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When Sabri and Regard Yakou were arrested in the fall of 2003 for brokering an arms deal with the Iraqi regime of Saddam Hussein, their case created a welcome media splash for the U.S. government. Regard Yakou, a U.S. citizen, and his Iraq-born father Sabri, who had held permanent-resident status in the United States, were pursued overseas by Immigration and Customs Enforcement agents and charged with facilitating the construction and sale of six armed patrol boats to Saddam’s navy in the run-up to the U.S. invasion. “It’s really a shock,” Michael Dougherty, a top ICE official, told The New York Times in October 2003, “when you think about American residents dealing with an enemy regime in a time of war.” But less than three years later, perhaps the most shocking thing about the prosecution of the Yakous is the disintegration of the government’s case. On July 20 in federal court in Washington, D.C., the U.S. Attorney’s Office for the District of Columbia agreed to drop all charges against 72-year-old Sabri. That same day, federal prosecutors struck a plea deal with 46-year-old Regard. In return for Regard’s pleading guilty to a felony count of making a false statement, punishable by up to five years in prison, the government agreed not to seek any prison time for Regard at his sentencing, which is scheduled for October. The move to give up prosecuting Sabri and strike a plea with Regard came in response to a series of rulings against the government by U.S. District Judge Gladys Kessler and the U.S. Court of Appeals for the D.C. Circuit. That the Yakous would avoid prison time was far from obvious in 2003. The government had collected a wealth of evidence against them, including a videotape in which the Yakous told ICE special agents in Baghdad (posing as officials with the Coalition Provisional Authority) how the U.S. embargo against Iraq had slowed their efforts to acquire parts for the gunboats, forcing them to rout through Jordan equipment shipped from Malaysia. The government also had memos about and contracts for the construction of the six patrol boats, as well as evidence obtained from an employee at Saddam’s Military Industrial Corp. But the government had focused its investigation on Sabri, who played the lead role in arranging the gunboat deal. And building the case around Sabri had a fatal flaw. Since he’d left the United States more than a decade ago, Sabri’s defense attorneys successfully argued, he had effectively abandoned his permanent-resident status in the United States. That meant that despite conducting a wide-ranging probe that led investigators from Baghdad to Bangkok to Washington, the government didn’t have jurisdiction to prosecute him as a “U.S. person,” as defined under the criminal statutes prohibiting arms sales to the Iraqi government. Establishing jurisdiction is, of course, the most basic step in any court proceeding. But in this case, the federal investigators and prosecutors handling the case appeared to have been blindsided. “My instinct is, the government prosecutors treated the issue as they went into it lightly,” says Stanley Mailman, an immigration specialist at New York’s Satterlee Stephens Burke & Burke who has followed the case. “Or perhaps didn’t see the issue at all.” Kenneth Wainstein, the U.S. attorney for the District of Columbia, expressed no remorse for the outcome of the case, saying the judge’s decision clarified an unclear area of the law. “In this post-9/11 era, we do not apologize for aggressively pursuing and prosecuting those who trade military material with outlaw regimes,” said Wainstein in a written statement. LET’S MAKE A DEAL The Yakous’ involvement in the boat deal with Saddam’s military dates back to 1999, according to government court filings. In June of that year, Sabri, working as the authorized Iraqi representative of a Malaysian company named Sasacom, brokered an $11 million deal between Sasacom and an Iraqi government military-procurement company called Al-Nasar Al-Adeem, also known as Great Victory State Co. As part of the deal, Sasacom was to provide Iraq with six 85-foot combat patrol boats, fitted with mounts for turrets and heavy machine guns. But Sasacom failed to perform on the contract, according to court documents. As a result, in January 2002, the same month President George W. Bush declared Iraq part of the “axis of evil,” Sabri signed a $2 million contract to supervise the completion of the unfinished patrol boats within six months. To do so, prosecutors say, the Yakous, operating under a company called PT Gulf International from a compound in Baghdad, purchased components from Singapore, Malaysia, and Germany, using letters of credit from Saddam’s government. To evade the arms embargo, the government asserted, Sabri bribed foreign officials and shipped equipment through Jordan to Iraq. Three of the boats were eventually completed and deployed to the port city of Basra on the Persian Gulf. As the U.S. invasion approached, Regard, on behalf of his father, wrote to Great Victory in February 2003, urging the company to protect the boats in the event