Issue 11

The simplest explanation to a problem is probably the correct. The more complex the explanation the less likely to be correct. Occam’s Razor


The Saudi Ambassador to Washington, Prince Bandar, was a surprise visitor at a tete-a-tete between President Clinton and South African President Mandela. All other people had been ushered from the room, much to the chagrin of National Security advisor Sandy Berger, and so no one knows what was discussed in the brief meeting. Was Bandar’s presence mere happenstance? What was he doing in Capetown to begin with? Prior to Clinton’s arrival there had been speculation that President Mandela — known for his support of Libya, Cuba and Iran; all of whom the United States dislikes — would invite the Libyan Ambassador to the state dinner for Clinton and that Bandar had some interest in the meeting. One could speculate that the two are connected and that Mandela was giving Bandar a golden opportunity to bring up Libyan sanctions with Clinton. Why would Bandar care to do this? It is true that the Arab League is working to have the UN sanctions imposed upon Libya for the Pan Am 103 bombing revoked, but Saudi Arabia has not been particularly concerned with this effort. Would it be that Libya is offering Bandar something he never refuses — lots of money — in order to get him to plead their cause?


It seems all but official that foreigners, including governments, can buy influence in Washington. This makes legitimate foreigners capable of doing what Ambassador Prince Bandar has been doing for as long as one can remember. Washington Post reports; “Justice Department’s own interpretations of campaign finance laws seem likely to limit its reach among the sellers of influence. The department seems to believe, for example, that soliciting foreign money cannot be prosecuted if the contributions are soft-money donations”. K98 This statement finally makes a partially honest man of Ambassador Prince Bandar, that is, only towards his Washington politician slush fund allotments. We still have to deal with Prince Bandar’s deferred payment scheme to political appointees and careerists.


It is quite well known that Crown Prince Abdullah will become King upon Fahd’s death to be succeeded by Prince Sultan as Crown Prince. These gentlemen are relatively the same age and thus suffer from life’s equalizer, age. The question is then who will be #3 in the line of succession? How old and healthy will #3 be? Important questions must be answered not only by opposition leaders but to foreign governments dependent on the stability of Saudi oil flow.


Private Eye reports: “Prince Fahd bin Salman, eldest son of … Prince Salman, the governor of Riyadh … a court case brought by the BCCI liquidators over the little matter of $397,000 owed to the rogue bank. Since 1994 the liquidators had been seeking repayment of this money under a guarantee given by the prince for the overdraft of an offshore company, Colchest Corporation N.V. In an unusual response, Prince Fahd sought to offset against this debt money held at another BCCI branch in the name of one Esam Ghazzawi, claiming that this was his money. The court of appeal rejected this suggestion on the basis that it was unclear who owned what in the Ghazzawi accounts.” This is an example of how Saudi princes get tangled up in their own financial web. They refuse to keep it simple. This leaves them open to unscrupulous advisors and lengthy, costly litagation. When will they learn! K99


Khalid bin Mahfooz has been in and out of controversy for many years. New York Times reports: “But a new campaign by Sheik Khalid bin Mahfooz to portray himself as the innocent scapegoat of zealous American prosecutors in the 1991 collapse of BCCI… closed by European and American regulators in July 1991 after they concluded that it had stolen billions of dollars from its depositors, forged financial statements and been involved in laundering drug money, tax evasion and the illegal ownership of several sizable American financial institutions … Sheik Khalid, however, pleading chronic diabetes and the effects of a serious motor accident and a heart attack, steered clear of the American courts.” K100 His family controls National Commercial Bank the largest private bank in Saudi Arabia and are King Fahd’s personal bankers. As a personal banker to the Saud family hierarchy, Khalid and his family suffer at the whims of the Saud family and it’s government. He continues to retain the services of Harvard Law professors who moonlight as consultants to the rich, powerful and controversial, especially the Saud family and their associates. Khalid misses the point when he hired yet again Professor Larry Tribe to clean up his name. He does not realize that by having had a BCCI office in New York as well as having purchased Khashogi’s old Trump Tower palace in the sky, he made himself vulnerable to the New York City legal system with a powerful Jewish constituency. The Jewish community of New York do not take kindly to Saud family skullduggery within their neighborhood. The Saud family Washington retainers could and did shut down the Federal BCCI investigations. This abuse was not taken lightly by District Attorney Robert Morgenthau’s office which decided to conduct their own investigation, much to the embarrassment to the Bush Administration and the Saud family. To expunge his name Khalid gives a bad name to the BCCI components still quietly active within the US.

