1.

The Conflict in Iraq

ARMY IGNORED BROKER ON ARMS DEAL
By Ken Silverstein and T. Christian Miller

** U.S. general supervised an Iraq contract that a slain American said was tangled in kickbacks. **

Los Angeles Times
March 15, 2005

http://www.latimes.com/news/nationworld/iraq/la-fg-contract15mar15,0,4285507.story?coll=la-home-headlines

BAGHDAD -- Soon after interim Prime Minister Iyad Allawi took office last summer, he announced plans to create a tank division for the new Iraqi army.

The $283-million project was supposed to display the power of Iraq's new government. But under the guidance of a task force overseen by one of America's top generals, it has become another chapter in a rebuilding process marked by accusations of corruption.

The U.S. contractor working on the project repeatedly warned the task force headed by Army Lt. Gen. David H. Petraeus that a Lebanese middleman involved in the deal might be routing kickbacks to Iraqi Defense Ministry officials. But senior U.S. military officials did not act on the contractor's pleas for tighter financial controls, according to documents and interviews.

"If we proceed down the road we are currently on, there will be serious legal issues that will land us all in jail," the contractor, Dale Stoffel, wrote in a Nov. 30 e-mail to a senior assistant to Petraeus.

Eight days later, Stoffel was shot dead in an ambush near Baghdad. The killing is being investigated by the FBI, according to people who have been interviewed by the bureau.

Since then, senior U.S. military officials have continued to work with the middleman, Raymond Zayna, who has taken over part of Stoffel's contract, documents and interviews show.

Although the U.S. military initially insisted that the Iraqi government was in control of the project, e-mails obtained by the Times show that Petraeus' task force supervised it.

The case raises concerns about the U.S. commitment to accountability in projects involving Iraqi money. The inspector general for Iraq's reconstruction recently criticized the failure of the former U.S.-led Coalition Provisional Authority to properly account for $8.8 billion in contracts issued using Iraqi funds.

A $24.7-million payment on the contract that was supposed to go to Stoffel is unaccounted for.

Through a spokesman, Petraeus declined to be interviewed, referring inquiries to the Iraqi Defense Ministry. Ministry officials did not respond to requests for comment.

In January, Capt. Steve Alvarez, a spokesman for Petraeus' task force, said the arms contract was an "MOD [Ministry of Defense] matter."

"There really isn't much more to our involvement," he said.

Later, after being told about the e-mails indicating that task force officers were directing work on the contract, Alvarez said that "performance under this contract was of interest" to U.S. officials.

"Quite naturally, there were contacts and communications between [the task force] and the parties to the contract in order to coordinate," Alvarez said. He added that Petraeus "was never told of any improprieties."

The weapons deal took shape last year, after Allawi began pressing U.S. military officials for the formation of a tank brigade.

Although the U.S. did not consider the brigade vital to fighting the insurgency, Allawi saw it as a politically important demonstration to Iraqi citizens that the government was reconstituting its armed forces, an official with the U.S.-led coalition said. The Iraqis agreed to pay for an entire mechanized division at an estimated cost of $283 million.

Allawi wanted at least one tank brigade in place before the Jan. 30 national assembly election. The deadline put pressure on the U.S. military to deliver the tanks quickly.

Petraeus backed Stoffel, a weapons dealer with extensive experience in the Eastern European equipment used by the Iraqi army, as a man who could obtain and deliver the goods.

Stoffel had a long history of working with the U.S. government. He acted on behalf of U.S. intelligence agencies to covertly buy foreign military equipment for research and testing by the U.S. military, documents show.

In a letter to Iraqi Defense Minister Hazem Shaalan on July 20, 2004, Petraeus pledged to "fully support" Stoffel, who proposed to refurbish Iraq's tanks and personnel carriers and buy new equipment from Eastern European sources.

On Aug. 16, Stoffel's firm, Wye Oak Technology of Monongahela, Pa., signed a "broker's agreement" with the Defense Ministry, giving Stoffel the exclusive right to buy tanks and other equipment for the mechanized division on the ministry's behalf.

Stoffel was awarded the contract without competitive bidding. The contract was structured so that Stoffel was paid a percentage of the price of goods purchased -- an arrangement barred by U.S. law but allowed in Iraq.

