01►The Conspiracy
02►MI5 Tracked Group For A Year
03►U.S., U.K. At Odds Over Timing Of Arrests
04►Investigators Tracing Terror Plot Money Trail
05►Airline Stocks

The Conspiracy
How a group of suicide bombers planned to blow up 10 planes
Independent / by Jason Bennetto, Kim Sengupta and Steve Connor. Aug 11 2006 - About 9pm on Wednesday, Britain's police and intelligence chiefs learnt that a British-based al-Qa'ida cell was within 48 hours of mounting a terror attack that could have been more deadly than 9/11.

Within hours, 24 suspected terrorists, mostly British-born, were arrested after raids across the South-east and Birmingham.

The emergency response was the culmination of more than a year of intensive surveillance and investigation by MI5 and the police in the largest counter-terror operation yet undertaken. Security chiefs believe they have foiled a plot to smuggle home-made explosives on to up to 10 passenger jets bound for the United States, to be detonated by suicide bombers.

The operation began with MI5 officers watching a group of people in London with suspected sympathies for the aims of al-Qa'ida. The targets were among a group of about 1,000 terror suspects that the expanded Security Service had under investigation. At first, it appears to have been fairly routine, but gradually the alarm bells started to ring.

The group had links throughout the country - east London, High Wycombe in Buckinghamshire, and Birmingham - as well as abroad. They were said to be taking a disturbing interest in aircraft and homemade explosives, and how to smuggle the latter through airport security.

The handful of suspects grew to more than 20 - aged between 17 and 35 - and the surveillance operation began sucking in ever more MI5 agents and bugging teams. Whitehall sources say most of the suspects are of Pakistani descent and include women. But a few of the alleged plotters are also of north African descent. One suspect was a white British man in his 20s living in High Wycombe, who converted to Islam about six months ago. Sources said most of those arrested were in their late teens or early 20s.

In December, the Metro-politan Police's anti-terror branch was alerted. The targets were followed, their meetings and conversations recorded, their backgrounds investigated, and their bank accounts scrutinised. MI6 became involved and contacted a dozen counter-intelligence agencies in the United States, Pakistan, north African countries and Germany, for information and checks on the suspects. Information from phone taps and bugging devices began to build a picture of a well-organised and motivated group, who were inspired by the idea of a global jihad and sympathetic towards the aims of al-Qa'ida. Clear links with Pakistan and north Africa were established, including several visits to Pakistany, but the intelligence failed to uncover a "Mr Big" from al-Qa'ida pulling the strings. It initially seems that, as with the July 7 suicide bombers, who killed 52 people in London last year, the plotters were a mixture of young people radicalised while living in Britain and influenced by travelling abroad.

The details of the plot also began to emerge. An experienced counter-terrorism officer described the findings as "bloody scary stuff". The plotters were allegedly planning to commit phased attacks in which three or four aircraft would be blown up over the sea, thereby destroying any clues about how the bombs were smuggled on board.

There were claims from American sources that the terrorists could have been planning to bring down airliners over major cities, either in the UK or US, but that suggestion was discounted by a British anti-terrorist source. After the initial attacks, the terrorists would wait until fear and panic had spread, then commit two more series of attacks, each involving three or four planes. In total, they intended to bring down nine or 10 aircraft.

Details of the make-up of the bombs are still sketchy, but it appears the plotters will be accused of copying many of the tactics used in a liquid explosive device developed 10 years ago.

This plot, which was foiled, is known as the "Bojinka" attack. In 1995, an Islamist terrorist aimed simultaneously to destroy 12 airliners over the Pacific. In this case, the mastermind was named as Ramzi Yousef, who developed liquid nitroglycerin explosives which could be hidden in contact-lens solution bottles. He also converted a digital watch into a timing switch and used two batteries hidden in his shoe to power light-bulb filaments and spark an explosion.

The British cell will be accused of using a liquid explosive which they were going to hide in a sports drinks bottles and smuggle through the airport security checks in hand mluggage.

An unconfirmed report from the US said the suspects planned to use a false bottom in the bottle and fill it with liquid explosive that had been dyed to match the colour of the drink.

