CIA in
Western Europe”, Zed Press, London, 1978; P Agee [ex-CIA agent], chapter
“The CIA in Switzerland”, p211 and p214:
“An analysis of available documents… has revealed at least one CIA officer in Zurich, about nine in Bern, and about twenty in Geneva. …One…area of CIA operations in Switzerland concerns third countries such as France and Italy. In January 1976 it was revealed in Washington that during the previous month President Ford had approved the CIA’s spending of six million dollars between then and the next Italian elections – then thought to occur most probably in 1977. Because of the sensitivity of political intervention in a sister NATO country, these operations may well be staged from a neighbouring country such as Switzerland, particularly the meeting with agents and the passing of money… The CIA’s support for Italian neo-fascists, as revealed in the report of the House of Representatives Select Committee on Intelligence, would probably also require meetings and passage of money outside of Italy, most probably in Switzerland.”
It may be remembered, from my letter of 17 June,
that the Swiss-registered company SGS had won a substantial contract from the
Italian government, for the administration/control of FEOGA-Guarantee
expenditure in Italy. It may also be assumed: in view of the
Italian judiciary’s robust defence of its autonomy; in view of the political
damage which resulted from the revelation of domestic corruption in the early
1990s; and in view of the political parties’ continuing need for finance –
that a risk is present of any more recent ‘kick-backs’ being channelled
via Switzerland; perhaps ideally, via a blue-chip Swiss company.
The third potential route for CIA involvement in the SGS-Bhutto corruption scandal concerns a substantial direct shareholder, Baron August von Finck; according to Forbes, one of the richest men in the world (No. 68, net worth c.$5 billion), with substantial other interests in the US (e.g., vineyards, Movenpick hotel chain, Homestake gold mining company, etc.) and Europe (e.g., Lowenbrau brewery). An ancestor of the current baron fought as a general in the army of Frederick the Great; around 1900 the family moved into finance and insurance, establishing the major private bank, Merck, Finck & Co. Von Finck was already a major and influential SGS shareholder in 1989, when management of SGS passed to the founder’s grand-daughter, Mrs Elisabeth Salina Amorini, then aged 42.
From website, www.adele.at:
“In 1938 [Jewish anti-fascist] Ferdinand Bloch-Bauer fled Austria and his entire estate, including numerous… artworks…, was liquidated to pay illegal taxes levied by the nazis… many of the works going to top nazi officials. Waldmuller’s [4 painting titles] were purchased by August Von Finck [father of the current baron], director of the bank Merk, Finck & Co in Munich, as a present for Hermann Goering.”
Website, US Holocaust Memorial Museum, www.ushmm.org,
archive descriptions:
“Miscellaneous Records – Shuster Files (Entry UD27)(RG165)[The War Department and Army Records] – This series consists of post-World War II interrogation reports of German military officers and other German leaders. Boxes 1-9 location: 390/35/15/06” – lists 23 persons – e.g. Hermann Goering; and Hjalmar Schacht, Hitler’s personal banker and supporter – along with the subject of interrogation. The list includes, “August von Finck (Banking firm of Merck, Finck and Co, Munich and Berlin)[subject of interrogation], Private Banks”. The Western Allies sought to prosecute a representative of each military, administrative, and economic sector which had actively cooperated in the functioning of the Nazi regime. (The German economy developed in the 19th and first half of the 20th centuries without a substantial stock exchange. Industrialists financed investment primarily from the banking sector, giving banks a major control over industry – most companies featured a banker on the board. The German banks – which also actively participated in the looting of occupied Europe – therefore constituted an essential part of Hitler’s war machine.) Five of the 23 in the USHMM list subsequently featured in the main Nuremberg trial; others featured in other post-war trials. Also in USHMM: “Records of the Office of the Financial Adviser and the Financial Division (RG260)[Theaters of Operations Records] – Records Regarding Investigations – [sub-title] Records Regarding Bank Investigations 1945-47: Includes numerous reports on banks, Nazi gold, the use of Swiss banks, links between German and Swiss banks, and the special account used to handle Swiss trade by the Reichsbank. Boxes 44-55, location 390/46/1/04. [Sub-title] Records Relating to Interrogations of Nazi Financiers 1946-47: Box 56 -… Exhibits to Finck Report 1-53… Box 57 - Interrogations of August von Finck, 22, 23, 25 September 1947…”. I have been unable to identify evidence of any subsequent prosecution of August von Finck.
