German computer experts are working round the clock to unlock the truth behind an unexplained surge in financial transactions made just before two hijacked planes crashed into New York’s World Trade Centre on September 11.
Were criminals responsible for the sharp rise in credit card transactions that moved through some computer systems at the WTC shortly before the planes hit the twin towers?
Or was it coincidence that unusually large sums of money, perhaps more than $100 million, were rushed through the computers as the disaster unfolded?
A world leader in retrieving data, German-based firm Convar is trying to answer those questions and help credit card companies, telecommunications firms and accountants in New York recover their records from computer hard drives that have been partially damaged by fire, water or fine dust.
Using a pioneering laser scanning technology to find data on damaged computer hard drives and main frames found in the rubble of the World Trade Centre and other nearby collapsed buildings, Convar has recovered in- formation from 32 computers that support assumptions of dirty doomsday dealings.
“The suspicion is that inside information about the at- tack was used to send financial transaction commands and authorisations in the belief that amid all the chaos the criminals would have, at the very least, a good head start,” said Convar director Peter Henschel.
“Of course it is also possible that there were perfectly legitimate reasons for the unusual rise in business volume,” he told Reuters in an interview.
Profiting from disaster?
“It could turn out that Americans went on an absolute shopping binge on that Tuesday morning. But at this point there are many transactions that cannot be accounted for,” Henschel said.
“Not only the volume but the size of the transactions was far higher than usual for a day like that. There is a suspicion that these were possibly planned to take advantage of the chaos.”
Nearly 3,300 people were killed in the attacks that destroyed the World Trade Centre.
Some 30,000 people in the buildings, symbols of America’s financial might, were able to escape between the time the planes crashed and about an hour later when they collapsed even though many of the unmanned computers continued working.
The United States blames the Al Qaeda group led by Saudi-born Osama bin Laden for the attack and has since waged war on the Taliban regime in Afghanistan that sheltered them.
Advance knowledge of attack?
There are several data retrieval companies in the United States and Europe, but Convar said it has won the lion’s share of the contracts from the World Trade Centre because of its laser scanning technology.
Convar developed the laser scanner two years ago that made it possible to retrieve data from badly damaged computers.
With a staff of 30 in its high-security facility in Pirmasens near the French border, the frm has worked with the US armed forces in Germany as well as German federal police for the last 15 years.
Its offices in Pirmasens, a town of 36,000 still suffering from the departure of some 4,000 American soldiers stationed here during the Cold War, are closely guarded behind high fences and monitored by dozens of security cameras.
Inside the building, an endless series of code-operated door locks keeps unwelcome visitors away. In the centre of the facility is a 120 square metre (1,292 square foot), dust-free “clean room” where the damaged computer drives are coaxed back to life.
Citing client privacy, Henschel declined to say which companies Convar is working for, or provide details about the data retrieved so far. But he said the raw material, up to 40 gigabytes per computer hard drive, is sent immediately by satellite or courier back to New York.
Richard Wagner, a data retrieval expert at the company, said illegal transfers of more than $100 million might have been made immediately before and during the disaster.
“There is a suspicion that some people had advance knowledge of the approximate time of the plane crashes in order to move out amounts exceeding $100 million,” Wagner said. “They thought that the records of their transactions could not be traced after the main frames were destroyed.”
The companies are paying between $20,000 and $30,000 for each computer recovered, Henschel said.
The high recovery costs are one reason why only a limited number of hard drives are being examined. Convar has turned down a request by one British newspaper to try to recover personal last hour e-mails sent by someone trapped in the doomed building.
Henschel said the companies in the United States were working together with the FBI to piece together what happened on September 11 and that he was confident the destination of the dubious transactions would one day be tracked down.
“We have been quite surprised that so many of the hard drives were in good enough shape to retrieve the data,” he said.
“The contamination rate is high. The fine dust that was everywhere in the area got pressed under high pressure into the drives. But we’ve still been able to retrieve 100 percent of the data on most of the drives we’ve received.
“We’re helping them fnd out what happened to the computers on September 11 as quickly as possible. I’m sure that one day they will know what happened to the money.”
Mystery of terror ‘insider dealers’
Chris Blackhurst – The Independent – 14 October 2001 Share speculators have failed to collect $2.5m (£1.7m) in profits made from the fall in the share price of United Airlines after the 11 September World Trade Centre attacks.
The fact that the money is unclaimed more than a month later has reawakened investigators’ interest in a story dismissed as coincidence.
It may be that investors who were able to predict the share price crash so skilfully are reluctant to be seen profiting from tragedy. But investigators now wonder whether there is a more sinister explanation.