The battery detonators would be sourced in electronic devices such as MP3 players or laptops. Based on details recorded from the suspects, the police had explosives specialists build a model which could be put together in minutes and blow a devastating hole in an aircraft.

The suspects were also allegedly heard discussing targets. On information presumably passed on by British police, US authorities said they had identified six to 10 airlines including United, American and Continental, all US carriers. Ten of their aircraft could hold as many as 2,800 passengers and crew. As the months of surveillance continued, police and politicians issued increasingly gloomy warnings. The investigation was gathering pace and counter-terrorism chiefs decided to act soon as they thought the plot was about to be implemented.

On Wednesday night, the security services believed there was a strong possibility that the cell was preparing to execute its plan within the next 48 hours, or flee to reassemble later.

On Tuesday, the Home Secretary, John Reid, warned that Britain was facing its most sustained period of serious threat since the end of the Second World War.

Liquid explosives
Many commercial explosives come as two ingredients - oxidant and fuel - which when mixed produce an explosive that can be detonated by an electrical charge. A bomb can be made by mixing relatively innocuous liquids such as acetone and hydrogen peroxide. Another well-known liquid explosive is nitroglycerine, right, which can be detonated with an electrical charge from the battery of an iPod or laptop computer.

"Most liquid explosives are unstable and dangerous to handle," said Professor Peter Zimmerman, chair of science and security at King's College London. "The best-known example is nitroglycerine. But there are extremely safe commercial explosives which come in two liquids which are mixed just before they are to be detonated. Explosive detonators are small, simple and, if just lightly camouflaged, could escape detection by X-ray scanners."

Clifford Jones, of the University of Aberdeen, said that if an explosion on an aircraft raised atmospheric cabin pressure by just 1 per cent, windows were likely to shatter.

If a blast raised pressure by 10 per cent, structural damage and possibly death would result. Dr Jones added: "A home-made bomb could be constructed with ammonium nitrate as the oxidant and something as innocuous as sawdust as the fuel. Overpressures can also arise when a liquid fuel and a liquid oxidant are so reacted, perhaps using hydrogen peroxide and acetone."

Mi5 Tracked Group For A Year
Financial Times / by Bob Sherwood and Stephen Fidler Aug 10. - For more than a year, police and security service officers had tracked a "large group" of people they were convinced were plotting to blow up transatlantic aircraft in mid-flight.

The detectives allowed the alleged plot to continue for as long as they dared. They followed the young Muslim men´s movements in London and other parts of the UK, listened into their meetings and monitored their spending. But by late on Wednesday, with the suspected suicide bomb plans well advanced and an attack considered "imminent", MI5 and anti-terrorist branch officers decided they could wait no longer without risking public safety.

During the night, 24 people were arrested in a co-ordinated series of raids on homes in London, High Wycombe and Birmingham. By 2am, MI5, which is responsible for domestic security, had raised Britain´s threat level to the highest possible alert. Surprised airport staff were told to implement the most stringent security precautions, causing chaos at the airports.

John Reid, the home secretary, said security chiefs were confident that "we have the main players in custody" but the terror threat would remain at "critical", which implies a terrorist attack is imminent, in case other members of the suspected terrorist cells were still at large.

Most of the people being questioned yesterday were believed to be young British Muslims, although police refused to rule out the possibility of international connections. The Pakistan government said on Thursday night that the country´s intelligence helped to crack the plot and had arrested some suspects. A senior government official said "two or three local people" were held a few days ago in Lahore and Karachi. In London officers were beginning the painstaking task of ascertaining the suspect´s true identities and nationalities, interviewing witnesses and searching homes and business premises.

Peter Clarke, deputy assistant commissioner of the Metropolitan police, who is leading the investigation, said: "The investigation has focused on intelligence, which suggested that a plot was in existence to blow up transatlantic passenger aircraft, in flight.

"The intelligence suggested that this was to be achieved by means of concealed explosive devices smuggled onto the aircraft in hand baggage. The intelligence suggested that the devices were to be constructed in the UK, and taken through British airports."

