[Reader-list] Ibrahim Warde: Riches beyond belief

[Patrice Riemens]

from Le Monde diplomatique, September 2007

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    September 2007
                BIN LADEN AS A FANTASY FIGURE

                     Riches beyond belief


    Most of the factoids that have become canon about Osama
    bin Laden and the financing of terror were estimates,
    guesstimates or simply made up, as in the case of his
    presumed $300m personal fortune. But these fantasies
    have driven real and dangerous actions.
                                            by Ibrahim Warde
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    Michael Lewis, in Liar's Poker, his classic portrait of
    Wall Street in the 1980s, described how he invented
    "logical lies" as an investment banker to explain
    otherwise inexplicable events to nervous clients. Asked
    why the dollar fell, he would confidently say: "Several
    Arabs had sold massive holdings of gold for which they
    received dollars. They were selling those dollars for
    marks and driving the dollar lower." In his words: "Most
    of the time when markets move, no one has any idea why.
    A man who can tell a good story can make a good living
    as a broker. And it's amazing what people will
    believe... selling out of the Middle East was an old
    standby. Since no one ever had any clue what the Arabs
    were doing with their money or why, no story involving
    Arabs could ever be refuted." (1).

    That story was unavoidable in the wake of the 11
    September 2001 attacks. No one knew anything specific
    about them. The magnitude of the destruction suggested
    that a huge financial and logistical infrastructure had
    been at work. With the involvement of Osama bin Laden,
    usually described as a Saudi billionaire and terrorist
    financier, and the participation of 15 Saudi hijackers,
    the plausibility of the financial argument coincided
    with a common stereotype. As Jack Shaheen's
    comprehensive study of the portrayal of Arabs by
    Hollywood suggests, they had long been associated with
    "vile oil sheikhs with an eye for western blondes and
    arms deals and intent on world domination, or with
    crazed terrorists" (2). By joining two of the three
    stereotypes, the billionaire and the bomber (the third
    was the belly dancer), the events of 9/11 seemed to
    verify the truth of the caricature.

    An instant canon on terrorist financing was established
    in the days after the attacks. The laundry list was
    familiar and mindlessly repeated: the Bin Laden $300m
    fortune, business fronts legal and illegal, Islamic
    charities, Saudis, rich Arabs, hawalas, drugs, gold and
    diamonds, etc. From the popular press to prestigious
    thinktanks, the lists were almost identical. Repetition
    looked like corroboration. The lackadaisical way in
    which the discourse on terrorist finance had been
    constructed contrasted with the authoritative way in
    which the dubious facts were cited and recited.

    After 2004 there was considerable new information
    available about the financial war on terror, but such
    evidence had little impact on perceptions or policies.
    Key players such as former Treasury Secretary Paul
    O'Neill, former counterterrorism czar Richard Clarke,
    and Michael Scheuer, who headed the "virtual Bin Laden
    station" at the Central Intelligence Agency, published
    memoirs or contributed to books debunking much of what
    was commonly believed.

    The publication of the September 11 Commission report in
    August 2004 helped a clearer understanding of the
    reality and contradicted much of the canon. The report,
    complemented by a terrorist financing monograph, was
    based on "a comprehensive review of government materials
    on terrorist financing from essentially every law
    enforcement, intelligence and policy agency involved in
    the effort".

                     The story lives on

    The report and monograph made important points: they
    showed how little money is needed for terror attacks;
    they debunked the urban legend of the Bin Laden personal
    fortune; and they hinted at the politicisation of
    terrorist financing inquiries. Since Bin Laden had been
    singled out in 1998 as Public Enemy Number One, the
    financial war was driven by the belief that his $300m
    fortune was the core of the al-Qaida funding network.
    The report confirmed that the figure was fictive. Yet
    the story lives on. A Google search in April 2006
    yielded 154,000 hits.

    The $300m factoid seems to have originated in 1996, when
    a State Department analyst inserted it in a fact sheet
    on Bin Laden (3). It was arrived at by a rough
    calculation based on approximate figures. The analyst
    divided assets of the Bin Laden group (estimated at
    $5bn) by the number of sons (estimated at 20). That gave
    $250m, which he rounded up to $300m. The calculation
    rested on estimates and dubious assumptions about the
    family, inheritance laws and practices, the actual worth
    of the privately-held company and its ownership
    structure. Though it was not even a back-of-the-envelope
    calculation, the figure soon gained absolute status.

