"Follow the money" could be Wall Street Journal reporter Glenn R. Simpson's motto. His sophisticated dispatches from the banking/terrorism/money-laundering/organized crime nexus routinely advance well-covered subjects.
On the last day of 2004, Simpson published a Journal story about the Justice Department's investigation of purported money-laundering at Riggs Bank, which is headquartered in Washington, D.C. Previous news reports had connected Riggs to the dubious financial machinations of Saudi diplomats and despots from Africa and South America, including Chile's former maximum leader, Gen. Augusto Pinochet. Banking regulators fined Riggs $25 million last year for its violations, the institution put itself up for sale, and a Justice Department investigation was started.
Simpson's Dec. 31 piece—inexplicably appearing on Page A-4 instead of A-1—locates what may be the common denominator shared by Riggs, the Saudis, the Africans, and the South Americans: the Central Intelligence Agency.
Citing unnamed U.S. government officials and people familiar with Riggs operations, Simpson reports that the bank has enjoyed a "relationship" with the CIA for some time. "That relationship, which included top current and former Riggs executives receiving U.S. government security clearances, could complicate any prosecution of the bank's officials, according to private lawyers and former prosecutors," he writes. By "complicate" one can safely assume that Simpson means "make impossible." He writes:
The relationship with the CIA could prove problematic because it could cast a different light on the bank's dealings with two U.S. foreign-policy allies, former Chilean dictator Augusto Pinochet and Prince Bandar bin Sultan, Saudi ambassador to Washington.
Given the intelligence connections to Riggs, prosecutors could be faced with proving that the bank's failure to disclose financial activity by the foreign officials wasn't implicitly authorized by parts of the U.S. government.
Bandar briefed Treasury Secretary John Snow in early 2003 about the work he'd done for the CIA, Simpson notes. The parapolitical credits on the prince's resume include funding the Contras at the behest of the White House, supporting the Afghan rebels against the Soviet Union, and serving as a go-between in the mending of the Libya-U.S. relationship. The CIA worked with Pinochet through his secret police chief, Manuel Contreras, Simpson reports, adding that Contreras banked at Riggs as recently as 1979.
"That wasn't money-laundering, detective, I was just serving national security," would be an excellent defense in a criminal prosecution. Another reason the government might want to shut down the criminal probe that Simpson doesn't mention is that where there are one or two CIA-related bank accounts, there are probably more. Better to cover up the extent of Riggs' "full-service" banking.
Simpson's story is a damn fine one, made all the more unique by the fact that nobody followed it except to cite the Journal. On Wednesday (Jan. 5), Washington's hometown newspaper, the Washington Post, ignored the CIA angle in a business story about the Justice Department's settlement talks with Riggs concerning criminal liability. Riggs' merger suitor, PNC Financial Services Group Inc., wants that liability off-loaded before consummating the deal, the Post reported.
Where is the rest of the press on the Riggs-CIA connection? Spooks, sheiks, dictators, millions in laundered money, and a $766 million merger in the balance! What does it take to entice an assignment editor these days, a tsunami or something?
Simpson doesn't name the source of his scoop, which invites me to speculate. He attributes his CIA information to U.S. government officials, which isn't much help. But "people familiar with Riggs operations" does illuminate. It's a safe bet that Riggs officials aren't ratting themselves out to a Journal reporter, which leaves us with the green eyeshades at PNC Financial, who probably know all of the spooky secrets about Riggs bank by now.