Dagan was determined to change the paradigm. He viewed the money as the air that the terrorists breathed, and he was determined to strip them of every dollar, dinar, and euro he could. It was a hard sell.
Hamas for its part continued to build explosive vests and convince young Palestinians to strap them on and detonate themselves with promises of earthly glory and heavenly bounties. The West Bank–born Engineer was still Hamas’s chief bomb maker and asset and, as such, the number one fugitive hunted by the security services. The Shin Bet eventually removed the thirty-year-old Ayyash from the equation in early January 1996. Ten grams of military-grade explosives hidden inside a Motorola cellular phone killed “the Engineer” as he spoke to his father. The death of Ayyash was as much an act of preemptive deterrence as it was of vengeance. The brilliantly executed operation was a desperately needed confidence booster for the Shin Bet.
More than 250,000 mourners flooded the streets of Gaza City to express their grief over Ayyash’s assassination and swear revenge. There was a forty-day period of mourning and then the suicide bombers returned to the streets of Jerusalem and Tel Aviv. Other bomb makers picked up where the Engineer left off.
The first catastrophic attack came on the morning of February 25, 1996, when a Hamas suicide bomber blew himself up on a bus on Jaffa Road in the heart of Jerusalem.* Twenty-six people were killed and more than fifty were wounded. Exactly one week later, the same bus route was hit at the exact same time. This attack left nineteen people dead, and close to one hundred wounded. On March 4, 1996, Hamas claimed to take revenge again for the Engineer’s death. At 4:00 PM that day, a twenty-four-year-old suicide bomber from Ramallah, Abdel-Rahim Ishaq, detonated himself outside the Dizengoff Center, Tel Aviv’s largest mall. It was the eve of the Purim holiday, and the stores were particularly crowded with shoppers, many accompanied by children dressed in costumes for the holiday. The bomber sought to enter the mall but turned back because of the armed guards on the doors. Instead, he stepped into the busy intersection where a large number of pedestrians were crossing the street and set off his twenty-kilogram nail bomb. Thirteen people were killed and 130 were wounded. One of the victims, Tali Gordon, was a twenty-four-year-old student from the Tel Aviv suburb of Givatayim. She was standing in line at an ATM machine, waiting to withdraw some cash before she went out to celebrate that evening with friends. Her mother, a tour operator, was in Jordan that day on business. She heard the news about the Dizengoff attack but had no clue that her daughter was nearby, much less one of the victims. “Two hours after the attack,” she said in an interview, “I suddenly saw Tali in the sky. The entire sky filled up with her image. She was all over it. I stopped breathing. I realized then that Tali was one of the victims. She came to me to say good-bye.”
It was the fourth suicide bombing in a ten-day period.
The Rabin assassination, the bombings, and the sense of paralyzing fear that ensued had brought Israel to the brink. Israel went to the polls on May 29, 1996. It had been a traumatic two years for Israel, with hopes of peace dashed by suicide bombers and an assassin’s bullets. Election polls and the Hebrew press were predicting Peres would be returned to the prime minister’s residence. But Israeli voters opted for stability and security, and the close election saw Benjamin Netanyahu, the head of the Likud Party, become the twenty-seventh prime minister of Israel. On June 18, 1996, Netanyahu formed a right-wing coalition between Likud and some smaller fringe and religious factions.
Netanyahu was elected on a promise of security. One of his first steps was to promote Dagan, whose genius and tenacity he appreciated, to head the Counterterrorism Bureau. Dagan’s first phone call as the head of the bureau was to the COGAT headquarters. “I was a colonel, working at my desk when the call came in,” Uri recalled. “Dagan asked me what I was planning to do with my future. Before I could reply he asked if I’d like to come and work for him.”19 Shortly after, Uri was in Jerusalem as Dagan’s deputy.
One of the unit’s first acts was to establish an informal task force to focus on terror financing. Finally, there would be a real effort to cut the means of terror off at the source—its funding. For the newly appointed Bureau Chief, it was like Sayeret Rimon all over again. It was pure Dagan—rogue and revolutionary. Prime Minister Netanyahu didn’t even know it existed.