    Most accounts of Bin Laden after 11 September describe a
    cave-dwelling heir and tycoon with close ties to the
    Saudi establishment who ran his business empire and made
    shrewd moves in the stock market while plotting
    terrorism. The enduring legend became that "of the
    world's richest terrorist, a business-savvy nomad who
    has used a vast inheritance and a constellation of
    companies to finance a global network of violence" (4).

    With almost no exceptions, every news article, every
    thinktank report, every book of revelations on terrorist
    financing, has repeated the assertion that Osama bin
    Laden had a $300m personal fortune, the basis of the
    financing for al-Qaida. That figure has been unchanged
    since 1996: despite a life of danger, Bin Laden's wealth
    stayed remarkably stable: no gains or losses, no
    expenses or subsidies to Taliban hosts, no confiscations
    and no accretions dented or inflated it.

    The terrorist-finance literature was a form of magic
    realism - a mix of rich detail, surrealism and fantasy.
    Numbers were necessary, even when invented, if only to
    lend precise cachet to reports or analyses and, to
    paraphrase George Orwell, give the "appearance of
    solidity to pure wind". The lawsuit filed on 15 August
    2002 against several Saudi princes, banks and charities
    (Burnett v Al Baraka Investment and Development
    Corporation), which came to be called "the lawsuit of
    the 21st century", sought "an amount in excess of
    $100trn" from dozens of defendants (5). The lawsuit was
    thoroughly prepared and lavishly financed. Yet on the
    day after it was filed, the attorneys issued a
    correction, claiming that a clerical error had misstated
    the amount asked: the plaintiffs were only asking for
    $1trn. Perhaps the lawyers had realised that the initial
    amount exceeded the GNP of all countries in the world
    combined.

    At the time of 9/11, the Bush administration was bent on
    implementing an agenda of financial deregulation which
    included dismantling much of the existing anti-money
    laundering apparatus. The attacks caused a sharp policy
    U-turn. With the zeal of the newly converted, those very
    people who had been intent on dismantling the
    legislative apparatus found themselves hastily and
    vigorously expanding it.

                 More truthiness than truth

    Throughout the war on terror, organised crime analogies
    came easily to law enforcement agencies, as well as to
    influential pundits. Michael Ledeen of the American
    Enterprise Institute, one of the most influential
    intellectuals in the early days of the war on terror,
    described Osama bin Laden as "the CEO of a multinational
    terrorist corporation... very imaginative at finding
    ways to make money from his terrorist ventures... The
    best way to think of the terror network is as a
    collection of mafia families" (6).

    In the 1980s the focus was on Central and Latin American
    drug lords. After 9/11 the war on drugs was overshadowed
    by the threat of Islamic fundamentalism. The massive
    shift of resources resulted in a substantial mismatch.
    Those government agents who did have some international
    experience and cultural-linguistic skills were typically
    fluent in Spanish and had no experience of the Islamic
    world. New experts appeared who fitted the description
    of management scholar Henry Mintzberg: "An expert has
    also been defined as someone who knows more and more
    about less and less until finally he or she knows
    everything about nothing. Perhaps this means that if you
    understand only certain discrete chunks, ultimately you
    understand nothing" (7).

    Since none of the "$300m fortune" was traceable, a new
    industry purported to reveal the secrets of its
    whereabouts. Some practitioners were partisan hacks with
    a transparent political agenda; others were imaginative
    writers eager for a scoop. Those who made up the
    original allegations seemed well-informed and were asked
    for further revelations. Steven Emerson, a ubiquitous
    terrorist expert, said that immediately after 9/11 he
    "fielded 1,000 calls, many from news organisations" (8).

