How Pakistani Spy Officials Blocked Justice for Daniel Pearl

By Jeff Stein

Of all the open sores in the long, painful relationship between the United States and Pakistan, the dragged-out case of Daniel Pearl’s murder hurts the worst.

Just over 20 years have passed since Pearl, an affable and gifted correspondent for The Wall Street Journal, went missing in Karachi. About a month after his disappearance on Jan. 23, 2001, his killers posted a grisly video of his beheading.

From start to finish, the people involved in Pearl’s kidnapping and murder were members of militant groups long backed by Pakistan’s all-powerful Inter-Services Intelligence agency, or ISI. Last month, in yet another outrage, Pakistan’s Supreme Court freed Omar Saeed Sheikh, the man responsible for luring Pearl to his death, from prison and sent him to a halfway house. The judges had connections to the ISI.

The act exemplified Pakistan’s treacherous double game with the U.S. The Islamic nation claims to practice democratic norms, yet empowers its security agencies to collaborate with the world’s most dangerous militant groups, from Al Qaeda to the Afghan Taliban to terrorist units carrying out bloody attacks in India.

“The overturning of the convictions of Daniel Pearl’s killers reflects the tenuous nature of Pakistan’s actions against terrorists,” Hussain Haqqani, a prominent pro-Western Pakistani journalist who served as his nation’s ambassador to the U.S from 2008 to 2011, told SpyTalk.

But the case has also been complicated by the FBI and Justice Department quietly accepting false and conflicting confessions in the U.S. case against Sheikh, who was indicted by a federal grand jury in Newark on March 14, 2002. One former FBI agent who worked on the case in Pakistan tells SpyTalk that his bosses and then-federal prosecutor Chris Christie “didn’t want to hear” information that undermined a murder charge against the Pakistani suspect. “There was no one else that they could stick with it,” Ty Fairman told SpyTalk in an exclusive interview. “They wanted to get him” because he’d been involved in the kidnapping of two other Americans in India seven years earlier.

Biden administration officials responded to the Pakistani court decision with unbridled anger. At the White House, Press Secretary Jen Psaki said the United States was “outraged.” She described Sheikh’s release as “an affront to terror victims everywhere.” Secretary of State Antony Blinken issued a lengthy statement asserting that the United States was “deeply concerned,” a message he “reinforced” in a telephone call with Pakistan’s foreign minister. Acting Attorney General Monty Wilkinson added that the U.S. “stands ready to take custody of Sheikh.” Pearl’s widow Marianne wrote a mournful piece for The Washington Post saying she was “convinced that true justice will never come from above.”

She is right. The case has been so tainted by corruption and interference by powerful figures in Pakistan’s security establishment that Sheikh is not only likely to go free but escape justice here—in the unlikely event he were shipped to the U.S. for trial. The U.S. and Pakistan have no extradition agreement. The case has been marred from the beginning by false, coerced and contradictory confessions that would make a murder conviction in an American court unlikely.

“It would be a nightmare of a case," former FBI agent Jay Kanetkar, who headed the bureau’s investigation in Pakistan, told Georgetown University’s Pearl Project, which has spent years on the case. Omar Sheikh had undergone a "softening up" by Pakistani police, he said.

The case had been troubled from the beginning. Pakistani police coerced a confession from a taxi driver that he had ferried Pearl and Omar Saeed Sheikh to the spot where Pearl was kidnapped.

Former FBI agent Fairman tells SpyTalk Sheikh was nowhere near Karachi. He “was actually in his home town with his wife and family the day that Daniel Pearl was picked up [by kidnappers] in Karachi,” Fairman says, “and we all knew that. It was part of the information that we passed on. Everyone knew it.”

But in an unsettling allegation, Fairman says his FBI bosses and Christie, then the U.S. Attorney in Newark, who would rise to become governor of New Jersey, didn’t want to hear about it. They wanted a fast solution to Pearl’s murder, implicating Sheikh, who had already been secretly indicted for kidnapping American tourists in India years earlier.