He said the number, timing and destinations of the planned attacks were still under investigation. But officials in Washington indicated that United, American and Continental flights to New York, Washington and California had been targeted.

British security officials suspected the innovative use of liquid explosives smuggled on board could have evaded airport detection devices. They said the method of attack, if used to blow up an aircraft over the ocean on a flight from the US to the UK, could potentially have been used repeatedly because its detection would have been all but impossible after the event.

One official said: "We were very lucky to have acquired the intelligence about the modus operandi of the attacks. If we hadn´t got the intelligence, they probably would have succeeded and there would have been little or no forensic evidence showing how they had done it. The modus operandi could have made waves of attacks feasible."

British police had liaised closely with US law enforcement agencies for some time, although US officials said they learnt the intelligence pointed to threats against specific US airlines only in the past two weeks.

Security officials indicated that the police were aware of threats against a number of airlines but had not told the carriers for fear of compromising the operation. The airlines were eventually warned by US officials. During the night the government´s Cobra emergency response committee was hurriedly convened and met again twice during the morning, chaired by Mr Reid, to oversee developments.

Tony Blair, on holiday in the Caribbean, spoke to US President George Bush during the night to tell him the operation to disrupt the plot was under way. It is understood the two leaders had also spoken about the plot in the days before the arrests.

The US Department of Homeland Security increased its security level for US-bound flights from the UK to "red", the first time it had applied the highest level for flights from another country. It also despatched US air marshals to Britain to provide extra security.

As the day wore on, Eurostar increased its security for trains through the Channel tunnel, and Kent police stationed armed officers at the county´s ferry ports.

Nine houses were evacuated in High Wycombe near to where at least one suspect was arrested as a "precautionary measure". Police also raided a mosque in the Small Heath area of Birmingham, near where two men had been arrested.

The suspects, most of whom were arrested in London, were held on suspicion of the commission, preparation or instigation of acts of terrorism under the 2000 Terrorism Act. The number of arrests suggests the group occupied significant resources from MI5, which has enjoyed a big increase in its budget since 2001 and is in the midst of a recruitment campaign.

However, officials said the breaking-up of the group would give the agency little respite because those involved would be quickly redeployed to tracking other suspects. John O´Connor, a security consultant and former Metropolitan police commander, said part of the alleged plotters´ objectives had been achieved. "Airports have been disrupted. Businesses have been disrupted."

U.S., U.K. At Odds Over Timing Of Arrests
British wanted to continue surveillance on terror suspects, official says
NBC News / by Aram Roston, Lisa Myers, and the NBC News Investigative Unit Aug 12. - NBC News has learned that U.S. and British authorities had a significant disagreement over when to move in on the suspects in the alleged plot to bring down trans-Atlantic airliners bound for the United States.

A senior British official knowledgeable about the case said British police were planning to continue to run surveillance for at least another week to try to obtain more evidence, while American officials pressured them to arrest the suspects sooner. The official spoke on condition of anonymity due to the sensitivity of the case.

In contrast to previous reports, the official suggested an attack was not imminent, saying the suspects had not yet purchased any airline tickets. In fact, some did not even have passports. The source did say, however, that police believe one U.K.-based suspect was ready to conduct a "dry run." British authorities had wanted to let him go forward with part of the plan, but the Americans balked.

At the White House, a top aide to President Bush denied the account. "There was unprecedented cooperation and coordination between the U.S., the U.K. and Pakistani officials throughout the case," said Frances Townsend, Assistant to the President for Homeland Security and Counterterrorism, "and we worked together to protect our citizens from harm while ensuring that we gathered as much info as possible to bring the plotters to justice. There was no disagreement between U.S. and U.K. officials."
Another U.S. official, however, acknowledges there was disagreement over timing. Analysts say that in recent years, American security officials have become edgier than the British in such cases because of missed opportunities leading up to 9/11.

Aside from the timing issue, there was excellent cooperation between the British and the Americans, officials told NBC. The British official said the Americans also argued over the timing of the arrest of suspected ringleader Rashid Rauf in Pakistan, warning that if he was not taken into custody immediately, the U.S. would "render" him or pressure the Pakistani government to arrest him.

