Merchant of Death: Money, Guns, Planes, and the Man Who Makes War Possible

by Douglas Farah

  On December 9, Secretary of State Madeleine Albright met in Pretoria with South African president Thabo Mbeki and raised U.S. interest in seeing Bout brought to trial. Susan Rice, who was traveling with Albright, briefed the South African leader, and when she finished, Mbeki agreed to forward the case to his special prosecutor.

  But the next step was departure. On December 12, the U.S. Supreme Court halted a Florida vote recount sought by Al Gore’s campaign, allowing the certification of Bush’s win in the state and sealing his victory as the forty-third president. With a Republican administration looming, the Bout task force was operating on borrowed time.

  Still hoping for a breakthrough in the final days of the Clinton administration, Schneidman decided to use a trip to an AIDS conference in Nairobi as a jumping-off point for a final bid to persuade the South Africans to move against Bout. He had been consulting for months with South African diplomats and legal officials. On one trip he had taken along several intelligence officials to make the case. The South Africans were sympathetic but made no commitments.

  With a flurry of international phone calls, Schneidman set up a last round of meetings in Johannesburg, hoping to persuade the South Africans to refer the Bout case to their special prosecutor, Jan D’Olivera. Arriving in early January, Schneidman met with Aziz Pahad, the deputy minister of foreign affairs. Pahad listened, but was still hesitant. Exhausted and frustrated, Schneidman headed home. He flew back to Nairobi first, where he planned to call Susan Rice on a secure line and tell her that the effort was a bust. “I figured I’d failed, I’m giving up,” he recalled.

  A message was waiting for him at the embassy. Pahad had changed his mind. He would refer the Bout case to the special prosecutor. Elated, Schneidman returned to Washington convinced that Bout’s arrest was only a matter of time. “I came back feeling there would be a next step,” he said.

  He would not be around to see it. On inauguration day, Schneidman, Susan Rice, Gayle Smith, and other senior Clinton staffers packed their files and left. “We just ran out of time,” he said.

  Wolosky and Clarke decided to take their chances in the incoming administration. Clarke was a bureaucratic survivor who had prospered under Bush’s father. Wolosky was easily identifiable as a Democrat and had privately disagreed with most of the new administration’s statecentric foreign policy impulses. But he had been impressed during the 2000 campaign by Bush’s tough talk about taking on Russian organized crime. If the new national security team showed interest in extending the Bout hunt, Wolosky decided, he would stay on until the Russian was under arrest.

  CHAPTER 11

  Now or Never

  Shortly after the inauguration of George W. Bush in January 2001, Condoleezza Rice, the new national security adviser, joined counterterrorism chief Richard Clarke and several NSC deputies for a classified briefing in the White House Situation Room. Lights dimmed and an overhead projector flashed a series of slides on a large screen. Each click brought up a satellite photograph showing dozens of aging Soviet aircraft parked on an airfield tarmac. An expert in Soviet studies and arms control issues, Rice instantly recognized the Soviet-era aircraft. One by one, she neatly identified a succession of Antonovs, Ilyushins, and military helicopters with each new image pulsing onscreen.

  Clarke, who had invited Rice to the briefing, asked his new boss if she knew who owned the massive armada of planes. They belonged to the Russian air fleet, Rice answered. No, Clarke explained. The planes had been part of the Russian fleet. Now they belonged to Viktor Bout’s air armada.

  The briefing had been designed to enlist Rice’s support for continuing the top-secret effort to obtain an international warrant for Bout’s arrest. Clarke, Wolosky, and other NSC officials were convinced they were closing in on the Russian. They hammered home two simple points to Rice: Bout’s air fleet and global logistical network rivaled that of many NATO nations—an image made starkly clear by the Russian planes parked wing to wing in the satellite photographs. And the United States could no longer afford to let him rent that network out to the highest bidder, continuing its gunrunning activity in a volatile world.

