This is the second article in a two part series. Part one was published on GlobalResearch.ca on August 11, 2009. In that article, Peter Dale Scott argued that, as a result of outsourcing, networks of private military and intelligence contractors (PMCs and PICs) are now in a position to influence or even determine U.S. foreign policy, and have clearly a profit motive to steer America into more and more grandiose and expensive foreign adventures, like the unnecessary war in Iraq. In this second part he explores the transnational aspects of the networks he previously discussed (inhabited by low-profile PMCs like SAIC and Diligence LLC), and their covert operations which have contributed to destabilization and conflict.

Diligence LLC’s Russian Connections: Alfa Bank and Far West Ltd

What we have been talking about until now is advocacy disguised as expertise. But overseas associates of Diligence LLC and its allies have also been accused of false-flag operations intended to provoke war.

Consider first the transnational connections of Diligence LLC. The Chairman of Diligence from 2001 to 2007 was former U.S. Ambassador and arms negotiator Richard Burt, of Barbour, Griffith and Rogers and McLarty Kissinger Associates. Burt, a neocon who once called the SALT agreement “a favor to the Russians,” is also on the Alfa Bank’s Senior Advisory Board in Moscow.

Alfa’s clout in Washington dates back into the mid-1990s, when its oil company, Tyumen (TNK)

was loaned $489m in credits by the US Export-Import Bank after lobbying by Halliburton; ….The [Clinton] White House and State Department tried to veto the Russian deal. But after intense lobbying by Halliburton the objections were overruled on Capitol Hill. [which then was Republican-controlled] ….The State Department’s concerns were based on the fact that Tyumen was controlled by a holding conglomerate, the Alfa Group, that had been investigated in Russia for mafia connections.[1]

At some point in time, the leaders of Halliburton and Diligence, Alfa’s allies and “roof” in Washington, allegedly made contact with a shady group in Russia with Alfa connections, a group that, back in 1998, incorporated itself as the Russian firm Far West Ltd (now Far West LLC). [2]

Vladimir Filin, the president of Far West, once described his company’s activities and backers in a press interview. Far West, he said was

connected with the secured transport of commercial shipments from Afghanistan, where we have an office, to ports on the Black Sea.  …But the most commercially attractive route seems to be that from Bagram to the US air base in Magas [Manas], in Kyrgyzstan. By the way, it is quite near the Russian air base in Kant. A significant flow of shipments passes through Magas, there is a niche there for commercial shipments too.  This is very profitable.  It is much more profitable than routing commercial shipments from Afghanistan  through Tajikistan.  Therefore last year we completely withdrew from all shipping through Tajikistan and closed our office in that country….

Who our partners are is a commercial secret.  I can say that they are four private firms from three countries, Turkey, Russia, and the USA, which engage among other things in shipping. One of these firms is a sub-division of a well-known American corporation. This firm is a co-founder of our agency.[3]

A hostile critic of Far West, “Yuri Yasenev” (a fictional name on the Internet), identified Far West’s U.S. partners as

– «Kellogg, Brown &Root» (KBR Halliburton) – in Colombia, Afghanistan, Kosovo, Georgia, and Iraq.

– «Diligence Iraq LLC» (controlled by the Kuwaiti Mohammed as-Sagar) – in Iraq.”[4]

More specifically “Yasenev” charged that Far West’s chief business, in Colombia and elsewhere, was drug trafficking, an activity which Filin himself attributed to the Americans controlling Bagram.[5]

Some of “Yasenev”’s charges against Far West – but not these ones – were publicized in America by the Hoover Institution scholar John Dunlop. Dunlop transmitted nothing of what “Yasenev” said about Far West’s connections to KBR and Diligence LLC, as well as to the intelligence services of Israel, Turkey, Saudi Arabia, Russia, and the United States. Dunlop did not mention Far West itself at all by name. But he relied heavily on “Yasenev” to support his claim that some of Far West’s members planned in advance for what has been called “the Russian 9/11:” the series of false-flag terrorist attacks in 1999 that led to the election of Putin as Russian president and also to the second Russian war in Chechnya.[6]

