Libya May Escape Final Judgment in Pan-Am 103 Case

By Jeff Stein, CQ National Security Editor.

Libya is close to getting off the hook for millions of dollars in payments to relatives of the 189 Americans who died in the bombing of Pan American Flight 103, amid a stiff new challenge to the 2001 verdict and rapidly warming relations between the erstwhile terrorist state and Washington.

It was 19 years ago this weekend that the airliner, bound from London to New York with 259 passengers, 189 of them Americans, exploded in the night skies over Scotland, killing all aboard as well as 11 residents of Lockerbie, the village where the fiery chunks of steel and other debris came crashing down.

A memorial service was planned for Friday at Arlington National Cemetery to mark the anniversary.

Back in 1988, Iran was immediately suspected of authoring the mass murder, in retaliation for the accidental downing of one of its own airliners by a U.S. Navy warship in the Persian Gulf a few months earlier.

U.S. intelligence agencies, in overdrive to find the culprits, quickly compiled evidence that the Popular Front for the Liberation of Palestine-General Command, or PFLP-GC, had carried out the plot on behalf of Iran and Syria. (The PFLP-GC was formed to opposed PLO leader Yassir Arafat’s movement toward detente with Israel.)

Nevertheless, on Jan. 31, 2001, a panel of three Scottish judges found Abdel Basset al-Megrahi, officially the head of security for Libyan Airlines, guilty of carrying out the plot and sentenced him to life in jail. A Libyan co-defendant was set free.

Libya always denied any guilt in the crime, but agreed to compensate relatives of the dead to open the door for normal relations with the United States. It also agreed to compensate victims of the 1986 bombing of the LaBelle discotheque in West Berlin, a gathering place for U.S. soldiers. Libya also denied complicity in that attack, which killed three and wounded scores more, but likewise agreed on compensation payments.

Megrahi, now serving a life sentence in Scotland, could be freed soon, British authorities hinted on Thursday, as part of a broad normalization of relations with Libya.

Only a day earlier, the Bush administration managed to stave off a congressional effort, led by Sen. Frank R. Lautenberg , D-N.J., to deny it funds to build an embassy in Tripoli until Libya completed payments to the relatives of those who died on Pan Am 103.

While Lautenberg lost that battle, he and his allies in the House did manage to prohibit the administration from giving Libya any U.S. aid until the payments are completed.

‘A Gaping Hole’

The ranks of critics of the 2001 verdict have steadily grown through the years.
Among them is Hans Koehler, the eminent Austrian jurist who was appointed by the United Nations to ensure the trial was conducted fairly.

“It is highly likely that the sentenced Libyan national is not guilty as charged and that one or more countries other than Libya, through their intelligence services and/or financial and logistical support for a terrorist group, may have responsibility for the crime,” Koehler said in a formal statement this year.

Likewise, Robert Black, the senior University of Edinburgh legal scholar who devised the trial of the Lockerbie defendants in the Netherlands under Scottish law, noted that the prosecution never produced any direct evidence tying the defendants to the bomb that brought the plane down.

It was entirely “circumstantial,” he said, based on a single computer print-out of a baggage manifest, which was contradicted by other evidence. “A gaping hole in the prosecution’s case,” he called it.

But more sinister factors were at work in the investigation, Black and other authoritative sources close to the case told me.

Black told me that he suspected Libya was framed to avoid a case that would hold Iran and Syria responsible.

The first Bush administration needed Syria to stay in the broad Middle East coalition that it was readying to oust Iraq’s troops from Kuwait.

“I have been told by persons involved in the Lockerbie investigation at a very high level, that a public announcement of PFLP-GC responsibility for the bombing was imminent in early 1991,”

Black told me, confirming earlier U.K. press reports. “Then suddenly, and to the mystification and annoyance of many on the investigation team, the focus of the investigation changed to Libya.”

Robert Baer, the former CIA officer who was based in Paris at the time and tracking Iranian terrorist operations, agrees.

Baer told me the Scottish commission reviewing evidence in the case was able to confirm that Iran and Syria paid the PFLP-GC to carry out the bombing.

Indeed, Vincent Cannistraro, who headed the CIA’s investigation of the crash, was quoted several times in 1989 blaming Iran, and right after the 1991 verdict he said it “was outrageous to pin the whole thing on Libya.” (Oddly, last week he told me the evidence “always pointed to the Libyans.”)

But Baer says, “Everybody” in U.S. intelligence knew about “Iran’s intention to bomb an American airliner” in response to the downing of one of its own only months earlier.”

“We knew that,” Baer added. “We had that solid.”

