The Hunt for KSM

by Terry McDermott

  Basit had found the southern insurgents unsophisticated. He didn’t think they would benefit from his bomb-making expertise. Mainly, he said, they liked to shoot their guns,4 and he and Mohammed had bigger plans than their small-arms expertise could underwrite. But the local jihadi networks offered other advantages. Khan had been a close associate of Osama bin Laden during the Afghan war, and had visited him after bin Laden moved to Sudan. Khan had also been friends with the man who ran the International Islamic Relief Organization in Peshawar. Either bin Laden, the IIRO man, or both could have provided introductions to Mohammed Jamal Khalifa, a Saudi brother-in-law of bin Laden’s who ran the East Asian branch of IIRO. Khalifa had fought in the Afghan campaign, too, but had left early, in 1985. He moved to Manila, took a Filipina wife, and established a wide range of businesses—timber sales, rattan furniture manufacture, agricultural seed distribution—and charitable organizations to fund Islamic education and, authorities said later, insurgencies. He was a substantial donor to both Moro and Abu Sayyaf. He helped fund their training camps in the southern jungles. Khan became an intermediary between Mohammed and Basit on the one hand and Khalifa’s local network on the other.

  Khan was also the go-between with one of Mohammed’s friends from the Afghan camps, an Indonesian named Hambali. Khan, Hambali, and Mohammed Amein al-Sanani, an associate of Khalifa’s, were among the founding directors of Konsojaya, a shell company the group set up in Malaysia to transfer money to Manila. One of Khan’s school friends from Saudi Arabia, Ibrahim Muneer, joined him in the Philippines and Malaysia and probably guided the creation of Konsojaya. Muneer was an actual businessman, though, and a fairly successful one. He operated an import-export company out of Karachi. Among other enterprises, he was said to have had the royal concession for the export of holy water from Saudi Arabia to Pakistan. Konsojaya, according to its incorporation papers, was intended to be just such a trading company, exporting palm oil from Malaysia to the Arab world. Pellegrino would later find that the company actually did make one deal, buying a load of vegetable ghee and shipping it from Singapore to Karachi. But the shipment got caught up in customs at the port in Karachi. The Pakistanis held it up for taxation and the Konsojaya executives didn’t have the money to pay people off. So they let it sit there and the ghee spoiled.

  Beyond that, it’s not clear what other deals, if any, the company ever did, although it gave the plotters credentials that allowed them to pass themselves off as businessmen. They had cell phones registered to the Konsojaya account, and the company served as a point of contact.

  In late 1994, Basit returned to Manila and soon moved into the Josefa. Khan and his girlfriend, Carol Santiago, moved out to an apartment on Singalong Street. Using various aliases, Basit collected the materials—nitromethane, citric and nitric acid, wire, cotton balls, Casio watches—needed to make the bombs he and Mohammed had experimented with during the summer. By telephone, he and Mohammed discussed different ways to kill John Paul, including suicide bombers disguised as priests, remote-control bombs, and an aerial attack. Basit ordered custom-made clerical cassocks. When they learned that President Clinton was to visit during the same period, they discussed ways to kill him, too.

  With both the pope and the American president about to make appearances, it was a nervous season in the capital. A typhoon had blown through earlier in the month, cutting power and uprooting trees that still lay strewn along the streets. Philippine authorities were hyper alert to threats against the pope. Given both Abu Sayyaf’s and Moro’s history of attacking Catholic clergy, they added security throughout the capital. Basit and Mohammed, worried that they couldn’t penetrate the heightened defenses, turned instead to another, more innovative attack.

  Mohammed and Basit had been talking for months about ways in which they could use commercial airliners as terror targets, dating back at least to the first time Murad mentioned using airplanes as missiles in Pakistan. Basit thought he could devise small, electronically controlled explosive devices that could be disassembled and smuggled aboard airliners. Once aboard, the device’s parts could be reassembled, connected to a modified digital watch that would serve as a timer, then set to explode after the man who assembled the device had deplaned.

