Identifier
Created
Classification
Origin
05KUWAIT4904
2005-11-27 14:52:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Kuwait
Cable title:  

PARLIAMENTARIAN REQUESTS ASSISTANCE FOR KUWAITI

Tags:  PREL CJAN CVIS KCRM KU 
pdf how-to read a cable
This record is a partial extract of the original cable. The full text of the original cable is not available.
UNCLAS SECTION 01 OF 03 KUWAIT 004904 

SIPDIS

SENSITIVE

STATE FOR NEA/ARP MISENHEIMER

E.O. 12958: N/A
TAGS: PREL CJAN CVIS KCRM KU
SUBJECT: PARLIAMENTARIAN REQUESTS ASSISTANCE FOR KUWAITI
CITIZEN

REF: STATE 160410

UNCLAS SECTION 01 OF 03 KUWAIT 004904

SIPDIS

SENSITIVE

STATE FOR NEA/ARP MISENHEIMER

E.O. 12958: N/A
TAGS: PREL CJAN CVIS KCRM KU
SUBJECT: PARLIAMENTARIAN REQUESTS ASSISTANCE FOR KUWAITI
CITIZEN

REF: STATE 160410


1. (SBU) Summary and Action Request. In a letter dated 19
November 2005, Mohammad J. Al-Sager, Chairman of the
Committee on Foreign Affairs, Kuwaiti Parliament, wrote
Ambassador requesting Embassy intervention with U.S.
Department of Justice on behalf of Kuwaiti citizen Ali
Hijazi, a principal in the Kuwaiti firm La Nouvelle. Hijazi
is a subject of an on going investigation regarding alleged
contract irregularities involving a former employee of the
KBR Corporation and La Nouvelle (see reftel). Al-Sager
asserts that the U.S. District Attorney for the Central
District of Illinois has indicted the KBR employee and Mr.
Hijazi without cause. He notes that Kuwait and the U.S. do
not have an extradition treaty, and that the U.S. would not
have jurisdiction anyway regarding contracts concluded in
Kuwait between two private companies. He further alleges
that Department of Justice has denied Mr. Hijazi due process
and that the U.S. Attorney refused to speak with La
Nouvelle's counsel. Al-Sager asks that Embassy "intercede
and express its concern to the Department of Justice with the
hope that Mr. Hijazi's indictment would be dismissed and
attempts to arrest, detain or extradite him around the world
would cease." See para 3 for the text of Al-Sager's letter;
para 4 for Embassy's proposed response. (Post understands
that the Kuwaiti Ambassador provided an almost identical
document to NEA.)


2. (SBU) Action Request: We have no way to evaluate the
validity or accuracy of Mr. Al-Sager's points. However,
Al-Sager is a senior official and a well-respected and
valuable contact for Embassy. Ambassador proposes, with
Department concurrence, to send him the letter text in para

4. Embassy also requests Department assistance in drawing
the attention of Department of Justice to the issues
addressed by Al-Sager for their consideration with the
objective in mind of meeting with La Nouvelle's counsel
regarding the case. End Summary and Action Request.


3. (SBU)

Begin Text of Al-Sager Letter


November 19, 2005

H.E. Honorable Richard LeBaron
American Ambassador
Embassy of the United States of America
Kuwait City, Kuwait

My dear Mr. Ambassador:


First, let me thank you for all of your personal efforts to
strengthen the relationship between our two great nations.
Second, I feel compelled to bring a matter to your attention
that concerns a Kuwaiti-based company and one of its
principals.

La Nouvelle ("the Company") is a long-standing, Kuwaiti-based
services company with an excellent reputation. It provides
valuable contracting services to numerous contractors and
government customers throughout the region, including to the
Government of Kuwait. La Nouvelle was a passionate supporter
of the Government of Kuwait and the Government of United
States during the recent hostilities involving Iraq. The
Company and Mr. Ali Hijazi, one of its principals, worked
closely on-site with the U.S. military and related
contractors to supply and support the armed forces and the
post-Saddam Government in Iraq. They did so at great
financial and personal risk. I know and respect Mr. Hijazi
and he is highly respected by my Government as well. Mr.
Hijazi is neither an American citizen nor a resident of the
United States. He does not own property or pay taxes in the
USA.

I have been informed of the following facts that I commend to
your consideration. Following the primary phase of
hostilities, an American-based contractor, KBR, came under
investigation by the U.S. military and Department of Justice
because of potential improprieties involving certain payments
and possible overcharges. KBR was one of the many
contractors that La Nouvelle had well served, often in dire
situations and under extreme time pressure. As part of its
response to these investigations, KBR began to investigate
many, if not all, of its contracts in the region.
Regrettably, a commercial dispute arose between KBR and La
Nouvelle. KBR wrongly suggested that there was some
impropriety with respect to Mr. Hijazi's attempt to support
and invest in a nascent business venture (which is legal
under Kuwaiti Law) of a former, low-level KBR contracting
officer, Mr. Jeff Mazon. KBR also wrongly suggested that
there was some linkage between this attempted investment and
an obvious pricing mistake on a small contract with La
Nouvelle that KBR found during routine audit. The contract
in question was for desperately needed transportation fuel
tankers at the Aerial Port of Debarkation in Kuwait and
represented less than 1 percent of the business done between
KBR and La Nouvelle. In making this unsupported connection
between two entirely unrelated circumstances, KBR ignored the
very obvious nature of the pricing mistake, the fact that
many other KBR employees besides Mr. Mazon were involved in
review of this transaction, the fact that the subcontract was
renewed--at the same erroneous price--by other KBR employees
long after Mr. Mazon had left KBR's employ, and the fact that
La Nouvelle had offered to adjust the contract price downward
long before KBR even discovered the mistake.

