February 27, 2002
BY CERTIFIED MAIL & FAX
President George W. Bush Honorable George J. Tenet
The White House Director
1600 Pennsylvania Ave., NW Central Intelligence Agency
Washington, DC 20500 Washington, DC 20505
Honorable John Ashcroft Honorable Donald H. Rumsfeld
Attorney General of the United States Secretary of Defense
U.S. Department of Justice 1000 Defense Pentagon
950 Pennsylvania Ave., NW Washington, DC 20301
Washington, DC 20530
Director Robert S. Mueller, III Honorable Michael K. Powell
Federal Bureau of Investigation Chairman
J. Edgar Hoover Building Federal Communications Commission
935 Pennsylvania Ave, NW 445 12th St. SW.
Washington, DC 20535 Washington DC 20554
Honorable Harvey L. Pitt Honorable David M. Walker
Chairman Comptroller General of the United States
U.S. Securities and Exchange Commission General Accounting Office
450 Fifth Street, NW 441 G Street, NW
Washington, DC 20549 Washington, DC 20548
Complaint Requesting an Investigation of Hutchison Whampoa, Ltd.’s Actions To Gain Controlling Interest In Global Crossing Ltd., and Former Defense Secretary William S. Cohen’s Activities As A Director of Global Crossing, Ltd.
Judicial Watch, Inc., (hereinafter “Judicial Watch”) is a non-profit, public interest law firm that investigates and prosecutes government abuse and corruption. Judicial Watch, in the public interest, hereby submits this formal complaint requesting an investigation concerning Hutchison Whampoa Ltd.’s actions to gain controlling interest in Global Crossing, Ltd., and former Defense Secretary William S. Cohen’s activities as a Director of Global Crossings, Ltd.
Recent media reports have detailed Hutchison Whampoa Ltd.'s co-bid with Singapore Technologies Telemedia Pte. Ltd. for a majority stake in Global Crossing Ltd.
Global Crossing, Ltd., a Bermuda-based company, controls approximately 15% of the fiber-optic lines connecting the U.S. with Europe, 23% with Asia, and 25% with Latin America, according to Stephan Beckert, research director at Washington-based consultancy TeleGeography Inc.
Hutchison Whampoa, Ltd. is the holding company of billionaire Li Ka-shing, a well-known businessman, whose companies make up 15 percent of the market capitalization of the Hong Kong stock market. Ka-shing's empire includes ports, telecom and energy assets around the world.
According to recently declassified U.S. Government intelligence reports, obtained by Judicial Watch under the Freedom of Information Act (“FOIA”):
“Li is directly connected to Beijing and is willing to use his
business influence to further the aims of the Chinese Government.
He has positioned his son, Victor Li, to replace him in certain CK
[Cheung Kong Holdings, Ltd.] and HW [Hutchison Whampoa]
operations such as HW’s Hong Kong International Terminals (HIT).”
* * *
“Li’s interest in the [Panama] canal is not only strategic, but also
as a means for outside financial opportunities for the Chinese
Another recently declassified U.S. Government intelligence report obtained by Judicial Watch states:
“Hutchison Whampoa’s owner, Hong Kong tycoon Li Ka-shing,
has extensive business ties in Beijing and has compelling financial
reasons to maintain a good relationship with China’s leadership.”
Li Ka-shing's agency relationship to the Communist Chinese government should disqualify him from owning Global Crossing's network, which controls a significant percent of all the fiber optic cable leaving the United States. Such foreign ownership of crucial communications infrastructure by an agent of the Communist Chinese government poses a direct threat to the national interests of the United States.
Concerns over foreign control and influence, especially by a strategic competitor, of vital national communications links are not abstract, theoretical speculation. Global Crossing's bankruptcy filing prompted the United States Department of Defense to delay the awarding of a $450 million contract for a high-speed data network connecting its laboratories and research centers. Some media outlets report that members of Congress are questioning whether the military can award such a contract to a company controlled by foreign entities. Global Crossing originally won the contract last July under suspicious circumstances, with the apparent assistance of former Secretary of Defense William Cohen, who now, not coincidentally, sits on the Board of Directors of Global Crossing. In a Los Angeles Times article entitled “Global Crossing Hurt By Board’s Cronyism,” published on February 24, 2002, Global Crossing reportedly paid Cohen’s consulting firm, The Cohen Group, $500,000.00 in consulting fees in 2001.
Recent history proves that “concern by some members of Congress” alone – however well intentioned – is an inadequate means to insure the thorough investigation and analysis of security and defense concerns which affect our nation’s well-being. Over the last decade, the United States government has repeatedly ignored warnings, threats and politically incorrect security issues. Actions by individuals, groups and governments that are at odds with our nation’ survival and the American way of life were dismissed as “unthinkable.” September 11th changed all of that forever. Protection of our national infrastructure, particularly vital telecommunications capabilities, is now, more than ever, a matter of the highest importance.
Judicial Watch, which represents hundreds of thousands of individual members and is supported in spirit by millions of Americans across the United States, hereby opposes Hutchison Whampoa Ltd.'s application to obtain control of Global Crossing, Ltd. As recent intelligence by the U.S. Government ties Hutchison Whampoa, Ltd. to the Communist Chinese government, you have an affirmative duty to prevent this transaction.
Additionally, Judicial Watch hereby requests the immediate, full and thorough investigation of former Secretary of Defense William S. Cohen’s activities as a Director of Global Crossing in connection with Defense Department contracts; his consulting firm, The Cohen Group, and the bankruptcy of Global Crossing, Ltd. Reports concerning Mr. Cohen’s involvement in these matters present a prima facie violation of ethical standards and, quite likely, the law, as well.
JUDICIAL WATCH, INC.
Larry Klayman Thomas Fitton
Chairman and General Counsel President
Sarah McBride, “Global Crossing Co-Bidders May Face Opposition From U.S. Conservatives,’ The Wall Street Journal, February 5, 2002.
“China Awaits U.S. Departure (U) 221333ZAPR98," Deputy Chief of Staff for Intelligence, U.S. Army South, Intelligence Update, previously classified SECRET/NOFORN, attached as Exhibit 1.
“Panama: People’s Republic of China Interest and Activities (U),” U.S. Southern Command Joint Intelligence Center, Intelligence Assessment, 26 October 1999, previously classified SECRET/X-1, attached as Exhibit 2.