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  Hariri was legendary, the seminal political figure in Lebanon’s fractious politics, which had been defined by ethnic and religious divides that were sharpened after years of civil war. He and his party represented the Sunnis of Lebanon, and he was the principal foe of the Syrian forces still occupying the country. He was the chief political adversary of Lebanese President Emile Lahoud, who was supported by the Syrian regime and Hezbollah. Hezbollah purported to represent the country’s Shia population. A major political force and a “state-within-a-state” militia, the terrorist organization despised Hariri, his political force, and his close international ties to countries such as Saudi Arabia, France, and the United States. Most troubling to Syria, Hezbollah, and their benefactor, Iran, was that Hariri represented a Lebanon that longed for freedom—freedom from Syrian military occupation, from constant conflict with Israel, and from turmoil within Lebanon. Hariri was the most powerful man in Lebanon in a sea of sharks.

  We had not been summoned yet to the meeting, so we made our way to a Starbucks set on the Mediterranean seaside. As we parked and entered the two-story coffee shop, I was surprised at what I saw. The Starbucks was humming, full of a young, hip crowd. Young men and women were mingling, checking their cellphones, and working on laptops. On the second floor, I looked at the vibrant seaside scene and the dark Mediterranean beyond the window-panes. As we drank our coffee, I marveled at how this could easily have been a scene from Los Angeles or Seattle. Then we got the call—the prime minister was ready to meet. We made our way quickly to the Suburbans and headed straight for Hariri’s home in the heart of Beirut.

  As we entered his home, we were escorted to a large office that doubled as a meeting room, where Hariri and our ambassador and deputy chief of mission were waiting. I walked in and greeted Hariri as he stood at his chair. I could tell that the ambassador was anxious, since we had never met in person and had not coordinated our message before the meeting. I sensed that everyone in the room was surprised that I had arrived alone—and that I was not an older man. Hariri graciously invited me to sit next to him and offered me Swiss chocolates from a bowl sitting on the table in front of us. I took one, and we paused so Hariri could watch an evening news broadcast on the big-screen TV in the corner of the room. He was listening intently to the news coverage of Lebanese President Lahoud’s visit to Damascus to meet with Bashir al-Assad, which included footage of them walking together after their meetings. In a surreal moment, we watched as the news broadcast shifted to a report on Hariri’s meetings that day and showed footage of him, too. I watched Hariri watch himself on his own big-screen TV.

  We then began our discussions, as staff brought in more food. Hariri was pleased to receive me and asked me to pass his warm regards to Condoleezza Rice, for whom he had great respect. I told him I would and that I brought our deepest regards from the White House. I then spoke about the need to move toward repatriation of Iraqi assets found in Lebanese banks. I noted that this would be an important step for both the Iraqis and the Lebanese, especially for its banking system. Beirut banks could be seen as leading the banking world by repatriating the assets. The move would serve as a clear demonstration effect for other banks holding Iraqi assets. He was well versed in the issue and knew the amount of assets in question. In the middle of our discussion, Lebanese Finance Minister Fouad Siniora came in to join the discussion. Fortunately, Siniora and I had met on numerous occasions in the past, so he knew who I was and added a sense of familiarity to the meeting. Siniora and Hariri were close allies, and Siniora, too, would later become Lebanon’s prime minister.

  Hariri understood our position but expressed concern about the Beirut banking system’s exposure to liabilities as a result of repatriating too quickly. There would be opposition by merchants, bankers, and those claiming to be owed by the Iraqi government. He suggested calling his friend Kofi Annan, the UN secretary general, to get a new UN resolution that would clarify the obligation to repatriate assets, suggesting that it might build in immunity for banks and jurisdictions doing so. I argued that this might be a confusing step, since the obligations under UN Resolution 1483 were already clear, with the requirement and manner of repatriation spelled out neatly. The most important next step was moving to repatriate those assets that undeniably belonged to the Iraqi state. The new Iraqi government could then resolve any claims against their assets through a separate process. If we allowed claims—real or not—to get in the way of repatriation, we would never see a penny sent back to Iraq.

