Arafat uses Libyan money from Khadafy to finance Al Aqsa Brigades.
 http://www.sfgate.com/cgi-bin/article.cgi?file=/chronicle/archive/2003/06/23/MN285456.DTL

Arafat alleged to raise Libyan money
Sources say he uses funds to finance Al Aqsa Brigades

Matthew Kalman, Chronicle Foreign Service Monday, June 23, 2003

Ramallah, West Bank -- Sources close to Palestinian leader Yasser Arafat say he has raised $2. 5 million from Libyan leader Moammar Khadafy to finance continued terror attacks against Israel, undermining efforts by reformist Prime Minister Mahmoud Abbas to achieve a cease-fire as the first step on the U.S.-backed road map toward peace.

The sources say the Libyan money has been paid into bank accounts controlled by Arafat in Beirut and Cairo to underwrite the terror activities of the Al Aqsa Martyrs Brigades, the paramilitary wing of Arafat's Fatah movement.

Members of the Brigades confirmed to this reporter last week that they were receiving funds from Arafat's office despite efforts by the new Palestinian government headed by Abbas to end attacks against Israel.

Israeli and Palestinian officials say privately that the Arafat-Khadafy link is part of a series of secret diplomatic moves by Arafat designed to undermine Abbas, who is engaged in intensive talks with Palestinian extremists on the terms of a cease-fire.

The Al Aqsa Brigades continue to embarrass Abbas, even though both he and they belong to the Fatah movement. Last Tuesday night, Al Aqsa claimed responsibility for killing a 7-year-old Israeli girl and wounding her 2-year- old sister in a shooting attack on their family's car as it drove along one of Israel's major motorways near the border with the West Bank.

Al Aqsa is also suspected of involvement in a shooting attack near Ramallah on Friday that occurred during a Jerusalem press conference held by U.S. Secretary of State Colin Powell. Tzvi Goldstein, 47, a settler originally from New York, was killed, and his 73-year-old parents were badly injured.

Late Sunday, four members of the Brigades were killed in the northern Gaza town of Beit Hanoun, apparently when a bomb they were planting detonated prematurely. Loudspeaker trucks drove through the area later, saying that the four had died while "fulfilling their national duty," a phrase used in the past to announce accidental deaths.

MINISTER IN TUNIS
Arafat remains isolated in the wreckage of his headquarters compound in Ramallah. The secret diplomatic contacts are being conducted on his behalf by Farouk Kaddoumi, the foreign minister for the Palestine Liberation Organization, who is based in Tunis and is not part of the Palestinian Authority's government.

Nabil Shaath, the Palestinian Authority's foreign minister, is strongly opposed to Kaddoumi's activities and has threatened to resign in protest, according to Palestinian officials.

Kaddoumi flew to Damascus this month on another top-secret mission on behalf of Arafat to meet with Khaled Mashal, Hamas' political and military leader, whose headquarters are in the Syrian capital. Kaddoumi carried a message from Arafat denouncing Abbas' peace diplomacy and distancing himself from Abbas' recent conciliatory speech toward Israel at the Aqaba summit.

According to Palestinian officials within Arafat's close circle and reports in the Arabic press, Arafat has spoken to Mashal several times by telephone since the Aqaba summit. Hamas sources say that Arafat is trying to set up a joint strategy between the pair to undermine Abbas.

Kaddoumi has a history of carrying out sensitive, deniable missions for Arafat. He was revealed as the go-between in secret contacts last year between Iraq and Libya aimed at providing a safe haven for Saddam Hussein. Those talks,

which were abandoned after being revealed by British intelligence, were conducted by Kaddoumi with Hussein's chief of staff, Abid Hamid Mahmud al- Tikriti, who was captured by U.S. forces in Iraq last week.

British intelligence officials said the PLO had been paid more than $1 million by Hussein for Kaddoumi's failed efforts.