U.S. EVIDENCE LINKS DRUG RING TO TERRORISTS

WASHINGTON -- Federal authorities have amassed evidence for the first time
that an illegal drug operation in the United States was funneling proceeds
to Middle East terrorist groups such as Hezbollah. Evidence gathered by the
Drug Enforcement Administration since a series of raids in January
indicates that a methamphetamine drug operation in the Midwest involving
men of Middle Eastern descent has been shipping money back to terrorist
groups, officials said.

"There is increasing intelligence information from the investigation that
for the first time alleged drug sales in the United States are going in
part to support terrorist organizations in the Middle East," DEA
administrator Asa Hutchinson said.

DEA officials said the men, most of whom were indicted on drug charges
after their January arrests, were smuggling large quantities of the
chemical pseudoephedrine from Canada into the Midwest.

Officials said the smuggling went through two primary Midwest locations,
Chicago and Detroit, and involved several men with ties to Jordan, Yemen,
Lebanon and other Middle East countries. There is no evidence that the
money was connected to the Sept. 11 attacks, officials said.

Pseudoephedrine is used in some cold and allergy medications. It is an
essential ingredient in the creation of methamphetamine, a powerful drug
known on the streets as "ice," or "crystal meth."

The U.S. drug ring was reselling pseudoephedrine to Mexican-based drug
operations in the Western United States that used it to produce
methamphetamine, authorities said.

The Middle Eastern men then diverted some of the proceeds from the
pseudoephedrine sales back to the Middle East to accounts authorities have
begun to connect to terrorist groups, DEA officials said. Some connections
involved the Iranian-backed terrorist group Hezbollah, and some of the
money has been traced to accounts in Lebanon and Yemen, officials said.

DEA officials said U.S. authorities don't know yet how much money was
funneled from the drug sales to the terrorist groups but said the
pseudoephedrine sales alone amounted to millions of dollars.

The drug ring was broken up Jan. 10 as part of a massive DEA investigation
called Operation Mountain Express. Arrests were made in Detroit, Cleveland,
Chicago, Phoenix and several California cities.

The raids have resulted in criminal charges against 136 people and the
seizure of nearly 36 tons of pseudoephedrine, 179 pounds of
methamphetamine, $4.5 million in cash, eight real estate properties and 160
cars used by the drug gangs.

Hutchinson has been warning for months that illegal drug money provides a
compelling opportunity for terrorist groups to siphon support from the
United States, but the DEA investigation provided the first evidence of a
direct flow of money.

The evidence of the terrorist ties emerged after the arrests. U.S.
authorities said it is possible some defendants charged with drug
violations could face additional charges.

The Bush administration has been stepping up efforts to stem the flow of
money and items from sympathizers in the United States to foreign terrorist
groups under a law that prohibits providing "material support and
resources" to known terrorist organizations.

Six men who lived in the United States were indicted last week on charges
they conspired to provide such support to al- Qaida or related terrorists.

Federal agents believe they have uncovered a broad effort by American
residents, many of them legal immigrants or visitors, to use credit-card
thefts, illegal cigarette sales, diverted charitable funds and cash
smuggled in airline luggage to enrich anti-American and anti-Israeli
terrorist groups, officials said.