  After over an hour of discussion, Hariri seemed pleased and convinced that the assets needed to be returned. There would need to be some work within the Beirut banking world and the Lebanese commercial sector to allow this to move forward, but he and Siniora seemed resolved to get this done. The Syrians did not like the idea of assets being returned—in part because it isolated them further and portended a day when their leadership assets might be chased and frozen in the Beirut banking system. We chatted a bit longer and then ended the meeting.

  As we exited Hariri’s home, a crowd of reporters met us with the bright lights of their television cameras. Some of the reporters wondered what the meeting was about, and some plainly asked, “Who are you? Where are you from?” I was happy to remain anonymous as we slipped back into the black Suburbans and sped away to the ambassador’s residence. Our mission was complete in Beirut. We were back on track to see the return of Iraqi assets. I knew I had just had an encounter with an important historical figure. Little did I know just how important.

  In October 2004, Hariri would resign as prime minister, feeling constrained in his role by the Syrian- and Hezbollah-backed political forces. Instead, he would work behind the scenes for change, perhaps wielding more independent power as he sat behind the throne. His enemies knew just how powerful he remained. On February 14, 2005, Hezbollah and Syrian operatives packed a Beirut street with 2,200 pounds of explosives, killing Hariri in his motorcade along with twenty-one others. They had known his route and planned extensively—creating mass destruction and a massive crater where the explosives and Hariri’s car had once been. This followed a string of assassinations of pro-Western and anti-Syrian figures, including journalists, security personnel, and politicians, that continues to this day.

  Hariri’s death spawned a new movement, the March 14 coalition—named after the date of a mass rally that took place in Lebanon a month later to protest both the assassination and Syrian occupation. With popular displeasure with the Syrians growing, the Assad regime was forced to withdraw Syrian forces from Lebanon. Saad Hariri, the slain leader’s son, along with French, Saudi, and American diplomats, pressed for an accounting. A special tribunal was commissioned to investigate the murders, and after months of wrangling, the prosecutors issued a report. Evidence pointed to Hezbollah and Syrian direction and involvement in the attack. Hezbollah had attempted to undermine and stop the tribunal, attacking those who were involved, disputing the facts, and, ultimately, trying to cast blame for the assassination on Israel. After this event, Hezbollah further eroded its credibility within Lebanon, especially in 2008 when the terrorist group turned its guns on fellow Lebanese during an internal conflict. The organization has continued to throw its support behind the regime of Bashar al-Assad, even after the escalation of conflict in Syria in 2012 between the government and rebel forces and the assassination of Lebanon’s security chief, Wissam al-Hassan, who was a key pro-Western figure in the March 14 coalition.

  At this point, we were making progress. However, all of the efforts to recover assets began to change complexion as the insurgency took hold inside Iraq.

  American and allied forces and the Iraqi government faced a full-fledged armed insurgency by 2004. Al Qaeda in Iraq, aided by the broader Al Qaeda network, began to see the US presence in Iraq and the perceived injustice of US forces “occupying” another Muslim country as a major opportunity. Added to this violent mix was Iranian support for allied Shia militias, which were threatening Americans, attacking Sunnis, and und
ermining the authority of the new Iraqi government. Thus, by 2006, we were fighting multiple fronts in Iraq. Meanwhile, we were trying to avoid a sectarian civil war and build the capacity of the Iraqis to handle their own security, economy, and politics. At the heart of this effort was an attempt to cut off the flows of funds that fueled the groups fighting US troops in Iraq.

