Salah Ezzedine was interrogated inside a dark and damp holding cell somewhere inside the slums of south Beirut. Hezbollah’s detainees were routinely beaten. The men who interrogated Ezzedine were counterintelligence specialists, the most suspicious and devious minds inside the organization, who were trained in the best spy schools in Syria and Iran. They had no doubt they would swiftly get to the bottom of what had happened. If foreigners were truly involved they were determined to reveal their identities. Ezzedine was questioned for days. Specialists scoured his computers and years of e-mails. His cell phones and their SIM cards were examined. All of Ezzedine’s vehicles were searched for tracking devices. His home was taken apart in search of hidden communications gear or radio receivers.
No one suspected Ezzedine of being duplicitous. He was not a liar nor was he a cheat. Had he been a swindler, Hezbollah would have disposed of the financier in an expeditious and grisly manner: a public hanging, if he was lucky. Ezzedine was genuinely a religious man. Focus soon shifted on his investment partners in the Gulf. They had all vanished without a trace.
Ezzedine was handed over to the Lebanese judiciary for investigation and adjudication. The Lebanese prosecutor general was quietly coerced into charging Ezzedine with negligent bankruptcy—a crime of stupidity rather than criminal intent that carried a short jail sentence, a public slap on the wrist. Nasrallah wanted the affair to simply go away.
Usually, when ill fortune fell upon Hezbollah, the organization was quick to blame Israel and the United States. It was a surefire formula to get the rank and file out on the streets and inside the trenches ready to fight and die. A sewer main collapse in South Beirut, a day of unseasonably cold weather, an accidental explosion at a munitions warehouse, and the Mossad and the CIA were always culpable. This time, though, there were no mentions of Israel or the United States in the Hezbollah press or even in the acclaimed Lebanese media outlets. But still, some people had a sneaking suspicion as to who was to blame. “All this happened because of the United States and Israel,” a cab driver from southern Lebanon who invested $10,000 with Ezzedine commented after the crash with a theme some in Lebanon openly wondered about. “When they discovered that Ezzedine was close to Hezbollah,” he added, “they ruined him.”33
There was concern among some of the Hezbollah hierarchy that the Israeli-led war against terrorist finances played a significant role in unraveling the Ezzedine scheme. While Hezbollah leaders were clear never to lay blame on Israel’s doorstep, some believed that the U.S. Department of Treasury and its effort to battle the laundering of terrorist-related funds played a direct role in making Ezzedine’s funds disappear.34 Some in Hezbollah were certain that Israel was behind the scheme. How else could it be explained, they asked?
Still, Lebanese Shiites were very wary to go as far as to openly charge Ezzedine with being duplicitous, or being a dreaded jassoos, an informant or operative, either willing or otherwise, on behalf of a “foreign” intelligence service.
The Ezzedine affair exposed a moral vulnerability inside Hezbollah that needed to be penetrated and exposed. Nasrallah once said of his supporters that they were “the most honorable people in the world.” Nasrallah knew that these honorable people would not accept the fact that Hezbollah operated one of the largest drug trafficking and money laundering criminal operations in the world. He was wary of risking anything that might cause them to cast their suspicious eyes in Hezbollah’s direction. In the aftermath of the affair, Iranian coffers were emptied to try, once again, to compensate the believers for their faith and suffering. Just like in 2006, Hezbollah compensation came in the form of brand-new U.S. $100 bills. Like 2006, one Lebanese media website posted, “The speed with which the dollars began flying was clearly aimed as much at blunting ill will toward the party because [it] unleashed such a destructive onslaught as it was at helping people. Hezbollah knows it needs to pay these people or risk losing its more ardent followers. Once again, the party will throw money at the problem it is responsible for creating.”
The Ponzi scheme exposed many chinks in Hezbollah’s seemingly impenetrable armor—money being its most glaring weakness. The affair was a major embarrassment for Hezbollah and a major financial hit for the Party of God.
No one in Israel shed a tear for their pain and suffering.