Omar’s Alibi

Fairman, who is telling the inside story of the FBI’s handling of the case for the first time, says he told his supervisors that not only was Sheikh 840 miles away in Islamabad, an FBI forensic analysis of the execution video released by his captors on Feb. 22 ruled out Sheikh’s presence at the scene. The real killer was the infamous Al Qaeda terrorist Khalid Sheikh Mohammed, who was then at large in Pakistan and wanted for coordinating the Sept. 11, 2001, attacks on the World Trade Center and Pentagon.

“We got the videotape and we processed it one frame at a time,” Fairman says. “We looked at the feet, the hands, everything about the video. And we gave FBI Newark the information saying this is not Sheikh. We said it was Khalid Sheikh Mohammed.”

“They weren't happy with that information,” Fairman added. He says he was demoted and eventually forced out of the FBI because of his objections. “Chris Christie was not happy with the information.” Nor were the Pakistanis. Authorities “deliberately discounted testimony suggesting” Khalid Sheikh Mohammed was responsible, the BBC reported.

The Justice Department and FBI declined to comment. Chris Christie, who now runs a lobbying firm, did not respond by press time.

Gone Free

KSM, as he’s universally known, was captured by U.S. agents in Pakistan in 2003 and immediately hustled out of the country to a succession of CIA black sites, where he was subjected to “enhanced interrogation techniques.” Four years later at Guantanamo, he confessed to FBI agents that he “personally slit Pearl’s throat and severed his head to make certain he’d get the death penalty and to exploit the murder for propaganda,” the Pearl Project reported. But he has never been charged in the case. His trial by a military court on the 9/11 charges has been repeatedly delayed, most recently because of coronavirus concerns.

Fairman says Pakistani authorities “refused to allow us to interview the taxi driver. It was off limits. We were told to leave him alone—don't even push the issue. And that's it, don’t touch it.” And he added, “That was a smoking gun. If you have no proof to put Omar Sheikh in Karachi at the same time that Daniel Pearl was picked up and actually kidnapped, you can't really tie them together” in a murder charge.

Not that Sheikh was entirely innocent—hardly. He’d volunteered to police that he’d arranged for Pearl’s kidnapping, but nothing more. Fairman says Sheikh told him he had planned to kidnap Pearl in a grand scheme to ransom him for U.S. F-16 warplanes that Pakistan had paid for but never received because of congressional concerns over Islamabad’s pursuit of nuclear weapons. But then Al Qaeda intervened, Sheikh told him.

“He did admit to me that he was orchestrating the kidnapping,” Fairman said in a telephone interview from Sierra Leone, where he now lives and works. “But when Al Qaeda found out [Pearl had been kidnapped], that's when they came in and took over. And he was pissed off with Al Qaeda and had issues with them on why they would circumvent his operation.”

That’s not what Sheikh was telling authorities, however. In a deposition a few month later he told the anti-terrorism court he had nothing to do with Pearl’s disappearance, that “he had never met him.” The judges didn’t buy it, convicting him of murder and sentencing him to death by hanging. Only 17 years later, in a bid for a new hearing to get the sentence overturned, did he admit complicity in the crime, arguing that his involvement was “a relatively minor one….”

“That’s a lie, of course,” wrote Pearl Project Co-Director Asra Nomani, a former Wall Street Journal reporter and close friend of Pearl. Sheikh “was the spider who lured Pearl into a web of murderous extremists who killed him.”

If Sheikh were to be extradited to the U.S. to stand trial on murder charges, Fairman maintains, he would be acquitted. Federal prosecutors “have no concrete evidence to tie him into the murder of Daniel Pearl,” he says. “Accessory to the kidnapping, yes.”

The notion that Pakistani security officials, a number of whom have sympathies for and even close ties to terrorist groups including Al Qaeda, were quick to confine their murder case to Omar Sheikh and a few accomplices is not new—NBC News reported that in 2007. What is new is that U.S. officials went along with it.

The Pearl Project, co-directed by Barbara Feinman Todd, who has assisted such Washington Post luminaries as Bob Woodward, Carl Bernstein and the late Benjamin Bradlee with their books, also found that the proceedings were corrupt.