  “She immediately saw what the problem was,” said one participant in the meeting. “The visuals were compelling. We got her support by showing her the logistics.”1

  The impact of Rice’s support was immediate. In the early days of the Bush administration, White House officials had little interest in following up on old Democratic initiatives, an “anything but Clinton” mind-set that openly scorned the priorities of Bush’s predecessor. But despite the Bush administration’s return to a traditional foreign policy agenda dominated by states instead of nonstate actors, Rice was persuaded that the NSC should continue the Bout hunt. She authorized Clarke and Wolosky to forge ahead.

  Wolosky’s first move was to request Rice’s permission to pick up where Schneidman had left off. He wanted to meet with the Belgians and the South Africans and develop support for an arrest warrant against Bout. The Bush White House, seeking to reshape the flow of power in the executive branch, had sharply curtailed NSC staff travel, limiting trips only to those flying with the president or in direct support of a presidential meeting. But Rice again agreed.

  Wolosky was the first NSC staffer allowed to independently take an overseas trip in the Bush administration. His plan was simple. He wanted an arrest warrant for Bout from anyone who would give him one. What happened after the warrant was uncertain, but consultations between Clarke and his contacts in the UAE left Wolosky with the strong impression that the emirates would honor a commitment to arrest Bout if there were a legal basis.

  “There was a limit to what the United States could do,” Wolosky recalled. “We couldn’t hold people for three years at Bagram Air Base, like they do now. We knew eventually we would have to have him in a court somewhere and make the case against him. That is why Belgium and South Africa were the best opportunities.”

  Their case that Bout was a key figure in the international arms trade had been strengthened by two public reports issued by the United Nations in late December 2000. The separate reports, issued by experts hired by the Security Council to monitor arms embargo breaches in Angola and Liberia, contained a wealth of new details on the Bout network’s air operations. The reports not only named Bout but also listed his associates and allied firms and identified some of his aircraft. One Bout-linked air firm cited in the Angola report for suspected arms flights was Flying Dolphin, the Sharjah-based cargo airline that was the only firm allowed by the United Nations to continue flying to Taliban-controlled Afghanistan in late 2000. Barely a month after the Angola report’s release, the United Nations halted the air firm’s Afghan routes, raising further suspicions about Bout’s dealings with the Afghan Islamists.2

  Wolosky flew first to Belgium, where there was an open investigation into reports of massive money laundering by Bout firms. But during meetings in Brussels, negotiations quickly went off the rails. Wolosky had invited the local Belgian prosecutor handling the Bout case, Dirck Merckx, to the U.S. embassy for the initial discussions. A small man with a wandering eye, Merckx arrived alone and seemed surprised to find himself facing several U.S. officials across a long conference room table, sitting in front of a large American flag. The U.S. officials encouraged Merckx to “think big,” but then proceeded to rapidly fire off questions about the prosecutor’s knowledge about Bout and his activities, front companies, and money movements. Merckx spoke carefully, reluctant to compromise his inquiry. And when the Belgian asked the Americans what information they would be willing to provide, Wolosky and his team were equally cagey, declining to open up about intelligence and sources because they doubted the sensitive information could be adequately protected.

  “I think we scared the crap out of him,” Wolosky recalled ruefully. “In retrospect it may not have been the best way to handle it.” There were more desultory American contacts with Merckx and other Belgian diplomats over the following weeks, but the two sides never recovered fr
om the strained first meeting. “Ultimately, he wasn’t willing to open his books to us, or us to him,” Wolosky said. “It is too bad because we had a commitment from the UAE to execute the warrant if it were issued.”