    Another founding mythographer was Jack Kelley, star
    reporter of USA Today, the largest circulation daily in
    the US, who produced countless scoops until, in 2004,
    his paper discovered a "pattern of lies and deceit". He
    found it easy to write about terrorism and financing.
    Hiding behind confidential and anonymous sources, he
    broke many of the stories which have since entered the
    journalistic bloodstream. They included an eyewitness
    account of young Palestinian suicide bombers and their
    culture of death; the revelation that prominent Saudi
    businessmen "worth more than $5bn" continued to transfer
    tens of millions of dollars to Bin Laden as "protection
    money to stave off attacks on their businesses in Saudi
    Arabia"; and the discovery of computer records in Afghan
    caves showing links between Chicago-based Islamic
    charities and al-Qaida (9). For his suicide bomb
    eyewitness account, he was a Pulitzer prize finalist.

    With the 9/11 attacks, the lines between fact and
    fiction were further blurred since the unbelievability
    of the events lent credence to many of the wildest
    assertions about Arabs and Muslims. Nobody then knew
    much about al-Qaida and Osama bin Laden. Americans were
    ready to believe he was a James Bond villain, rich
    enough to fund his own wars. Indeed, his hidden wealth
    has captured the imagination of many novelists. Chris
    Ryan's Greed (a bestseller, at least according to its
    cover) bears more than a passing resemblance to
    non-fiction purporting to reveal the secrets of
    terrorism financing. A character says: "Al-Qaida has a
    lot of money. Its roots are in Saudi Arabia, and that's
    a rich place. But it has a lot of support right across
    that region. There are contributions coming from
    everywhere - Jordan, Egypt, Pakistan, Malaysia. That's
    what makes them so deadly. Fanatics we can handle.
    Fanatics with cash are a different story. Overall, we
    estimate the organisation has at least $5bn at its
    disposal. They hide their money, and they are good at
    it. So it could be a lot more" (10).

    It could be said, to borrow from satirist Stephen
    Colbert, that there is much more truthiness than truth
    in the terrorist financing discourse - with truthiness
    defined as what you want the facts to be as opposed to
    what the facts are. The parallels between Bin Laden's
    hidden stash and Saddam Hussein's weapons of mass
    destruction are striking. They caused the financial war
    against global terrorism and regime change in Iraq. The
    usual suspects of terrorist financing - rich Arabs, the
    Saudis, Islamic charities, etc - became as familiar as
    the smoking guns of WMD - mobile labs, aluminum tubes,
    Niger uranium, etc - that helped sell the invasion of
    Iraq to the US public. Both wars created created a new
    and very real problem through pursuing an imaginary one.
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    Ibrahim Warde is adjunct professor at the Fletcher
    School of Law and Diplomacy, Tufts University (Medford,
    Massachusetts). This is excerpted from The Price of
    Fear: The Truth Behind the Financial War on Terror (IB
    Tauris and University of California Press, 2007)

    (1) Michael Lewis, Liar's Poker: Rising Through the
    Wreckage on Wall Street (Norton, New York, 1989).

    (2) Jack G Shaheen, Reel Bad Arabs: How Hollywood
    Vilifies a People (Interlink Pub Group, New York, 2001).

    (3) Kenneth Katzman, "Terrorism: Near Eastern Groups and
    State Sponsors, 2001", Washington, DC, Congressional
    Research Service, 10 September 2001.

    (4) Karen DeYoung, David Hilzenrath and Robert O'Harrow
    Jr, "Bin Laden's Money Takes Hidden Paths to Agents of
    Terror", The Washington Post, 21 September 2001.

    (5) Jennifer Senior, "Intruders In The House Of Saud",
    The New York Times Magazine, 14 March 2004.

    (6) Michael Ledeen, The War Against the Terror Masters
    (St. Martin's Griffin, New York, 2003).

    (7) Henry Mintzberg, The Rise and Fall of Strategic
    Planning: Reconceiving Roles for Planning, Plans,
    Planners (Free Press, New York, 1994).

    (8) Felicity Barringer, "Terror Experts Use Lenses of
    Their Specialties", The New York Times, 24 September
    2001.

    (9) Jack Kelley, USA Today, 26 June 2001, 29 October
    1999 and 30 January 2002.

    (10) Chris Ryan, Greed (Arrow Books, London, 2004).



    Original text in English


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