Iraqi Deputy Defense Minister Mashal Sarraf insisted on another unusual provision, according to sources with knowledge of the contract: He required that Stoffel conduct all financial transactions through middleman Zayna.

Sarraf did not respond to requests for comment made through the Defense Ministry.

In September, Stoffel signed a limited power of attorney allowing Zayna to "arrange financing and request banking guarantees" for the contract, records show. Zayna was to act as a broker between Stoffel and the Defense Ministry, reconciling invoices and disbursing payments.

Another Lebanese businessman, Mohammed abu Darwish, worked with Zayna's firm, General Investment Group, on the contract and participated in meetings with task force officials, e-mails and interviews show. In an unrelated case in September, the Pentagon barred Darwish from receiving future American contracts because of his alleged role in a scheme to defraud the U.S. of millions of dollars on a security contract in Iraq, according to a U.S. Air Force document.

Soon after he started work on the contract, Stoffel began to voice concerns about Zayna and his relationship with Iraqi defense officials, according to e-mails and interviews.

In conversations with military officials, Stoffel complained that Zayna was charging him a 3% fee on financial transactions. He suspected that a portion of the fee was being kicked back to the Defense Ministry. Stoffel also said Zayna was trying to force him to use certain subcontractors that he believed were secretly controlled by Zayna and Iraqi officials.

Asked for comment, Darwish referred questions to Zayna, saying that "the deal belongs to him." Efforts to reach Zayna were unsuccessful.

By October, the Defense Ministry had issued Zayna's firm $24.7 million in payment for the refurbishing work Stoffel had done, the contractor told military officials.

The money was never delivered to Stoffel, who in October began complaining to U.S. officials in Washington and Baghdad. He wrote letters, previously disclosed by the Times, to Sen. Rick Santorum (R-Pa.) and a senior Pentagon official spelling out his suspicions about Zayna.

Stoffel also e-mailed U.S. Army Col. David Styles, Petraeus' assistant on the project. He asked Styles to have Petraeus intervene to stop millions of dollars being funneled without oversight through Zayna.

"There is no oversight of the money and if/when something goes wrong, regardless of how clean our hands are, heads will roll and it will be the heads of those that are reachable, and the people who are suppose to know better (US citizens, military, etc.)," Stoffel wrote in the November e-mail to Styles.

Stoffel's concerns were shared by an official with the U.S.-led coalition in Iraq who worked as an advisor to the Defense Ministry. On learning of Zayna's role in the contract, this official urged the ministry to suspend further payments. The official also had concerns about Stoffel, who had come under scrutiny for previous arms dealings unrelated to the Iraqi contract.

The official suggested that the Defense Ministry establish a clear audit trail on the use of the funds. However, the official noted that Styles was worried that additional accounting measures would cause delays.

Styles said the concern over accounting was "getting in the way," the official said. "It was a pretty big issue for Petraeus to get it done and delivered, and he was riding Styles hard."

In one e-mail, Styles referred to Stoffel and business associates as his "team." The e-mail describes orders to both Stoffel and Zayna on how to implement the contract, down to such mundane details as fixing an oil leak and having Zayna buy sets of tools.

Styles pressed Stoffel to draft a progress report for coalition and Iraqi officials to "get the advisors off our [backs] and ensure the uninterrupted flow of funds for the project."

Petraeus worked with top Iraqi officials to allow Stoffel access to bases across the country, according to a letter from Bruska Noori Shaways, the Defense Ministry's secretary-general.

"With the assistance, cooperation and support of Lt. Gen. David J. [sic] Petraeus and the U.S. company Wye Oak Technology, the Iraq Ministry of Defense has instituted and initiated" the program to create a mechanized division, Shaways wrote in September to Army Gen. George W. Casey, commander of coalition forces in Iraq.

Task force spokesman Alvarez initially said the U.S. military did not get involved in the contract dispute. "We were not aware of any U.S. military working with Wye Oak," Alvarez wrote in January. In response to follow-up questions from the Times, Alvarez acknowledged that Petraeus intervened with Iraqi officials after learning of problems with the contract.

