Terror Watch: Distorted Intelligence?

Abdallah said he made his way from bin Laden's hideout to Zarqawi's Al Tawhid training camp near Herat. There, he was informed that Al Tawhid's mission was explicitly to "fight the Jordanian regime and to overthrow the government of Jordan" as well as the "annihilation of Jews all over the world."

After training in Zarqawi's camp, Abdallah returned to Germany and hooked up with an alleged Al Tawhid cell there that was involved in raising funds and acquiring fake passports for the terror group. Abdallah says that after American forces drove him out of Afghanistan following the 9-11 attacks, Zarqawi for several months ran Al Tawhid out of Iran, using telephones and a network of couriers to pass messages and documents to the German cell and other operatives in Europe.

At the time of Abdallah's arrest by German authorities last spring, Zarqawi apparently was still running the group out of Iran; and the only Iraqi connection with Al Qaeda was access to phony Iraqi documents, Abdallah told authorities.

Several U.S. officials familiar with intelligence reports that were used to craft Powell's Feb. 5 presentation to the Security Council told NEWSWEEK they were aware all along of the German information about Zarqawi. But the officials insist the CIA firmly stands behind what Powell said about Zarqawi's purported links to Al Qaeda. Even the German evidence, they said, indicates that there were some associations and links between the two organizations.

Despite the inflammatory language of Powell's U.N. presentation, Bush Administration officials also have acknowledged that their information about Zarqawi's stay in Baghdad is sketchy at best. According to U.S. officials, Zarqawi entered Iraq around May of last year to have an amputation performed on his leg, which was injured while he was fleeing American forces in Afghanistan. According to some reports, one reason that he might have gone to Baghdad for the operation was that the Iranian government, in one of its sporadic crackdowns on Al Qaeda, had expelled him.

Senior U.S. officials acknowledged to NEWSWEEK within days of Powell's speech that it was "unknown" whether Saddam's government helped arrange Zarqawi's hospital stay in Baghdad or whether Iraqi intelligence had any contacts with him while he was in Baghdad.