CHAPTER FOUR
The Head of the Table
Meir Dagan’s detractors liked to say that he shot first and aimed later. His rivals in the IDF believed that the man was all about brute force, the ends justifying the means. The depiction was inaccurate and, ultimately, insulting. Dagan possessed a tactical gift to analyze strategic threats and create daring ways to mitigate them. He analyzed every military objective, and was never scared to make a tough call or venture into harm’s way to do what had to be done.
Planning to create a financial intelligence task force in the mid-1990s, Dagan envisioned an all-hands-on-deck effort. He wanted to chair a roundtable comprising a representative apiece from the IDF, military intelligence, the Israel Police, the Ministry of Finance, the Israel Tax Authority, the Israeli Customs Directorate, COGAT, the Bank of Israel, and the Foreign Ministry. Joining them would be one of the prime minister’s legal advisors. Of course, for Dagan’s experiment to work, both the Mossad and Shin Bet had to send representatives of their own.
As the director of the Prime Minister’s Counterterrorism Bureau, Dagan should have had little difficulty in getting the various government agencies to cooperate and send a representative to the monthly meeting. But the opposite was true. None of the intelligence, military, or security chiefs wanted anything to do with the venture.
The Mossad had little interest in cooperating. They were battling Hamas overseas, as well as attempting to gather intelligence on Hezbollah, Iran, Syria, Saddam Hussein’s Iraq, and the multitudes of other enemies that kept the director of the Mossad awake at night. The Shin Bet, shepherded by Ami Ayalon, also had more than it could handle. The PA, Hamas, and the PIJ were all waiting for an opportunity to launch a war against Israel. The zealots, like Rabin’s assassin, were still out there—still determined to make the next prime minister pay with his life for the unpopular agreement with the Palestinians—and the Shin Bet’s Jewish Affairs desk had to recruit personnel from other divisions just to protect Netanyahu.
The Mossad director did all he could to ignore Dagan’s constant stream of calls and e-mails. The Shin Bet displayed an equal dose of contempt for the repeated requests to assign a senior staffer to Dagan’s task force. “Many in the organization,” a senior Shin Bet official confided, “simply hoped that Dagan would forget about the nonsense and go away.”1 But Dagan didn’t take rejection well. The more the Mossad and Shin Bet chiefs resisted, the more persistent he became. Dagan possessed an ample supply of a uniquely Israeli personality trait known as davka, a word that loosely translates as “stubborn spite.” Ultimately, the spy chiefs relented, overwhelmed by Dagan’s full-court press insistence, and dispatched representatives to the monthly meetings.
Most of the task force’s early work was to establish a true forensic analysis of how the terrorist groups funded their activities.
The financial warfare unit was plagued by politics and ego. Jealousies, a trait very apparent in ambitious Israelis in prominent positions, hampered Dagan’s attempts to formalize and unify this element of Israeli counterterrorism. The various representatives bickered and dragged their feet; some were reticent to share intelligence. The spies didn’t like being told whom to snoop on, the military didn’t like being told whom to target, and the police didn’t like being told whom to investigate. Reluctance and confusion reigned.
The new unit had no clue where to begin or whom to target first. There were also political considerations to take into account because of the peace process, not to mention a separate financial effort directed against the PA.
Prime Minister Yitzhak Rabin had staked his political legacy—and, ultimately, his life—on a lasting peace with Arafat, and the est
ablishment of the Palestinian Authority. The United States and countries in the Middle East and Europe weren’t willing to go all in just yet, so they sent money—billions of dollars intended to improve the lives of the Palestinian people. The donations were meant to fund schools, build hospitals, and establish a national infrastructure—everything that Hamas was already doing with its own separate network, the da’wa.
But corruption inside the territories was rife. Arafat had built a feudal empire of nepotistic grandeur, where funds intended to help the impoverished were diverted into Swiss bank accounts and secret stock portfolios, and sent to Parisian real estate brokers. While ordinary West Bank Palestinians struggled, the BMW and Mercedes dealerships in Ramallah did a stellar business. Cronies close to Arafat, along with those related to his security chiefs, built palatial hilltop villas around Ramallah and Nablus. The money provided the Palestinians with just enough confidence to work with the Israelis, but they always made it clear that they could easily halt the relationship and unleash more horrific bloodshed.