"When told that there was a holdup regarding refurbishment of the armored vehicles, Lt. Gen. Petraeus did ask the ministry to get on with whatever they were going to do with the contract so that the stand-up of the mechanized brigade would not be delayed," Alvarez said.

By late November, Stoffel had returned to the United States to seek help in getting his payment. He asked Pentagon officials and Santorum's office to pressure the Iraqis to release the $24.7 million to him.

Stoffel suggested that an international accounting firm be brought in to supervise the contract's financial transactions and clear up questions about the missing money.

He warned of consequences if the money was not recovered.

"News of it will be on the front page under the photos of President Bush, [Defense Secretary Donald H.] Rumsfeld, me" and Petraeus' task force, Stoffel wrote to another military officer in early December. "Jobs will be lost and congressional hearings will be held."

U.S. military officials informed Zayna about the allegations of corruption, according to several people familiar with the matter. British Brig. Gen. David Clements summoned the parties to a Dec. 5 meeting in Iraq. Afterward, Clements ordered Zayna to release the money to Stoffel, sources said.

As of Dec. 8, Stoffel still had not received the money. That day, after he left the Taji military base outside Baghdad, his SUV was rammed by another vehicle. Stoffel and a business associate, Joseph Wemple, were cut down in a hail of bullets.

Another occupant of the vehicle apparently escaped unharmed, leading to suspicions among the victims' friends that he may have been involved in the attack.

About a week later, a previously unknown insurgent group, Brigades of the Islamic Jihad, claimed responsibility.

Since the killing, U.S. military officials have continued working with Zayna. He is doing construction work on a U.S.-controlled military base outside Baghdad related to the project, said officials with the U.S.-led coalition.

Stoffel's firm tried unsuccessfully to keep the contract. Wye Oak Technology sent a letter to U.S. and Iraqi officials on Jan. 25 saying it was prepared to resume work so long as "transparency and accountability" were established.

The U.S. military and Iraqi Defense Ministry have not responded. A Wye Oak official declined to comment.

Petraeus' task force has also pressed ahead with the creation of the mechanized division. The first brigade was operational just before the January election, and some elements of it are guarding Iraqi government buildings.

Coalition officials met in February with the Defense Ministry to try to track down the $24.7 million.

So far, they have had no luck accounting for the money.

2.

Local News

Obituaries: Dale C. Stoffel, Joseph Wemple

TWO CIVILIANS KILLED IN IRAQ AMBUSH
By Milan Simonich

Pittsburgh Post-Gazette
December 18, 2004

http://www.post-gazette.com/pg/04353/428764.stm

Dale C. Stoffel, a businessman who oversaw construction projects in Iraqi war zones, was shot and killed Dec. 8 by two masked insurgents outside Baghdad.

Mr. Stoffel, of Monongahela, will be buried today. He was 43.

Funeral services also will be today for Joseph Wemple, the second victim of the ambush. Mr. Wemple, 49, spent his boyhood in Weirton, W.Va., and Toronto, Ohio, before settling in Florida.

He worked for Mr. Stoffel, who was executive vice president of CLI USA, a construction and engineering company based in Canonsburg.

They were driving from a job site in Taji, north of Baghdad, when two men wearing black hoods killed them in a hail of gunfire.

Mr. Stoffel spent most of 2004 in Iraq, work he considered worthwhile.

"He said that, contrary to what you hear and read in the media, the people in Iraq very much appreciate what the United States is doing for them," his mother, Carol Stoffel, said yesterday.

While home for Thanksgiving, Mr. Stoffel told relatives he felt privileged to help the Iraqis. He described them as friendly toward Americans, and said most want to live in a free society.

CLI was modifying a building in Taji so it could be used to refurbish armored vehicles for the Iraqi civil-defense force. The company also worked on rebuilding the Iraqi Ministry of Defense, the first place attacked by the U.S. military when war began in 2003.

In addition to his employment with CLI, Mr. Stoffel listed himself as president of Wye Oak Technology Inc., a company cloaked in international intrigue.

Wye Oak, which was based in a house Mr. Stoffel owned in Alexandria, Va., is described on its Web site as "a development and engineering company." But at Wye Oak, Mr. Stoffel marketed himself as an international weapons dealer.