“In their haste to close the case, Pakistani authorities knowingly used perjured testimony to pin the actual act of murder on Omar Sheikh and his three co-conspirators,” the Pearl Project said in its 2011 report. “While the four were involved in the kidnapping plan and certainly were culpable, they were not present when Pearl was murdered. Others, who were present and actually assisted in the brutal beheading, were not charged.”

The main culprit, of course, was KSM, who was captured in Rawalpindi, which also happens to be the headquarters of the Pakistani Army and home to hundreds of current and retired generals and senior officials of the ISI. As the world now knows, Osama Bin Laden lived for some time in Abbottabad, 75 miles north of Islamabad and home to the Pakistani Military Academy. The Al Qaeda leader and his terrorist group had previously been sheltered in Afghanistan by the ISI-backed Afghan Taliban.

If Pakistan admitted that KSM had executed Pearl, its tolerance, if not protection, of Al Qaeda would be laid bare. But Omar Sheikh’s involvement also threatened to spotlight the double game Pakistani intelligence has long played with the U.S. and its allies.

While the ISI had worked hand in glove with the CIA in the 1980s to defeat the Soviet Red Army in Afghanistan, elements of it have gone on to work with terrorist organizations to advance Pakistan’s aims of destabilizing India and thwarting its influence in Afghanistan. At other times, Pakistani security agencies have helped Washington hunt down jihadis such as Mir Aimal Kansi, who shot several CIA employees outside the agency’s gate in Langley, Virginia, in January 1993, and Abu Zubaydah, a militant wrongly identified at the time as a top lieutenant to Osama Bin Laden. Elements of the ISI and Pakistani Army Rangers also assisted in the 2003 capture of senior 9/11 conspirator Khalid Sheikh Mohammed, whose presence in the country was a huge embarrassment.

Omar Sheikh was deeply enmeshed in that duplicity—and more. According to a 2002 ABC News report, the U.K.-raised and educated Sheikh began working for the ISI in 1993, after he’d gone to Bosnia to help Muslims under assault by Serbs. According to some accounts, he may also have been working for Britain’s MI6 intelligence in Bosnia when it and the CIA were both helping the Bosnian Muslims fend off the Serbs. Former Prime Minister Pervez Musharraf alleged in his 2006 autobiography that Sheikh was recruited by MI6 while a student at the London School of Economics but “went rogue” and turned into a jihadi “double agent” in Bosnia. In any event, he soon joined up with Harkat-ul-Ansar, an ISI-backed Pakistani terrorist group fighting in India’s divided Kashmir. He became such a trusted operative that in the summer of 2001 then-ISI head Mahmoud Ahmed reportedly gave him $100,000 to wire to Mohammed Atta, the lead hijacker in the 9/11 attacks. In the ensuing months and years seven key Al Qaeda operatives, most of them connected to the 9/11 plot, were arrested in Pakistan.

In late January and early February 2002, Pakistan was under enormous pressure from Washington to find and rescue Pearl. Within days of his disappearance, his kidnappers had released a photo of Pearl with a gun at his head, but KSM’s connection to the crime had not surfaced. On February 5, 2002, Sheikh showed up at the home of retired general Ijaz Shah, a family friend who also happened to be a former ISI intelligence officer. Seven days would pass before Ijaz Shah delivered Sheikh to Pakistani police. Was ISI trying to work out some kind of deal to keep him quiet about its connection to him, or even figure out a way to help him escape?

“This interlude has raised numerous questions,” noted the Pearl Project, “Was the ISI protecting Sheikh?” the project’s final report asked. “Was it holding him to make sure he wouldn’t spill any of its secrets? Was Omar Sheikh hoping the intelligence service—perhaps the most powerful institution in Pakistan—would provide him some protection? Most provocatively, were elements in the ISI, which have backed the Taliban and Pakistan militant groups, knowledgeable about Omar Sheikh’s kidnapping activities? Even worse, was the ISI involved?”