CHAPTER THIRTEEN
The Cocaine Jihadis
As far back as the 1990s, the Canadian Security and Intelligence Service, the country’s foreign-intelligence-gathering espionage agency better known by its acronym of CSIS, identified Hezbollah as a threat. For decades, scores of Lebanese seeking to flee the barbarous civil war sought a new life in Canada. Between lax immigration laws and French being the provincial language of Quebec, the newcomers from the Middle East felt welcome. Unfortunately, not all the newcomers were refugees seeking better lives for themselves and their families. Some had terrorist ties back home and nefarious interests in their new, adopted country.
In an internal report, CSIS identified operatives using Canadian cities as deep-cover bases, and it identified criminal activity as supporting hostile operations against Canada and the United States; Hezbollah, CSIS would later assess, was very active operationally in Canada.1 Hezbollah operations in the United States were just as much of a concern.
In 1996, in the cigarette country of North Carolina, an Iredell County Sheriff’s Department deputy passed on a tip to the local Bureau of Alcohol, Tobacco, and Firearms field office in connection with Middle Eastern males making large-scale cigarette purchases at local warehouses and then driving out of state. Truckloads of tobacco products were being bought at a time. The curious law enforcement officer had stumbled on a far-reaching and sophisticated Hezbollah operation that funneled cigarette-smuggling profits back to Lebanon. The suspicions and investigations ultimately involved the FBI-led Joint Terrorism Task Force in North Carolina, the Secret Service, the Immigration and Naturalization Service, the Internal Revenue Service, and the State Department’s Diplomatic Security Service. The Hezbollah cell purchased cigarettes in the low-tax state of North Carolina and transported them north to Michigan, a high-tax state, where the cigarettes were resold and taxes never paid. In July 2000, federal, state, and local law enforcement authorities, following the tip, executed eighteen search warrants, and seized cash, weapons, and incriminating documentation. The federal effort, known as Operation Smokescreen, was executed with the assistance of intelligence provided by CSIS.2
Hezbollah’s cigarette smuggling operation netted a total of $8 million, which was spread among hundreds of bank accounts and wire transfer locations that sent the funds back to Lebanon. Some of the profits were used to purchase a mini-arsenal of military equipment in the United States to be shipped back to Hezbollah for the fight against Israel and, later, the United States in Iraq. The equipment included night vision goggles and sniper scopes, laser range finders, laptop computers, and very expensive digital cameras and long-range lenses. The materials also included advanced naval equipment. It is suspected—but not known—if any of this advanced equipment was delivered to the Iranian Islamic Revolutionary Guard Corps.
Charges were filed on March 28, 2001, in the U.S. District Court for the Western District of North Carolina. Twenty-six individuals were ultimately charged with a multitude of crimes including racketeering, money laundering, immigration fraud, credit card fraud, marriage fraud, visa fraud, bribery, and providing material support to a declared terrorist organization.3 Those charged were also hit with violations of the Racketeer Influenced and Corrupt Organization Act—a lethal tool used by U.S. attorneys in major cases of a criminal conspiracy. “In a lot of ways, this case was a model for how to use intelligence information. Not only U.S. intelligence but foreign intelligence,” stated Martha Rubio, a Department of Justice attorney involved in the prosecution.4
All those involved in the Hezbollah scheme either confessed or were convicted of their crimes. The ring leader, Mohammed Yusef Hammoud, was sentenced to 155 years in federal prison
. Hammoud had, years earlier, attempted to obtain a visa to enter the United States at the U.S. embassy in Damascus, Syria. His request was denied, so he traveled to Venezuela and purchased a forged visa for $200. South America, it appeared, was becoming a Hezbollah stronghold of great concern to Israel and, ultimately, the United States.
Shai U. was born in Israel in 1960. He was seven years old when the Middle East changed forever and Israel achieved the impossible in six days in June 1967. He was of Bar Mitzvah age when Israel, once again at war, eked victory from the initial shock of surprise, overconfidence, and unpreparedness in the 1973 Yom Kippur War. Like all Israelis, Shai U. completed high school and served his mandatory three years of conscripted military service, followed by additional time in uniform as a commissioned officer. As he neared the completion of his service, Shai’s mother urged him to hang up his uniform and leave the army; she wanted him to follow the dream of every Jewish mother and go to medical school. Medical school didn’t work. Shai was bored and unhappy. He reenlisted, serving four years in the army in a combat unit.