  The Belgians later broached the idea of a secret multinational meeting in London with officials from Britain and the United States to share current information on Bout’s operation and coordinate their separate offensives. But intelligence-sharing remained an insurmountable hurdle, and Wolosky had no interest in the proposal. The Belgians soon soured on the idea when unnamed officials suggested that the meeting include Russian and East European officials. The Belgians and the Americans worried that word would get back to Bout. “It was, how shall I say, a question of trust,” a senior Belgian foreign officer said. “We were not prepared to share our files with all of these governments.”3 The fears that Bout had his own intelligence channels proved justified. Within a week of the first Brussels meeting between the Americans and Merckx, U.S. officials later learned, Bout had been informed of the session.4

  Wolosky still had hope for South Africa, where special prosecutor Jan D’Olivera was looking into the possibility of charging Bout with either immigration violations or offenses under a newly passed antimercenary law. U.S. officials believed they could establish a case based on Bout’s alleged criminal intent while operating there. But in meetings with legal officials in Johannesburg, Wolosky sensed that they, too, were nowhere close to delivering a warrant. Without overwhelming evidence, South African officials were reluctant to act. “We did take it seriously, but it needs to be within our law,” D’Olivera explained in 2002. “If someone says that Viktor Bout landed at a certain airport, can you connect it with a certain offense? Without concrete evidence, there’s nothing one can do.”5

  There was one bright moment. In February, the same month Wolosky went abroad, the government of Slovakia, aided by U.S. and British intelligence, halted the Bout-sponsored shipment of a combat helicopter from Slovakia to Liberia. Using a complicated scheme to circumvent the embargo against Charles Taylor’s government, Bout-controlled front companies had arranged for two grounded Mi-24 helicopter gunships to be purchased from the government of Kyrgyzstan, then flown in an Il-76 to Slovakia for repairs. On paper, the helicopters were then to be shipped to Guinea, a neighbor of Liberia in West Africa. The company ostensibly ordering the helicopters was Pecos, a paper entity that frequently served as a front company for Bout’s West African operations.6

  In both cases the helicopters were picked up in Kyrgyzstan and delivered to Slovakia by Il-76 aircraft belonging to Bout’s Centrafricain Airlines. The same aircraft was to fly the repaired helicopters to their final destination: Liberia.7 The repair and delivery of the first helicopter went off without a hitch, but with U.S. and British intelligence monitoring the movements of Bout’s aircraft, the second delivery soon hit snags. Slovak authorities, checking the paperwork of the Centrafricain aircraft requesting permission to pick up the second helicopter, found numerous irregularities in the registration and insurance. With the encouragement of the U.S. embassy, Slovakian officials denied the aircraft permission to land. On February 22, after several days of desperate attempts by Bout associates to obtain landing permission by presenting papers from several different companies controlled by Bout, including San Air, the airplane was allowed to land in Bratislava. But the Slovak authorities, having determined the EUC for the helicopter was a forgery, refused to allow the helicopter to be loaded.8

  Wolosky was ecstatic. He went out of his way to meet with the Slovakian defense minister when the minister visited Washington shortly after the incident. “I wanted to thank him for his help and encourage him to keep doing things like that,” Wolosky said. “It took a lot of moxie for the Slovaks to do that.”

  Obscure as the incident seemed, for those who were tracking international conflicts, bringing down Bout would be a big win for the United States and its allies, and for the first time it was starting to look truly possible.

  In the late spring of 2001, after the Slovak interdiction of the helicopter, other smaller weapons shipments also were interdicted or delayed. The mood among those in the U.S. government following Bout was still hopeful.

  A member of the intelligence community decided to host a Viktor Bout party to acquaint people from different government agencies with each other, given their common interest in the elusive Bout. Several dozen people turned up for the gathering, which took place under cover of a weekend cookout in a Virginia suburb south of Washington, D.C. The mood was festive. Spouses and children were invited, and as the burgers and hot dogs sizzled in the fading light of dusk, those working on Bout clustered into small groups to discuss the latest developments in their hunt for the arms trafficker. With the NSC interest spearheaded by Wolosky, government resources for the operation had expanded and key policymakers had been won over. To this small but dedicated group that included officials from the CIA, DIA, NSA, and NSC, the wind seemed to have shifted in their favor.