One of his biggest successes was landing an $11.5 million contract with Boeing Co. Boeing hired Mr. Stoffel to obtain Russian X-31 missiles. [See (4) below.]

But the missile deal fizzled and a contentious court case followed.

Boeing subsidiary McDonnell Douglas Corp. sued Mr. Stoffel last year in St. Louis, seeking return of $6 million it had paid him. McDonnell Douglas claimed Mr. Stoffel delivered just five of the 32 missiles he had promised.

Mr. Stoffel countered that he would not return the money, which he said was essential to his efforts to secure more missiles.

The lawsuit was before U.S. District Judge Richard Webber in St. Louis. One of the judge's staff members said yesterday the case was closed Sept. 27. The outcome, though, is unknown, as Webber sealed the file.

Court documents obtained by the St. Louis Post-Dispatch before the case was closed said Mr. Stoffel intended to obtain the missiles through contacts he had in Ukraine, Hungary, the Czech Republic and Russia itself.

As the lawsuit implies, Mr. Stoffel previously worked for the U.S. government. The nature of his government job and how long he held it were not clear yesterday.

Raised in Monongahela, Mr. Stoffel graduated from Ringgold High School in 1979. He went on to Washington & Jefferson College, from which he received a bachelor's degree in physics in 1984.

He is survived by his wife, Barbara; a son, Christopher; and three daughters, Alexandra, Michelle and Jocelyn.

Other survivors include his parents, Carol and Thomas Stoffel, of Monongahela; and his brothers, David, of Moundsville, W.Va.; and Dean, of Minneapolis.

Mr. Stoffel's funeral will be at 11 a.m. today in Marshall Marra Funeral Home, Monongahela.

He will be buried in Monongahela Cemetery.

Mr. Wemple's funeral also is today, in Orlando, Fla., where he lived most of his adult life.

Like Mr. Stoffel, he believed in the war in Iraq and its rebuilding.

"He gave his life for a good cause," said Mr. Wemple's brother, Bruce, of Orlando. "He was proud of what he was doing."

Mr. Wemple previously worked as a construction manager for Disney World. After spending eight months in Iraq this year, he told relatives he preferred his new job.

At Disney, he constructed or reconstructed rides and buildings. In Iraq, he saw his job as rebuilding a country.

(Milan Simonich can be reached at msimonich@post-gazette.com or 412-263-1956.)

3.

WHO KILLED DALE STOFFEL?

The Writing Company
January 22, 2005

http://writingcompany.blogs.com/this_isnt_writing_its_typ/2005/week3/

[CARTOON: writingcompany.blogs.com/photos/uncategorized/terrorcorruption.jpg]

The above cartoon -- published in the Iraqi newspaper Al-Mutamar last October -- shows an insurgent shaking hands with a civil servant carrying suitcase labeled "Administrative Corruption."

The intersection of these sinister forces has now resulted in an American murder mystery -- one that could have far-reaching implications for the Iraqi Ministry of Defense and whatever government emerges from the January 30 elections.

The Los Angeles Times reports :

"An American contractor gunned down last month in Iraq had accused Iraqi Defense Ministry officials of corruption days before his death, according to documents and U.S. officials.

"Dale Stoffel, 43, was shot to death Dec. 8 shortly after leaving an Iraqi military base north of Baghdad, an attack attributed at the time to Iraqi insurgents. Also killed was a business associate, Joseph Wemple, 49.

"The killings came after Stoffel alerted senior U.S. officials in Washington that he believed Iraqi Defense Ministry officials were part of a kickback scheme involving a multimillion-dollar contract awarded to his company, Wye Oak Technology, to refurbish old Iraqi military equipment.

"The FBI has launched an investigation into the killings and whether they might have been retaliation for Stoffel's whistle-blowing activities, according to people familiar with the inquiry. The FBI declined to comment.

"Stoffel, of Monongahela, Pa., made his allegations in a Dec. 3 letter to a senior Pentagon official and in a meeting with aides to Sen. Rick Santorum (R-Pa.). Soon after, Stoffel was summoned to the Taji military base in Iraq by coalition military officials to discuss his concerns about his contract. He complained about payment problems with a mysterious Lebanese businessman designated by the Iraqis as a middleman, sources said.