At the age of twenty-four Shai was already a seasoned combat veteran eager to start a new and more interesting chapter to his life. In 1984 he entered service with the Shin Bet as a counterterrorist and counterintelligence officer. Like all junior agents, he cut his teeth on terrorist cases in the West Bank. A crash course in Arabic gave him the colloquialisms of someone who had spent much of his life in Nablus or Jenin. As he began running agents and handling operations, Shai was a natural for the spy game.
Some of Shai’s work was in Israel, inside the West Bank and Gaza. He also operated far from Israel’s borders. He rose up the ranks fairly quickly, developing a reputation as a thorough case officer and a cunning commander. Shai was rewarded with a plum assignment. Between 2001 and 2004 he served as the Shin Bet agent in charge responsible for the Latin and South American desk. He learned Spanish and traveled throughout the continent. Shai had an inherent talent for the assignment: He loved soccer and had a knack for coordinating multijurisdictional cooperation on a wide array of investigations and operations.
When Dagan recruited Shai to serve as Harpoon’s deputy chief, his service in South America was considered a plus. Israel’s intelligence services have had a long operational track record in South America. One of the early Mossad operations to inspire world attention was the legendary abduction of Adolf Eichmann, one of the chief architects of Adolf Hitler’s Final Solution, from Buenos Aires in 1960. After the fugitive Nazi official—who was in deep hiding—was tracked down, he was seized by Israeli agents and whisked out of the country to stand trial in Jerusalem for his role in the genocide he had perpetrated in Europe. It was a stunning and spectacular accomplishment for the fledging Jewish state and publicly displayed the Mossad’s cunning and global reach to an amazed world. The Shin Bet was summoned to Buenos Aires twice, in 1992 and 1994, to investigate the Hezbollah and Iranian connections to the suicide truck bombings of the Israeli embassy.
Hezbollah consumed much of Shai’s activities in South and Latin America. Lebanese and Syrian immigrants, descendants of the great Phoenician seafarers, had traveled to the four corners of the world in the late 1800s and early part of the twentieth century to seek their fortune and religious freedom. Many of those who settled in Argentina and Brazil were Shiites. They built strong and vibrant communities, established enterprises—legitimate and other—and created hubs of commerce and religion that would attract future generations of nomads who spoke little Spanish or Portuguese but who could work hard and be trusted inside the insular ethnic ghettos that they had created.
Maicao, a city of some 100,000 inhabitants in northern Colombia, was cigarette and marijuana country, and a key area of operations for government and communist forces fighting Colombia’s protracted civil war. Maicao was the northernmost city in the continent. It bordered Venezuela. Maicao also boasted one of the largest Shiite populations in South America; seventy percent of the local commerce in the city was run by Shiite émigrés and their children.5 The money, from sales of consumer goods and the sale of weapons and cocaine, flowed into the hands of powerful merchant clans who became millionaires ten times over in the tropical paradise. Some of the money remained in Maicao. Palatial homes were constructed, and the local BMW and Mercedes dealerships did a brisk business. The city boasted the opulent palace-like Mosque of Omar Ibn al-Khattab, built in September 1997, which is the second-largest Muslim house of worship and religious center in South America.
The local merchants proudly displayed photos of Hezbollah’s leaders, such as the movement’s spiritual mentor, Sheikh Mohammed Hussein Fadlallah, and Sheikh Nasrallah. The stores all had little cans or jars near the register so that shoppers could drop a coin or a few pesos for the cause back home. Larger donations were also solicited from the Shiite community. The packs of cash, converted into dollars, were sent to Lebanon—and sometimes Syria—through banks in Panama and Bogotá. These banks, the same that had made billions laundering the drug profits from the dreaded Colombian cartels, were used to handling money without asking too many questions, and they were used to handling money from Maicao.