The authorities are examining the possibility that if they knew what was coming, traders were intent on taking their profits immediately, before regulators had woken up to any possible scam. But investors failed to foresee that the first response of the US stock markets to the disaster was to suspend all trading for four days, thereby denying them the chance of cashing in their profts.
Further details of the futures trades that netted such huge gains in the wake of the hijackings have been disclosed. To the embarrassment of investigators, it has also emerged that the frm used to buy many of the “put” options – where a trader, in effect, bets on a share price fall – on United Airlines stock was headed until 1998 by “Buzzy” Krongard, now executive director of the CIA.
Until 1997, Mr Krongard was chairman of Alex Brown Inc, America’s oldest investment banking firm. Alex Brown was acquired by Bankers Trust, which in turn was bought by Deutsche Bank. His last post before resigning to take his senior role in the CIA was to head Bankers Trust – Alex Brown’s private client business, dealing with the accounts and investments of wealthy customers around the world.
There is no suggestion that Mr Krongard had advance knowledge of the attacks.
Between 6 and 7 September, the Chicago Board Options Exchange saw purchases of 4,744 “put” option contracts in UAL versus 396 call options – where a speculator bets on a price rising. Holders of the put options would have netted a profit of $5m (£3.3m) once the carrier’s share price dived after 11 September. On 10 September, more trading in Chicago saw the purchase of 4,516 put options in American Airlines, the other airline involved in the hijackings. This compares with a mere 748 call options in American purchased that day. Investigators cannot help but notice that no other airlines saw such trading in their put options.
It was not just airlines that were targeted by remarkably canny investors. One of the biggest occupants of the World Trade Centre was Morgan Stanley, the investment bank. In the first week of September, an average of 27 put option contracts was bought each day in its shares. The total for the three days before the attacks was 2,157. Merrill Lynch, another WTC tenant, saw 12,215 put options bought in the four days before the attacks, when the previous days had seen averages of 252 contracts a day.
Suppressed Details of Criminal
Insider Trading Lead Directly into
the CIA’s Highest Ranks
CIA Executive Director “Buzzy” Krongard man-
aged frm that handled put options on UAL
Michael C. Ruppert – www.copvcia.com – October 2001
Although uniformly ignored by the mainstream U.S.
Media, there is abundant and clear evidence that a
number of transactions in fnancial markets indicated specific (criminal) foreknowledge of the September 11 attacks on the World Trade Centre and the Pentagon. In the case of at least one of these trades – which has left a $2.5 million prize unclaimed – the frm used to place the “put options” on United Airlines stock was, until 1998, managed by the man who is now in the number three Executive Director position at the Central Intelli- gence Agency. Until 1997 A.B. “Buzzy” Krongard had been Chairman of the investment bank A.B. Brown.
A.B. Brown was acquired by Banker’s Trust in 1997.
Krongard then became, as part of the merger, Vice Chairman of Banker’s Trust-AB Brown, one of 20 ma- jor U.S. Banks named by Senator Carl Levin this year as being connected to money laundering. Krongard’s last position at Banker’s Trust (BT) was to oversee “private client relations.” In this capacity he had direct hands-on relations with some of the wealthiest people in the world in a kind of specialised banking operation that has been identified by the U.S. Senate and other investigators as being closely connected to the laundering of drug money.
Krongard (re?) joined the CIA in 1998 as counsel to CIA Director George Tenet. He was promoted to CIA Executive Director by President Bush in March of this year. BT was acquired by Deutsche Bank in 1999. The combined frm is the single largest bank in Europe.
And, as we shall see, Deutsche Bank played several key roles in events connected to the September 11 attacks.
The scope of known insider trading
Before looking further into these relationships it is necessary to look at the insider trading information that is being ignored by Reuters, The New York Times and other mass media. It is well documented that the CIA has long monitored such trades – in real time as potential warnings of terrorist attacks and other economic moves contrary to U.S. Interests. Previous stories in FTW have specifically highlighted the use of Promis software to monitor such trades.
It is necessary to understand only two key financial terms to understand the significance of these trades, “selling short” and “put options”. “Selling Short” is the borrowing of stock, selling it at current market prices, but not being required to actually produce the stock for some time. If the stock falls precipitously after the short contract is entered, the seller can then fulfil the contract by buying the stock after the price has fallen and complete the contract at the pre-crash price. These contracts often have a window of as long as four months.
