U.S. renews probe into Iraqi weapons buildup Justice Department examines aid, technology that came from America

September 13, 1993|By Los Angeles Times

WASHINGTON -- The Justice Department, after months of scrutiny, has decided to open a broad new investigation into whether laws were broken by U.S. officials and American companies in arming Iraq before the Persian Gulf war.

The inquiry, which is being led by a special assistant to Attorney General Janet Reno, raises the possibility of new criminal charges in a controversy that many skeptics thought had been dismissed by the Clinton administration.

So far, only one U.S. company -- a division of Los Angeles-based defense contractor Teledyne Inc. -- has been charged. And six employees of an Italian bank have been convicted in connection with transactions that helped Iraq obtain billions of dollars' worth of sensitive computers and weapons technology in the years before the war.

John Hogan, a longtime associate of Ms. Reno when she was Miami's chief prosecutor, said he and a team of prosecutors and investigators are examining whether U.S. export laws were violated by sales to Iraq and whether any government officials were involved in misconduct in arranging aid to Baghdad or covering it up after the war.

"I perceive my task to include looking at various investigations and prosecutions around the country to see if there are common threads that reveal criminal activity in conjunction with how Iraq was armed," Mr. Hogan said in an interview at his Justice Department office.

Along with examining sales by U.S. businesses, the investigation will scrutinize the actions of some government officials under former President Bush in providing assistance to Iraq before the war and concealing the extent of such aid after the conflict.

U.S. District Judge Marvin H. Shoob, a persistent critic of the Justice Department's handling of the Iraq investigation, called Mr. Hogan's inquiry a step in the right direction.

"I've met with Mr. Hogan, and I think he will do his best to ferret out the details and information concerning these complex matters," said Judge Shoob. "However, I think you still need an independent counsel, with the resources and time to fully investigate the issues."

Justice Department officials said Mr. Hogan's inquiry does not rule out later efforts to appoint an independent counsel, who would enjoy more autonomy than typical federal prosecutors. The law establishing the in dependent counsel process was allowed to expire last year, but Congress is expected to consider renewing it later this year.

During last fall's campaign, President Clinton promised a fresh and aggressive review of allegations that laws had been violated in executing the U.S. policy of assisting Iraq before the war. He said the results would determine whether an independent counsel was necessary.

However, Democrats in Congress have complained that the administration has been slow to move on the Iraq investigation.

The impression of reluctance was reinforced last month at a hearing in Atlanta before Judge Shoob.

The hearing was to sentence five former employees of the Atlanta office of Italy's Banca Nazionale del Lavoro. They had pleaded guilty to roles in a scheme to provide Iraq with $5 billion in loans, some of which were used by Baghdad to buy weapons technology and improve Iraq's arsenal of Scud missiles.

Mr. Hogan surprised Judge Shoob by saying he had investigated the bank case and agreed with the Bush administration's Justice Department that the Italian bank had not authorized or approved the loans by its Atlanta office. But Mr. Hogan was careful not to say that his inquiry had exonerated individual bank officials or any U.S. officials.

The Banca Lavoro case ended on Sept. 2 with the surprise guilty plea of the sixth defendant, former branch manager Christopher P. Drogoul. With the conclusion of the bank case, Mr. Hogan said, the investigation has turned to the broader inquiry into possible export violations and official misconduct.

"All the doors are still open in this investigation," said Mr. Hogan, who is devoting all of his time to the matter and reports directly to Ms. Reno.

While part of the investigation involves transactions financed by Banca Lavoro, Mr. Hogan said, it would include examining actions of U.S. officials. He refused to identify any of the subjects or targets.

The Italian bank's tiny Atlanta office financed $5 billion worth of commodity and technology purchases by Iraq between 1984 and 1989. After the gulf war, United Nations inspectors discovered that some U.S. and European technology financed by Banca Lavoro had been used in Iraqi programs to develop nuclear weapons and other arms.

Investigators also will examine actions by U.S. policymakers, who have been accused by Democrats of deceiving Congress about aid to Iraq.

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