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

by Douglas Farah

  The Russians were the least of Chris Walker’s concerns when he took over Baghdad’s flight clearance operation in the fall of 2003. Several fly-by-night air firms had disobeyed landing procedures, and at least one, a Lebanese outfit, was banned outright from Baghdad. The Russians and other East European air crews, adept at seat-of-the-pants flying, blended right in with BIAP’s “cowboy environment.” They rarely spoke more than a smattering of English, a language barrier that sometimes became a concern during nerve-racking approaches. But their planes were better suited than newer American models for the airport’s rugged conditions. “They were cheap and plentiful, old warplanes built for chaos and adverse conditions,” Walker said. “They could take bad runways, crash landings, and keep on flying. Airbuses and Boeings were just not built for that kind of wartime stress.”

  The Russians faded into the background as Walker wrestled with a rash of new problems. Sudden power blackouts were darkening the field and shutting down flight operations several times a week. Looted furniture and equipment still had not been replaced, forcing some airport officials to work on crates. Inexperienced Iraqis had taken over forklift operations, leading to a surge in smashed pallets and punctured aircraft hulls. And in December, a departing German DHL Airbus 300 was struck by a SAM 7 surface-to-air missile. With one wing shredded and an engine aflame, the freighter managed to land safely. The repercussions were immediate: commercial flights were delayed even further. Cargo operations picked up after a brief delay, but with tighter security arrangements. Fearing that skyrocketing air insurance rates would shut down the Baghdad airlift, Walker and another CPA official quietly flew to London to plead with Lloyd’s of London to keep carriers’ rates low.

  By spring 2004, cargo operations had resumed without further incidents, and the airport settled back into its normal high-pitched state of chaos. As the pace of reconstruction work in Iraq quickened, the volume of daily cargo flights rose dramatically, from twenty-five a day in January to more than sixty by April. Overworked air freighters were flying into BIAP in the morning, departing and returning for a second run by day’s end. Every day, Walker had to sort through a growing backlog of new e-mails requesting permission to land. And there was the constant intrusion of cold calls from air firm and shipping agents pleading their cases to set up favored new passenger and cargo routes into Baghdad. “Everything was hurry up, we need it now,” Walker recalled. “It wasn’t when do you want it, it was: Do it now. The fewer questions asked the better.”3

  Then, one morning in mid-May, Walker flicked on his laptop and saw an urgent e-mail relayed from his superior, former marine lieutenant general Jeffrey Oster, Bremer’s deputy administrator and the CPA’s chief operating officer. Officials in Washington were up in arms about a May 17 news story that had appeared in the Financial Times of London. Though its details were sketchy, the newspaper was reporting that Viktor Bout’s air transport network was active again: the Russian’s air firms appeared to be “delivering goods to U.S. forces in Iraq.” At the same time, the newspaper added, French officials were complaining that U.S. and British diplomats were resisting a Security Council proposal to impose an assets freeze on Bout as part of efforts by the United Nations to isolate associates of Liberian dictator Charles Taylor, who had been forced from power in 2003. “U.S. and British officials at the UN deny any knowledge of Mr. Bout’s alleged activities in Iraq,” the Times reported.4 Oster wanted to know whether the story was accurate. If it was, he wanted Walker’s recommendations on how to deal with it. “We need answers,” Oster messaged.

  Walker had never heard of Viktor Bout. But as Walker began contacting American military contracting officials and scanned aviation and news sites on the Internet in the days that followed, the odd Russian name became depressingly familiar.

  Bout had pulled off the ultimate metamorphosis, from hunted international criminal to the U.S. military’s secret delivery man. In times of war, his fleet of battered planes had proved again and again that it could move anything into and out of battle zones, no matter how rough the terrain or chaotic the circumstances. It was the global reach of his planes, a rugged transport system that no other private hauler could duplicate, that made Bout’s organization such a valued partner across the Third World. Now the same logistical prowess that had alarmed Lee Wolosky because of the access it offered to terrorists and warlords made Bout’s network useful to U.S. military planners. When America went to war, repercussions could always be shunted off for later, after the shooting stopped and the supplies were in. Bout got things done, no questions asked. But it quickly became clear in the aftermath of the swift U.S. victory over Saddam Hussein’s hapless forces that the shooting would go on and that the urgent need for supplies would not let up. In time, the hiring of Bout’s planes in Iraq became a glaring embarrassment for the Bush administration, a textbook case of shoddy postwar planning and bureaucratic blindness.

