The Washington Times / May 30, 1995
By Larry Luxner
CIUDAD DEL ESTE, Paraguay -- This seedy, traffic-choked border town, situated at the point where Argentina, Brazil and Paraguay meet, has long boasted one of Latin America's most prosperous Arab communities -- with Lebanese and Palestinian shopkeepers controlling four-fifths of the trade in liquor, perfume and other contraband flowing daily from Brazil.
Yet Ciudad del Este may also be a hotbed of support for Hezbollah -- a shadowy terrorist group suspected of planning two recent terrorist attacks in Buenos Aires that killed 117 people and left hundreds more injured.
On Jan. 29, Paraguayan police arrested five Lebanese and two Brazilians in the house they had been renting just outside of Asunción. All seven had entered through Ciudad del Este on Brazilian passports, and all had overstayed their tourist visas. They were immediately charged with drug trafficking, violating immigration law and illegal possession of weapons.
In February, Argentine President Carlos Menem demanded that the seven be extradited to Argentina to face questioning in the 1992 destruction of the Israeli Embassy in Buenos Aires, which killed 30 people, and the 1994 car-bombing of the headquarters of AMIA, a Jewish cultural organization, in which 87 people died.
Yet so far, despite mounting pressure from Buenos Aires and Washington, Paraguay has delayed turning the suspects over. The seven are identified as Mohamad Hassan Alayan, 41; Roberto Ribeiro Ruíz, 22; Johnny Moraes Baalbaki, age unknown; Luis Alberto Nader, 22; Valdirene Vieira Ferguglia, 23; Sergio Rodrigo Salem, 26, and Fadi Abdul Karim Checair, 23.
Little is known about the suspects themselves other than the information contained in a police reported dated Feb. 2 and signed by Enrique Martinetti, chief of D-2, the Paraguayan intelligence agency. According to that report, police confiscated from the group an unlicensed .38 caliber Taurus revolver, various types of ammunition and a plastic bag containing six grams of cocaine. In addition, one of the Brazilian suspects, Valdirene Ferguglia, had an Iberia airline ticket valid for Madrid and Brussels at the time of her arrest.
"There's been no interrogation and they haven't been extradited yet," says a foreign observer here with close knowledge of the case. "It's not clear what the holdup is, but apparently huge sums of money are involved. They have local lawyers, and they don't want to go to Argentina.
The observer added: "Ciudad del Este has lots of young, Middle Eastern men in their 20s running around, with very little border control. Our suspicion is Hezbollah. They contribute money to the cause."
Indeed, Paraguayan sources quoted in late April by the Argentine newspaper Primera Edición said that more than $500,000 was recently deposited in a bank in Encarnación -- just over the river from Posadas, Argentina -- in order to bribe Paraguayan officials to prevent the extradition of the seven suspects at all costs.
According to those same sources, Paraguayan magistrate José Yaluk -- the seventh judge to handle the case in three months -- was forced to excuse himself from the case after Lebanese fundamentalists in both Ciudad del Este and Encarnación had made death threats against Yaluk's wife and children. Yaluk, the newspaper said, "was one of the few judges dedicated to complying with the extradition so that the terrorists would be indicted and tried in Buenos Aires."
Humberto Rubín, founder of Radio Ñandutí and a member of Paraguay's 1,000-member Jewish community, says he's sure that "the Argentine and Brazilian police, together with the Mossad [Israel's intelligence service], have an agreement" to investigate the case. He adds that the Paraguayan police aren't part of this agreement, either because it doesn't want to be, or because the Mossad doesn't trust the Paraguayans. Interestingly, a prominent member of the Jewish community who asked not to be named said Israeli bodyguards -- not Paraguayans -- are protecting key judges involved in the case.
Israel's ambassador in Asunción, Yoav Bar-On, wouldn't comment directly on the Mossad's involvement, though he did say that Menem's extradition request is being treated very seriously.
"Argentina has important evidence that makes these people suspects," said Bar-On, who arrived in Paraguay less than two months ago. "Israel has always been in the vanguard of fighting terrorism. If they are extradited, it's [because] they have evidence. We must know who participated in this bombing."
Carlos Monge López, a Paraguayan Supreme Court justice who received the Argentine extradition order by fax from Buenos Aires two months ago, said the CIA and Mossad are "90 percent sure" that three of the seven suspects -- he didn't say which ones -- were directly involved in the July 1994 bombing of the AMIA headquarters.
López also said that Alejandro Sucksdorf, an Argentine ex-intelligence agent and Nazi sympathizer who has since been arrested, had trained at least four of the seven suspected terrorists on his ranch outside Buenos Aires, where military weapons and explosives were found.
According to López, all seven suspects were arrested in Santisima Trinidad, five miles from Asunción, and that at the time, "they didn't have any regular jobs or visible means of support, but spent lots of money."
The Paraguay connection is not the only angle being pursued in the AMIA bomb investigation. Authorities are also questioning the role of officials at the Iranian Embassy in Buenos Aires, and are holding Carlos Telleldin, a petty crook believed to have sold the van used in the attack.
Yet the Ciudad del Este area has also become a focus of the investigation because of the presence of 25,000 or so undocumented Arabs, Chinese and other foreigners, and precisely because border controls are so lax.
In Ciudad del Este itself, it's hard not to notice the Arab presence, with huge signs advertising Jebai Center and other duty-free shops that form the lifeblood of this town's economy. Just over the river in Foz do Iguaçu, Brazil -- jumping-off point for the world-famous Iguazu Falls -- tourists can change money at the Casa Jerusalém, order a shish-kebob from the Restaurante Arabe Esfiha Líbano or visit the large white mosque just off Avenida Juscelino Kubitschek.
Like most of the Arabs in this border region, Ibrahim Chiah --who manages liquor sales at La Petisquera, one of Ciudad del Este's busiest stores -- is of mixed Lebanese-Brazilian extraction. He says he condemns terrorism of any kind.
"If they did it, they should pay for it," Chiah said of the seven suspects. "If they're innocent, let them go."
Rubín, whose own radio station endured years of harassment under the Stroessner regime, suspects that most of the Arabs in Ciudad del Este are legitimate businessmen who have nothing to do with Islamic fundamentalism. On the other hand, he said, it's likely that some Arabs there pay a quota to Hezbollah as a percentage of their profits -- much the same way Paraguay's 1,000-member Jewish community supports Israel through the purchase of Israel Bonds.
If and when the suspects will be extradited is anyone's guess. The issue was sure to have come up during Paraguayan President Carlos Wasmosy's planned May 21 meeting with President Clinton in Washington -- but that meeting was cancelled, and Paraguayan Embassy officials say they know of no plans to reschedule it.
Meanwhile, the prominent Asunción newspaper Hoy has urged Wasmosy to approve the extradition of the seven suspects to Argentina immediately, warning in an editorial that any further delay "will give Paraguay a negative image could affect its good name in the world community."