None of these questions have been answered. Nor this one: How much did MI6 and the CIA know about Omar Sheikh Sheikh’s connection to ISI-backed terrorist groups? In an disquieting coincidence, the former ISI chiefMahmoud Ahmed happened to be in Washington on Sept. 11, 2001 on an official visit feted by CIA Director George Tenet and other top officials. (Ahmed would be forced out after reports of Omar Sheikh’s $100,000 wire transfer to Mohammed Atta surfaced.)

Taxi to the Dark Side

Fairman says that Pakistani police “coerced the taxi driver into saying that Pearl and Sheikh were both in the car together" in Karachi, where the reporter was en route to a meeting for a story he was pursuing.

On July 15, 2002, with Washington closely watching, an anti-terrorism court judge sentenced Sheikh to death by hanging as the “mastermind” of Pearl’s murder. Three others involved in the plot were given life sentences.

“Islamabad was embarrassed about Pearl’s execution and wanted to show it was tough on terrorism—at a time when it had just established a new, post-9/11 counterterrorism partnership with Washington,” Michael Kugelman, senior associate for South Asia at the Wilson Center in Washington, D.C., recently wrote.

In New Jersey, a federal grand jury returned a superseding, and more careful, indictment charging Sheikh with “hostage-taking and conspiracy to commit hostage-taking, resulting in the death of Daniel Pearl.” The Justice Department also unsealed an indictment charging him with the 1994 armed kidnapping of Béla Nuss, an American tourist, in India. (Sheikh was jailed in that case but freed soon after when his followers hijacked an Air India jet out of Nepal and swapped the hostages for his release.)

In both the Béla Nuss and Pearl cases, the tall, sweet-talking Pakistani with the plummy British accent had diabolically employed his quick wit to lure them into danger. In India, Sheikh had offered Nuss a special tour. In Pakistan, he offered Pearl help with his investigation of Pakistani terrorist links to Richard Reid, the so-called “shoe bomber” who attempted to blow up an airliner en route from Paris to Miami in December 2001.

After KSM’s 2007 confession, Sheikh’s lawyers began appealing his murder conviction.

On April 2, 2020, Pakistan’s high court decided he was guilty only of kidnapping and sentenced him to seven years in jail. Since he had already spent 18 years in prison, he was ruled free to go, but the Pakistani government prevented his release by detaining him and the three co-defendants. While denouncing his release, the U.S. State Department hailed Pakistan’s decision to appeal. Then came the Pakistani Supreme Court January order freeing Sheikh to a halfway house.

All along, more questions have arisen about the true role of Ijaz Shah, the former ISI intelligence officer who gave shelter to Sheikh for a week in February 2002. According to some reports, Shah was Sheikh’s ISI handler.

In the years following Sheikh’s conviction, Shah would rise to become head of Pakistan’s powerful domestic Intelligence Bureau, a vicious rival to the ISI. Shah’s reputation for political repression was such that in 2004 Australia rejected his nomination to be Pakistan’s High Commissioner, or ambassador, to Canberra. He was also suspected of having a hand in the2007assassination of Pakistan’s formerPrime Minister Benazir Bhutto in Rawalpindi. According to reports, Bhutto had told associates that Shah “was conspiring with terrorists to assassinate her, naming him in a letter as someone who should be investigated if she died.” And that’s not all. One of the ISI’s former chiefs, General Ziauddin Butt, publicly accused Shah of helping hide Osama Bin Laden in Abbottabad.

Shah dismissed Butt’s charges as simple bureaucratic rivalry. “The General is settling old scores,” Shah told The Age, an Australian newspaper. “He is trying to damage people by alleging everything about everyone. This is the way in Pakistan.”

None of that has stopped Shah’s rise in Pakistan’s security hierarchy and may have even helped it. Last year Prime Minister Imran Khan elevated him to interior minister, where a well informed source said he “got the court to acquit Sheikh and has effectively blocked Sheikh’s extradition to U.S.” In a cabinet shuffle in December, he was put atop the counter-narcotics ministry. His new boss, Sheikh Rasheed Ahmad, was once detained at the Houston airport and interrogated for five hours about his links to the terrorist organization Lashkar-e-Taiba and Hafiz Muhammad Saeed, an alleged mastermind of 2008 Mumbai attacks. A strenuous protest by Pakistan got him released.

