The British newspaper The Observer reported on its Web site that the terrorist network led by Osama bin Laden struck deals in “blood diamonds” worth more than $20 million in the months before the attacks of Sept. 11, 2001.

Alex Yearsley of Global Witness, the non-governmental agency fighting conflict diamonds in Sierra Leone, was quoted by the paper as saying “Given that the attacks on America cost only about $500,000, it is terrifying that al-Qaeda managed to convert $20 million of its cash into diamonds.” The paper cited other anonymous sources, such as an unnamed Antwerp newspaper and unnamed European and Belgian government officials who allegedly leaked information about how al-Qaeda made millions from stones mined illegally by Revolutionary United Front rebels in Sierra Leone, but it had no direct quotes from any source other than Yearsley and no direct attribution for any of its other statements.

The Observer article claims that according to information leaked by the government officials, a Lebanese diamond merchant named Aziz Nassour employed couriers to exchange $300,000 for diamonds every week between December 2000 and September 2001, and that Nassour, now living in Beirut, is undergoing an investigation into claims he conducted deals with al-Qaeda with his cousin, Samih Ossailly. Ossailly is in prison in Belgium under the same charge and is expected to appear in court early next year. The paper also alleges ties to a used car dealer in Boston.

Both Nassour and Ossailly admit being involved in the diamond business in Sierra Leone and Congo but they deny any ties to al-Qaeda, the paper reports.

JCK