“Put Options,” are contracts giving the buyer the option to sell stocks at a later date. Purchased at nominal prices of, for example, $1.00 per share, they are sold in blocks of 100 shares. If exercised, they give the holder the option of selling selected stocks at a future date at a price set when the contract is issued. Thus, for an investment of $10,000 it might be possible to tie up 10,000 shares of United or American Airlines at $100 per share, and the seller of the option is then obligated to buy them if the option is executed. If the stock has fallen to $50 when the contract matures, the holder of the option can purchase the shares for $50 and immediately sell them for $100 – regardless of where the market then stands. A call option is the reverse of a put option, which is, in effect, a derivatives bet that the stock price will go up.
A September 21 story by the Israeli Herzliyya International Policy Institute for Counter terrorism, entitled “Black Tuesday: The World’s Largest Insider Trading Scam?” documented the following trades connected to the September 11 attacks:
• Between September 6 and 7, the Chicago Board Options Exchange saw purchases of 4,744 put options on United Airlines, but only 396 call options. Assuming that 4,000 of the options were bought by people with advance knowledge of the imminent attacks, these “insiders” would have profited by almost $5 million.
• On September 10, 4,516 put options on American Air- lines were bought on the Chicago exchange, compared to only 748 calls. Again, there was no news at that point to justify this imbalance; Again, assuming that 4,000 of these options trades represent “insiders,” they would represent a gain of about $4 million.
• [The levels of put options purchased above were more than six times higher than normal.]
• No similar trading in other airlines occurred on the Chicago exchange in the days immediately preceding Black Tuesday.
• Morgan Stanley Dean Witter & Co., which occupied 22 floors of the World Trade Centre, saw 2,157 of its October $45 put options bought in the three trading days before Black Tuesday; this compares to an average of 27 contracts per day before September 6. Morgan Stanley’s share price fell from $48.90 to $42.50 in the aftermath of the attacks. Assuming that 2,000 of these options contracts were bought based upon knowledge of the approaching attacks, their purchasers could have profited by at least $1.2 million.
• Merrill Lynch & Co., with headquarters near the Twin Towers, saw 12,215 October $45 put options bought in the four trading days before the attacks; the previous average volume in those shares had been 252 contracts per day [a 1200% increase!]. When trading resumed, Merrill’s shares fell from $46.88 to $41.50; assuming that 11,000 option contracts were bought by “insiders,” their proft would have been about $5.5 million.
• European regulators are examining trades in Germany’s Munich Re, Switzerland’s Swiss Re, and AXA of France, all major reinsurers with exposure to the Black Tuesday disaster. [FTW Note: AXA also owns more than 25% of American Airlines stock making the attacks a “double whammy” for them.]
On September 29, 2001 – in a vital story that has gone unnoticed by the major media – the San Francisco Chronicle reported, “Investors have yet to collect more than $2.5 million in profits they made trading options in the stock of United Airlines before the Sept. 11, terrorist attacks, according to a source familiar with the trades and market data.
“The uncollected money raises suspicions that the investors whose identities and nationalities have not been made public had advance knowledge of the strikes.” They don’t dare show up now. The suspension of trading for four days after the attacks made it impossible to cash-out quickly and claim the prize before investigators started looking.
“October series options for UAL Corp. were purchased in highly unusual volumes three trading days before the terrorist attacks for a total outlay of $2,070; investors bought the option contracts, each representing 100 shares, for 90 cents each. [This represents 230,000 shares]. Those options are now selling at more than $12 each. There are still 2,313 so-called “put” options outstanding [valued at $2.77 million and representing 231,300 shares] according to the Options Clearing- house Corp.”
“The source familiar with the United trades identifed Deutsche Bank Alex Brown, the American investment banking arm of German giant Deutsche Bank, as the investment bank used to purchase at least some of these options.” This was the operation managed by Krongard until as recently as 1998.
As reported in other news stories, Deutsche Bank was also the hub of insider trading activity connected to Munich Re. Just before the attacks.
CIA, the banks and the brokers
Understanding the interrelationships between CIA and the banking and brokerage world is critical to grasp- ing the already frightening implications of the above revelations. Let’s look at the history of CIA, Wall Street and the big banks by looking at some of the key players in CIA’s history.
Clark Clifford – The National Security Act of 1947 was written by Clark Clifford, a Democratic Party powerhouse, former Secretary of Defence, and one-time advisor to President Harry Truman. In the 1980s, as Chairman of First American Bancshares, Clifford was instrumental in getting the corrupt CIA drug bank BCCI a license to operate on American shores. His profession: Wall Street lawyer and banker.