"As Stoffel, Wemple and an Iraqi interpreter left the Taji base in a car Dec. 8, another vehicle rammed theirs head-on. Two masked men jumped out and executed the two Americans in a fusillade of bullets, according to news accounts at the time. Their interpreter fled and is missing."

Here's where the story gets interesting:

"The attackers stole Stoffel's computer from the scene. About a week later, a video showing photographs and identity documents of Stoffel and Wemple was posted on a website frequently used by insurgent groups. A group calling itself the Brigades of the Islamic Jihad claimed responsibility for the killings. The group was not previously known to terrorism experts.

"The timing and the unusual details of the killings have raised suspicions in the U.S. and Iraq that the video was a ruse to disguise an assassination.

"'The video was very unusual,' said Evan Kohlman, a terrorism consultant who examined the video.

"'It didn't show bodies or the killing, but only photos, documents and materials taken from the bodies. It is certainly possible that someone [other than insurgents] manufactured the video.'" [The video is available for viewing at this website, but a free registration is required for viewing.]

But what really intrigues me are the companies that Stoffel and Wemple worked for: Wye Oak Technology and CLI Corporation.

The company's web site describes Wye Oak Technology as "a team of engineering professionals who can meet your project needs today and into the future. With over 50 years of development and engineering experience we can analyze your needs, create a plan and rapidly move your organization into it next stage of technical impact." This could be just about anything technology related, though the home page then goes on to describe services such as "programming solutions," "web development," "database solutions" and a nebulous category called "special projects." I don't know about you, but I think it's pretty unusual for a bunch of webheads to be over in Iraq refurbishing outdated Soviet tanks. It's also pretty unusual for a web design firm to be registered as a lobbyist by the U. S. House of Representatives. Listing Wye Oak Technology as his employeer, Stoffel also contributed $2,000 each to the campaigns of Nevada Senator John Ensign and Pennsylvania Congressman John Murtha. (I find it curious that I can't locate any information about Wye Oak Technology's domain name, webrenovators.com, in the WHOIS database.)

Dale Stoffel is also described as "executive vice president of international development " for CLI Corporation (based in Canonsburg, PA). CLI, according to its website, "provides engineering, construction, equipment and management services in the field of coal and mineral processing (solid-liquid separation and waste removal)." David Hartley and Robert Irey of CLI each contributed $1,000 to Pennsylvania Senator Arlen Spector's recent campaign.

Again, what does "coal and mineral processing" have to do with refurbishing tanks?

These paragraphs from the Times' story are very revealing, however:

"Stoffel's killing drew scrutiny from investigators not only because of his whistle-blowing activities but also because of his mysterious and controversial past. Stoffel worked on a top-secret U.S. program in the 1990s to buy Russian, Chinese and other foreign-made weapons for testing by the U.S. military, according to documents and interviews.

"Stoffel's Iraq contract was the first large-scale contract issued and funded directly by the Iraqi government for military purposes, and was crucial for training and equipping the Iraqi army, considered a key component of the U.S. strategy for exiting Iraq."

All in all, something about this whole thing doesn't smell right.

I wonder if -- as the de-Baathification effort in Iraq has stalled -- a nexus of former Saddam loyalists in the MoD, with ties to Lebanon (most likely via Syria), has managed to insert itself into the contracting process. The alleged kickback scheme via a Lebanese third party certainly has all the hallmarks of an oil-for-food-like set-up. And the Saddamites are certainly very skilled at manipulating the terrorists into doing their dirty work.

This is definitely one to keep an eye on.

UPDATE: The Washington Post has more on the story: "Stoffel had negotiated a project to rehabilitate Soviet-era tanks, armored personnel carriers and other armored machinery for Iraqi security forces to use, according to colleagues at CLI USA Inc., a Pennsylvania-based consulting firm where Stoffel was executive vice president. The project was the first of its kind issued by the Iraqi Ministry of Defense and was part of the effort to bolster Iraqi forces, a key element of the United States' exit strategy in Iraq. Stoffel was administering the umbrella contract through his own firm, Wye Oak Technology, but CLI was poised to do much of the work, colleagues said."