  The Iraqi Intelligence Service had been a major financial facilitator for Saddam, and its former operatives were in the middle of fomenting the insurgency. Khalaf al-Dulaimi, a former intelligence officer and a key money manager for Saddam’s regime, helped to operate some of the front companies that Treasury identified. He had held money for the regime and wheeled and dealed on its behalf. When Dulaimi was designated by the United States and the United Nations, most of the assets that he controlled were frozen, much of it by Switzerland. Dulaimi, however, made his way to Syria with some money and allies to help maintain the Baathist resistance to the United States and the new Iraqi government. He and others found safe haven in Syria and used their prior networks to begin to fuel the insurgency. Dulaimi did not need access to major accounts or sums. Even a few thousand dollars went a long way to ensure instability in Iraq. Amazingly, Dulaimi has challenged the freezing of his assets in Switzerland, arguing before the European Court of Human Rights that he was not afforded due process before the UN and Swiss orders to freeze them took effect.

  With this shift taking place, we began to focus less on asset recovery and more on cutting off flows of funds to the insurgency. Recovery was well underway, but we would now also direct our efforts to border checkpoints and airports, where cash would be moving into the country in satchels and suitcases en route to the insurgents within Iraq. We would begin to turn our attention as well to the criminal activities—such as hostage taking, oil smuggling, and bank robberies—that Al Qaeda in Iraq and other insurgents would employ to raise money while sowing fear.

  I sat down with US Central Command (CENTCOM) leadership—at Treasury and then later when I served in the White House—and we discussed what an operational financial task force would look like. We took cues from the cooperation logged to date between the Pentagon and the Treasury Department on asset recovery and counterterrorism. Treasury had built strong relationships with the military after 9/11, sending OFAC analysts to sit with the combatant commanders and their intelligence units in the Pacific, in Europe, and at targeting centers in the United States.

  This effort was of even deeper relevance to the military than what we had done together so far, since the money flows we were trying to freeze or stop this time were heading into Iraq to kill soldiers. It did not take much to convince the military leadership that this mattered. Questions to detainees about financial backing and money flows now moved up the list for the military interrogators. Our designations and diplomacy became focused on shutting down the foreign fighter pipeline from North Africa and the Gulf and the related financial pipelines from Gulf donors and other financial supporters.

  By 2006, we would stand up the first interagency task force focused on wartime insurgency financing. The force would target “threat finance”—a military term meaning any money flows representing a threat to US military personnel and interests. Called the Iraq Threat Finance Cell, it would be run by CENTCOM and the US Treasury and would focus on recovering documents, gathering financial data, and creating the actionable intelligence necessary for the military to go after the financial underbelly of the growing insurgency. The analysts and agents of the finance cell would find the courier routes, financial frauds and bank robberies, and oil-skimming and corruption schemes that fueled attacks against the coalition. Soldiers now gathered ledgers, contracts, and documents to fill intelligence dossiers on suspected financiers, while Treasury continued to identify networks sending money into Iraq to support suicide attacks and Al Qaeda. The rat lines of recruits from Saudi Arabia, Libya, Morocco, and other parts of the “jihadi” world were funneled through Damascus International Airport en route to the Iraqi battlefields. This had become the battlefield of choice for Al Qaeda. With their presence came flows of funding that we needed to disrupt both inside and outside of Iraq.

  Our original mission, asset recovery, had come to an end, but we had channeled our strategies into a legitimately new military innovation. The model of threat finance cells (TFCs)—tracking an enemy’s assets and using them as a key vulnerability—began to take hold. In Afghanistan, with a rising Taliban insurgency in 2007 and 2008, we moved to create an Afghan Threat Finance Cell in Kabul. This one would be led by the Drug Enforcement Agency under the visionary leadership of Mike Braun, the chief of the DEA’s expeditionary and intelligence-driven Strategic Operations Division (SOD). The DEA had already been tracking and arresting Taliban narcotics traffickers. The trick now was to combine those efforts with the military’s capabilities and Treasury’s tools. What emerged was a new capability in Afghanistan to exploit financial information and the money and corruption tied to the opium trade to target the Taliban and its Al Qaeda allies. This model would animate policy discussions within the Department of Defense and at Special Operations Command as officials determined how the United States could leverage this brand of financial warfare to its benefit.