British security was concerned that Rauf be taken into custody "in circumstances where there was due process," according to the official, so that he could be tried in British courts. Ultimately, this official says, Rauf was arrested over the objections of the British.

The official shed light on other aspects of the case, saying that while the investigation into the bombing plot began "months ago," some suspects were known to the security services even before the London subway bombings last year.

He acknowledged that authorities had conducted electronic and e-mail surveillance as well as physical surveillance of the suspects. Monitoring of Rauf, in particular, apparently played a critical role, revealing that the plotters had tested the explosive liquid mixture they planned to use at a location outside Britain. NBC News has previously reported that the explosive mixture was tested in Pakistan. The source said the suspects in Britain had obtained at least some of the materials for the explosive but had not yet actually prepared or mixed it.

Terror Plot Suspects Bugged By Mi5 'Sneak And Peak' Teams
Daily Mail / by Jason Lewis Aug 12. - MI5 agents secretly infiltrated a bomb factory and found liquid explosives and detonators weeks before they foiled the plot to blow up America-bound passenger jets flying from British airports.

The covert raids on homes of key terror suspects were also used to plant bugs and gather hours of crucial evidence against them.The carefully planned 'sneak and peek' operation involved members of the SAS and other surveillance specialists. It allowed the Security Service to eavesdrop on the suspected terrorists in the weeks before they were arrested. The high-risk strategy which allowed the terror plot to almost reach fruition - potentially putting civilian lives at risk - is understood to have been discussed with the Prime Minister and by the Government's crisis management Cobra committee.

A Whitehall source said this was just one of a dozen terror plots being investigated by M15. But the audacious surveillance exercise - approved by the Home Secretary - allowed MI5 surveillance teams to build up a detailed picture of the group's planning, contacts and, crucially, when they intended to strike.

Hours of tape recordings, photographs and video are now likely to be used as evidence against the men if they are charged for their part in the alleged plot. Tiny eavesdropping devices picked up conversations involving various members of the suspected terrorist gang as they put the finishing touches to their plans to blow up a series of commercial flights over the Atlantic. During months of careful work, the specialists are understood to have managed to get inside the gang's bomb-making factory - giving final confirmation that the plotters were indeed planning mass murder.

In earlier, unrelated, anti-terrorist operations, MI5 specialists had managed to remove explosive compounds from one terror cell and replace it with inert material. But in this case MI5 chiefs decided this was not an option - making it even more critical that the plotters were watched 24 hours a day.

Intelligence sources last night indicated that some of the bomb-making chemicals and equipment being used by the gang had been seen 'in situ' but could not be removed or replaced without raising suspicion. The operation is thought to have drawn on the expertise of a special unit providing specialist surveillance techniques which were first used against the IRA.

The unit was set up two years ago to operate against Islamic terrorists around the world as well as to counter the terrorism threat in Britain itself. Much of the core of the unit is made up of undercover surveillance operators who honed their skills fighting terrorists in Northern Ireland. There, among other covert operations, they were involved in the bugging of Gerry Adams, the Sinn Fein president, during the 1998 Good Friday peace negotiations.

Last night, Whitehall security sources confirmed MI5 had deployed 'every resource at its disposal' during the long investigation. "Everything that could have been done was done to try to identify the precise nature of the threat we faced," said a source.

He added: "MI5 received large amounts of intelligence about the nature of this plot and it deployed resources to fill the gaps in its knowledge to develop a complete picture." The Security Service has a licence to 'bug and burgle' but only with the approval of the Home Secretary in order that any evidence obtained can later be used in court.

Over several months, former Home Secretary Charles Clarke and, more recently, John Reid were given detailed updates on the progress of the investigation to enable them to sign warrants for sophisticated intrusive surveillance against the terrorists.

As MI5 reveals on its website: "The Services does use intrusive investigative methods, such as eavesdropping in a target's home or vehicle. "However, our use of such methods is subject to a strict control and oversight regime. "To install an eavesdropping device in a target's home we need to apply to the Secretary of State for a warrant under the Regulation of Investigatory Powers Act 2000 (RIPA) to authorise the intrusion on the privacy of the target."