  Basit researched flight schedules and identified a dozen American-flagged jumbo jets that would all be in the air, most eastward-bound for America, at the same time. They called the plan Bojinka, Serbo-Croatian for “big noise.” Mohammed, Basit, Murad, Khan, and another man would all place bombs on different planes. If they could make it work, it would be an astonishing catastrophe, an amazing victory. Who would then doubt the power of the Liberation Army?

  Late in the evening on December 1, Wali Khan rode his motorcycle to a mostly deserted movie theater in a Makati district shopping center, placed a small version of the Basit-designed explosive device under a seat, and left. The bomb worked on schedule, blowing up an empty seat and injuring a handful of late-night moviegoers

  The next step was to make sure the bombs could be assembled on board an aircraft. Basit built a slightly larger version of the bomb Khan had placed in the movie theater, then booked passage on a flight from Manila to Tokyo that included an intermediate stop in Cebu. Basit boarded the flight in Manila, set the timer, and planted the device beneath the seat in front of him. A flight attendant noticed that he then kept switching seats, moving all over the cabin. She didn’t know he was trying to get further and further out of range of the bomb. He got off the plane in Cebu. The bomb went off exactly as scheduled on the next leg of the flight, killing a Japanese businessman and nearly dooming the entire aircraft, which the pilots heroically managed to land with a gaping hole in its fuselage. A slightly larger bomb would have brought the entire plane and its passengers down.

  With the test run successful, Basit and Mohammed began final preparations. Mohammed planned a return to Manila for early January.5 Basit called Murad in the Gulf and asked him to come to Manila. Murad had been expecting the call. Basit gave him instructions to buy a variety of hair dye products and to check in to a low-rent hotel upon arrival. When Basit met him at the hotel and took him over to the Josefa, Murad wasn’t surprised to see Basit’s apartment full of bomb-making materials—“chocolate”—but was very surprised to see Ibrahim Muneer, whom he knew as the Saudi businessman Majid. Muneer wore gloves every time he visited.

  Just after Christmas, Muneer and Basit left Manila for a weekend. They told Murad they were going scuba diving and gave him instructions to begin constructing the bombs. When they returned, Basit and Murad set about making more bombs in earnest. Muneer disappeared. Murad had the impression Muneer was living with Basit at the Josefa before Murad arrived, but had moved elsewhere in town. Muneer left the apartment that night. Murad would never see him again.

  The plot ended there. A chemical fire ignited by the ever-careless Basit flushed the two from the apartment. The smoke caused the fire department to respond, then the police. The cops made a bit of a mess of it, going into the room without a warrant and discovering the trove of bomb-making materials. Alarmed, they went shopping for a judge who would sign a search warrant with no evidence of the need to search other than a small fire. Twelve judges denied them. The thirteenth authorized the search, which uncovered an astonishing litany of chemicals and bomb-making gear—gallon jugs of nitrobenzoyl; grape juice bottles full of acid; switches, watches, alarms. They also found a chemical dictionary, two Bibles, two crucifixes, and a manual on how to hear Roman Catholic confessions. It took two full-size police vans to haul the stuff away. Murad was arrested later that same night, after Basit sent him back to get his Toshiba laptop from the apartment. Khan was arrested outside his apartment a few days later. Basit had simply disappeared.

  Mohammed didn’t have to disappear. No one yet knew he had ever been there.

  CHAPTER 5

  Making a Case

  Manila, the Philippines, January 1995

  Just as Pellegrino surmised he would, Basit flew back to Pakistan vi
a Singapore the night of the Josefa calamity. He got away, but hardly clean. He had left behind so many clues that he might as well have waved a red flag on the way out of the country.

