June 2, 2004

BY JOHN SOLOMON ASSOCIATED PRESS

WASHINGTON-- The FBI is investigating who in the U.S. government leaked information to former Iraqi exile Ahmad Chalabi that made its way into the hands of the Iranian government, potentially damaging American efforts to monitor Tehran's activities, government officials said Wednesday.

The officials, who would speak only on condition of anonymity because the information remained classified, said the U.S. government has evidence that Chalabi or his followers told Iran that Washington had cracked some of it secret codes for transmitting sensitive information.

In Najaf, Iraq, Chalabi told The Associated Press that the reports he leaked such information to Iran are "false" and "stupid."

"Where would I get this from?" Chalabi asked. "I have no such information. How would I know anything about that? That's stupid from every aspect."

Chalabi and other Shiite Muslim figures are in Najaf to try to shore up a cease-fire between U.S. troops and radical Shiite militiamen.

In Washington, the official speaking on condition of anonymity said that a raid last month on Chalabi's home inside Iraq was conducted to determine how the leader of the Iraqi National Congress got the information and whom he shared it with. The FBI is already trying to determine if someone in the U.S. government gave the information to Chalabi, which would be a criminal offense for leaking highly classified material, the official said.

CBS News initially reported Tuesday that Chalabi had told an Iranian intelligence official that the United States had cracked its codes, allowing U.S. agents to read Iran's secret communications. Revealing such information would expose one of the United States' most important sources of information about Iran.

Following the broadcast report, The New York Times, Los Angeles Times and The Washington Post followed with similar stories, all quoting anonymous U.S. intelligence officials.

Appearing on NBC"s "Today" show Wednesday, national security adviser Condoleezza Rice said: "I actually can't comment on this story. I don't know about its veracity or not. I'm sure if there is anything there, it will be investigated."

The New York and Los Angeles papers said they had learned some details of widely reported U.S. assertions last month that Chalabi had given classified material to Iran, but had agreed not to publish those details at the request of U.S. officials who said to do so would endanger an ongoing investigation.

The two papers said those requests to withhold the information they had gathered were withdrawn Tuesday when other news accounts began appearing.

A CIA official declined to comment on the reports Tuesday night.

American officials quoted in the news reports said Chalabi told the Baghdad chief of the Iranian spy service that the United States was reading its communications and that the Iranian spy described the conversation in a message to Tehran, which was intercepted by U.S. intelligence.

The New York Times account said Iranians in Tehran then sent a bogus message to Baghdad purportedly disclosing the location of an important weapons site, in an apparent attempt to test whether what they were hearing from Chalabi was true.

The idea was that if the United States was able to intercept such transmissions, Americans would react by going to the weapons site. They intercepted the message, according to the Times, but did not take the bait by going to the weapons site.

Chalabi reportedly told the Iranian he had he had gotten the information from an American who had been drunk.

FBI agents were reported to be questioning Defense Department officials in an effort to find out who gave such information to Chalabi.

Chalabi, a member of the Shiite Islamic sect to which the majority of Iranians and Iraqis belong, once was a favorite of Pentagon officials.

He had provided intelligence to the Bush administration about weapons of mass destruction, which was used to justify the U.S. war against Iraq, but his information came under major criticism after no weapons were found.

The CIA has long been suspicious of Chalabi's INC, but he had maintained strong supporters in other government agencies.

Until last month, his organization was on the U.S. government payroll, receiving roughly $340,000 a month from the Defense Department for intelligence under a specific authorization from Congress.

While refusing to discuss the new intelligence report, Rice did talk in general terms about U.S. ties to Chalabi.

"We had a relationship with Mr. Chalabi and his INC (Iraqi National Congress) during a time when the Iraqi Liberation Act of 1998 put a high premium on trying to find a way to overthrow Saddam Hussein and to bring about regime change in Iraq," she told NBC, "and there were a number of organizations with which the United States had a relationship, including the INC. "

But Rice also said that President Bush "made very clear that the United States had no (opposition) force, so to speak, that it was backing. ..made very clear that Mr. Chalabi would have to make his way on the basis of his relationship with the Iraqi people-- and that's still the case today."

Rice said she was "quite certain that the United States was absolutely vigilant in the way it should have been. ... We did have a relationship and it has been strained of late."

Contributing: Associated Press writer Mariam Fam in Najaf, Iraq.

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