The basic facts of the Russian 9/11 have been well summarized by the historian David Satter:

On August 5 [1999], a Muslim force led by Shamil Basayev, a Chechen guerilla leader, entered western Dagestan from Chechnya, ostensibly to start an anti-Russian uprising. On August 9, Stepashin was dismissed and Putin became prime minister. On August 22, the force withdrew back into Chechnya without heavy losses, amid suspicion that the incursion had been a provocation. At the end of August, Russian aircraft bombed Wahhabi villages in Dagestan in seeming retaliation for the incursion and this was followed, days later, by the explosions that obliterated the apartment buildings in Moscow, Buinaksk and Volgodonsk.

According to Satter, along with other observers east and west, “the weight of the evidence supports the view that the bombings were not the work of Chechen terrorists but rather the action of the Russian government undertaken to justify the launching of the Second Chechen War.”[7]

What we may call this “first-cut” false-flag explanation for the August 1999 incidents – that it was “the action of the Russian government” – was refined by other observers, notably John B. Dunlop of the Hoover Institution and Jamestown Foundation. According to this “second cut” refinement, the August bombings and Dagestan incursion were both planned in Adnan Khashoggi’s Riviera villa the previous June, by a meeting of Chechen Islamists together with a Kremlin representative.[8] According to Dunlop the meeting was actually brokered by a retired GRU officer called Anton Surikov, who we know from other sources to have been an officer of Far West Ltd. In Dunlop’s words,

On the day following the initial incursion of rebel forces into the Dagestani highlands in early August of 1999, the investigative weekly Versiya published a path-breaking report claiming that the head of the Russian Presidential Administration, Aleksandr Voloshin, had met secretly with the most wanted man in Russia, Shamil’ Basaev, through the good offices of a retired officer in the GRU, Anton Surikov, at a villa belonging to international arms merchant Adnan Khashoggi located [in Beaulieu] between Nice and Monaco.[9]

Dunlop blamed the plotting on three protégés of the Russian oligarch Boris Berezovsky – Valentin Yumashev [Yeltsin’s son-in-law], Alexander Voloshin, and Roman Abramovich – all of whom at this point were members of Yeltsin’s “Family” in the Kremlin. He neglected to mention that Anton Surikov had spent time at the London Centre for Defence Studies; and in addition had admittedly had contacts with former CIA officer Fritz Ermarth.[10]

Russian researchers in the group Left.ru proposed a “third cut” explanation for these events: that they furthered the needs, not just of the “Russian government” or the Berezovsky circle, but also of a CIA-linked international drug connection (of the type exemplified by Adnan Khashoggi).

Developing on their arguments, I myself suggested in particular that “the events of the Russian 9/11” were part of a larger quid-pro-quo discussed at the meeting, including a rerouting of Afghan heroin through Pristina airport in Kosovo, which Russian troops had just occupied.[11] I noted that Dunlop had reported very selectively from his chief source “Yasenev,” particularly with reference to the Far West group’s involvement with other intelligence agencies, and with drug trafficking. I proposed in short that what might have been at stake in the quid quo pro was a major realignment of politics for the sake of the drug traffic itself.

Dunlop did transmit the drug allegations concerning one participant at the meeting,

a Venezuelan banker named Alfonso Davidovich. In the Latin American press, he is said to be responsible for laundering the funds of the Columbian [sic] left insurrection organization FARC, which carries out an armed struggle with the official authorities, supported by the narcotics business.[12]

For almost four years after 2005 I was (according to Google) virtually the only western source of information about Far West Ltd. My essay, charging them with the provocation of terrorist violence and involvement with drug trafficking, was highly relevant to the argument in this chapter, that those who profit from enduring violence can also at times induce it.