UPDATE: This website offers a photograph of the investigation, credited to the USMC, which features a man in a business suit:

[PHOTO: writingcompany.blogs.com/this_isnt_writing_its_typ/images/investigation.jpg]

The man in the business suit would appear to be the same guy we see in these photographs of Wemple from the video:

[PHOTO: writingcompany.blogs.com/photos/uncategorized/man_in_suit.jpg]

[PHOTO: writingcompany.blogs.com/photos/uncategorized/man_in_suit_2.jpg]

Any ideas out there who the man in the suit might be?

UPDATE: Stoffel's obituary in the Pittsburgh Post-Gazette contains this intriguing passage:

"Wye Oak, which was based in a house Mr. Stoffel owned in Alexandria, Va., is described on its Web site as 'a development and engineering company.' But at Wye Oak, Mr. Stoffel marketed himself as an international weapons dealer.

"One of his biggest successes was landing an $11.5 million contract with Boeing Co. Boeing hired Mr. Stoffel to obtain Russian X-31 missiles.

"But the missile deal fizzled and a contentious court case followed.

"Boeing subsidiary McDonnell Douglas Corp. sued Mr. Stoffel last year in St. Louis, seeking return of $6 million it had paid him. McDonnell Douglas claimed Mr. Stoffel delivered just five of the 32 missiles he had promised.

"Mr. Stoffel countered that he would not return the money, which he said was essential to his efforts to secure more missiles.

"The lawsuit was before U.S. District Judge Richard Webber in St. Louis. One of the judge's staff members said yesterday the case was closed Sept. 27. The outcome, though, is unknown, as Webber sealed the file.

"Court documents obtained by the St. Louis Post-Dispatch before the case was closed said Mr. Stoffel intended to obtain the missiles through contacts he had in Ukraine, Hungary, the Czech Republic and Russia itself.

"As the lawsuit implies, Mr. Stoffel previously worked for the U.S. government. The nature of his government job and how long he held it were not clear yesterday." [My emphasis.]

A news account of the Boeing arms-deal-gone-awry can be found here. [A Nov. 16, 2004, Knight Ridder story, reproduced below] The story describes Stoffel as "an obscure weapons dealer."

This account, which appeared in the Monessen Valley Independent last December, adds some details of Stoffel's background and what he was purportedly doing in Iraq:

"It was learned later that Stoffel, who was a partner of Robert Irey at CLI Corp. in Cecil, was a resident of Carroll Township. Stoffel was the company's executive vice president of International Development for the company.

"'We are just stunned and devastated by what has happened,' said Irey. 'It is hard to believe that Dale is no longer with us.'

"'Dale was my partner since January of this year,' said Irey. 'He came to me and my other partner, Bill Stein, one day and said, "I want to go to Iraq." He was driven. He had an unbelievable passion for what America is doing in Iraq."

"Irey said that Stoffel was driven by a desire to make things right in that country.

"'You don't go there just to collect a paycheck,' said Irey.

"CLI Corp is an engineering and construction firm with Irey serving as chief executive officer. The firm has been involved in a project to construct a center in Taji, which would perform work for the Iraqi civil defense force. [My emphasis.]

"Stoffel and Wemple reportedly had just left Taji when their vehicle was ambushed.

"Irey explained that CLI is doing work in the Green Zone, a fortified safe area near Baghdad, and in Taji.

"'They had left Taji and were driving back to the Green Zone for a meeting,' Irey said. 'They were 10 minutes from the Green Zone when they were ambushed.'

"Irey described Stoffel, who had a strong military background, as 'bigger than life.'

"'He was an experienced military Special Forces guy who knew what he was doing, how to handle weapons and was always heavily armed,' said Irey. 'He always felt if ever there was an altercation, he'd get them before they got him."

Something or someone must have lulled Stoffel and Wemple into a false sense of security; I'm betting it was their interpreter who helped tee up the hit.

UPDATE: This article from the New York Times may shed some light on the Lebanese connection:

"Earlier this month, according to Iraqi officials, $300 million in American bills was taken out of Iraq's Central Bank, put into boxes and quietly put on a charter jet bound for Lebanon.

