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Subject: DNI-NEWS Digest - 18 Aug 1999
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There are 2 messages totalling 174 lines in this issue.

Topics of the day:

1. Iran Proceeds With Spy Trial
2. Iran increases funds for terrorist activities

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Date: Thu, 19 Aug 1999 00:10:31 -0500
From: aryopirouznia <aryopirouznia@EMAIL.MSN.COM>
Subject: Iran Proceeds With Spy Trial

Iran Proceeds With Spy Trial
By BARRY SCHWEID AP Diplomatic Writer

Tuesday August 17 6:23 PM ET

WASHINGTON (AP) - Iranian authorities have decided to proceed with trial
of 13 Jews on charges of spying for Israel, an official of a leading
American Jewish organization said Tuesday.

Prosecutors will take that move Thursday, said Malcolm Hoenlein, executive
director of the Conference of Presidents of Major American Jewish
Organizations.

The 13, in custody since their March arrests, were ``absolutely
innocent,'' Hoenlein said as he appealed to Iranian justice to return them
to their families. He said his information came from ``official sources,''
whom he declined to identify.

In Jerusalem, Israel's Chief Sephardic rabbi, Eliahu Bakshi-Doron, asked
for prayers for the safety of the Jews. He said their trial was to begin
Wednesday.

State Department spokesman James P. Rubin said he had no information about
the reported trial, noting that there is no U.S. Embassy in Tehran.

Iran has denounced the United States for objecting to the arrests, saying
no country had a right to interfere in Iran's internal affairs.

The State Department has criticized the charges as unfounded and
unacceptable. Jesse Jackson also has appealed for their release.

Espionage is a capital crime in Iran, a nation of 60 million people, many
of them Shiite Muslims.

Iran has executed 17 Jews on espionage charges in the past two decades,
including two in 1997.

Iran had a long history of tolerance toward Jews, through the reign of the
shah. About 200,000 were living in the country when Islamic
revolutionaries overthrew the Peacock throne in 1979.

All but about 25,000 Jews fled. Those who remained were allowed to
practice aspects of their religion but are forbidden to teach Hebrew and
they face restrictions on emigration.

On Monday, a former member of the Jewish community of Mashad who now lives
in Israel reported that bulldozers had uprooted the headstones at the
Jewish cemetery in the Iranian city, 450 miles east of Tehran.

``They didn't leave a single grave,'' Moshe Zvulini said.

The 13 Jews detained are from Shiraz and include at least one rabbi and
several teachers.

The Iranian government daily Jomhouri Eslami said they were accused of
having ``set up an espionage network in Iran for gathering ...
intelligence from sources inside some of Iran's state organs ... (which)
were then passed on to Mossad (Israel's intelligence agency).

The case's outcome could reveal the extent of the moderation that the
Clinton administration said it saw in the election of President Mohammad
Khatami two years ago.

------------------------------

Date: Thu, 19 Aug 1999 00:11:35 -0500
From: aryopirouznia <aryopirouznia@EMAIL.MSN.COM>
Subject: Iran increases funds for terrorist activities

Iran increases funds for terrorist activities
THE WASHINGTON TIMES

By Ben Barber

Iran has stepped up funding for Islamic terrorists in Lebanon, Syria and
Israel to sabotage the revived Middle East peace process and distract
Iranians from problems at home, Israeli and U.S. officials say. A weekend
report said $5 million was sent to Hamas bank accounts in Syria last month.

Israelis are braced for a resumption of the sort of devastating
suicide bus bombings that killed scores of Israelis from 1994 to 1996 and
led voters to elect a hawkish Israeli government, stalling the peace
process.

"I can confirm that we do know Iran is boosting its assistance to
Hamas, Islamic Jihad and Hezbollah in the recent period," said an Israeli
government spokesman yesterday.

"We've also noted that basically the entire Iranian leadership is
continuing to denigrate Israel and the peace process in the strongest
terms," said the official, speaking on the condition of anonymity.

The London Sunday Telegraph reported this week that Iranian
intelligence gave an estimated $5 million during July to Hamas, the
militant Palestinian group operating in the Gaza Strip, the West Bank,
Israel, Lebanon and Syria.

The money is intended to support terrorist attacks on Israeli targets
and derail efforts to revive the peace process by Prime Minister Ehud
Barak, who was elected in May.

The previous government of Benjamin Netanyahu had stalled the
turnover of land to Palestinian control, citing security concerns.

Iran began paying the cash into Hamas bank accounts in Damascus in
July, the Telegraph said. The payments are to continue monthly and should
be followed by increasing terrorist attacks on Jews inside Israel.

Three Israeli soldiers were killed yesterday by Hezbollah guerrillas
in the Israeli-controlled security zone of Lebanon, but Israeli officials
were unable to say whether that represented a continuation of Hezbollah
resistance to occupation or was part of a fresh spate of attacks.

U.S. intelligence sources said Iran "operates an ongoing pipeline
that gives at least millions of dollars per year to Hamas alone."

But the sources, speaking on the condition of anonymity, said they
"did not know of any recent infusion of money from Iran."

However, while Iranian funding could not be specifically linked at
present to an effort to counteract Mr. Barak's peace initiative, "the
money is to fund terrorism," said the American source.

A State Department official said that "our concerns regarding Iran's
support of terrorist groups opposed to the peace process is well known. .
. . We have no indication this kind of support has ceased."

The official noted that the annual State Department terrorism report
says Iran provides support to Hamas, Hezbollah and Islamic Jihad in
varying amounts for training, money or weapons.

Despite continued Iranian support for terrorism, the Clinton
administration plans to continue to improve relations with Iran, said
another State Department official.

Reform-minded President Mohammed Khatami was elected in 1997 and
asked for a dialogue with the United States.

There have been unofficial exchanges since then, and Iran was dropped
recently from a list barring it from purchasing U.S. food and medicine.
The first purchase of 50,000 tons of corn was completed a few weeks ago.

"There has been some movement to having better relations on a
nongovernmental level," said another State Department official, "but we
have not re-established relations on any level with the government of
Iran."

"There are still lots and lots of problems with Iran," the official
said, "such as the prosecution of 13 Jews for espionage and many other
things."

While Israeli officials confirmed the increase in Iranian funding for
terrorism, they declined to link it to the internal power struggle between
reformists led by Mr. Khatami and the hard-line clerics who control the
security forces.

Israelis fear that any open support for Mr. Khatami would destroy his
credibility within Iran and help the hard-liners to undercut his authority.

Besides its struggle between reformists and clerics, Iran is in the
midst of severe economic difficulties stemming from the large drop last
year in the price of oil, which provides over 80 percent of its export
revenue.

However, Iran continues to transfer cash to terrorists -- some of it
in the form of direct payments to the families of suicide bombers
--according to Israeli and U.S. sources.

------------------------------

End of DNI-NEWS Digest - 18 Aug 1999
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