My article was also largely based on controversial sources. But in June 2009, for the first time, a western mainstream newspaper, Australia’s Sunday Herald Sun, mentioned Far West Ltd. This was because an Australian citizen, Sarfraz Haider, was one of four people murdered in connection with a Far West smuggling plot I had referred to.[13] According to the Sun, Haider’s murder

was the culmination of a bizarre plot — worthy of a spy thriller — in which nuclear missiles were allegedly stolen from the Russians and sold to Iran for $63 million. ….Up to 20 nuclear-capable Kh-55 missiles — with a 3000km range — and four 200-kiloton nuclear warheads were stolen by a shadowy group of former Russian and Ukrainian intelligence and military officers…. [O]ne version of events, supported by documents obtained from the Ukrainian parliament and the investigations of the Haider family, is that they ended up in Iran and China.

Letters written by Hryhoriy Omelchenko, a former intelligence colonel to Ukraine’s President Viktor Yushchenko, give details of the arms deal. The letters also confirm Mr Haider, 53, was suspected of being part of the arms trafficking gang that sold the missiles to Iran and China…..While wrangling with lawyers and local officials over his father’s estate in Cyprus, Sam Haider was contacted by a man called Ruslan Saidov, who claimed to be a friend and business associate of Sarfraz…. “He said the theft of the missiles was masterminded by the partners of an intelligence and military consultancy firm called Far West Ltd.”[14] [Saidov is in fact an officer of Far West.]

This Australian story corroborated an earlier one in the Ukrainian press, linking Far West to the smuggling and the murder:

three other people who had taken part in the smuggling of the Ukrainian missiles had already been killed. The first was Valeriy Malev, who headed [arms export company] Ukrspetseksport: he was killed in mysterious circumstances in a car crash on 6 March 2002. In January 2004 the general director of the company S.H. Heritage Holding Ltd, an Australian citizen, [Sarfraz Haider?], crashed while driving a quadrobike (according to information from the investigation, the missiles were transported to Iran under a fictitious contract from that company with the Iranian SATAK Co. Ltd of NIOC for the supply of gas turbine equipment). In the same month the Ukrainian businessman Serhiy Petrov, the former head of the consultancy firm Far West Ltd, was blown up in his car in South Africa.[15]

The case itself was reported aroused considerable attention in 2005. Jane’s Intelligence Digest, March 18, 2005, noted: “There is no doubt that the sale of the missiles to Iran and China could only have taken place with the knowledge and cooperation of senior Ukrainian officials. … there is … mounting evidence to suggest that the sale of missiles to Iran was undertaken with the assistance of the Russian security services.”[16]

Moisés Naím, editor of Foreign Policy, later used the case to argue that, in smuggling where government officials are involved, illicit networks rather than state organizations can be the main players.[17] This important point, consonant with my own argument here, complicates the notion of a false flag operation: events attributed to the Ukraine government may in fact have been intended by subordinate officials, at least partly, to embarrass and destabilize it.

However in the course of his argument Naím wrote that “these deals were motivated by profit, not politics.” This claim was sharply contested by a Russian news agency, quoting Ukrainian sources, which claimed that the Kh-55 smuggling was initiated by American neocons, including Cheney and Rumsfeld, in order to create a casus belli against Iran.

In 2005 Filin denied the involvement of Far West in the illegal Kh-55 sales, even as he announced that his company Far West had passed $3 million in bribes concerning other deals with the same Ukrainian state agency Ukrspetsexport.[18] According to Pravda-info, he and two other co-founders of Far West, Ltd., Anton Surikov, and Alexei Likhvintsev, met with representatives of the Bush Administration. Later Filin cited fear of criminal persecution by US law-enforcement agencies as the reason for his and his partners’ hasty relocation from Europe to Brazil and Dubai. According to Filin, he and his partners were warned by a high-ranking U.S. official that they would be brought to justice for their role in the 2001 Kh-55 affair.[19] Later Filin attended the inauguration of President Evo Morales in Bolivia, where he adopted a new and militantly anti-CIA stance, denouncing the CIA as “absolute and universal evil.”[20]

Filin’s switch-hitting in matters of alliance with official intelligence agencies may have been more a matter of theater than of substance. Even so, it corroborates  a “fourth-cut” explanation for Far West’s provocations which I shall develop below. This is that Far West’s principal aim is to promote conditions that facilitate its own business prospects (including drug trafficking), and specifically the chaos that makes for future contracts as well as allowing for illegal crops to be harvested and trafficked with impunity. In would be interesting to learn if, after the exposure of the Kh-55 scandal, Far West continued to operate its “export” business out of the US-controlled airports of Bagram and Manas. An affirmative answer would indicate the tolerance, if not indeed complicity, of U.S. personnel in Far West’s activities.

