Computer firm in Dubai was hub for black market nuke network

Thursday, February 12, 2004

LONDON A Dubai-based company in the United Arab Emirates has been cited as the linchpin in the lucrative nuclear weapons black market that has supplied Iran, Libya and North Korea.

The United States and the International Atomic Energy Agency have determined that the UAE company served as the hub for the traffic of nuclear weapons components. Officials said the company coordinated with a range of nuclear suppliers for orders from such countries as Iran, Libya and North Korea.

The Bush administration identified the UAE firm as SMB Computers, a key element in the nuclear weapons black market operated by Pakistani scientist Abdul Qadeer Khan. The company was found to have served as a clearinghouse for nuclear components ordered by Iran, Libya and North Korea.

Another UAE company involved in the nuclear black market was Gulf Technical Industries, which worked closely with SMB's Tahir, Middle East Newsline reported. The Dubai-based Gulf Technical, founded by British engineer Peter Griffin, an associate of Khan, contracted with Malaysia's Scomi Group Berhad for the manufacture of centrifuge equipment identified as P-2.

The public confession on Feb. 4 by Khan the "father" of Pakistan's nuclear weapons program in which he admitted to facilitating the network, has shocked the world and prompted new warnings that terrorists could gain access to weapons of mass destruction.

"The supply network will grow, making it easier to acquire nuclear weapon expertise and materials," IAEA director-general Mohammed El Baradei wrote in the New York Times on Thursday. "Eventually, inevitably, terrorists will gain access to such materials and technology, if not actual weapons."

"Khan and his associates," a White House fact sheet said, "used a factory in Malaysia to manufacture key parts for centrifuges, and purchased other necessary parts through network operatives based in Europe, the Middle East, and Africa. Libya, Iran, and North Korea were customers of the Khan network, and several other countries expressed an interest in Khan's services."

The company was said to have processed orders for such goods as uranium hexafluoride used for the centrifuge process that can produce enriched uranium for nuclear bombs as well as components and complete centrifuges.

The shipments were said to have been disguised and often relabeled in Dubai to avoid detection.

SMB was operated by a deputy of Khan. Officials said the deputy, identified as Bukhari Sayed Abu Tahir, a Sri Lankan native, employed his Dubai company as the front for the nuclear network that sought to provide up to 1,000 centrifuges to Libya.

"Tahir acted as both the network's chief financial officer and money launderer," President George Bush said in a speech on Wednesday. "He was also its shipping agent, using his computer firm as cover for the movement of centrifuge parts to various clients. Tahir directed the Malaysia facility to produce these parts based on Pakistani designs, and then ordered the facility to ship the components to Dubai. Tahir also arranged for parts acquired by other European procurement agents to transit through Dubai for shipment to other customers."

The nuclear network, which was said to have been penetrated by the CIA, contained companies and people from both Western and Third World countries, officials said. They included Belgium, China, Germany, Japan, Malaysia, the Netherlands, Pakistan, Russia, South Africa, Sri Lanka, Switzerland, the UAE and the United Arab Emirates.

Dubai served as the port of destination for these shipments. Officials said Tripoli acquired nuclear weapons components manufactured in Malaysia, shipped and processed in Dubai and then sent to Libya.

"As a result of our penetration of the network, American and the British intelligence identified a shipment of advanced centrifuge parts manufactured at the Malaysia facility," Bush said. "We followed the shipment of these parts to Dubai, and watched as they were transferred to the BBC China, a German-owned ship. After the ship passed through the Suez Canal, bound for Libya, it was stopped by German and Italian authorities. They found several containers, each forty feet in length, listed on the ship's manifest as full of 'used machine parts. In fact, these containers were filled with parts of sophisticated centrifuges."

Bush outlined a new policy to prevent nuclear proliferation by a crackdown on the black market and a ban on the sale of some legal equipment to countries that do not submit to close international supervision.

In 2002 and 2003, officials said, Gulf Technical maintained a representative from Dubai to Malaysia to oversee the production of P-2 for Middle East clients. The P-2, made of maraging steel, has double the uranium enrichment capacity of the earlier model P-1, which is composed of aluminum.

For its part, the IAEA has questioned European businessmen suspected of having helped supply orders from Iran and Libya. They included executives from the German firm Leybold Heraeus, a leading maker of vacuum technology and a unit of the Swiss firm Unaxis AG. The agency cited four former Leybold employees that transferred centrifuge components to Iran and conducted business with other countries interested in nuclear technology, such as Saudi Arabia and Syria.

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