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Prince of Darkness: Deals in the shadows
By Jason Leopold

Richard Perle’s resignation Thursday as chairman of the Defense Policy Board, a Pentagon advisory group, is long overdue. Perle quit the chairmanship amid controversy centered around his position as a retainer for bankrupt telecommunications firm Global Crossing which hired him to the potential tune of US$725,000 to win approval from the US Department of Defense for Hong Kong billionaire Li Ka-shing to buy the company. A growing chorus of critics and lawmakers decried Perle, nicknamed Prince of Darkness, as putting himself in a situation with a significant conflict of interest. This is anything but terra incognita for Perle, who has resigned from a previous post as assistant secretary of defense in April 1987 - amid complaints of conflicts of interest.

Global Crossing presumably hired Perle, former assistant secretary of defense under Ronald Reagan, as a lobbyist because he wields an enormous amount of power around the Pentagon. Perle is one of the biggest hawks in the nest: key adviser to buddy and Secretary of Defense Donald Rumsfeld and a leading architect and proponent of the Bush administration’s bellicose policies toward Iraq.

The Pentagon and the Federal Bureau of Investigation objected to Global Crossing’s sale to Hong Kong's Hutchison Whampoa, which was accused last year by Perle's fellow hawks of being a front for China's People's Liberation Army. The FBI was concerned because the US government uses Global Crossing’s fiber-optics networks and a sale would put the networks under control of the Chinese government. Global Crossing said it would pay Perle $125,000 plus an additional $600,000 if the deal went through.

Perle denied Thursday that his unpaid advisory role on the policy board would have interfered with his lobbying on behalf of Global Crossing, which is mired in shareholder lawsuits as a result of its questionable accounting practices. But Perle has a long history of using his influential role as a government adviser to line his pockets.

Earlier this very month, Pulitzer-prize-winning investigative journalist Seymour M Hersh published a story in the New Yorker entitled "Lunch with the Chairman". Hersh's piece focused on a lunch in France between Perle and Harb Saleh al-Zuhair, a Saudi industrialist. The lunch was arranged by freewheeling Saudi-born businessman Adnan Khashoggi, one of the stars of the Iran-Contra scandal during the Reagan administration. Hersh alleged that Perle was engaging in fundraising for Trireme Partners LP, a venture-capital company specializing in homeland security/defense. Perle is a managing partner at Trireme.

“Richard Perle … has made a lucrative career out of some bald conflicts of interest,” wrote Mark Crispin Miller, a New York University media professor, in the Free Press in 2000. “As an Assistant Secretary of Defense for International Security under Ronald Reagan, he got in some slight trouble when he wrote a memorandum urging the department to consider buying equipment from a company that had paid him a $50,000 consulting fee (as the the New York Times noted back in 1984). As chairman and CEO of Hollinger Digital (owned by media titan Conrad Black), Perle maintains his close connections with the military industries. For example, as a non-executive director of Morgan Crucible, PLC (UK), which has done business with the Pentagon ...”

Moreover, Perle was also a director of Memorex Corp, a defense contractor, in the 1990s while he was advising then-secretary of defense Dick Cheney as a member of the Defense Policy Board Advisory Committee during the first Bush administration. At the same time, Perle also was a paid consultant to a Turkish-hired lobbying firm in Washington and has been both an adviser to FMC Corp and a director of an FMC-Turkish joint venture building military equipment. It should be noted that during Perle’s tenure in the Reagan administration he was a fierce proponent of aid to Turkey’s military.

In 1987, the Pentagon’s Office of General Counsel opened an inquiry into whether Perle’s attempts to write a fictional novel based on classified intelligence information constituted a conflict of interest. At the time, Perle was offered a $300,000 advance for the novel, titled Memoranda.

The proposal for the novel described an inside look at the bureaucracy and promised a plot that seemed a thinly veiled account of Perle's long-running internecine struggle with former assistant secretary of state Richard R Burt. It promised “an array of bureaucratic maneuvers recounted in the context of actual events altered only enough to make them publishable, to preserve the fiction in Memoranda".

In April of 1987, Senator Sam Nunn (Democrat-Georgia), the former ranking Democrat on the Senate Armed Services Committee, wrote an angry letter to Reagan suggesting that Perle’s book “creates a climate encouraging disrespect for the protection of classified information” and might have “a chilling effect on the candor of [officials'] policy analysis and recommendations”. Nunn also raised questions about the propriety of the sale of the book during Perle's tenure in office.

In response to the inquiries, Perle resigned his post as assistant secretary of defense in April 1987 to write the book. The title was later changed to Hard Line.

Perle will stay on as an adviser to the Defense Policy Board. But by relinquishing the chairmanship, he will not be bound by the same governement ethics code.

Jason Leopold was the Los Angeles bureau chief for Dow Jones Newswires. He is currently finishing a book on the California energy crisis.
 
Mar 29, 2003



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