Magazine ‘Euromoney’, article “Europe’s
most powerful families”, May 1994:
“August and Wilhelm von Finck owe their fortune to their father August, a leading post-war industrialist and banker. August senior dominated private bank Merck, Finck & Co and all the family’s huge industrial and property assets…”
“Forbes” magazine, 22.7.91:
Observes Flick family is doing well, given that Flick snr., “drew seven years in Nuremberg”. Regarding the family von Finck, no corresponding mention is made.
The following standard historical works (in
English) were reviewed: T Bower, “A blind eye to murder: Britain, America
and the purging of Nazi Germany – a pledge betrayed”, 1997;
FM Buscher, “The US war crimes trial programme in Germany, 1946-55”, 1989; T Bower, “Blood money: the Swiss, the Nazis and the looted billions”, 1997; R Overy, “Interrogations: the Nazi elite in Allied hands, 1945”, 2001; J and S Pool, “Who financed Hitler? The secret funding of Hitler’s rise to power, 1919-33”, 1979; T Bower, “The paperclip conspiracy: the battle for the spoils and secrets of Nazi Germany”, 1987; and C Fitzgibbon, “Denazification”, 1969. None of these texts mention or make reference to either August von Finck, or the role of Merck, Finck and Co.. There is no mention of August von Finck in the “Neue Deutsche Biographie”, Duncker and Humblot, Berlin, 20 volumes, 1952-2000, the relevant volume of which was published in 1960; nor of the family in “Who’s Who” of 2002.
C Simpson, “Blowback: America’s
recruitment of Nazis and its effect on the Cold War”, London, 1988, p246 and
p248:
”Nazis were never employed or protected for their own sake, but only as a means to achieve some other goal that was presumably in the interests of US national security… Using Nazis (or the Mafia…) was never an aberration in the minds of most intelligence operatives. This is simply the way clandestine wars are fought…”. Given all of the above, and with specific
regard to Cotecna; there is a clear risk that the integrity of the BWI-EC
loan/grant condition-verification procedure has been compromised.
In terms of realpolitik, if the above is the case,
it is perhaps unsurprising. Much of the Cold War was conducted in the
developing world. The post-colonial role of international finance has
been of immense significance to the developing world, both as a ‘carrot’
(reward to local political elites for actions deemed beneficial to
‘Western’ interests) and as a ‘stick’ (withdrawal of finance essential
to sustaining local political elites, in retaliation for actions detrimental
to ‘Western’ interests). That the United States might seek covert
involvement in the award of international funding to developing countries
would be entirely consistent with how the US is known to conduct certain
aspects of its foreign policy. Further: given the presence in Bilderberg
et al of the heads of the Bretton Woods Institutions; of US diplomats,
strategists and financiers; of European Commissioners and national
politicians, bankers and businessmen; given Mr Annan’s family relationship
with Cotecna; and given Bilderberg’s close association with the
‘intelligence community’ – it is conceivable that the presence of covert
US activity in the BWI-EC verification process is known, understood and
approved by the top managers of these bodies. The above would also
explain the United States’ relative miserliness, in terms of the level of
development assistance which it has provided throughout the Cold War and to
date: why should the United States spend its own money, when it has covert
control over European and other international assistance efforts? This
may be to push a ‘conspiracy theory’ too far. But to paraphrase a
question put to Mr Akhund, by a CIA chief querying Pakistan’s denial of its
then-clandestine nuclear programme: “It looks like a duck, it quacks
like a duck; but you expect us to believe it isn’t a duck?”.
At this point, I should like to re-examine the
account of US ‘hacking’ into the European Institutions computer network,
as reported in The Sunday Times of 4 August 1996; “CIA spies on Europe?
