Former U.S. Envoy, 2 Others Charged in Gulf War Scheme

A former U.S. ambassador to Bahrain in the Ronald Reagan Administration and two former executives of Conservative Digest have been charged with secretly taking $7.7 million from Kuwait to push for U.S. intervention against Iraq.

An indictment unsealed Tuesday by federal prosecutors in Denver alleges that former Ambassador Sam Zakhem and two Colorado businessmen acted as secret agents for Kuwait and avoided U.S. income taxes in connection with the scheme.

The indictment, identifying front groups used by the three to promote intervention, sheds more light on the massive overt and covert campaign that Kuwait mounted in 1990 to persuade American political leaders and the public that the United States should step in to reverse the Iraqi invasion of Kuwait.

According to the indictment, Zakhem, who served as U.S. ambassador to Bahrain from 1986 to 1989, carried out the scheme with William R. Kennedy Jr., former owner and publisher of the Conservative Digest, and Scott Stanley Jr., former editor of the publication. They are accused of failing to register with the Justice Department under the Foreign Agents Registration Act and of violating U.S. tax laws.

U.S. Atty. Michael J. Norton in Denver said the defendants operated “under the guise of patriotism” but actually were paid “agents of a foreign power.” They allegedly lobbied members of Congress at a time when some Democrats and conservative Republicans were arguing that the government should not risk American soldiers’ lives and spend billions of dollars to restore a monarchy with an uneven human rights record and a questionable pattern of cooperation with this country.

Zakhem was charged with 12 counts and could receive a maximum sentence of 40 years if convicted. Kennedy and Stanley each were charged with two counts. Norton said he could not estimate the sentence they would face.

Kennedy was arrested Monday in San Diego. He appeared Tuesday before U.S. Magistrate Barry Ted Moskowitz, who set bail at $1 million and said he would let marshals take Kennedy to Denver.

The indictment said that the three men spent about $2 million of the $7.7 million they received from the Kuwaiti government on a grass-roots and direct-mail public relations campaign designed to generate public support for military action against Iraq after its invasion of Kuwait in August, 1990.

The three diverted the remaining $5.7 million to their personal use and took steps to avoid paying taxes, the indictment charged.

Norton said members of Congress were falsely told that Zakhem and his associates were leaders of two patriotic volunteer groups called Coalition for America at Risk and the Freedom Task Force. Zakhem, 56, a native of Lebanon, was an unsuccessful candidate this year for the Republican nomination for the U.S. Senate in Colorado and said in his campaign literature that he had “rallied support for American efforts in the Persian Gulf.”

An outspoken conservative, Zakhem attended the founding conference in 1983 of the North American branch of Causa, a political arm of the Unification Church of the Rev. Sun Myung Moon, and served on the group’s international advisory board.

None of the defendants had immediate comment on the indictment, and the Kuwaiti Embassy in Washington also declined comment.

The Zakhem case follows disclosure in recent months that Kuwaiti oil sheiks and the Kuwaiti government spent $11 million on a massive public relations campaign in 1990, spearheaded by the public relations firm of Hill & Knowlton, which has offices in Washington, New York and Los Angeles.

The funds were channeled through an organization known as the Committee for a Free Kuwait, which was headquartered in Hill & Knowlton’s Washington office.

Two months after the Iraqi invasion, the firm produced a 15-year-old girl to testify about Iraqi atrocities before the Congressional Human Rights Caucus, headed by Rep. Tom Lantos (D-Burlingame).

The witness, identified only as Nayirah, allegedly to protect her family, said that she had seen Iraqi soldiers rip 15 Kuwaiti babies out of their incubators and leave them to die on a hospital floor. Amnesty International and other human rights organizations seized on this testimony as an example of Iraq’s evil military machine, and President Bush cited the incident, among other acts, as justification for U.S. intervention.

It was later learned that the witness was the daughter of the Kuwaiti ambassador to the United States, Saud al-Sabah.

The panel could find no corroboration for her testimony from any medical officials, and Amnesty International later disavowed it, saying that it “found no reliable evidence that Iraqi forces caused the deaths of babies. . . .”