Arms-to-Iraq Scandal

The Arms-to-Iraq scandal involved the prosecution of Matrix Churchill directors Paul Henderson and Peter Allen by Customs and Excise in 1992 for the alleged illegal export to Iraq of machine tools for munitions.

The case collapsed on November 1992 when it emerged that the then Conservative government was aware of the exports.

This lead to the setting up of the Scott Inquiry (lead by Lord Justice Scott) which investigated the Matrix Churchill case.

In 2001 the two directors were paid compensation by the government out of a fund for miscarriages of justice.

Several Tory ministers signed PII Public Interest Immunity Certificates to try to stop the disclosure of documents which showed that the defendants had been working for British secret services.

Connected assassinations?

 * Gerald Bull, arms dealer and inventor of the "super gun", was assassinated in Belgium in a 1990 professional hit.
 * A 28-year-old British journalist, Jonathan Moyles, was killed in Santiago, Chile, the day after interviewing arms dealer Carlos Cardoen. Cardoen had been involved in selling Iraq 50 Bell helicopters containing the ultra-sophisticated Helos guidance system, illegally exported from Britain.
 * Andre Cools, former deputy prime minister of Belgium, was murdered in 1991, shortly after being asked to investigate Belgian involvement with Iraqi arms deals.

It has been alleged that the bizarre fetishistic death of former Tory MP Stephen Milligan is also connected. According to some insiders, the MP, who worked for the Defence Ministry, was killed for asking too many questions about arms trade corruption.)

External Links, 1992-1995

 * Charles Blackhurst, "Chance and Friendship Led to Discovery of Iraqi Supergun," the Independent, Nov. 8, 1995.
 * Neil Lewis, "Bank Fraud Plea Forestalls Questions About Iraq Arms," New York Times, Sept. 23, 1993.
 * Neil Lewis, "New Jersey Concern is Tied to Iraq Arms Network," the New York Times, Feb. 15, 1993.


 * "The Man Who Made the Supergun," Frontline, PBS, Feb. 12, 1991.
 * Elaine Sciolino, "Arming Iraq: The Ohio Connection," New York Times, July 28, 1992.
 * Douglas Frantz and Murray Waas, "U.S. Knew Firm Was Iraq's A Year Before It Closed," the Los Angeles Times, July 24 1992
 * Douglas Frantz, "U.S. Eased Way for Iraqi Supergun," Los Angeles Times, Oct. 27, 1992:

"The Bush Administration approved export licenses for computers and software that helped design Iraq's notorious supergun and a ballistic missile capable of reaching Israel and other Middle East countries, according to documents and congressional investigators. The export license for the computers was granted in the fall of 1989 to a Maryland company controlled by artillery wizard Gerald Bull, who was assassinated six months later outside his apartment in Belgium."


 * Douglas Frantz and Murray Waas, "Bush Had Long History of Support Iraq Aid," Los Angeles Times, Feb. 24, 1992.
 * Murray Waas and Douglas Frantz, "U.S.Loans Indirectly Financed Iraq Military," Los Angeles Times, Feb. 25, 1992.
 * Murray Waas and Douglas Frantz, "Despite Ban, U.S. Arms Are Sold to Pakistan," Los Angeles Times, March 6, 1992.
 * Murray Waas and Douglas Frantz, "U.S. Knew Arms Sales Broke Law, Pell Charges," Los Angeles Times, March 7, 1992.
 * Murray Waas and Douglas Frantz, "U.S. Gave Intelligence Information to Iraq Three Months Before Invasion," Los Angeles Times, March 10, 1992.
 * Murray Waas and Douglas Frantz, "Abuses in U.S. Aid to Iraqis Ignored: Bush Administration Pushed Trhough $1 Billion More in Assistance Despite Efforts of Kickbakcs and Evidence That Food May Have Been Traded for Arms," Los Angeles Times, March 22, 1992.
 * Norman Kempster and Murray Waas, "U.S. Paying Off Bad Iraqi Loan," Los Angeles Times, March 29, 1992.
 * Dean Baquet, "Documents Charge Iraqis Made Swap: U.S. Food for Arms," New York Times, April 27, 1992.
 * Murray Waas and Douglas Frantz, "Bush Tied to `86 Bid To Give Iraq Military Advice," Los Angeles Times, May 7, 1992.
 * Douglas Frantz and Murray Waas,"Bush Officials Defend Prewar Aid to Iraq," Angeles Times'', May 22, 1992.
 * Douglas Frantz and Murray Waas, "Iraq's $5 Billion Windfall Spins Deepening Mystery," Los Angeles Times, May 24, 1992.
 * Murray Waas and Douglas Frantz, "Officials Investigating Whether U.S. Loans Helped Iraq Buy Arms," Los Angeles Times, May 30, 1992.
 * Elaine Sciolino, "U.S. Reports A Stronger Saddam Hussein," New York Times, June 16, 1992.
 * Douglas Frantz and Murray Waas, "Testimony on Iraq Export List is Contradicted," Los Angeles Times, June 24, 1992.
 * Douglas Frantz and Murray Waas, "Special Counsel Sought to Probe U.S. Aid to Iraq,"Los Angeles Times, July 10, 1992.
 * Murray Waas and Douglas Frantz, "Iraq Got U.S. Technology After CIA Warned Baker," Los Angeles Times, July 22, 1992.
 * Elaine Sciolino, "Arming Iraq: The Ohio Connection," New York Times, July 28, 1992.
 * Douglas Frantz and Murray Waas, "CIA Told White House of Iraqi Arms Exports," Los Angeles Times, August 6, 1992.
 * Douglas Frantz and Murray Waas, "Iraqi Used American-Built Plant to Develop A-Arms," Los Angeles Times, August 7, 1992
 * Murray Waas and Douglas Frantz, "Iraq Got U.S. Technology After CIA Warned Baker," Los Angeles Times, July 22, 1992.
 * Elaine Sciolino, "Arming Iraq: The Ohio Connection," New York Times, July 28, 1992.
 * Douglas Frantz and Murray Waas, "CIA Told White House of Iraqi Arms Exports," Los Angeles Times, August 6, 1992.


