Congressional sources said several prominent senators have determined
that despite U.S. appeals Riyad has failed to stop the funding of groups
deemed by the State Department as terrorists. The sources said the senators
have warned the Bush administration that they will press for sanctions on
the kingdom over the next year unless Riyad halts the flow of money to these
The United States was said to have threatened Saudi Arabia with
sanctions as early as 1999. The congressional sources said an increasing
number of senators are dismayed that the Bush administration, despite the
U.S.-led war on terrorism, failed to fulfill that threat in wake of the
investigation that demonstrated Saudi complicity in the Al Qaida suicide
attacks on New York and Washington in September 2001.
Saudi Arabia has reduced financing to Al Qaida in wake of the May 12
suicide strikes by the organization in Riyad that killed 35 people, the
sources said. But they said the administration and the U.S. intelligence
community have acknowledged that Riyad might have increased its financial
support of Hamas and other Islamic insurgency groups.
The sources said the most important backers of Saudi financing to Al
Qaida, Hamas and aligned groups are Saudi Interior Minister Prince Nayef Bin
Abdul Aziz and Riyad Governor Prince Salman Bin Abdul Aziz. Both men were
said to have been instrumental in establishing Al Qaida and sending
thousands of Saudis to support the Taliban regime in Afghanistan in the
Sen. Charles Schumer, a New York Democrat, has demanded Nayef's
resignation from the Saudi Cabinet. In a letter to Saudi ambassador to
Washington, Prince Bandar Bin Sultan, Schumer said Nayef has a
"well-documented history of suborning terrorist financing and ignoring the
evidence when it comes to investigating terrorist attacks on Americans."
The threat of congressional sanctions on Saudi Arabia was raised during
a hearing of the Senate Governmental Affairs Committee on Thursday. Sen.
Arlen Specter, a Pennsylvania Republican, proposed the imposition of
criminal sanctions on Saudi Arabia. He did not elaborate.
The hearing contained some of the harshest criticism on the Saudis
voiced either in Congress or by administration officials. An administration
official acknowledged that the White House and State Department have blocked
efforts to penalize Riyad for its alleged support of Al Qaida while senators
accused President George Bush of protecting the Saudis.
"There is considerable concern here in the Congress about Saudi Arabia
being shielded for foreign policy purposes," Specter said.
The senators asked the Treasury Department for a list of Saudi
organizations and individuals investigated on suspicion of transferring
money to groups deemed as terrorist. Several senators accused the
administration of blocking Treasury efforts to impose economic or criminal
sanctions on Saudi organizations.
R. Richard Newcomb, director of Treasury's Office of Foreign Assets
Control, acknowledged that the administration rejected his agency's
recommendation that Saudi entities be sanctioned. The refusal came from an
interagency national security committee that included officials from the
State Department and Justice Department.
"I can't say whether it's because they were Saudi organizations,"
Newcomb said. "The extent to which that [Saudi financing to terror groups]
takes place is not completely clear, but I would characterize it as
The senators asked Newcomb whether the administration protected such
Saudi state-sponsored groups as the World Assembly of Muslim Youth and the
International Islamic Relief Organization. Newcomb said Treasury has been
examining both organizations, but would not elaborate.
The administration again pledged to press the Saudi government to crack
down on financing to Islamic insurgency groups. John Pistole, deputy
assistant director of the FBI's Counter-Terrorism Division, said he will
meet Saudi security officials in Jedda next week and urge that the kingdom
increase cooperation in the effort to halt terror financing.
Pistole said Saudi Arabia has significantly improved security
cooperation with the United States in the aftermath of the May 12 suicide
bombings in Riyad. The FBI official said that for the first time Saudi
authorities allowed the FBI to interview Saudi nationals.
"I think the royal family in particular feels vulnerable," Pistole said.
"I think they see themselves as in a struggle for survival at this point."