  After only a few hours online, sitting at his desk in the Presidential Palace, Chris Walker realized that the Coalition Provisional Authority and the Defense Department faced an acute public relations problem. As he read up on the Russian’s arms trade background and scanned through lists of his suspected air holdings in UN reports and aviation sites, Walker bristled, recognizing the name of Bout’s flagship air firm, Irbis. Registered in Kazakhstan, Irbis—Russian for “snow leopard”—based most of its planes in Sharjah. The firm, Walker would learn later, was an alter ego of Bout’s Air Bas operation. Walker knew that “Irbis” was listed repeatedly on the RAMCC flight manifests he looked over every day. Irbis planes had been flying into Baghdad even before he arrived in August 2003. And he had never had reason to double-check the firm’s background because Irbis had already been approved through RAMCC. As he scrolled further, Walker read about Bout’s manipulation of an entire orchestra of air cargo firms—with names often altered to avoid the scrutiny of prying officials like him. That meant that any of the Russian and Eastern bloc air crews who had been the rock-solid linchpins of the Iraq airlift were now suspect. Several dozen East European air cargo firms had been flying into Baghdad since the summer of 2003. Many of the companies were based in the UAE. Their planes had routinely shuttled into and out of BIAP on hundreds of cargo runs. Some of the flights had carried high-security items such as guns, ammunition, and armored vehicles. How many of the firms, Walker wondered, were run by Viktor Bout? Were there security breaches? How did military intelligence agencies fail to flag Bout’s flights before they began arriving in Baghdad? Even if Bout’s planes did not pose risks, could insurgents similarly exploit the same security gaps and gain access to BIAP and other American air bases in Iraq?

  Walker felt sandbagged. He remembered watching idled Irbis crewmen chain-smoking besides their planes while their cargos unloaded. He had even climbed into the cramped cockpit of one of their Antonovs for a random inspection, admiring the 1960s-vintage freighter’s antique altimeters and gauges and torn seats patched with duct tape. “Everything was grizzled, even the crew,” he recalled. “They looked like guys who needed a buck. They looked like they hadn’t shaved in a week.”

  Now armed with specific tail numbers of Baghdad flights that matched Bout-tied Antonovs and Ilyushins on Internet aviation sites, Walker began contacting American military officials to find out if Irbis was flying with valid government contracts. The officials he spoke to did not volunteer much, but they confirmed the worst. Bout’s network was flying for the United States. The officials explained that Irbis had been hired repeatedly as a secondary military subcontractor, delivering tents, frozen food, and other essentials for American firms working for the U.S. Army and the U.S. Marines. The Bout flagship also was a third-tier contractor for the U.S. Air Mobility Command, flying deliveries for Federal Express under an arrangement with Falcon Express Cargo Airlines, a Dubai-based freight forwarder. And Irbis was also flying, Walker learned, under reconstruction contracts with the petrochemical giant Fluor, and with Kellogg, Brown, and Root (KBR), the engineering and constructi
on subsidiary of Halliburton—the influential multinational conglomerate that had been awarded a massive no-bid reconstruction contract in Iraq and that was previously headed by Vice President Dick Cheney. (Even Walker was unaware at the time that Irbis’s contract flights for Fluor had been awarded by the agency he worked for—the CPA. Only two weeks earlier, on May 6, an Irbis Antonov An-12 had flown into Baghdad carrying coalition cargo under contract with Fluor.5)

  Walker began preparing a report for Oster, but even as he wrote, calls were coming in from nervous colleagues. Some wanted Bout’s firms banned immediately from any participation in the supply pipeline. Walker was just as perturbed as they were. Bout’s network had evaded U.S. security checks and flown in and out undetected for months. But at the same time, Walker was reluctant to interrupt the flow of equipment and matériel to American servicemen in Iraq. “I was pretty bummed to learn we had no idea about the extent of this guy’s network,” Walker recalled. “But I worried for the guys who would lose out on supplies if we shut him down.” As he understood the purview of his job, Walker could only bar an air firm for safety or security reasons. Despite Bout’s dalliance with the Taliban and his arms work across the Third World, there were no allegations that the Russian’s air crews had committed clear security breaches in their Baghdad flights. As he finished his report, Walker hit on what he felt was the right method to shut down the Bout network’s involvement in the Iraq airlift: place the responsibility for dealing with Bout’s arrangements squarely with the people who hired his organization in the first place—U.S. military contracting officials. “If you’re going to ban Viktor Bout, my attitude was to phase him out through the contracting people. They were the people who hired him. That way they could replace his planes with some other company’s—quickly, without jeopardizing the supply lines. They would know the schedule of materials that had to come in and they could handle it properly.”