John Foster and Allen Dulles – These two brothers “designed” the CIA for Clifford. Both were active in intelligence operations during WW II. Allen Dulles was OSS station chief in Berne, Switzerland, where he met frequently with Nazi leaders and looked after U.S. In-vestments in Germany. John Foster went on to become Secretary of State under Dwight Eisenhower and Allen went on to serve as CIA Director under Eisenhower and was later fired by JFK. Their professions: partners in the most powerful – to this day – Wall Street law firm of Sullivan, Cromwell.
Bill Casey – Ronald Reagan’s CIA Director and OSS veteran who served as chief wrangler during the Iran- Contra years was, under President Richard Nixon,
Chairman of the Securities and Exchange Commission.
His profession: Wall Street lawyer and stockbroker.
David Doherty – The current Vice President of the New York Stock Exchange for enforcement is the retired General Counsel of the Central Intelligence Agency.
George Herbert Walker Bush – President from 1989 to January 1993, also served as CIA Director for 13 months from 1976-7. He is now a paid consultant to the Carlyle Group, the 11th largest defence contractor in the nation, which also shares joint investments with the bin Laden family.
A.B. “Buzzy” Krongard – The current Executive Director of the Central Intelligence Agency is the former Chairman of the investment bank A.B. Brown and former Vice Chairman of Banker’s Trust.
John Deutch This retired CIA Director from the Clinton Administration currently sits on the board at Citigroup, the nation’s second largest bank, which has been repeatedly and overtly involved in the documented laundering of drug money. This includes Citigroup’s 2001 purchase of a Mexican bank known to launder drug money, Banamex.
Nora Slatkin – This retired CIA Executive Director also sits on Citibank’s board.
Maurice “Hank” Greenburg – The CEO of AIG insur- ance, manager of the third largest capital investment pool in the world, was fated as a possible CIA Di- rector in 1995. FTW exposed Greenberg’s and AIG’s long connection to CIA drug trafficking and covert
operations in a two-part series that was interrupted just prior to the attacks of September 11. AIG’s stock has bounced back remarkably well since the attacks. To read that story, please go to http://www.fromthewildern ess.com/
One wonders how much damning evidence is necessary to respond to what is now irrefutable proof that CIA knew about the attacks and did not stop them. Whatever our government is doing, whatever the CIA is doing, it is clearly NOT in the interests of the American people, especially those who died on September 11.
New scrutiny of airlines options deals
Christian Berthelsen – San Francisco Chronicle
19 September 2001
The Chicago Board Options Exchange said yesterday that it is looking into an unusual spike in trading in two airline stocks in advance of last week’s terrorist attacks.
As reported in The Chronicle, options trading in the stocks of the parent companies of American and United airlines was unusually heavy in the three trading days prior to the attack.
That activity is the focus of an international
investigation in the United States and several other countries that is trying to determine whether people with advance knowledge of the attacks sought to proft from the trading.
Four American and United planes, along with their crew and passengers, were hijacked on Sept. 11. Three were used in the terrorist attacks against the twin towers of the World Trade Center and against the Pentagon.
The fourth crashed in rural Pennsylvania.
Both airlines’ stocks fell precipitously when trading resumed on Monday, with shares of UAL, the parent of United, dropping 43 percent, and shares of AMR, the parent of American, dropping 39 percent. Both recovered slightly yesterday, with UAL rising $1.49 to close at $18.99, and AMR rising $2, to close at $20.
The Chicago Exchange, the largest options market in the nation and the board on which United options are offcially listed, experienced volume eight times its normal levels in the trading of UAL Corp. put options on the Friday before the attack.
The purchaser of a put contract is guaranteed the right to sell a specifc amount of shares at a specifed price by a certain date. The purchaser profts from the deal when the share price drops lower than the agreed sale price.
Lynn Howard, the exchange’s chief spokeswoman, said, “As is usual, CBOE is conducting an investigation of trading prior to the news event.” Howard declined to elaborate on the specifc nature of the inquiry. Sources who have agreed to speak on condition of anonymity say government investigators are also looking at the trades.
Exchange offcials and market markers in San
Francisco refused to discuss the inquiry.
On the day before the terrorist attack there was a spike of 25 times the normal levels in the trading ratio of UAL put options, with larger-than- average volume coming through the Pacifc Exchange.
Dale Carlson, a vice president of the Pacifc Exchange, refused to comment on whether an inquiry is taking place there in the trading of put options on UAL or any other security.
A foor broker with TFM Investment Group, the market maker in UAL options at the Pacifc Exchange, also refused to comment.
For more information, please read the article ‘Black Tuesday – The World’s Largest Insider Trading Scam?’ published by the Institute for Counter Terrorism