American spies hack into Euro computers to steal trade secrets” (article
featuring in my previous letter). This story is, literally, incredible.
The Americans invented the internet. The
Americans developed it, pioneered its use, and know it, and the capabilities
of associated computer networks, intimately. The US government has
invested substantial resources in developing strategies and tactics to counter
any military or terrorist attack on the internet, which is now essential to US
commerce and society; a by-product of this effort, is a thorough knowledge of
how ‘foreign’ systems work, and their vulnerabilities.
If the US did wish to engage in such a
diplomatically high-risk activity as stealing trade negotiation secrets from
the European institutions’ computer network, then it is almost certain that
the Americans possess the capability to do so without leaving any record for
subsequent investigators to find of the network’s security having been
compromised. In any event, it is straining credibility to conclude that
the covert agency which “cracked” the network, is so incompetent as to
leave evidence in the system of the attack’s origins in the United States.
If the attack was made via the institutions’ “routers”, then an attacker
seeking anonymity need only despatch his “packet-sniffers” via an offshore
Internet Service Provider in a third country; and ensure that the computer of
origin could not be traced to any US agency. The newspaper story may
have credibility outside the institutions, where the public may believe the
integrity of the European Parliament and Commission network is guarded by a
small army of IT security specialists, using cutting-edge security methods;
but it has no credibility among those who actually work in “Europe”, and
who know how “Europe” operates in reality.
This leads to the conclusion that the Americans
“cracked” the European network and allowed the origin of the attack to be
identified because they wanted to get caught, and wanted to be seen to have
obtained trade secrets. The most obvious interpretation of the American
action, is that it was designed to provide a “cover story”: i.e., an
“explanation” for how they had come to know in advance the details of the
European negotiating position. Such “cover story” disinformation is
the stock-in-trade of US (and European) covert operations; and the fact that
the European network was “cracked”, certainly demonstrates the involvement
of one or more covert US agencies in this affair.
Furthermore, several years ago David Leppard, the
journalist jointly responsible for this story, devoted a major article on the
“Lockerbie” bombing case to attacking the credibility of a US secret
service defector, Mr Lester K Coleman (Donald Goddard and Lester K Coleman,
“Trail of the Octopus: Behind the Lockerbie Disaster”, Argonaut Press,
1995. Mr Coleman, who claims to be a former agent of the US Defense
Intelligence Agency – five times the size of the CIA, with an undisclosed
budget, and answerable only to the military – obtained political asylum in
Sweden on the grounds that his life was at risk in the United States, where
his alleged former employer had decided he knew too much. Mr Coleman
claims a Syrian-backed CIA/DEA-sanctioned drugs-running network was used to
place a bomb made from Libyan components on a Pan-Am flight at Frankfurt
airport. A cover-up subsequently took place of CIA/DEA involvement –
and of Syrian involvement, since Syria’s support against Saddam Hussein was
deemed crucial to Western interests.) On that occasion, Mr Leppard’s
article was ‘good news’ for Western intelligence services, which sought to
place undivided responsibility for the Lockerbie bombing on Libya.
This raises the question of who the Americans
wished to protect, via the “cover story” reported by Mr Leppard. The
obvious candidate is someone with an intimate knowledge of the EU’s
policies, negotiating positions and strategies, a source worth protecting to
secure information over future years. The extended hypothesis would
suggest, this US source is a senior official allegedly compromised, as
indicated in my letter of 17 June, and in exactly the same way as Benazir
Bhutto: in the same manner (“kick-backs”); in the same time period
(1994-96); and by the same company (blue-chip, neutral, Swiss, Société Générale
de Surveillance) – Director General Mr [X].
As indicated in my letter of 17 June, I submit
that the allegation of corruption against Mr [X] in respect of the SGS deal
involving sales of agricultural produce to China merits further investigation.
As indicated in my letter of 17 June, I also submit that OLAF is not reliable
in following up allegations made against senior persons within the Community
institutions.
R Dougal WATT
Auditor 3 September 2002 (on sick leave) Note: This letter and its attachment were published as a JUST Response exclusive report on September 24 2002.
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