  Walker’s recommendation made sense to Oster. The former marine general had flagged the British newspaper story because of its possible diplomatic repercussions. “Somehow this guy was on the payroll of the U.S. government when he should have been blacklisted,” Oster recalled in late 2004. Oster felt the breakdown needed to be investigated, but he also saw Bout’s hiring, as Walker did, through the eyes of a combat veteran—in the rush to equip American servicemen, corners are sometimes cut. “We have an old saying in the Marine Corps: If you want it bad, you get it bad.” Oster approved Walker’s decision. At the same time, concerned that U.S. officials needed to know how they had fouled up, Oster also forwarded the Bout case to Stuart Bowen, the CPA’s inspector general.6

  Oster’s decision hardly settled matters. During a teleconference call several days later with U.S. aviation officials at the Baghdad airport, Walker found himself taking heat for allowing Bout planes to continue to fly. Frank Hatfield, a senior Federal Aviation Administration official detailed to Iraq as an adviser to the CPA, wanted Bout barred. Hatfield was already exorcised about the lax customs procedures of Iraqi aviation officials and had complained that cargo manifests were not being toughly scrutinized at the airport. To his reading, the United States was doing business with a known criminal. “This could be an embarrassment, Chris,” he told Walker on the open line. Walker held firm. “That may be so, but we’ve got supply lines to worry about. If you want me to stop him,” Walker told the assembled officials, “give me the order.” The phone meeting broke up without consensus.7

  Pressure was also building in Washington to deal with the emerging revelations about Bout. On May 18, the day after the Financial Times story broke, Senator Russell Feingold, a maverick second-term Democrat from Wisconsin, waylaid two senior Bush administration officials about the matter during a Senate Foreign Relations Committee hearing on Iraq reconstruction spending. Feingold, the ranking Democrat on the Africa subcommittee, was well aware of Bout’s role in inflaming the continent’s war zones with his elusive arms pipelines. As Deputy Secretary of Defense Paul Wolfowitz, a key architect of Pentagon war planning, and Deputy Secretary of State Richard Armitage testified about future Iraq costs, Feingold weighed in with barbed questions about Bout’s role in the postwar Iraq airlift. He started with Armitage: “Is Viktor Bout or any firm associated with Viktor Bout providing air freight services for coalition forces in Iraq?” Citing the Financial Times story, Feingold added: “Has the United States opposed including Bout on an asset-freeze list being compiled by the UN, which targets individuals who are involved with the criminal regime of former Liberian president Charles Taylor? And if so, why?”

  “I certainly hope what you suggest is not true,” Armitage replied. He described Bout as a “merchant of death,” using the well-worn tag line coined by Britain’s Peter Hain. “As far as I’m concerned, he ought to be on any asset-freeze list and anything else you can do to him.” Wolfowitz appeared equally in the dark. “I share your concern about it,” he said, “and I will work with Secretary Armitage to look into it to try to fix the problem if there is one.”8

  State Department officials began moving rapidly in the days afterward to see what could be done to draw the brakes on U.S. contracts with the Bout organization. They also began pulling internal contracting files to see if their own agency had done any work with the Russian’s firms in the past. Armitage had an answer back to Feingold in two weeks. Wolfowitz would stay silent for nine months.

  The once-promising U.S. campaign to scuttle the Viktor Bout network had devolved into bureaucratic schizophrenia. Plagued by the Clinton administration’s inconsistent political will and turf squabbles with international partners before the September 11 attacks, and then left dormant in the months afterward by Bush administration inaction, U.S. policy toward Bout was now lurching in polar-opposite directions. While the State Department remained committed at least in principle to shutting down Bout’s global air transport operation, the Defense Department was enriching it with government contracts and American taxpayer funds.

  Among the far-flung circle of diplomats and investigators who had worked for years to thwart Bout’s aviation empire, the reaction was predictable dismay. Many were already skeptical of American resolve to ground Bout’s planes. Now they wondered whether Bout had become a secret partner of the U.S. military, his recent dalliance with Islamic militants conveniently ignored by Bush administration officials eager to launch their postwar airlift into Iraq.