A Fourth-Cut Account of Far West Ltd: an Ongoing Destabilization Machine

The ensemble of evidence now gathered suggests a fourth-cut explanation for the Russian 9/11: that it was not an ad hoc conspiracy, but part of an on-going connection for destabilization operations – not primarily to support either Russia or the United States, but to promote chaos in order to weaken legitimate government in the Caucasus, create an environment for entrepreneurial violence, and facilitate drug trafficking.[21]

The use of Khashoggi’s villa, furthermore, can be interpreted as corroboration of this. A 1991 DIA report listed numerous Colombian traffickers and their associates, and included: “69. Adnan ((Khashoggi)) — An international arms trafficker who allegedly has sold arms to the Colombian drug traffickers, especially to the Medellin Cartel.”[22] This is of course consistent with the report, transmitted by Dunlop, that Alfonso Davidovich of Far West Ltd “is said to be responsible for laundering the funds of the Columbian [sic] left insurrection organization FARC.”

Many have observed that the military incursions used by America to fight terrorism in Asia are contributing to, not reducing, the threat to this country. My own conclusion is both more severely critical, and also in the end more optimistic. It is that America has been drawn into these conflicts by forces it failed to understand, some of which it is sustaining from the public trough. What is needed more than a change in Afghanistan or in Pakistan is a change in Washington itself, to cease subsidizing the predators who have been profiting from our discomfort and casualties abroad.

It would be nice to think that understanding of this folly would lead to its termination. But what we are witnessing is precisely the progressive erosion of the power of the public state to control the billions of activities that are conducted, in its name, for private profit. Neither the President nor the Congress appears capable of reversing the tide of corruption that is overwhelming both them and us.


[1] “Cheney firm won $3.8bn contracts from government,” Observer, July 21, 2002,  http://www.guardian.co.uk/world/2002/jul/21/globalisation.georgebush.

[2] Novyi Region, November 27-30, 2006: English summary in “U.S. Companies Linked to Vice-President Cheney Supervised the Transfar of Ukrainian WMD to Iran,” Left.ru, http://www.left.ru/burtsev/ops/novyiregion.phtml.

[3] PravdaInfo, 9/2/05, http://www.pravda.info/news/3601.html.

[4] Yuri Yasenev, “Rossiyu zhdet oranzhevaya revolytsiya” (“An Orange Revolution is in Store for Russia”), compromat.ru, 12/17/04, http://www.compromat.ru/main/surikov/saidov.htm; partial translation at http://www.left.ru/burtsev/ops/yasenev_en.phtml: Yasenev implied that in 2003-04 Georgia Far West had worked with KBR on the two Rose Revolutions which ousted Shevardnadze and installed Georgia’s present ruler, Saakashvili (Scott, “The Global Drug Meta-Group: Drugs, Managed Violence, and the Russian 9/11,” Lobster, October 29, 2005, http://www.lobster-magazine.co.uk/articles/global-drug.htm).

[5] “-Vladimir Ilyich [Filin], is it true that Americans are involved in drug business?

-Yes, they are in ideal situation for this. They control the Bagram airfield from where the Air Force transport planes fly to a U.S. military base in Germany. In the last two years this base became the largest transit hub for moving Afghan heroin to other US bases and installations in Europe. Much of it goes to Kosovo in the former Yugoslavia. From there the Kosovo Albanian mafia moves heroin back to Germany and other EU countries” (Alexander Nagorny, “Narkobarony iz CIA i MI-6” Pravda-info, September 13, 2004, translated into English at Left.ru, http://left.ru/inter/2005/narkobarons.phtml

[6] John B. Dunlop, “`Storm in Moscow’: A Plan of the Yeltsin “Family” to Destabilize Russia,” The Hoover Institution, October 8, 2004, http://www.sais-jhu.edu/programs/res/papers/Dunlop%20paper.pdf. This article disappeared from the Johns Hopkins University SAIS website shortly after my critique of it was published in October 2005.