It adds: "In most cases we must also apply for a 'property warrant' under the Intelligence Services Act 1994 to authorise any interference with the target's property necessary to install the device covertly.

"As with interception, we must convince the Secretary of State that what we are proposing to do is both necessary and proportionate."

Strict application of the rules is crucial as evidence obtained using bugging devices planted in suspects homes can be used as evidence in court and is likely to be the key to the prosecution's case against these men.

A senior Whitehall security source warned last night that the public should not be complacent despite MI5's recent success. He said: "Until six weeks ago this plot was one of a dozen being prioritised by MI5. Intelligence received pushed this plot to the top of the list but the other dozen plots remain and are still being investigated. These are very worrying times."

Investigators Tracing Terror Plot Money Trail
FOX News - Aug 11. Investigators on three continents worked to fill in the full, frightening picture Friday of a plot to blow U.S. jetliners out of the Atlantic skies, tracking the money trail and seizing more alleged conspirators in the teeming towns of eastern Pakistan.

One arrested there, a Briton named Rashid Rauf, is believed to have been the operational planner and to have connections with Al Qaeda in Afghanistan, Pakistani and U.S. officials said. British and Pakistani authorities have arrested as many as 41 people in the two countries in connection with the alleged suicidal plan, broken up by British police this week, to detonate disguised liquid explosives aboard as many as 10 planes bound from Britain to the United States.

"The terrorists intended a second Sept. 11," said Frances Fragos Townsend, White House homeland security adviser.

New information underlined how close they were to mounting attacks. After the first arrests in Pakistan some days ago, word went from Pakistan to the London plotters to move ahead quickly, a message intercepted by an intelligence agency, a U.S. official disclosed on condition of anonymity. That prompted British police to move in on the conspirators, long under watch.

British Home Secretary John Reid told reporters officials were confident the main suspects in the plot were in custody. But authorities "would go where any further evidence takes us," he said.

"I think it's pretty clear that in this case, we don't have everybody," Townsend told The Associated Press in Washington. The British government released the names of 19 of the 24 arrested in Britain — many apparently British Muslims of Pakistani ancestry — and froze their assets. One of the 24 detainees later was freed.

The record of financial transactions, along with telephone and computer records, may help investigators trace more people in the alleged plot. "Think of it as a river — you look upstream to find the source, and downstream to find out where the money is going," said Cliff Knuckey, former chief money laundering investigator for Scotland Yard.

American authorities were looking for any U.S. links in the conspiracy. Hundreds of FBI agents checked possible leads the past few weeks, including what two U.S. counterterrorism officials said, on condition of anonymity, were calls the British suspects placed to several U.S. cities.

But the U.S. homeland security secretary said Friday nothing significant had emerged. "Currently, we do not have evidence that there was, as part of this plot, any plan to initiate activity inside the United States or that the plotting was done in the United States," Michael Chertoff said.

Britain kept its threat assessment level at "critical," indicative of an imminent attack. Extraordinary security measures continued at British airports, although the backlog of passengers eased from Thursday's chaotic conditions, when hundreds of flights were canceled.

At Heathrow, Europe's busiest airport, around 70 percent of flights operated Friday, but many people turned around and headed home after an announcement that a raft of flights had been canceled, including British Airways services to San Francisco and Los Angeles.

At U.S. airports, airlines were recruiting more baggage handlers as U.S. travelers — facing new rules banning almost all liquids from carry-on luggage — adapted by checking bags they normally would have carried aboard. American passengers faced a second level of security checks starting Friday, with random bag searches at boarding gates.

The alleged terrorists were planning to assemble their bombs aboard the aircraft, apparently with a peroxide-based solution disguised as beverages or other harmless-seeming items, and using such electronic equipment as a disposable camera or a music player as a detonator, two U.S. law enforcement officials told The Associated Press.

A U.S. intelligence official said they planned to deploy a couple of attackers per plane, and the two dozen plotters didn't all know one another — a typical security measure in terror groups.

London's Evening Standard reported the plotters apparently chose next Wednesday as a target date, since they had tickets for a United Airlines flight that day, as well as ones for this Friday, apparently a test-run to see whether they could smuggle chemicals aboard in soft-drink containers.