Khalid bin Mahfooz

Jeff Gerth of the New York Times, in explaining the sorry financial state of Saudi Arabia, said: “Strains on the banking system, including billions of dollars in uncollected loans to members of the Saudi royal family, the indictment in the United States of the head of the largest Saudi bank (Khalid bin Mahfooz)——have profound implications for the United States.” K101 Khalid bin Mahfooz is head of the National Commercial Bank, the largest bank in Saudi Arabia. Michael Callen, the senior advisor to Khalid Bin Mahfooz at the National Commerce Bank of Saudi Arabia reports: “The royal family believes “they own the country—–They took it by force of the sword. When the King says, ‘Give me a loan,’they believe they’re taking their money back.” K102 Peter Kilborn of the New York Times reports; “Many debtors, however, are members of the King’s huge extended family or have close ties to it, and their names are not listed. The royal family’s banking activities are not well known. The family is said to do much of its business through the National Commercial Bank, the biggest of the 11, and the only one that is privately owned. It belongs to a partnership of two prominent families, the Mahfouzes and the Kaakis.” K103

Khalid bin Mahfooz’s Houston palace

Khalid bin Mahfooz spends little time at his River Oaks, Houston palace on Willowick. Behind his large iron fences he has the usual Saudi 24 hour security guard. One neighbor complained of Khalid’s son shooting a gun at her windows. Being a gentleman, Khalid apologized and replaced the windows. This property has been registered in Khalid’s name, unlike nearby Saud family princes ( Prince Faisal’s palace on Kirby in River Oaks in issue 3) who prefer to hide their ownership under threat of law suite from irate US citizens enslaved and tortured in Saudi Arabia.


The Los Angeles Times reports: “a Saudi company illegally sold training manuals for the Army’s Abrams tank, the Patriot missile and other American-made weapons … Their release apparently would not threaten the security of U.S. forces” K104 Although the Riyadh and Washington tried to play down the illegal sale of confidential documents, one has to wonder if Saudis are selling other information which could very well jeopardize the safety of the US military personnel garrisoned in Saudi Arabia to protect the Saud family regime. If there is another attempt to kill US soldiers it could be accomplished with information given to the perpetrators by the Saudis. We would most probably have denials from both Riyadh and Washington blaming some mysterious terrorist group with magical powers of success. We already commented that Saudi princes consider the US soldiers protecting them “our new slaves”. It would be nothing for a Saudi prince to sell security plans of the US military for a handsome profit. We need not be reminded that the Al Khobar killings of US servicemen have yet to be solved. This is a very dangerous position for US soldiers.


The Saudi Government dictatorship has been attempting for several years to create a Saudi Center in the Washington area. Initially, Bandar attempted to develop a polo field complex in the Poolesville area of Maryland, approximately 30 kilometers Northwest of Washington. He started by calling it a religious academy even though the vague development plans showed otherwise. The local housewives caught on to his deceptions and formed a Farm Group which demanded forthright behavior from Prince Bandar, his associates and local politicians allied with him. The Farm Group housewives got a petition for a referendum when Prince Bandar ignored their inquiries. The referendum allowed the Poolesville citizens to circumvent local politicians and demand a democratic vote of all eligible Poolesville voters. Prince Bandar and his associates put ads in friendly newspapers including a full page ad in the Washington Post telling of the virtues of the Saudi Government. Ambassador Prince Bandar was defeated but then angrily vowed to continue the fight. He has since acknowledged defeat and set his sights on Ashburn, Loudoun County, Virginia across the Potomac from Poolesville. Prince Bandar is still being vague about his plans calling the planned compound a Saudi academy. If the compound is built Ambassador Prince Bandar and succeeding Saudi Ambassadors will automatically be absolute rulers of the compound. All heads of departments at the academy will have to be Saudi. Saudi princes and princesses will have special privileges over others at the academy. Prince Bandar and his associates are still being deceptive as to their goal. Rather than a unanimous vote by the planning board as in Poolesville Prince Bandar stayed with a comfortable 7-2 vote for his facility. Prince Bandar and his associates are still being deceptive as to their goal. We are awaiting another a similar group to stand up for their democratic rights. It will be difficult for opponents of the Saudi Government since they have seemed to profit from their Poolesville mistakes. For one, the Saudi Government security details monitoring dissent are more prevalent in Loudoun County than in Poolesville. We have heard the object of the Saudi Government dictatorship is to develop a Saud family community in Loudoun County as a fall back position. When they are deposed they will be granted political asylum by their Washington retainers and live comfortably. One must be reminded, there are more then 4,000 of them!

Dear Reader:

As Americans we should be outraged at the idea that the Saudi Ambassador to Washington may be using the opportunity for personal gain to lobby on behalf of Libya’s Muammar Qadhafi. The reasons United Nations sanctions were imposed on Libya was that it was held responsible for the bombing of Pan Am flight 103 which resulted in hundreds of Americans being blown out of the skies over Scotland. It is one thing for the Arab League to take the politically correct position that it must be concerned about Libyan citizens and other ways found to try the Libyan suspects. It is quite another for Prince Bandar to use his carefully cultivated friendship with South African President Mandela and his access in Washington for venal reasons at the expense of the American people. Is there nothing that Prince Bandar will draw the line at if money is involved?

Herb Mallard

National Press Club member
London Press Club member
Royal Society fellow