"The money was to be used to buy tanks and other weapons from international arms dealers, the officials say, as part of an accelerated effort to assemble an armored division for the fledgling Iraqi Army. But exactly where the money went, and to whom, and for precisely what, remains a mystery, at least to Iraqis who say they have been trying to find out.

"The $300 million deal appears to have been arranged outside the American-designed financial controls intended to help Iraq -- which defaulted on its external debt in the 1990s -- legally import goods. By most accounts here, there was no public bidding for the arms contracts, nor was the deal approved by the entire 33-member Iraqi cabinet."

As the article goes on to describe, the Iraqi defense minister, Hazim al-Shalaan, seems to be the one who created the arrangement -- and who may have ordered the hit on Stoffel and Wemple. Why has no news organization begun to connect the dots?

UPDATE: I've created a photo album of screen shots from the "Brigades of the Islamic Jihad" video here. (http://writingcompany.blogs.com/photos/stoffel_wemple/index.html)

UPDATE: Steven Vincent, author of In the Red Zone, has some good insights on the Stoffel/Wemple murders. (spencepublishing.typepad.com/in_the_red_zone/2005/01/the_dispute_bet.html)

4.

BOEING UNIT SUES MYSTERIOUS ARMS DEALER
By Peter Shinkle

Knight Ridder
November 16, 2004

http://www.zambezitimes.com/fulltxt.php?id_news=1755

WASHINGTON -- Russia's X-31 anti-ship missile is a devastating weapon. Capable of traveling at 2,000 mph, the 15-foot missile skims over the ocean until it slams into its target and explodes. It also can be modified to seek out and destroy radar systems, such as those used to guide the U.S. military's Patriot missiles, defense analysts say.

For years, the U.S. military has sought to develop an effective defense against the X-31. In 1999, Boeing Co. announced in St. Louis that it had won an $18.8 million contract from the Navy to acquire 34 of the Russian missiles and modify them to test the effectiveness of U.S. ship defense systems. But Boeing's efforts stalled as Russian officials, who once seemed ready to sell to the United States balked.

Stymied in Moscow, Boeing sought help from an obscure weapons dealer, Dale C. Stoffel, who sought to buy the missiles through contacts in Ukraine, the Czech Republic, Hungary and Russia itself, documents show. Now, those efforts also have largely failed, culminating in a courtroom dispute over $6 million that reveals the lengths to which Boeing went in its bid to acquire the X-31.

Boeing subsidiary McDonnell Douglas Corp. filed a lawsuit last month claiming Stoffel's company delivered only five of the 32 missiles it agreed to deliver for a fee of $11.5 million.

The contract, signed in March 2001, initially called for the missiles to be delivered within 90 days. But McDonnell Douglas claims that the dealer's company, Wye Oak Technology Inc. of Alexandria, Va., repeatedly led McDonnell Douglas on by saying it would provide the missiles, only to have those assurances evaporate.

Early this year, after Wye Oak said it was working with Ukrainian and Hungarian sources to obtain the missiles, McDonnell Douglas agreed to forward Wye Oak $6 million in cash. Wye Oak placed the money in an escrow account, according to documents filed in the case in U.S. District Court in St. Louis.

But after the deal again fell through, McDonnell Douglas officials became concerned that they had no control over the account.

In June, the company sent a letter demanding the return of the $6 million. Stoffel, Wye Oak's president, refused. On June 27, he sent McDonnell Douglas a letter saying that returning the money would not be "appropriate," and it would be used to buy missiles or to pay other "contractual obligations" that McDonnell Douglas owed to Wye Oak.

Despite the conflict, McDonnell Douglas still did not pull the plug on the deal. In August, Stoffel said a Ukrainian agency, Ukrspetsexport, would be able to provide 27 X-31 missiles. Once again, the purchases failed to materialize.

Last month, a McDonnell Douglas attorney demanded, at a minimum, that the aircraft maker be given signature authority over the $6 million in the escrow account. Wye Oak did not grant it that authority or return the cash, and McDonnell Douglas filed its suit Oct. 21.

Acting on McDonnell Douglas's request, U.S. District Judge Richard Webber issued a temporary restraining order requiring Wye Oak not to diminish the $6 million further. The order also requires Wye Oak to transfer the $6 million -- or the remaining funds -- to a location agreeable to McDonnell Douglas.