In short time the Shiite community grew and spread out geographically, absorbing wealth and influence as it grew. There were known Hezbollah and Iranian hotbeds in South America. The tri-border region area along the junction of Paraguay, Argentina, and Brazil, where the Iguazú and Paraná rivers converge; the Paraguayan city of Ciudad del Este; the Argentine city of Puerto Iguazú; and the Brazilian city of Foz do Iguaçu, were long known to be Hezbollah’s South American hubs. Shai had visited the area, known as the “Triangle,” on numerous occasions, as had spies and special agents from the United States, Canada, and a half-dozen nations in the European Union. Drugs, guns, and human trafficking were the currency of day-to-day life in the region.
But Harpoon had learned, especially following the 2006 Second Lebanon War, that Venezuela was a center of Hezbollah’s criminal—especially narcotics-related—revenue. The criminal money was critical to Hezbollah. Iranian support, while guaranteed, was not as generous as in previous years. A combination of economic sanctions, a miserable economy spurned by mismanagement, and plummeting oil prices forced Tehran to send fewer dollars to Beirut. The smaller grants had a great impact on Hezbollah, and forced the organization to rely more on its criminal enterprises around the world to continue to finance its ever-expanding infrastructure and the loyalists back home.6 Most of Hezbollah’s profit stemmed from cocaine trafficking.
Israel’s intelligence organizations had very little experience in crime fighting. Battling drug operations was the domain of the police. But all of Israel’s intelligence service placed a newfound focus on South America and the cocaine trade and was determined to unravel the highly secretive layers that shielded Hezbollah’s global drug empire from penetration and compromise.
Dagan’s roundtable reviewed the intelligence carefully. The meetings were lengthy and sometimes hotly contested, as differing opinions on strategies—and jurisdictional responsibilities—were often debated with typical Israeli zeal and volume. A cloud of smoke from Dagan’s pipe always fogged up the conference room. No one ever dared to complain; they simply developed alternative methods of breathing. As the roundtable assembled their data, all coming in from a variety of sources that represented the agencies they worked for, one name kept appearing in report after report: a mysterious forty-four-year-old Venezuelan named Ghazi Atef Nasser al-Din.
Ghazi Atef Nasser al-Din was born in southern Lebanon on December 13, 1962. When he was young, his family—nearly all of the collective clan, or hamula—migrated to Venezuela to seek their fortune and to escape the turmoil, conflict, and combat that had erupted once the Palestinian guerrilla organizations, forced out of Jordan, had taken up residence in Lebanon in 1970 and 1971. Life was difficult for the young Lebanese boy in the new country with a new language and a new culture. Ghazi’s family was pious. The family worshipped at the local mosque; Ghazi attended I
slamic schools. Intelligent and ambitious, Ghazi worked with local Islamic businesses and charities that placed him as a go-to guy in Venezuela’s Shiite community. The young entrepreneur minded his own fortunes as well. Ghazi developed an impressive portfolio of real-estate holdings and business ventures that made him wealthy and powerful. In time he was considered a man in good standings with some of the Lebanese émigré criminal gangs, including those who worked in narcotics.
Many of the émigrés lived on Margarita Island, a vacation spot 190 miles due east of Caracas, the Venezuelan capital. The island was a smuggler’s paradise—it was a cigarette boat ride from Trinidad and Tobago; Curaçao, Panama, and the Caymans were all accessible on the wide open seas. Margarita Island was virtually a Lebanese and Syrian colony. It was a favorite vacation spot for religious Muslims, boasting resorts that catered specifically to visiting Shiites from the Middle East. Eighty percent of the businesses on the island were owned by Arabs, primarily Lebanese and Syrian Shiites; the U.S. government estimated that many of these businesses were also involved in drug trafficking and money laundering.7 As a result of this lucrative and dangerous trade, the island was full of fortresses and heavily armed thugs who protected the drugs and the money they earned.
There were two markets that these cocaine gangs served: North America and Europe. The profits from the trade, minus the skim and expenses, were always sent back as tribute to Hezbollah, Syrian intelligence forces, and the Iranian Islamic Republican Guard. As in every organized crime enterprise, the money earners were expected to kick up the organizational chain and allow the leadership to earn its due. One method used for shipping the funds back to the Middle East was known as the Black Market Peso Exchange, or BMPE.
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