  He had sent Murad back for the laptop for two good reasons. One, it was dangerous to go back himself; better somebody other than he. Indeed, Murad walked right into the police handcuffs. Or, rather, he ran. When he was spotted returning to the hotel, a policeman yelled at him, and he turned and ran. The cop fired and missed, but Murad tripped over an uprooted tree trunk and was arrested. Two, the laptop was worth going back to get. It contained enough information to identify Basit, Mohammed, everything they had planned, and almost everyone they knew. Among the names and phone numbers: Khalid Sheikh, similar to the name on the wire transfer before the World Trade Center bombing. There was also a copy of a letter apparently asking for money and signed by “Khalid Shaikh + Bojinka”:

  To: Brother Mohammad Alsiddiqi:

  We are facing a lot of problems because of you. Fear Allah, Mr. Siddiqi, there is a day of judgment. You will be asked, if you are very busy with something more important, don’t give promises to other people. See you on the day of judgment. Still waiting.

  When the police first took Murad into custody, they didn’t really know who they had or what crime, if any, might have been committed. What they had was a mountain of evidence, and, soon enough, as Murad began talking about the World Trade Center bombing, they began to suspect they might actually have Basit—the infamous Ramzi Yousef—in their custody. They put the word out to the United States.

  When the call came into the JTTF at 26 Federal Plaza in lower Manhattan, Pellegrino, unusually, was in the office. He had spent much of the previous two years chasing faint leads around the five boroughs, then the five continents, without great success. He and his colleagues knew who Basit was, but not much else.

  Sensing a big break in the case, he rushed to get to the Philippines. The Filipinos, however, were in a near panic about the pope’s imminent arrival and had virtually shut down the country. Nobody could get in or out until the pope was safely packed off to wherever his world tour took him next—not even the FBI and its team of forensic experts, who could help determine who the Filipinos had in their custody.

  By the time Pellegrino arrived on January 16, the local investigation was well under way. Filipino police and intelligence agents had determined that the man in their custody was not Basit but Murad. For a few days they also had Khan locked up, but he escaped jail—almost certainly with the help of a bribed jailer—and left the country two days before Pellegrino arrived. He didn’t resurface for months. Still, the computer and documents gathered at the Josefa and at Khan’s apartment on Singalong Street provided dozens of leads. They showed that Khan, in particular, had traveled extensively and had contact information for, among others, Osama bin Laden and his brother-in-law Khalifa, the IIRO executive. In the short time he was in custody, Khan admitted that he had received money from Khalifa. The police had been watching, and wiretapping, Khalifa for two years, so they knew his connections to Abu Sayyaf and Moro. And he was connected to these transients, too?

  Coincidentally, Khalifa had been arrested in the United States just two weeks before. He was at that moment in a Northern California jail, being held formally on suspicion of visa violations. Khalifa was wanted in Jordan after being convicted in absentia for involvement in a bombing campaign there. The Jordanians wanted him extradited. The U.S. inclination at the time was to accede to such extradition requests. In fact, it wasn’t a formalized policy, but in practice the U.S. preferred to ship suspected terrorists out of the country rather than go through the headache and expense of investigating and trying them. Mary Jo White, the U.S. attorney in Manhattan, thought this was crazy. Extradition didn’t solve problems, she said, it merely delayed them. What was to keep a suspected terrorist who had been extradited from returning to the United States and attacking again at a time of his choosing?

  As was usual for the New York field office, when agents left town for an investigation they often took federal prosecutors with them. This helped focus the avenues of inquiry. The prosecutors knew what they needed to take a case to court, relieving the agents of the need to reinvestigate everything later, when the prosecutors would want to see the evidence and hear the witnesses. Michael Garcia and Dieter Snell, two of White’s young assistant U.S. attorneys from the Southern District, were partners in the Manila Air investigation. Garcia and Pellegrino butted heads, in part because Garcia, the prosecutor, wasn’t the only lawyer of the two. But by their second or third extended tour of Southeast Asia, the two had become close, a model of how agent and prosecutor could work together.

  They were also accompanied wherever they went by a CIA “minder,” whom they grew to tolerate and even, at times, appreciate. He could be helpful in gaining the clearance needed to set foot on foreign soil, and to make their visits less threatening to the in-country CIA station chiefs, who didn’t like FBI agents and prosecutors straying into their airspace. Anything that could possibly be used in a criminal prosecution—and thus be brought out into the open—was anathema to the CIA, to the point that its on-the-ground people usually stayed far away from the visiting law enforcement investigators. In return, the federal agents usually welcomed the lack of attention even if it meant less help. “There was not a close working relationship between the FBI and the agency in Manila,” one participant recalls.

