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SITE In The News
Charity Leader Accepts a Deal in Terror Case
By Eric Lichtblau
Published in: The New York Times
February 11, 2003

WASHINGTON, Feb. 10 - The director of one of America's largest Muslim charities, a man depicted by federal prosecutors as a crucial financier for Osama bin Laden, struck an eleventh-hour plea agreement today without admitting any ties to Al Qaeda or terrorism.

In a surprise plea bargain, the director of the Chicago-based Benevolence International Foundation, Enaam M. Arnaout, admitted in court that he had illegally funneled donations to rebel fighters in Bosnia and Chechnya to pay for boots, tents and other military supplies in the 1990's. But prosecutors dropped six other charges in which he was accused of financing terrorism.

Mr. Arnaout agreed to cooperate with prosecutors, and the authorities said they hoped his contacts with Afghan rebel groups in the 1980's would provide a roadmap to the roots of the Qaeda network. But Mr. Arnaout, who has steadfastly denied any ties to Al Qaeda, did not admit any ties to the terrorist network in his plea today. Prosecutors said they remained convinced that Mr. Arnaout - the only leader of an Islamic charity to be charged criminally since the Sept. 11 attacks - had helped to finance terrorism and viewed the case as a linchpin in their efforts to shut down Al Qaeda's money pipeline.

But the ambiguous outcome of the case, which left both sides claiming victory, underscored the difficulties that federal prosecutors face in trying to establish clear financial links between terrorists and their suspected backers in the United States.

Mr. Arnaout, a naturalized American citizen from Syria, faces up to 20 years in prison after pleading guilty to a single count of racketeering conspiracy. His plea bargain means he will probably receive a significantly reduced sentence if he fully cooperates with the authorities before sentencing, lawyers in the case said. Mr. Arnaout's plea bargain came as jury selection was set to begin in a federal court in Chicago. Instead, lawyers said they had struck a deal.

After prosecutors were dealt a setback last week, "I think the government realized it was going to have a very, very difficult time proving this case," said Rita Katz, director of the SITE Institute, a Washington research group that studies terrorism and terrorist financing.

"Al Qaeda's infrastructure is built like the Mafia, where you can't trace the money. You won't find a check from Benevolence International to Al Qaeda," she said.

The case against Mr. Arnaout, 41, a father of four, drew attention as a test of the Justice Department's ability to trace the sprawling financial roots of global terrorism. One of the biggest Muslim charities in the United States, Benevolence International reported more than $3.6 million in contributions for 2001. But it has been effectively shut down with its assets frozen after the Treasury Department linked it to terrorist financing following the Sept. 11 attacks.

Attorney General John Ashcroft went to Chicago last October to announce Mr. Arnaout's indictment personally. At the time, Mr. Ashcroft accused Mr. Arnaout of duping donors into helping to provide financial support for Al Qaeda and terrorism. "There is no moral distinction between those who carry out terrorist attacks and those who knowingly finance terrorist attacks," Mr. Ashcroft said. Prosecutors collected extensive evidence that they said linked the charity to Al Qaeda and showed that Mr. Arnaout worked under Mr. bin Laden's watch, starting in the late 1980's at mujahadeen camps in Afghanistan. Mr. Arnaout, the government contended, was once a personal chauffeur to Mr. bin Laden.

Cracks began to emerge in the government's case recently. Perhaps the most damaging blow came last week when Judge Suzanne Conlon of Federal District Court ruled that certain hearsay evidence the government wanted to use - linking Mr. Arnaout to Al Qaeda - probably could not be introduced at trial. Lawyers said they worked through the weekend to reach a plea deal, completing it only this morning. Matthew Piers, a lawyer for Benevolence International, said the defense was eager to avoid a trial.

Because of the public's concerns about terrorism and the attention the case generated, he said, "we thought it would be very difficult to get a fair trial. The problem of jury bias in a case like this is so intractable." From the government's perspective, the chance to secure Mr. Arnaout's cooperation was a powerful inducement, said Patrick J. Fitzgerald, the United States attorney in Chicago, who was planning to try the case himself. "To take a bird in the hand and short-circuit a trial and get him talking was very satisfying," he said in an interview.

No sentencing date was set, but defense lawyers said they hoped that Mr. Arnaout - in jail since April - could be freed soon. Depending on whether the government is satisfied with his cooperation, the sentence "could be anything from time served to 20 years," Mr. Piers said. Despite the government's declarations linking Mr. Arnaout to Al Qaeda, the plea agreement focuses exclusively on Benevolence International's support of rebel fighters in Chechnya and Bosnia in the 1990's.

Mr. Arnaout admitted that starting in about 1993, he and others at the charity used donations to support rebel fighters overseas with boots, tents, uniforms, and, in Bosnia-Herzegovina, an ambulance to be used by soldiers. Mr. Arnaout admitted that he worked to conceal the true use of the funds after telling donors that contributions would be "solely for humanitarian work for the benefit of civilian populations."

Prosecutors would not say how much money they believe was diverted to military groups, but defense lawyers placed the figure at $300,000 to $400,000. Federal prosecutors insisted - despite denials from Mr. Arnaout and his lawyers -that they still believed Mr. Arnaout and Benevolence International were financing Al Qaeda.

"We do have a gap between what he's admitted and what we were prepared to prove," Mr. Fitzgerald said. "He has admitted guilt, which is a remarkable turn of events. But he hasn't admitted the full extent of what we've alleged, and we're not ready to walk away from that."

Mr. Ashcroft, hailing the plea agreement in a statement in Washington, said that when Mr. Arnaout was sentenced, "we are prepared to prove that he did support Al Qaeda." The attorney general added that the plea bargain "makes clear we will prosecute and imprison those who would exploit the generosity of charitable donors to provide financing for violence overseas. We will shut down terrorist funding sources."

Copyright 2003 The New York Times Company

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