One of the officers working the COGAT desk near Ramallah liked a political cartoon so much that she hung it at her work station. A former member of COGAT remembered the sharp daggers of the illustrated editorial. The lampoon depicted Arafat, at his desk in the president’s office at the helm of the Palestinian Authority, taking a call on why the garbage hadn’t been collected and why the mail hadn’t been delivered. Arafat, the drawing showed, turned to a comrade, lamenting, “Hijacking airplanes was so much easier.”2
Jet-setting around the world as a guerilla leader and fighting in the trenches of Beirut were simpler affairs than building a state or meeting the enormous expectations of his people. The PA was supposed to be a transitional step in the establishment of a sovereign Palestinian state. The PA’s true power was evident primarily in what was known under the 1993 Oslo Accords as Area A. This designation—the Gaza Strip and the eight West Bank cities of Hebron,* Jericho, Bethlehem, Qalqilya, Tulkarm, Nablus, Jenin, and Ramallah—was where the PA held full security and civilian control. The Palestinians enjoyed political autonomy there—political control that Arafat maintained with an iron grip courtesy of thirteen security services, intelligence agencies, a Praetorian guard, and a police department. All were led by sycophants and Arafat loyalists. He even had a Coast Guard. The PA was not allowed to maintain a standing army under Oslo, but Arafat’s security services were firmly in charge. Israeli citizens and, crucially, Israeli military and intelligence personnel were forbidden to enter Area A.
Meanwhile, the money also kept flowing into the Hamas coffers. The group perpetrated three suicide bombings in 1997, the deadliest of which were the July 30 twin attacks at Jerusalem’s busy Mahane Yehuda Market. Both bombers entered the outdoor market dressed in black business suits and white shirts, masquerading as attorneys; reportedly, the bombers smiled at each other before detonating themselves moments apart.3 Sixteen people were killed in the double bombing and more than one hundred were wounded.
The Mahane Yehuda attack put Hamas squarely in Israeli crosshairs. Experts like Lavi S. did their best to argue that in the case of Hamas the money was both a tactical and a strategic target. “The da’wa, the long-term investment in the fundamentalist education of children from cradle to grave, was more important to Hamas than military operations,” Lavi argued. “The da’wa was everything for Hamas. The money paid for schools and teachers to indoctrinate future generations. The da’wa paid for bread for the hungry and care for the sick; if you were sick, the da’wa funded your medical treatment in Israel, in Jordan, or even in Doha. The da’wa housed the homeless.”
And, Lavi argued, “The da’wa not only paid for the salaries of military commanders but it paid for the bullets and for the explosives. The da’wa paid the salaries of those in the field and it paid salaries to those arrested by the Israelis. The da’wa paid for the funerals of suicide bombers; the da’wa paid the widows and the bereaved families. Without the da’wa Hamas couldn’t attract recruits nor could it function.”4
The infrastructure and proselytizing wasn’t something that could be taken down with an assassination or air strike. It was a complicated process that required a slow and methodical approach—something that the Israeli public, dealing with daily threats, did not have the patience for. The men sitting around Dagan’s roundtable didn’t want to take their focus away from targeting Hamas commanders and working with the PA on joint security operations. Secretly, and with naïve overreach, many Israeli security and military chiefs still had hoped that the PA would do Israel’s dirty work for it.
Despite all of his efforts and all of Uri’s analytical studies, little progress was made on the task force.
In the spring of 1999, Netanyahu’s government lost a vote of no confidence in the Knesset, setting the State of Israel on the path of yet another election cycle. On May 17, 1999, the voters resolutely showed that the status quo was unacceptable, voting Netanyahu out in a landslide. The new prime minister was Ehud Barak, Netanyahu’s former commanding officer in Sayeret Mat’kal and a protégé of Yitzhak Rabin. Barak had an impressive résumé: Israel’s most decorated soldier, a former commando, IDF chief of staff, and foreign minister. He promised to go above and beyond, to once and for all reach a peaceful accord with the Palestinians. He won the elections with 56 percent of the vote—an unprecedented victory by Israeli standards. Dagan was not immune to undercurrents of politics and ego, and he wasn’t interested in a clash of wills. “Dagan always said that Barak was incredibly smart, but also very dangerous,” Uri recalled.5 Meir Dagan resigned as head of the Prime Minister’s Counterterrorism Bureau shortly after Barak’s election.
