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  President Freezes Bin Laden Assets

By John F. Harris
Washington Post Staff Writer
Sunday, August 23, 1998; Page A01

President Clinton yesterday announced new steps aimed at choking the financial enterprises that Islamic extremist Osama bin Laden uses to fund his violent campaign against the United States.

An executive order, which Clinton signed Thursday but made public yesterday, freezes any U.S. assets owned by bin Laden, two of his senior lieutenants, or their Islamic Army organization. The order also prohibits U.S. firms and individuals from doing business with them.

The impact of the order on bin Laden's large and far-flung financial interests will be minimal, senior administration officials acknowledged yesterday. But they said the action is only the first step in a larger campaign -- for which Clinton will appeal for help from governments around the world -- to shut down the financial pipelines that subsidize bin Laden's suspected terrorist activities.

"We must not allow sanctuary for terrorism -- not for terrorists or their money," Clinton said in his weekly radio address. "It takes money, lots of it, to build the network bin Laden has. We'll do our best to see that he has less of it."

Clinton signed the order on the same day U.S. naval forces launched a shower of cruise missiles on suspected terrorist facilities in Afghanistan and Sudan.

Presidential spokesman Michael McCurry said yesterday that all six sites in Afghanistan incurred "moderate to severe" damage, an assessment that intelligence agencies could not make earlier because of clouds over some of the sites.

The president described the Thursday strikes as a retaliation after U.S. intelligence uncovered what he called convincing evidence that bin Laden's network participated in the deadly bombings earlier this month of U.S. embassies in Kenya and Tanzania.

Worried that the air strikes might spur terrorist reprisals, authorities yesterday continued to implement heightened security at a variety of domestic facilities and U.S. installations around the world. In the most visible manifestation here, the Park Service erected concrete barriers around the base of the Washington Monument.

But Clinton, in his address, warned that the United States should not let vigilance curdle into paranoia. "America will never give up the openness, the freedom, and the tolerance that define us," he said. "For the ultimate target of these terrorist attacks is our ideals, and they must be defended at any cost."

Thursday's military strike, which a few Republicans initially speculated might have been intended as a diversionary tactic because of Clinton's personal and legal problems, won an emphatic endorsement yesterday from Sen. John McCain (R-Ariz.), who delivered the GOP's weekly address. "The president deserves our support for acting swiftly and decisively," he said. "The military strikes he ordered against targets in Afghanistan and Sudan were appropriate."

Pivoting quickly, however, McCain accused the administration of following a weak and wavering foreign policy in places from North Korea, where some experts suspect a nuclear program is again underway, to Iraq, where President Saddam Hussein is snubbing international weapons inspectors, to Kosovo, where Serbs are apparently ignoring the administration's pledges that the United States will not allow a new season of ethnic cleansing. "Yes, terrorism is a danger that demands sustained presidential attention and a purposeful strategy to counteract it," McCain said. "But so do the many other threats to American security that have festered from this administration's negligence."

Bin Laden, a Saudi millionaire living in Afghanistan, sponsors his terror campaign with a "far-flung business empire," that runs "the gamut from agricultural companies to banking and investment firms, to construction companies", a senior administration official said. Clinton's action adds bin Laden and senior associates to a list of people and groups already barred from U.S. financial transactions under a 1995 executive order because of links to Middle Eastern terrorism.

A senior administration official yesterday said the action by Clinton, who is vacationing on Martha's Vineyard, Mass., was important because it would give him leverage as he presses other nations -- where more of bin Laden's money and businesses are based -- to squeeze him financially. "Until we take this official, formal, public step, it's difficult for us to have a lot of leverage with allies," the official said.

An official said that one aim of intelligence was to learn more about bin Laden's shadowy financial ties and associations.

Some of those shadowy trails may lead -- albeit indirectly -- to businesses that produce some of America's most familiar consumer brands. An ingredient in many colas and candies is gum arabic.

Between 70 and 90 percent of the world's gum arabic comes from Sudan -- and senior administration officials said yesterday they are concerned that bin Laden may have links to Sudan's trade in the substance.

Most U.S. commerce with Sudan is banned because of that nation's links to terrorism. But under lobbying from the food industry, among others, the administration in recent years has granted exceptions so that Sudan's Gum Arabic Co. can export to the United States. An administration official said that the White House learned only after Clinton signed his order of intelligence suggesting bin Laden may own or invest in two companies that sell gum arabic to the export company.

A request is pending for a license to allow export of Sudan's 1998 gum arabic crop. An administration official said the request would come under special scrutiny, and that the White House had ordered an effort to determine the precise nature of bin Laden's ties to the gum arabic business.

© Copyright 1998 The Washington Post Company

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