Juan Cole, discussing the arrest warrant out for Ahmed Chalabi asks, “He was charged with counterfeiting old Iraqi dinars (why not counterfeit new dinars if you were going to counterfeit?) and money-laundering.”
Chalabi counterfeited Iraqi dinars and exchanged them for new dinars during the currency swap, when the CPA replaced the old dinar with the new one. From Jason Vest:
Perhaps the most interesting strand of the investigation involves one Sabbah Nouri, an INC official whom Chalabi had installed in the Ministry of Finance earlier this year — and who’s virtually the star of a front-page story in today’s generally Chalabi-friendly New York Sun.
Nouri has not been a particularly high-profile figure, but he could end up being the demolition man for Chalabi’s political aspirations and the INC. Identified in a January 13 broadcast of the Voice of the Mujahideen (the short-wave program of the Shia Supreme Islamic Council for Revolution in Iraq) as the “director of the finance minister’s office,” Nouri popped up in a March 11 Washington Post story about millions of missing Iraqi dinars from Iraqi banks.
After Iraqis traded their old dinars for new ones late last year, a Finance Ministry bank audit revealed a $22 million gap. According to the Post, the Finance Ministry quickly rounded up scores of bank tellers, whom it accused of accepting counterfeit scrip or outright theft. Though lawyers for the accused noted that suspects extended beyond tellers, Nouri, identified as “head of the Finance Ministry’s bank audit committee,” asserted that “it was impossible that anyone but the cashiers could have inserted forged bills or taken some of the money,” adding that “in the past, employees did not have any respect for law. We want to teach people this respect.”
Nouri returns to the pages of the Post today (May 21) — which fails to reference its earlier story — and is now identified as being “at the center of the inquiry” into “a scheme to defraud the Iraqi government during the transition to a new currency.” According to the Post, Nouri was “arrested in April and faces 17 charges including extortion, fraud, embezzlement, theft of government property and abuse of authority.”
Similarly, the Times identifies Nouri as having been “arrested on corruption allegations that include stealing a dozen cars from the [Finance] Ministry” and standing accused of “theft, extortion, kidnapping and murder.”
But the most thorough description of the Nouri investigation comes — perhaps somewhat surprisingly — in a front-page story Friday in the neocon’s paper of record, The New York Sun.
According to that report, Nouri has told Iraqi investigators that “Mr Chalabi’s organization instructed him to strong-arm bureaucrats and steal government property.” Citing Nouri’s arrest date as March 24, the story also reveals that his charges include “coerc[ing] confessions from bank tellers” in the dinar investigation, and that when arrested, he attempted to extricate himself by invoking the name of Aras Habib, the INC’s intelligence director.
From the Sunday Times, May 31, 2004:
The way judge Zuhair Maleki related the story last week, a routine investigation into a giant currency fiddle eventually led to a heavily guarded Baghdad compound belonging to Ahmad Chalabi, the former London banker whose high-level US connections had eased him into a prominent role on the interim Iraqi Governing Council.
As the chief investigative judge of Iraq’s central criminal court, Maleki was in charge of a curious case involving one of Chalabi’s minions. Sabah Nouri, described by Maleki as a “former driver and smuggler with no qualifications”, had been appointed to head an audit committee at the Iraqi finance ministry, which fell under Chalabi’s council wing.
When evidence emerged that old dinars sent for burning were being switched with counterfeit bills – and that the genuine dinars were being represented in exchange for more dollars – Nouri apparently set off in hot pursuit of culprits.
This seemingly innocuous investigation into alleged currency fraud ultimately led Iraqi police to kick down the door to Chalabi’s home, rousing him from his bed and provoking a startling political row over whether the man the Pentagon once regarded as its best friend in Iraq was spying for Iran.
The tangled tale of Nouri’s currency shenanigans and Chalabi’s supposed dealings with Tehran reflects much that has gone wrong with the coalition effort in Iraq.
Under the pressure of the approaching June 30 deadline for the handover to civilian rule in Baghdad, Iraqi factions are scrambling for power almost as furiously as rival branches of the US administration are blaming each other for the mess. No one seems to agree on who is friend or foe.
According to Maleki and other sources, Nouri responded to reports of the currency fiddle by storming into several Baghdad banks and seizing female tellers suspected of skimming profits. Nouri “roughed up the girls, abused them verbally and dragged them out of the banks”, said Maleki. “He violated and exceeded his powers.”
When Maleki followed up complaints that the bank tellers had been kidnapped, the scam began to unravel. After weeks of further investigation, the judge concluded that Nouri and other Chalabi aides had in fact been running the counterfeit currency switch.
The question is, why now? Why both Chalabis?
UPDATE: Lew Rockwell on the LRC blog: It was fun to hear Chalabi interviewed by FOX, which holds that this great man is being persecuted for his anti-UN virtues. When asked about the charge of counterfeiting old (i.e. Saddam) dinars, Chalabi said it was an outrageous and politically motivated charge, and besides, “the amount was trivial.”