The Defense Intelligence Agency also thought the Iranians paid the PFLP-GC to do it.
Patrick Lang, chief of the DIA’s Middle East section at the time, told me he “signed off” on the DIA’s conclusion that “The bombing of the Pan Am flight was conceived, authorized and financed by Ali-Akbar (Mohtashemi-Pur), the former Iranian minister of Interior.”

“The operation was contracted to Ahmad Jabril” [the head of the PFLP-GC] . . . for $1 million,” said the Sept. 24, 1989, memo, first reported last week in a London tabloid. “The remainder was to be paid after successful completion of the mission.”

Lang said on Friday, “I still agree with that. We felt quite sure that this was a PFLP thing.”
“The CIA wouldn’t listen to that,” Lang added, because it couldn’t find proof of Iranian or Syrian complicity and was under immense pressure to solve the case.

Just last week, a Scottish newspaper, citing “sources close to the investigation,” recently cited specific transactions that the SCCRC allegedly had uncovered, including amounts and dates.

“This doesn’t exonerate Libya,” Baer cautioned. “Iran and Syria and Libya could have been working together.”

Plenty of Theories

Conspiracy theories have grown like barnacles on the much-questioned verdict, including far-fetched allegations of Israeli and even South African involvement in the crime.

On the Internet, some bloggers see the hand of the White House in the growing evidence of Iranian complicity in the Pan Am bombing, suggesting that the administration is further laying the groundwork for an attack on Iran.

The available evidence, however, suggests that the administration is primarily interested in getting Western companies’ access to Libya’s oil fields.

A particularly persistent rumor is that key witnesses were paid off by American intelligence to finger the Libyans.

Edwin Bollier, head of the Swiss company that was said to have manufactured the timer used to detonate the Pan Am bomb, has claimed variously that he was offered “bribes” by the FBI and CIA to finger Libya.

Bollier’s company did in fact supply the circuit boards to Libya, he admitted, but also East Germany, where the PFLP-GC had an office.

Since Bollier had ongoing business with the Qaddafi regime, his veracity has often been questioned.

In response to my query, a CIA spokesman ridiculed Bollier’s accusations that it offered or paid him anything.

“It may disappoint the conspiracy buffs, but the CIA doesn’t belong in your story,” he said, insisting on anonymity.

An FBI official, speaking on condition of anonymity, confirmed, however, that the bureau met with Bollier in Washington in 1991, but denied he was offered anything to implicate Libya.
In a formal statement, FBI spokesman Richard Kolko emphatically rejected any suggestions of a payoff.

“Any accusations that any witness was paid to lie are complete fabrications and these ridiculous statements should be immediately discounted as the untruths they are,” Kolko said. “That is not the way the FBI operates.”

Likewise, allegations have persisted that Tony Gauci, a shopkeeper on Malta who testified, in spite of contrary evidence, that he sold Megrahi clothing that ended up in the suitcase bomb, was paid to finger the Libyans.

But Gauci was paid approximately $2 million from the State Department’s USA Rewards program, an authoritative source told me, along with another, still unidentified witness.

Together, they were paid somewhere between $3 million and $4 million for information leading to the conviction of Megrahi, the source said.

The State Department acknowledged to me that rewards were paid.

“A reward was paid out in the Lockerbie-Pan Am 103 case,” a spokesperson there said on condition of anonymity, “but due to operational and security concerns we are not disclosing details regarding specific amounts, sources, or types of assistance the sources provided.”

Freeing Megrahi

All this — and much more questionable evidence related to the electronic timers and witnesses — may soon be moot.

A British Ministry of Justice spokeswoman confirmed on Thursday that Foreign Minister Jack Straw had been in contact with Scotland’s justice minister, Kenny MacAskill, about a deal that would send Megrahi back to Libya.

Such a move could well make irrelevant a Scottish appeals court’s expected judgment that a “miscarriage of justice” occurred in the case.

Reopening the investigation to present evidence of an Iranian/Syrian connection to the Pan Am bombing would be extremely difficult if not impossible, in the view of all observers.

The commercial pressure against such a move would be extreme. Western oil companies are eager to develop Libya’s reserves.

How this will affect Libya’s stalled payments to relatives of the Lockerbie and LaBelle discotheque victims is unknown, but if past patterns hold true, they cannot be optimistic.

In July 2006, a lawyer for the LaBelle families was about to finalize a deal with Libya when the State Department announced its intention to take Libya off the terrorist list.

The deal evaporated, said attorney Thomas Fay.
“They had made an offer and we accepted and at their request had every client execute release of claims forms” he told me by e-mail late Friday.

“In short, we were not close to a deal, we had made the deal,” Fay said. “They just refused to pay when they came off the terrorist list.”

Jeff Stein can be reached at jstein@cq.com.

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