  “Oh my, everything is possible nowadays,” said a senior Belgian Foreign Ministry official who had been involved in his government’s effort to have Bout arrested through Interpol. “Not only does Bout have the protection of the U.S. government, he now works for them. It’s incredible, amazing. It has to be the only reason why he is still around and free.”9 Johan Peleman was only slightly more charitable. From his monk’s nook in Antwerp, he chuckled derisively: “I have the impression the U.S. government has just been naive,” he said. “I don’t think they knowingly cooperated with Bout. I think they just didn’t clear these companies properly. They should have been careful, given all the articles written and the official reports that are well known. Perhaps they don’t read, eh?”10

  Conspiracy theorists immediately pointed to Richard Chichakli’s cryptic claim that Bout had organized post-September 11 flights for the American military into Afghanistan. Although there was no clear evidence that Bout’s planes had flown airlifts for the United States, critics suggested that the Russian’s organization had been rewarded with new work in Iraq. But even under the more plausible explanation that bungling U.S. military contracting officials had simply failed to do proper background checks in their haste to gear up a massive airlift into Iraq, the effect was largely the same: to the rest of the world, the American government appeared to be run by hypocrites and incompetents.

  Through the fall of 2004, a steady drip of revelations dredged up by outraged political bloggers and then by journalists in the United States and Britain revealed the vast dimensions of the Bout organization’s Iraq work. Irbis alone accounted f
or hundreds of flights during 2003 and 2004 that sluiced millions into Bout’s coffers. One air transporter with extensive supply work in Baghdad estimated to U.S. Treasury officials that Bout-network affiliated planes made a thousand flights into BIAP and other airfields in Iraq by the end of 2004. That figure could not be confirmed. But official flight records unearthed by reporters suggested the estimate was hardly an exaggeration. RAMCC flight records obtained by the Los Angeles Times showed that Irbis planes landed in Baghdad 92 times in the first five months of 2004 alone. And fueling records released by the U.S. Defense Logistics Agency to the Times revealed that Irbis planes had refueled at American facilities in Baghdad 142 times between March and August 2004, indicating an almost daily pace of flights into Iraq.11

  The Bout network’s financial take from its work in Iraq was also difficult to assess; in addition to uncertainty over its flight totals, there was enduring silence from Bout himself and from most of the private contractors who hired his planes. When a Los Angeles Times staffer phoned Bout’s mobile number in Moscow for a response to a story on his Iraq work in December 2004, the Russian was blistering and terse: “You are not dealing with fact, you are dealing with allegations,” he snapped. “Don’t call me anymore.”12 But others who had been approached for work by agents for Bout firms provided a solid sense of his financial stake. According to a former RAMCC official and a contractor who used Irbis for several flights into Iraq, the Sharjah-based flagship usually charged $60,000 for a single round-trip run into to Baghdad. Keith Chapman, a retired RAF officer who worked as a UN liaison with RAMCC in spring 2003, said that Irbis and other “dubious outfits in Sharjah” aggressively marketed their services, repeatedly calling and e-mailing, and even dispatching agents to “hang around” the UN office in Kuwait, making pitches. The Russians’ low-ball offer was well below the $100,000-per-flight cost usually borne by UN humanitarian agencies. Concerned about the firms’ “dodgy” claims and the safety of the old Antonovs, “we dismissed them out of hand,” Chapman said.13 Others did not. Dinu Kabiwar, manager of Frames International Travel, a British cargo charter, hired Irbis planes “three or four times” in 2004 at the firm’s cut-rate price of $60,000 to fly personnel from Bombay to Baghdad for KEC International, an Indian company hired by the U.S. Army Corps of Engineers to restore electricity in Iraq. Kabiwar considered using British firms but “to fly from here would have been three times the cost.”14 Such were the benefits of sitting atop a massive, inexpensively maintained air fleet. Bout owned his own planes, spent little on their upkeep, paid low wages to pilots and crews, and was able to insure his own planes at low rates. “He just undercuts his way into business,” said a rival air firm executive.15 At $60,000 per flight, Irbis likely raked in a minimum of $5.5 million for its work in the first five months of 2003. And if the estimate of a thousand flights overall is anywhere near accurate, U.S. taxpayers donated as much as $60 million to the Viktor Bout organization.