  In the years since we created the Iraq Threat Finance Cell, “threat finance” has become a part of the military’s vernacular and doctrines. The key counterinsurgency generals, David Petraeus and Stanley A. McChrystal, along with Admiral Eric T. Olsen, in charge of Special Operations Command, would begin to adopt this terminology and devote military resources to helping stem suspect financial flows in and out of war zones. This term now animates the military’s thinking and planning against America’s enemies, and it has embedded itself in the broader US national security lexicon.

  For our small team at Treasury, the Saddam asset hunt had initially seemed like a departure from the work we had already been doing to combat terrorist financing and isolate rogue states. However, in reality it dovetailed with that work and served to animate new thinking about a different kind of target—the high-end, all-encompassing corruption of kleptocracies, regimes engaged in widespread and endemic corruption, often serving the personal gain of the leadership. We had now seen how a regime could game the international system for profit. Saddam’s activities corrupted not only his own society but also those that came into contact with Iraq’s economy and touched its money. The international system had never before been adequately prepared to deter kleptocracy or to address its effects and aftermath. Though corruption was often pervasive in third world countries, it was often the first world banking centers and high-end real-estate markets that served as the welcoming refuge for leaders’ assets. Our work in Iraq had created an effective roadmap for recovering assets. It required cooperation with other governments and with the banking world—and it worked—yet with the new post-9/11 financial environment and the tools we had refined, we were capable of doing more.

  Soon I would leave Treasury to join the National Security Council, but I would remain a silent partner within the White House. From there, we sketched out a means of globalizing the lessons we had learned from the Saddam asset hunt to inoculate the international community from the perpetuation of kleptocracy. We would not be able to stop corruption cold, but we could make rogue leaders think twice before wiring millions of dollars to an offshore bank account—and banking executives think twice about taking the money of “politically exposed persons.”

  On August 10, 2006, President Bush issued the 2006 National Strategy to Internationalize Efforts Against Kleptocracy. There was little fanfare, but those in the anticorruption world noticed and saw its effects. When he launched the effort, President Bush made the most comprehensive statement on kleptocracy of any president to date:

  For too long, the culture of corruption has undercut development and good governance and bred criminality and mistrust around the world. High-level corruption by senior government officials, or kleptocracy, is a grave and corrosive abuse of power and re
presents the most invidious type of public corruption. It threatens our national interest and violates our values. It impedes our efforts to promote freedom and democracy, end poverty, and combat international crime and terrorism. Kleptocracy is an obstacle to democratic progress, undermines faith in government institutions, and steals prosperity from the people. Promoting transparent, accountable governance is a critical component of our freedom agenda.

  . . . Our objective is to defeat high-level public corruption in all its forms and to deny corrupt officials access to the international financial system as a means of defrauding their people and hiding their ill-gotten gains.9

  This strategy statement set the stage for greater prosecutorial focus on corruption overseas; provided for stronger anticorruption measures and more targeted financial intelligence gathering against rogue regimes; and authorized an increase in diplomatic efforts to gain support on this issue from close partners such as the United Kingdom, Transparency International, and the World Bank and to work with them to create new anticorruption initiatives. Eventually, the World Bank would begin its own Stolen Asset Recovery (StAR) Initiative. The Egmont Group of Financial Intelligence Units would create a specific group to focus on high-end corruption, while the Financial Action Task Force would devote more anti-money-laundering attention to the need for heightened financial scrutiny of “politically exposed persons” (PEPs). Switzerland would begin to take the lead on asset recovery in Europe, creating higher standards for its banks and acting more quickly than most other countries to freeze and repatriate leadership assets. Switzerland also launched the “White Money Initiative” to ensure the integrity and reputation of its financial system.