Dept Of Connections:
The Contractors
By Jane Mayer
New Yorker
03 May, 2003
Back when Americans were
still debating whether there was just cause for a preëmptive strike
against Iraq, few arguments were scrutinized more closely than the Bush
Administrations contention that there were covert links between
Al Qaeda and Iraq. At the C.I.A., analysts pored over aerial satellite
photographs. At the Treasury Department, experts sifted through financial
records. At the National Security Agency, Arab-speaking linguists eavesdropped
on phone conversations. But, even after Secretary of State Colin Powell
put his credibility on the line, in a damning, dot-connecting speech
before the United Nations last February, questions persisted about the
solidity of the alleged links between Saddam and Osama.
Now there is a new and demonstrable
connection, but it is not the kind that the Bush Administration had
in mind. In fact, it is more likely to fuel the speculations of conspiracy
theorists than it is to put their fears to rest. It turns out that a
money trail runsalbeit rather circuitouslyfrom the lucrative
business of rebuilding Iraq to the fortune behind Osama bin Laden. Bin
Ladens estranged family, a sprawling, extraordinarily wealthy
Saudi Arabian dynasty, is a substantial investor in a private equity
firm founded by the Bechtel Group of San Francisco. Bechtel is also
the global construction and engineering company to which the U.S. government
recently awarded the first major multimillion-dollar contract to reconstruct
war-ravaged Iraq. In a closed competitive bidding process, the United
States Agency for International Development chose Bechtel to rebuild
the major elements of Iraqs infrastructure, including its roads,
railroads, airports, hospitals, and schools, and its water and electrical
systems. In the first phase of the contract, the U.S. government will
pay Bechtel nearly thirty-five million dollars, but experts say that
the cost is likely to reach six hundred and eighty million during the
next year and a half.
When the contract was awarded,
two weeks ago, the Administration did not mention that the bin Laden
family has an ongoing relationship with Bechtel. The bin Ladens have
a ten-million-dollar stake in the Fremont Group, a San Francisco-based
company formerly called Bechtel Investments, which was until 1986 a
subsidiary of Bechtel. The Fremont Groups Web site, which makes
no mention of the bin Ladens, notes that though now independent,
Fremont enjoys a close relationship with Bechtel. A spokeswoman
for the company confirmed that Fremonts majority ownership
is the Bechtel family. And a list of the corporate board of directors
shows substantial overlap. Five of Fremonts eight directors are
also directors of Bechtel. One Fremont director, Riley Bechtel, is the
chairman and chief executive officer of the Bechtel Group, and is a
member of the Bush Administration: he was appointed this year to serve
on the Presidents Export Council. In addition, George Shultz,
the Secretary of State in the Reagan Administration, serves as a director
both of Fremont and of the Bechtel Group, where he once was president
and still is listed as senior counsellor.
Rick Kopf, the general counsel
of the Fremont Group, which manages some eleven billion dollars in assets,
confirms that the bin Laden family invested about ten million dollars
in one of Fremonts private funds before September 11, 2001. He
noted that the bin Laden family has not enlarged its stake since then,
but he declined to provide additional details about its association
with the firm. He also chose not to discuss the origin or the nature
of the relationship between the bin Laden and Bechtel families, both
of which made fortunes in huge construction projects in the Arab world.
The Fremont Group evidently does not go in for connecting the dots.
As Kopf said, Ownership is private and is not disclosed.