The paper didn't report the flight's destination, but United has flights from Heathrow to New York, Washington, Chicago, Los Angeles, San Diego, San Francisco and Seattle.

The British say their inquiry began months ago — prompted by a tip from within the British Muslim community after the bloody July 7, 2005, terror bombings of the London transit system, The Washington Post reported.There were signs preparations stepped up recently. One of the houses raided by British police this week had been bought last month by two men in an all-cash deal, in a neighborhood of $300,000 houses, neighbors reported.

Pakistani officials said British information led to the first arrests in Pakistan about a week ago, of two British nationals, including Rauf, called a "key person" by the Pakistani Foreign Ministry. Pakistan's interior minister, Aftab Khan Sherpao, said Rauf has ties with al Qaeda and was apprehended in the Afghanistan-Pakistan border area. The Foreign Ministry in Islamabad spoke of "indications" of a link between Rauf and Al Qaeda in Afghanistan.

On an unspecified date, Pakistani authorities also arrested five Pakistanis as alleged `facilitators" for the Britons in the major cities of Lahore and Karachi. An intelligence official in Islamabad said 10 other Pakistanis had been arrested Friday in the district of Bhawalpur, about 300 miles south of Islamabad near the Indian border.

Pakistan is both a key U.S.-British ally in the antiterror campaign, and a hotbed of Islamic radicalism and likely hiding place for al Qaeda leader Usama bin Laden. "I am 120 percent convinced there's a link" with Al Qaeda, Louis Caprioli, a former top French counterintelligence official, said of the trans-Atlantic bombing plot. "Was it Al Qaeda who contacted them, or vice versa? Only the investigation will be able to tell."

Scotland Yard didn't identify the lone detainee released Friday from among 24 arrested in London, its eastern suburb of High Wycombe and the central city of Birmingham. The 19 identified ranged in age from 17 to 35, had Muslim names and appeared to be of Pakistani descent, although many were born and all reared in Britain.

One not on the list of 19 names was believed to be a young woman in her 20s with a 6-month-old baby. At least three people among the suspects were converts to Islam. It was unclear how the alleged plotters met, or who the ringleader was, although suspicion fell on the only one identified who is over 30 — Shamin Mohammed Uddin, 35, of east London.

A teenage neighbor of suspect Assad Sarwar, 26, who lived with his parents in High Wycombe, said Sarwar had become increasingly strident after the London transit bombings, in which four suicide bombers killed 52 other people. "He started talking about terrorism and acting like it's OK to blow up people," said Nawaz Chaudhry, 17.

At least one "martyrdom" tape, the type left by suicide bombers, was found in the British raids, a U.S. law enforcement official said. Under Britain's toughened antiterrorism laws, suspects can be held for up to 28 days without charge. On Friday, detention orders for 22 suspects were extended through Wednesday. The 23rd suspect, still in custody, will have a detention extension hearing Monday.

Airline Stocks
Strange airline stocks shorting activities in Europe ahead of terror plot discovery raise doubt about who knew what and when?
India Daily Aug 10. - The airlines stock indices all across the globe was showing technical reasons for a drop for the last few days. After the London discovery of the terror plot to blow US-UK bound airlines, it dipped heavily only to be bought.

According to Financial times, the UK was put on its highest state of alert on Thursday after British police said they had foiled a terrorist plot to blow up transatlantic passenger aircraft in mid-flight. The announcement followed a number of arrests overnight. It is believed that flights from the UK to the US were the principal target.

“Overnight the police, with the full knowledge of ministers, have carried out a major counter-terrorism operation to disrupt what we believe to be a major threat to UK and international partners,” said John Reid, home secretary, adding: “We think we have the main players in this conspiracy”.

The trading pattern of the Airline stocks before and after raised the first doubts about the terror plot discovery. The airlines stocks bounced back with the same money that was raised shorting these stocks yesterday and before.

The biggest question now is who were the people who shorted these airlines stocks before the terror plot discovery and why are they so sure to buy them back at a 10% or more discount today?

The London Terror Gang
The London Terror Gang III

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