  “The idea of thirty or forty people showing up on this one issue was remarkable,” said one attendee. “Our spouses had no idea why we were there, but there would be little cliques of people off in the corner who talked about Bout. It was fun.”9

  On March 30, 2001, Richard Clarke chaired another interagency meeting on Bout in the Situation Room. The topic was how to quietly press the UAE to crack down on Bout’s aircraft and target his larger organization. Because there were so few regulations in the UAE relating to weapons trafficking and aircraft registration, his flight and ground operations operated with near impunity. One option was to ask UAE officials to require all aircraft operating out of Sharjah to install expensive communications and emergency response equipment. Some officials felt that Bout had so many aircraft based in the emirates of Sharjah, Ajman, and Ras al Khaymah that he would be forced to pack up and leave because of the prohibitive cost of installing the equipment—more than $10,000 per aircraft. The strategy had been proposed and accepted by the UAE two years earlier, but never implemented in a serious way. The UAE also had failed to move on promises to enact legislation outlawing at least some of the most egregious gunrunning. A new push on both fronts was ordered.10

  At the same time, the growing evidence against Bout compiled by the UN experts had finally spurred the Security Council to go beyond its “name and shame” campaign and restrict Bout’s movements. On May 21 the Security Council formally placed him on a mandatory international travel ban list, aimed at punishing senior members of Charles Taylor’s regime in Liberia. Along with Taylor and Bout, others on the list included Bout’s American partner Richard Chichakli; Ibrahim Bah, who had introduced Bout to the RUF; and Bout’s partner in weapons shipments to Liberia Sanjivan Ruprah.11 The United Nations’ move gave legal standing to any country willing to try to stop them on entrance, but few countries ever tried to stop anyone on the list. Bout continued to move at will.

  In January 2001 his San Air General Trading company in Sharjah signed a contract with the Ministry of Defense of Côte d’Ivoire for the sale of two Mi-8T helicopter gun ships. At the time, the government of xenophobic president Laurent Gbagbo had launched the traditionally stable West African nation on a long, downward spiral of civil war, fanning ethnic and religious hatreds. As opposition in the Muslim-dominated north mounted toward Gbagbo, the beleaguered president turned to Bout to bail him out.

  An invoice for $2.6 million, dated January 16, 2001, for the two gunships, equipped with C5 missile launchers and bomb launchers for 100-, 250-, and 500-kilogram bombs, was signed by Bout’s longtime San Air business manager Sergei Denissenko on behalf of San Air. The price included a training crew to train three Ivorian crews for four months, as well as $450,000 worth of bombs and missiles for the gunships.12

  San Air also concluded a separate deal on the same day for Bout’s more standard deliveries: AK-47s, millions of rounds of ammunition, mortar bombs, and grenades, for a total of $1.6 million. The invoices instructed that payment be made t
o San Air’s Dubai account number 01-5712572-01 in Standard Charter Bank and promised delivery of the merchandise within fourteen working days of receipt of payment.13

  The sanctions noose might be tightening, but Bout seemed to feel no need to answer to anyone. He refused to talk to the UN panels investigating him, and neither he nor his lawyers or associates responded publicly to their reports. Johan Peleman and fellow investigators on the Liberia sanctions panel finally managed to photograph the Sharjah fleet at close range and interviewed Sergei Bout and a few of Bout’s lieutenants. But the boss always remained unavailable.

  When one company was outed, Bout and his associates nimbly avoided sanctions by reorganizing, changing the names of companies, creating new firms, or reviving old ones that had been in mothballs. In August and early September a new company, Air Bas Transportation, set up offices in the old Air Cess building in Sharjah. Air Bas, unknown at the time to UN investigators and intelligence operatives, effectively replaced Air Cess, Centrafricain and Air Pass, all of which had ceased operations.14 Air Bas officials did not even bother to change the old Air Cess phone number. The aircraft were transferred without hassle.