It was not uncommon for even high ranking KBR employees to
leave KBR and go into business with or be hired by commercial
entities in the Gulf. Many did so on terms far more
favorable than the abandoned arrangement between Mr. Hijazi
and Mr. Mazon and many continued to work directly with KBR,
unlike Mr. Mazon. KBR investigators interviewed Mr. Mazon
about the attempted investment, and Mr. Mazon voluntarily
provided open and honest responses acknowledging the
relationship and denying any wrongdoing. Mr. Hijazi and Mr.
Mazon likewise disclosed that the never-consummated
arrangement occurred well after Mr. Mazon had decided to
leave KBR, the fact it was supported by a written agreement,
and, importantly, the fact that the investment had been
abandoned. Thus no money was every received or enjoyed by
Mr. Mazon, who elected another career path. In an apparent
effort to seek leniency with the Justice Department, however,
and presumably to obtain leverage in its commercial dispute
with La Nouvelle, KBR reported the relationship between Mr.
Hijazi and Mr. Mazon to U.S. authorities, along with a host
of other perceived contracting issues unrelated to La
Nouvelle. La Nouvelle and KBR settled their dispute this
past summer. The US government did not over pay or lose any
money over this contract with KBR.

Sadly, after refusing to speak with La Nouvelle's counsel,
the U.S. Attorney for the Central District of Illinois
indicted Mr. Mazon and Mr. Hijazi and south Mr. Hijazi's
extradition despite the absence of any relevant treaty. The
U.S. Attorney then refused to permit the court to rule on Mr.
Hijazi's well founded Motion to Dismiss, mischaracterizing
Mr. Hijazi as a fugitive in official documents and demanding
that he be extradited and incarcerated in the U.S. before the
Court considered the motion. Based on what I am told, this
situation is particularly disturbing and disrespectful given
the services provided by La Nouvelle, the wholesale absence
of any criminal conduct, and the extraterritorial abuse of
Mr. Hijazi despite the lack of any U.S. jurisdiction. I am
also told that Mr. Hijazi who is neither a US citizen or a
resident of the USA performed his work under Kuwait law, in
the territory of Kuwait, under a Kuwaiti commercial company
that performed services as a subcontractor to KBR in Kuwait.
Further, it seems that not only was the attempted investment
well after Mr. Mazon left KBR and eventually abandoned, but
La Nouvelle also successfully sued KBR with the assistance of
Hogan and Hartson LLP, the oldest and largest Washington D.C.
based firm, in U.S. Federal court for payment on the contract
at issue. La Nouvelle settled with KBR on the contested
contract for full payment, receiving a substantial payment
with the knowledge and approval of the U.S. Moreover, KBR
counsel have acknowledged that they are aware of no quid pro
quo for Mr. Hijazi's documented, yet ultimately unsuccessful,
attempt to enter into a long-term business venture with Mr.
Mazon. Throughout all of this, I am informed that the U.S.
Government never even consulted with the Government of
Kuwait.

Your Excellency, I would greatly appreciate it if you might
look into this situation. La Nouvelle had no contract with
the U.S. Government, only with KBR. Respected counsel in
Kuwait have examined the relevant contract and have found no
irregularities. Counsel in Kuwait also have reviewed the
indictment and are concerned that U.S. authorities have
attempted to assert jurisdiction. I am further advised that
U.S. law likewise suggests that there is no jurisdiction.
Some would suggest that these policies fail to honor Kuwait's
sovereignty and put all Kuwaitis at risk for unfair
prosecution in the U.S. for commercial transactions with U.S.
corporations. Here, Mr. Hijazi is in peril of being
extradited to the U.S., imprisoned, and unfairly prosecuted
all for a case where the alleged "bribe" post dates Mr.
Mazon's employment with KBR, the transaction was never
completed, and the U.S. ultimately approved payment for the
work done on the contract. Neither Kuwait citizens nor
others in Kuwait should be subject to such extraterritorial
abuses of the U.S. judicial system. Had the U.S. attempted
to prosecute in Kuwait, where all the relevant activity
occurred and where the contract with KBR was executed and
performed with distinction, the U.S. would have had no legal
grounds to have brought the case, and a Kuwaiti court would
have most certainly dismissed it.

Under these circumstances, it would be greatly appreciated if
the U.S. Department of State might consider it appropriate to
intercede and express its concern to the Department of
Justice with the hope that Mr. Hijazi's indictment would be
dismissed and attempts to arrest, detain or extradite him
around the world cease. It is also reasonable to inquire
whether the Department of Justice might consult the
Government of Kuwait, in the future, when it proposes to
attempt to impose its jurisdiction on commercial entities and
residents of Kuwait.

Respectfully submitted,

Mohammed Al Sager (signed)
Chairman of the Committee on Foreign Affairs
Kuwaiti Parliament

End Text of Al-Sager Letter


4. (SBU)

Begin Text of Proposed Embassy Response to Al-Sager

Dear Mr. Al-Sager:

I have received your letter of 19 November inquiring about an
on going investigation regarding alleged contract
irregularities involving the KBR Corporation and the Kuwaiti
firm La Nouvelle.

This matter has also been raised in Washington by Kuwait's
Ambassador to the United States. I am forwarding your letter
to the Department of State for consideration of appropriate
action.

End Text of Proposed Embassy Response to Al-Sager


*********************************************
Visit Embassy Kuwait's Classified Website:
http://www.state.sgov.gov/p/nea/kuwait/

You can also access this site through the
State Department's Classified SIPRNET website
*********************************************

TUELLER