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Iranian President Mahmoud Ahmadinejad. Photo by Getty Images
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The United States accused Iran of backing a plot to kill the Saudi ambassador to Washington, escalating tensions with Tehran and stirring up a hornet's nest in the Gulf, where Saudi Arabia and Iran have long jostled for power.

U.S. authorities said on Tuesday they had broken up a plot by two men linked to Iran's security agencies to assassinate Saudi Ambassador Adel al-Jubeir. One was arrested last month while the other was believed to be in Iran.

Iran denied the charges and expressed outrage at the accusations.

U.S. President Barack Obama called the alleged plot a "flagrant violation of U.S. and international law" and Saudi Arabia said it was "despicable."

The United States said Tehran must be held to account and Secretary of State Hillary Clinton expressed hope that countries that have hesitated to enforce existing sanctions on Iran would now "go the extra mile."

The State Department issued a three-month worldwide travel alert for American citizens, warning of the potential for anti-U.S. action, including within the United States.

"The U.S. government assesses that this Iranian-backed plan to assassinate the Saudi ambassador may indicate a more aggressive focus by the Iranian government on terrorist activity against diplomats from certain countries, to include possible attacks in the United States," it said in a statement.

At a news conference, FBI Director Robert Mueller said the convoluted plot, involving monitored international calls, Mexican drug money and an attempt to blow up the ambassador in a Washington restaurant, could have been straight from a Hollywood movie.

Attorney General Eric Holder alleged that the plot was the work of the Islamic Revolutionary Guard Corps (IRGC), the guardian of Iran's 32-year-old revolution, and the Quds Force, its covert, operational arm.

"I think one has to be concerned about the chilling nature of what the Iranian government attempted to do here," he told a news conference.

Quds force connection

The primary evidence linking the Iranian government to the planned attempt on al-Jubeir's life is the words of one of the alleged plotters, who told U.S. law enforcement agents after his arrest that he had been recruited and directed by men he understood were senior Quds Force officials.

The Quds Force has not previously been known to focus on targets in the United States.

A plot against targets inside the U.S. "would be a first for the Quds Force," said Kenneth Pollack, a former CIA and National Security Council analyst who now heads the Saban Center at the Brookings Institution in Washington.

"I do want to hear more about what evidence (U.S. authorities) have and why they believe" that the Quds Force was involved, Pollack said.

Senate Intelligence Committee Chairwoman Dianne Feinstein, who said she was briefed on intelligence about the suspected plot, said it looked like the Quds Force and the IRGC were responsible.

There are no formal diplomatic ties between the Islamic republic and Washington, which accuses Tehran of backing terrorism and pursuing nuclear arms, a charge Iran has denied.

Iran already faces tough economic and political sanctions and Washington slapped further economic sanctions on five Iranians including four senior members of Quds.

Iran and Saudi Arabia have likewise long been at odds. The Saudis, who see themselves as the center of the Sunni sect of Islam, have been alarmed by what they see as expansionist tendencies by majority Shi'ite Iran, whose people are primarily Persian rather than Arab.

U.S. officials said there had also been initial discussions about other alleged plots, including attacking the Saudi and Israeli embassies in Washington, however no charges for that were revealed on Tuesday.

Rejecting the allegations in a letter to UN Secretary-General Ban Ki-Moon, Iran's ambassador to the United Nations voiced outrage and complained of U.S. "warmongering."

"I am writing to you to express our outrage regarding the allegations leveled by the United States officials against the Islamic Republic of Iran on the involvement of my country in an assassination plot targeting a foreign diplomat in Washington," Iranian UN Ambassador Mohammad Khazaee said in the letter.

"The U.S. allegation is, obviously, a politically motivated move and a showcase of its long-standing animosity towards the Iranian nation," he said, reiterating that Tehran "categorically and in the strongest terms condemns this shameful allegation."

Last month, hopes were raised of improved ties when Iran released two U.S. hikers accused of spying when they were arrested on the Iran-Iraq border in 2009. Holder said there was no link between the hikers' case and the alleged plot.

U.S. says ambassador never in danger

U.S. officials identified the two alleged plotters as Gholam Shakuri, who is a member of the Quds Force, and Manssor Arbabsiar, who was arrested on Sept. 29 when he arrived at John F. Kennedy International Airport from Mexico.

Arbabsiar, 56, who is a naturalized U.S. citizen and holds an Iranian passport, initially cooperated with authorities after being arrested.

He made calls to Shakuri after being arrested and acted as if the plot was still a go, court documents said.

Arbabsiar made a brief appearance in a Manhattan courtroom on Tuesday where he was ordered detained and assigned a public defender. He appeared in blue jeans and a dress shirt, with thinning gray hair and a scar on the left side of his face.

Officials said that the Saudi ambassador, who is close to King Abdullah bin Abdul-Aziz and has been in his post since 2007, was never in danger. Obama was briefed in June about the alleged plot.

According to the court documents, the plot began to unfold in May 2011 when Arbabsiar approached an individual in Mexico who was posing as an associate of an unidentified drug cartel to help. That individual turned out to be an informant for the U.S. Drug Enforcement Administration.

The confidential source, who was a paid informant but not identified, immediately tipped law enforcement agents, according to the criminal complaint. Arbabsiar paid e100,000 to the informant in July and August for the plot, a down-payment on the $1.5 million requested.

Like a "Hollywood movie"

Shakuri approved the plan to kill the ambassador during telephone conversations with Arbabsiar, the complaint said.

As part of the plot, the informant talked to Arbabsiar about trying to kill the ambassador at a Washington, D.C. restaurant he frequented, but warned him that could lead to dozens of others being killed, including U.S. lawmakers.

The criminal complaint said that Arbabsiar responded "no problem" and "no big deal."

After Arbabsiar was arrested in New York, he provided U.S. authorities with more details about the Iranian government's alleged involvement, Holder said.

Court papers say that in a monitored phone call Shakuri confirmed to Arbabsiar the plot should move forward as quickly as possible, stating "just do it quickly, it's late."

Mueller said in this case "individuals from one country sought to conspire with a drug trafficking cartel in another country to assassinate a foreign official on United States soil."

He added: "Though it reads like the pages of a Hollywood script, the impact would have been very real and many lives would have been lost," he said.

The men are charged with one count of conspiracy to murder a foreign official, two counts of foreign travel and use of interstate and foreign commerce facilities in the commission of murder for hire and one count each of conspiracy to use a weapon of mass destruction and conspiracy to commit an act of terrorism.

Authorities said no explosives were acquired for the plot and the weapon of mass destruction charge can range from a simple improvised device to a more significant weapon. They face up to life in prison if convicted.