Two of the three Pakistani Supreme Court jurists who freed Sheikh in January, saying the murder conviction was flawed and that he’d already served enough time for kidnapping, are “considered sympathizers to militants in Pakistan,” Asra Nomani told SpyTalk. “One is a military judge.”

Fouling Justice

And so once again, Islamabad’s deeply entrenched intelligence officials have scuttled a chance for Pakistan to improve relations with the United States.

“Sadly,” says Larry Pfeiffer, former chief of staff to retired CIA Director Michael Hayden, “Pakistan’s behavior demonstrates that without continued U.S. pressure—persuasion or coercion—it too readily falls back into the bad habit of protecting or even supporting those who would do Americans harm. We’ve seen this movie before, and we know sadly that it too often can end in American deaths.”

Daniel Pearl’s parents, Ruth and Judea Pearl, said the family was “in complete shock” over the decision, calling it a travesty of justice.” They added that “the release of these killers puts in danger journalists everywhere and the people of Pakistan.”

In 2018, the Trump administration got fed up with Pakistan for continuing to "harbor criminals and terrorists," as the former president put it. It directed the Pentagon to suspend $300 million in aid designated for Pakistan under a program for regional partners who are helping "stop the resurgence of safe havens that enable terrorists to threaten America." Also at the administration’s urging, the Financial Action Task Force, an international dirty-money watchdog, put Pakistan on its “grey list” for failing to crack down sufficiently on terrorism. The FATF renewed the designation last month.

Lisa Curtis was a key advocate for a tougher line on Pakistan in the Trump White House National Security Council. “Pakistan did try to distance itself from the militancy somewhat” after the Pentagon aid cut, she told SpyTalk. “We did see some decrease in the operations of these groups, over the last couple of years.” On the other hand, she said, “with the Taliban, we still see that they [Pakistani leaders] are playing both sides.”

The prospects for Pakistan handing over Sheikh for trial in the U.S. are dim, Curtis says. Too many secrets could emerge.

Some Pakistani observers with longtime experience dealing with Islamabad suspect the CIA has sources and methods at risk as well. The CIA and ISI go back a long way, they note with a raised eyebrow. “Why is the U.S. not fast-tracking the extradition demand?” one asked. Knowledgeable Americans dismiss Pakistani skepticism as a conspiracy fantasy: The U.S. has wanted to try Omar Sheikh for years, all the way back to 1994 Bela Nuss kidnapping. In any event, that trial won’t happen—unless Washington finds some way to get Sheikh into a U.S. courtroom.

“I think it's highly doubtful that Pakistan would agree to extradite Omar Sheikh, for the simple reason that he likely has had dealings with the ISI in the past and the Pakistan government would not want that to surface,” Curtis said. “I think the best that we can hope for is that Pakistan finds some way to keep him in detention.”

Keeping him under wraps in Pakistan also keeps a lid on the FBI’s can of worms.

“I tell you what,” says Fairman, the former FBI agent, who was involved in several foreign terrorism cases as a forensic expert, “they couldn't call me to testify. I’d have to answer the questions and tell the truth. I couldn't lie. Not on the stand.” He’d say Omar Sheikh was only an accessory to the kidnapping..

The Pearl Project’s Asra Nomani just wants to see Sheikh back in prison, wherever.

“Because this was an extraterritorial case outside of U.S. boundaries, there were complicating factors in the case,” she concedes. “But Omar Sheikh and the three co-defendants are absolutely one-hundred-percent guilty. And they should not see freedom.”

Co-published with SpyTalk, where Jeff Stein leads an all-star team of veteran investigative reporters, writers, and subject-matter experts who will take you behind the scenes of the national security state. Subscribe to get full access to the newsletter and website.