 * Douglas Frantz and Murray Waas, "Iraqi Used American-Built Plant to Develop A-Arms," Los Angeles Times, August 7, 1992:

"In the spring of 1989, a CIA officer approached the president of a small engineering firm in Alabama and quizzed him about a carbide-tool manufacturing facility the company was building at an Iraqi government installation southwest of Baghdad.

"In the fall of that year, a Customs Service agent and an Agriculture Department criminal investigator visited the firm, XYZ Options Inc. in Tuscaloosa, and posed a similar set of questions to its president, William H. Muscarella.

"In both instances, I told the government what we were doing," said Muscarella. "I gave them blueprints and told them everything about the plant. They knew everything."

"By the fall of 1989, U.S. authorities suspected that Iraq intended to use the plant as part of its ambitious weapons program, according to newly obtained records. Yet, while the government blocked the export of a key piece of machinery, it apparently did nothing to discourage construction of the $14-million plant by withholding export licenses for other components, which were shipped to Iraq.

"When Iraq invaded Kuwait in August, 1990, the plant was virtually complete and capable of turning out military goods as well as consumer products, according to Muscarella.

"After the Gulf War, the military use was confirmed. U.N. inspectors hunting for Iraqi weapons facilities discovered the carbide factory was part of Iraq's main nuclear-weapons complex. After determining that the factory had been used in the effort to develop a bomb, the inspectors blew up the plant, U.N. documents show...

"The Times reported previously that U.S. intelligence agencies warned high-level Administration officials as early as June, 1989, that a company outside Cleveland named Matrix Churchill was a front in Iraq's worldwide arms-procurement network. However, the Administration rejected efforts to restrict sales of U.S. technology to Baghdad as late as May, 1990.

"The XYZ Options deal is a clear example of how the Iraqi network operated. Described as a commercial transaction, the arrangement was set up by Matrix Churchill and financed by the Atlanta branch of Italy's Banca Nazionale del Lavoro.


 * Murray Waas and Douglas Frantz, "New Documents Show U.S. Helping Iraq Loans," Los Angeles Times, Sept. 4, 1992.
 * Murray Waas and Douglas Frantz, "Justification of Iraq Aid Found Flawed in 1990," Los Angeles Times, Oct. 20, 1992.
 * Douglas Frantz, "U.S. Eased Way for Iraqi Supergun," Los Angeles Times, Oct. 27, 1992.
 * Murray Waas and Douglas Frantz, "Jordan Gave Iraq Broad Military Assistance,"  Los Angeles Times, Nov. 9, 1992.
 * Neil Lewis, "New Jersey Concern is Tied to Iraq Arms Network," the New York Times, Feb. 15, 1993


 * Russ Baker,"The Big One That Almost Got Away," the Columbia Journalism Review, March/April, 1993:

"ABC News Nightline opened last June 9 with words to make the heart stop. "It is becoming increasingly clear," said a grave Ted Koppel, "that George Bush, operating largely behind the scenes throughout the 1980s, initiated and supported much of the financing, intelligence, and military help that built Saddam's Iraq into the aggressive power that the United States ultimately had to destroy.

"Is this accurate? Just about every reporter following the story thinks so. Most say that the so-called Iraqgate scandal is far more significant then either Watergate or Iran-contra, both in its scope and its consequences. And all believe that, with investigations continuing, it is bound to get bigger.

"Why, then, have some of our top papers provided so little coverage? Certainly, if you watched Nightline or read the London Financial Times or the Los Angeles Times, you saw this monster grow. But if you studied the news columns of The Washington Post or, especially, The New York Times, you practically missed the whole thing. Those two papers were very slow to come to the story and, when they finally did get to it, their pieces all too frequently were boring, complicated,and short of the analysis readers required to fathom just what was going on. More to the point, they often ignored revelations by competitors.


 * Index of Articles, ""U.S. Military Aid to Iraq," Los Angeles Times, 1992-1994.
 * Index of Articles, "U.S. Foreign Policy Towards Iraq," Los Angeles Times.

See :,

Other Related SourceWatch Resources

 * See also the very similar Iraqi supergun affair.
 * Iraqgate
 * Iraqgate affair
 * U.S. Military Aid to Iraq
 * weapons of mass destruction
 * weapons of mass destruction investigation