of an attack. “Due to the current circumstances the nation is going through, and the vicious attacks by the international Imperialistic and Zionist forces . . . we would like to mention to you the importance of taking all necessary steps to safeguard the boats against any attacks (God forbids),” wrote Regard, according to court filings. Robert Tucker, a lawyer for Regard, declined to comment for this article. “I would be very skeptical of any of the government’s more incendiary allegations in this case,” says John Moustakas, Sabri’s lawyer. “I believe [if they were true] the government would not have dismissed the case against Sabri Yakou and it would not have settled the case the way they did with Regard Yakou.” The Yakous had deep ties to Iraq. Sabri had lived in Kirkuk until the mid-1970s, when he and his family moved to Britain. A businessman who had been importing goods to Iraq since the 1950s, he followed his children to the United States in 1986. Regard got his doctorate in the United States and eventually became a U.S. citizen. In 1989, Sabri gained lawful permanent-resident status and was issued a green card. But in early 1993 federal agents raided Sabri’s California home, seizing his business records. The reason for the search remains unclear, and Sabri wasn’t charged with a crime. Moustakas says the anti-Iraqi sentiment after the Gulf War spurred the raid. “His view is that it was all on suspicion of being Iraqi,” Moustakas says. Moustakas says Sabri felt unfairly treated and decided to leave the United States. Over the next decade, according to court records, he would return periodically, mostly to visit family, using his green card or British passport to clear immigration. UNTOUCHABLE The details of Sabri’s movement and immigration status would later prove the key to clearing him of federal criminal charges. In July 2003, ICE special agents in Baghdad, posing as Coalition Provisional Authority officials, interviewed Sabri and Regard on several occasions and gathered evidence to be used against them. In October, Regard was arrested at the Palestine Hotel in Baghdad. Days later, Sabri, traveling in Bangkok, was met by an ICE official and persuaded to go to Washington, where he was promptly arrested at Reagan National Airport. Sabri’s lawyers at Shea & Gardner (which has since been swallowed by Goodwin Procter) promptly contested the government’s jurisdiction in filing charges against him. Under the Arms Control Export Act and international arms-trafficking regulations, the government has the authority to prosecute those defined as “U.S. persons.” The prosecutors in the case from the U.S. Attorney’s Office in the District, Wendy Wysong and Laura Ingersoll, argued that because Sabri had never officially revoked his permanent-resident status when he moved to London in 1993 (and later to Iraq), he was still a “U.S. person.” Moreover, he’d used his green card on several occasions in the intervening years to re-enter the United States for short visits. But Moustakas and Goodwin Procter’s Matthew Hoffman were able to convince Kessler otherwise, citing case law from the Justice Department’s Board of Immigration Appeals that demonstrated that a green-card holder could involuntarily lose permanent-resident status by leaving the United States for an extended period of time. In April 2004, Kessler dismissed the government’s indictment against Sabri. The government appealed the case to the D.C. Circuit and, in the interim, filed a second indictment — similar to the first — in an effort to keep the case alive. But in January 2005, Judge Judith Rogers, writing the opinion for the three-judge appellate panel, upheld Kessler’s decision. “Infrequent and short stays in the United States are insufficient, as a matter of law, to support retention of his [permanent-resident] status,” Rogers wrote. The panel also ruled against the government’s contention that Sabri could be prosecuted for “aiding and abetting” the arms deal. The decision was a death blow to the case against Sabri. That left Regard, who, as a U.S. citizen, still faced charges. The problem was that much of the government’s case had focused on Sabri as the primary deal maker. “He was helping his dad out with paperwork,” says Moustakas. “He was not an international arms broker by any stretch.” While Regard awaits his sentencing in October, Sabri is back in Baghdad. Whatever loyalty he professed to Saddam seems to have evaporated with the U.S. invasion. Even while undercover ICE special agents were investigating him for building gunboats for Saddam, Sabri Yakou was squiring a new potential customer: the Coalition Provisional Authority. On July 9, 2003, he wrote to the Iraqi Oil Ministry and its new CPA adviser, declaring himself a representative of a German oil company and proposing to build 100 new gas stations in Iraq. A day later, he wrote to another CPA official, “It is a great pleasure for me to cooperate with your organization to supply you and/or the Iraqi market with all types of Chrysler, Jeep and Dodge cars.”
Jason McLure can be contacted at [email protected].

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