[7] David Satter, “The Shadow of Ryazan: Is Putin’s Government Legitimate: Is Putin’s Government Legitimate?” National Review, April 30, 2002, http://www.nationalreview.com/comment/comment-satter043002.asp. Cf. David Satter, Darkness at Dawn: The Rise of the Russian Criminal State (New Haven: Yale UP, 2003), Chapter 2.

[8] Patrick Cockburn, Independent, January 29, 2000: “Boris Kagarlitsky, a member of the Russian Academy of Sciences Institute of Comparative Politics, writing in the weekly Novaya Gazeta, says that the bombings in Moscow and elsewhere were arranged by the GRU (the Russian military intelligence service). He says they used members of a group controlled by Shirvani Basayev, brother of the Chechen warlord Shamil Basayev, to plant the bombs. These killed 300 people in Buikask, Moscow and Volgodonsk in September. Mr Kagarlitsky, who, from internal evidence in the article, is drawing on a source with close knowledge of the GRU, says that invasion of Dagestan by Shamil Basayev himself in August was pre-arranged with a senior Kremlin leader at a meeting in France in July.”

[9] John B. Dunlop, “`Storm in Moscow’: A Plan of the Yeltsin “Family” to Destabilize Russia,” The Hoover Institution, October 8, 2004, http://www.sais-jhu.edu/programs/res/papers/Dunlop%20paper.pdf. This article disappeared from the Johns Hopkins University SAIS website shortly after my critique of it was published in October 2005.

[10] Letter of Anton Surikov to Oleg Grechenevsky: “I am personally acquainted with Mr. Ermarth as political scientist since 1996. It’s well known by many people and we never hid this fact.” Fritz Ermarth did not retire from the CIA until 1998. Cf. Argumenty i Facty, September 15, 1999, http://www.aif.ru/oldsite/986/art010.html. That the two men met in 1996 was indeed public knowledge. (The Russian journal Commersant published a photo of the two men and others at the International Seminar on Global Security in Virginia, April 1996). However in 2002 Surikov’s paper, Pravda.ru, published a front-page story (or better, rumor) linking Ermarth to Surikov’s enemy Berezovsky: “Berezovsky is much more interesting from the point of view of different manipulations in domestic and partially in foreign political life. For this very purpose, British special services `handed Berezovsky over’ to American colleagues. We have information that Fritz Ermarth, former CIA officer and specialist on special operations in the East-European region, is in close contact with the oligarch. Russiagate, the scandal on Russian budgetary finance laundering through BONY in August to September of 1998, was one of his projects. He is in contact with Former CIA Director Woolsey, who has no official job in Washington but is known as a person close to Cheney. It is not ruled out that it was Ermarth who suggested that Berezovsky switch his attention from the weak and unpromising micro-party Liberal Russia to financing and cooperation with the Communist Party” (http://english.pravda.ru/politics/2002/10/09/37954.html).

[11] Peter Dale Scott, “The Global Drug Meta-Group: Drugs, Managed Violence, and the Russian 9/11,” Lobster, October 2005, http://lobster-magazine.co.uk/articles/global-drug.htm#_ftn9; “The Tao of 9/11,” Jacket 34, October 2007, http://jacketmagazine.com/34/scott-p-d-5p.shtml.

[12] Dunlop, “Storm in Moscow.”

[13] In a revised version of my paper I delivered at a symposium at the University of Melbourne, August 12, 2006.

[14] Laurie Nowell, “Did an Aussie sell nukes to Iran?” Sunday Herald Sun (Australia), June 7, 2009: “`He said my father had been killed because the people at Far West and their Iranian partners feared the Americans would get to him and make him tell them about the missiles. They feared that he knew too much information about their dealings, and knew more information than anybody else.’ Far West’s partners, all former Russian or Ukrainian military or intelligence officers, had close contacts with military figures and mafia groups within Russia and its former satellites. They spirited the missiles out of the Ukraine and shipped them to Cyprus under the auspices of a company called SH Heritage Holdings — whose owner and sole director was Sarfraz Haider.”

