Cheesey Business from St. Louis to County Kerry

international | anti-capitalism | news report Monday February 02, 2009 23:12 by C.D. Stelzer

Press accounts published in Ireland over the past decade, however, have linked the company to an influence-peddling scandal that rocked the Irish political establishment during the 1990s. Moreover, the man at the center of the controversy has had past ties to Carlyle Group, an American equity investment firm that is stacked with high-ranking former U.S. government officials with checkered careers.

The Irish scandal involved the granting of citizenship and passports to Saudi Sheik Khalid bin Mahfouz and others in return for his investment in development schemes of political supporters of high-ranking Irish politicians, including the late Charles Haughey, the former teoiseach or prime minister of Ireland.

As part of the schemes, bin Mahfouz is reported to have invested substantially in the Kerry Airport along with the Kerry Group, whose then-head Denis Bosnan was chief of the airport board. The corporation and the bin Mahfouz family are still listed as investors in the airport.

Bin Mahfouz, who controlled Saudi Arabia’s only private financial institution, National Commerce Bank, and acted as the royal family’s banker, was fined $225,000,000 in the 1990s for his involvement in the fraud that led to the collapse of Bank of Commerce and Credit International (BCCI), which operated in more than 70 countries.

The BCCI scandal involved a complex money laundering operation that supported drug trafficking, illegal weapons transfers, terrorism, espionage and organized crime. The CIA is known to have used the BCCI to finance some of its covert operations, including its secret war against the Soviet Union in Afghanistan during the 1980s. In 1999, the Saudis eventually placed bin Mahfouz under house arrest after he was implicated in helping to finance terrorism through Islamic charities that had direct ties to Osama bin Laden and al-Qaeda.

Bin Mahfouz is married to al-Qaeda leader Osama bin Laden’s sister. He also has past business ties to President George W. Bush.

While bin Mahfouz was buying his Irish citizenship by helping develop the Kerry Airport, he put all his American investments in the hands of Jim Bath of Houston. Bath, a self-professed CIA agent, is a former Texas Air National Guard buddy and business associate of George W. Bush. In the 1980s, while representing bin Mahfouz’s business interests, Bath invested $50,000 in Arbusto, a Texas oil company then owned by Bush. Bin Mahfouz’s financial ties continued through BCCI’s investments in Harken Energy. Bush cronies William DeWitt and Mercer Reynolds, owners of the St. Louis Cardinals baseball club, bailed Bush out in 1984, merging his failed business with their company, Spectrum 7, which was bought by Harken Engery in 1986. Bush became a board member of Harken and sat on the finance audit committee.

Besides the Kerry Airport, bin Mahfouz invested in the Houston Gulf Airport through a $1.4 million loan to Bath. Apparently, bin Mahfouz likes to invest in airports from one end of the globe to the other.

Bin Mahfouz and Bath also have reportedly had past links to the Carlyle Group. Carlyle's other big-money investors have included Democratic Party-whale George Soros. But the firm is more noted for its Republican Party connections, including former President George H.W. Bush and James Baker III, his chief of staff and Treasury Secretary. Baker spearheaded the successful efforts of George W. Bush's campaign to gain the presidency in 2000 during the contested Florida recount.