Islamic charity chief admits funding rebels

CHICAGO -- The head of an Islamic charity linked to Osama bin Laden pleaded guilty Monday to funding rebels in Chechnya and troops in Bosnia as the government dropped a charge accusing him of using his foundation to support al-Qaida.

Enaam Arnaout, a Syrian-born U.S. citizen, pleaded guilty to a single racketeering conspiracy count as jury selection was about to begin.

"In entering a plea today, Mr. Arnaout made a decision that he believes is in the best interest of his family, the charity and the American Muslim community," said Arnaout's attorney, Joseph J. Duffy.

"One has to question whether a fair and impartial jury could be found anywhere in America today that could sit in judgment of an Arab- American in a case involving allegations of terrorism," he added.

Prosecutors did not comment on the plea agreement.

The charges against Arnaout, 41, were announced in October by U.S. Attorney General John Ashcroft and were a major part of the government's effort to halt the flow of U.S. dollars for terrorists.

Federal prosecutors have said that Arnaout was close to bin Laden in Afghanistan in the 1980s and used his Benevolence International Foundation, based in suburban Chicago, to support the al-Qaida network.

Had the case gone to trial, prosecutors planned to call as a witness an al-Qaida member, Jamal Ahmed al Fadl. They said in court papers that he would testify that bin Laden spoke of using Arnaout's charity, with offices in a number of Muslim countries, of transferring funds around the world to places where al-Qaida was engaged in operations.

Arnaout could be sentenced to 20 years in federal prison. Prosecutors said they might ask for a considerably lighter sentence if he cooperates in future investigations.

No sentencing date was set at the request of both sides because prosecutors want to see how much cooperation they get beforehand.

In his 12-page plea agreement, Arnaout said he began soliciting funds through his foundation out of his office in suburban Palos Hills in May 1993. But he acknowledged that "a material portion" of the funds went to "support fighters overseas."

He acknowledged that he and others agreed to provide boots for rebels fighting Russian troops in Chechnya and boots, tents and an ambulance "intended for ultimate use by soldiers in Bosnia- Herzevogina."

Arnaout admitted doing so while telling donors, many of them American Muslims who thought they were doing their religious duty by contributing, that their money was helping only widows, orphans, refugees and the poor.

Arnaout was arrested last April 30 as he was seeking court permission to leave the country, saying he wanted to visit his sick mother in Saudi Arabia. At the time, he was under round-the-clock FBI surveillance.

Prosecutors quoted a witness as saying Arnaout discussed the possibility of never returning to the United States from such a trip.

They also said they had intercepted a phone conversation in which he urged a foundation agent in Pakistan to flee with the group's funds and be careful not to allow his telephone calls and e-mails to be monitored as part of the terrorism investigation.

The storefront office where the foundation operated for a decade in suburban Palos Hills was raided Dec. 14, 2001, and the group was placed on notice it was suspected of funding terrorism.

The same day the group's bank accounts were frozen by the government.

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