[15] Kommersant-Ukraina, Kiev, July 17, 2007, 3; as reported by BBC Monitoring Kiev Unit, July 18, 2007.

[16] “X-55 Long Range Cruise Missile,” GlobalSecurity.org, http://www.globalsecurity.org/wmd/world/iran/x-55.htm. Cf. Financial Times, March 18, 2005.

[17] Moisés Naím. Illicit: How Smugglers, Traffickers, and Copycats Are Hijacking the Global Economy (New York: Anchor, 2006), 279-80.

[18] Pravda.info, November 16, 2005, reported in English  by Left.ru, “`Consulting’ Agency Far West, LLC Paid $3 Million Bribe to Ukrainian Official For Illegal Arms Deals with Syria and Iran,” Left.ru, February 18, 2006, http://www.left.ru/burtsev/ops/lysenko.phtml). According to Left.ru, Filin’s admission was in response to an article by Ivan Demidov in the Ukrainian journal Obkom. Demidov accused two of Filin’s Far West partners, Ukrainian Generals Leonid Kosyakov and Alexei Likhvintsev, and the Russian billionaire Vyacheslav Kantor, adviser to Yushchenko, of seeking to obtain control over two Ukrainian seaports, in Odessa and Ilyichevsk. Demidov’s article (“Who Squeezes Juice from ‘Drug-Injected Oranges'”) hinted that under the guise of fertilizers to be exported to South America by Kantor’s company Akron, the group planned to transport drugs. It also reprinted a letter from a Ukrspetsexport official listing Far West’s business partners: KBR Halliburton (US), Diligence Iraq, LLC (Kuwait), and Meteoric Tactical Solutions (South Africa). And according to Left.ru, Demidov’s article “alleges that Fritz Ermarth, formerly high ranking official in the CIA, NSC, and NIC, plays the role of the “supervisor” of this GRU group on the part of the FWL’s chief partner: KBR Halliburton and the Dick Cheney circle.”

[19] Editorial staff of burtsev.ru, http://www.left.ru/burtsev/ops/bolivia.phtml; citing Vladimir Filin, Pravda-info, July 29, 2005, http://www.pravda.info/news/3377.html. Cf. Financial Times, March 18, 2005. The relocation followed Filin’s announcement that Far West had paid bribes paid to Ukrainian officials. Cf. Boston Globe, 2/12/06, A1.

[20] Natalia Roeva, Pravda-info, February 24, 2006; partially translated. Roeva is herself a partner in Far West.

[21] Far West has planted destabilizing rumors to discredit both the U.S. and Russia. Ruslan Saidov has “accused the high ranking officer of US military intelligence (DIA) Colonel Caleb Temple and his colleagues of running a heroin operation in the Near East and using the hawala money-transfer system for money laundering” (http://left.ru/burtsev/ops/hawala.phtml). In August 2009 Vladimir Filin claimed that the recently hijacked ship the Arctic Sea, under the cover of a load of Finnish timber, was delivering a shipment of weapons to Iran via Algeria (Cristina Batog, “The truth is adrift with the Arctic Sea,” Asia Times, August 26, 2009, http://www.atimes.com/atimes/Central_Asia/KH26Ag01.html; cf. J. R. Nyquist, “Never Ask the Wolves to Help You Against the Dogs,”
GodlikeProductions.com, August 21, 2009, http://www.godlikeproductions.com/bbs/reply.php?messageid=869607&page=1&quote=13460278).

[22] DIA Report of 9/23/91, “Subj: (U) IIR [DELETED]/Narcotics – Colombian Narco-Trafficker Profiles,” http://www.gwu.edu/~nsarchiv/NSAEBB/NSAEBB131/dia910923.pdf. Cf. New York Times, 8/2/04.