Wye Oak filed an answer to the allegations under seal, and the company's attorney, Kevin O'Malley, declined comment. Boeing officials declined to comment on whether Wye Oak has complied with the order.

Despite Boeing's difficulties in obtaining the missiles, the Navy has taken an understanding posture.

Asked whether Boeing had violated its contract or might lose the contract, a Navy spokesman issued a statement saying, "Boeing is continuing to work and meet terms of the contract."

The Navy also declined to address a question about whether it approved Boeing's hiring of Wye Oak. "The Navy has a contract with Boeing. Boeing may or may not subcontract to meet the terms of the contract," the statement said.

Perhaps one reason for the Navy's contentment with Boeing is its past performance. From 1995 to 1999, before the signing of the latest contract, Boeing obtained 13 X-31 missiles and converted them for use in testing U.S. defenses, according to Boeing.

At the center of the dispute is Stoffel, a Virginia businessman who earlier had owned and operated a company called Miltex that imported weapons from Bulgaria for sale in the United States.

Miltex came under scrutiny in 1998, when Bulgarian officials said they had blocked a sale of surface-to-air missiles to Zambia because Miltex had brokered the deal using bogus export documents, according to a report by Human Rights Watch of New York.

However, when Human Rights Watch contacted Stoffel, he denied his company had been involved in the deal. He said that either a former employee had used his company's name, or competitors had used the name in order to smear it, according to Money Talks, a report that Human Rights Watch published in 1999 on Bulgaria's arms trade with countries where human rights are abused.

When Stoffel entered the contract with McDonnell Douglas in 2001, he identified himself as the president of Wye Oak, not Miltex. Wye Oak's Web site depicts the company as a software and Web site development firm whose founder, David Stoffel, lives in Moundsville, W.Va. David Stoffel could not be reached for comment, and his relationship to Dale Stoffel is unclear. Wye Oak's Web site makes no mention of Dale Stoffel.

The Web site also touts Wye Oak's development of databases and various software projects, but it makes no mention of any services related to weapons or international business.

Dale Stoffel could not be reached for comment. His contract with McDonnell Douglas lists an address for Wye Oak at 700 South Lee Street in Alexandria, Va., that is a home owned by Stoffel and his wife. The property is for sale for $819,000, according to a real estate agent.

Dale Stoffel and his lawyer, John Quinn Jr. of Washington, faulted Boeing itself for some of the difficulties obtaining the missiles, according to documents filed in the case by McDonnell Douglas.

Quinn claimed in letters to Boeing officials that Boeing's own efforts to buy the missiles directly and through other companies, at a time when Wye Oak also was trying to make the purchases, had the effect of causing sellers to retract their offers in hopes of bidding up the price.

In January 2002, Quinn wrote Boeing a letter demanding that it retract a letter it had written to an Alabama company, R&G International, in an effort to buy X-31 missiles. Officials of R&G, which owns a weapons factory in Russia, could not be reached for comment.

The dealings were just part of a complicated legal and diplomatic landscape that Boeing had to navigate in an effort to obtain the missiles. The company's hopes of a diplomatic solution in Moscow soon faded, however. While Russia's Defense Ministry initially supported the deal, the Russian military later balked at the sales, even though they offered the Russians a chance to make a tidy profit.

In September 2002, Boeing executives told Jane's Defence Weekly that they still had received no word from Russia's export agency, Rosoboronexport, that the sale of the 34 missiles had been approved. "We're still hoping that the spirit of cooperation between the USA and Russia will free this up," Jane's quoted one Boeing official as saying.

Moscow wasn't the only source of opposition. Some members of Congress reportedly tried to block the purchases on the grounds that U.S. companies should make the targets to test the Navy's missile defense systems.

Richard Fisher, a defense analyst for the Center for Security Policy in Washington, said those concerns amounted to little more than efforts to win federal dollars for jobs in a Congressional constituency.

Fisher said whatever strategies Boeing used to obtain the missiles are justified because the X-31 poses a significant threat to U.S. forces. The X-31 missile is now deployed on Chinese navy vessels, and it is likely to be used by India and possibly Iran, he said. "American lives are definitely on the line," he said.