Old soldiers didn’t fade away, however, and Dagan became an ad hoc advisor to IDF Chief of Staff Shaul Mofaz. Uri remained at the Counterterrorism Bureau, working as liaison to the U.S. authorities, aiming to enhance the special relationship between the United States and the State of Israel. He shuttled back and forth between Tel Aviv and the Beltway, where he worked with members of the Department of Justice and other elements of America’s intelligence agencies to raise awareness of the Hamas presence in the United States, as well as other regional threats posed by groups such as Hezbollah in Lebanon.6
In May 2000 Prime Minister Barak ordered the unilateral withdrawal of all IDF personnel from southern Lebanon; Lebanon had been a quagmire for Israel since 1982, resulting in the deaths and injuries of thousands of soldiers. Many viewed Barak’s decision as necessary, but feared that it sent a message of capitulation and surrender to Hezbollah—and Iran. Barak was determined to end the stalemate with the Palestinians at what, to many, appeared to be any cost. Barak was a man who believed in decisive action on the battlefield as well as dynamic all-or-nothing gestures in politics. When in May 2000, the Palestinians launched their annual Naqba (the “great catastrophe”) protests throughout the West Bank to commemorate the founding of the Jewish state, Israeli counterterrorist officers had a sixth sense of the looming violence. “The protests, the burning tires, and the intensity of the rage and hatred were different this time around to previous years,” a team leader in a Border Guard undercover unit said as he stood a safe distance from Palestinian lines in Nablus. “There was an invisible sense that we were on a countdown toward a hellish eruption.”7
One final last-ditch effort to prevent the collapse of the peace process began on July 11, 2000, when Ehud Barak entered into intense negotiations with Arafat over the final status of the Oslo Accords. The two men met at the American presidential retreat of Camp David, Maryland. Bill Clinton, in the twilight of his presidency, was hoping to secure his legacy by brokering a deal. Barak, according to reports, was willing to offer the Palestinians concessions that were considered unthinkable in Israel, including the partition of Jerusalem. Arafat viewed the negotiations as an attempted ambush by the Israeli prime minister and the American president.8 For two weeks the parties negotiated in vain, with Arafat obstinately stubborn.
The failed negotiations mark
ed an end to any hopes that the Palestinian Authority could exist in peace side by side with the State of Israel. Barak had offered far beyond what Israelis back home would accept, and Arafat still rejected it.
Israel braced for a status quo, while Arafat prepared for bloody war. The Palestinian leader knew that the world would blame him for the summit’s failure, and he planned for a conflict that could give the Palestinians something of a diplomatic initiative.9 The only question was when to launch it.
The spark that ignited the fires of conflict came on September 28, when Ariel Sharon, head of the opposition Likud Party, led a contingent of party members to the Temple Mount, accompanied by a phalanx of security officers. The provocative visit, telegraphed well in advance, was intended to show Israelis that under a Likud government, there would be no compromise on Jerusalem’s Jewish sovereignty. Israeli officials had received private assurances from Palestinian security chiefs that the visit would not be used as a casus belli. But the next day at Friday prayers at the al-Aqsa mosque on the Haram ash-Sharif (the Arabic name for the Temple Mount), Israeli security forces were pelted with rocks and Molotov cocktails. The violence spread across the Old City of Jerusalem and to checkpoints separating Palestinian lines. The second Palestinian uprising, the al-Aqsa intifada, had begun.
Arafat saw his chance, and the violence quickly turned into armed confrontation. Within days Palestinian rioters, Israeli soldiers, and policemen were killed. Palestinian security forces openly engaged Israeli troops in battle. Oslo, as Rabin had envisioned it, was dead. Arafat sought to convince world leaders that the escalating violence and terror attacks were the result of a grassroots uprising spurred on by the disappointment and rage of the Palestinian street against Israel.
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