  When Pellegrino learned from the Filipinos that there was information suggesting that Khalifa was funding Basit, he and the attorneys pleaded with their superiors to keep Khalifa in custody in California until they could build a real case against him. They had no problem persuading White. Richard Clarke, the White House counterterrorism adviser, also was desperate to keep Khalifa in custody, believing he was financing not only the Philippine Airlines plot but Al Qaeda operations in Southeast Asia as well.1 But the State Department—in fact, secretary of state Warren Christopher himself—was angling to send Khalifa away as a favor to the Jordanians.

  The Basit investigation had become a point of political contention even before the events in Manila. There were three competing interests: the Southern District of New York, which was running the criminal investigation; elements within the headquarters of the Department of Justice who wanted to bring control of the case to Washington; and the CIA, which wanted the criminal investigation shut down entirely so its agents could have an open field in which to explore the intelligence implications of the case.

  Enough connections had been drawn between Basit and the wider jihadi world that the CIA wanted access to the information, if not to the case itself. Pellegrino and others at the FBI and Justice wanted to criminally prosecute Basit.

  As a matter of policy, information derived from a criminal investigation was not routinely shared with intelligence agencies, and information derived from intelligence operations was not shared with criminal prosecutors. The division resulted from a desire to protect the rights of those accused of criminal activities; much intelligence information would never be allowed in an American courtroom, and the point of the nonsharing policy was to avoid contaminating criminal cases.

  The wall, as it was called, was often misunderstood and frequently interpreted too broadly. The agents assigned to collecting intelligence sometimes couldn’t, or wouldn’t, talk to their colleagues who were working the criminal side of the same cases. Big things—like leads and plots and potential sources—fell through the cracks.

  “People were sitting next to each other, literally, and not sharing information,” said Neil Herman, then head of the New York JTTF. “Sometimes because they couldn’t, other times because they just didn’t want to or didn’t think to. One would be from the criminal division, another [from the] FCI [Foreign Counterintelligence] division. And they wouldn’t talk to each other. It got to be comical at points. It was crazy.”

  The larger issue was whether the Basit/Khalifa case should be treated as a criminal matter at all. Shouldn’t
it be handled as an intel-gathering effort? White’s answer was not so simple: yes, but the criminal case should also proceed, with both sides working together to the degree that they were able to. Some top DOJ officials in Washington disagreed, and told her to shut down the criminal investigation, citing “the wall.” She refused. Things got heated, and White had to send two of her top deputies to a series of meetings in Washington and New York just to preserve a law enforcement element of the case, and, especially, a supervisory role for her office and the New York FBI. She won the battle, but it was only the first salvo in a much longer war over the wall, and over what kind of information, if any, could be handed over to prosecutors and FBI agents from those on the intelligence side. White was in no mood to lose Khalifa, a crucial part of the case, just because yet another government agency wanted to do a favor for someone. But the negotiated settlement didn’t mean her office and the New York FBI got anywhere near the kind of intelligence that they believed the CIA was gathering in Manila and elsewhere.

  Meanwhile, Pellegrino was growing concerned that the Filipinos would let Murad go for lack of evidence before the FBI could build a case against him. He ended up spending almost three months in Manila investigating, but did not participate in the extensive interrogations of Murad by the Filipinos. He found lots of evidence anyway—enough for a federal grand jury to indict Murad in New York—but very little insight. Who was in charge? Who was the planner? Who had the ideas?

  Mohammed’s role was blurry; Pellegrino unearthed information showing he was more actively involved in Manila than he had been in Basit’s New York operation, but he remained in the background. He had come early to the Philippines and left early. The investigation later turned up a lone fingerprint of his on the chemical dictionary found in room 603 and enough information from witnesses to persuade Pellegrino that Mohammed was a figure worth pursuing. Still, he was one of many suspects, a second-tier figure, as one intelligence analyst described him; he was still regarded more or less as Basit’s uncle.