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Image: David Coleman Headley
Tom Gianni  /  AP
David Coleman Headley, shown in a courtroom sketch, testifies in federal court Monday in Chicago.
By Michael Isikoff National investigative correspondent
NBC News
updated 5/23/2011 11:10:31 PM ET 2011-05-24T03:10:31

A Pakistani intelligence officer worked closely with top operatives of one of that country’s leading terrorist groups to select the targets for the deadly November 2008 attacks in Mumbai, India, a former member of the terror organization testified on Monday.

The testimony of David Coleman Headley, a confessed American-born terrorist who once ran a popular bar in Philadelphia, is likely to further inflame U.S.-Pakistani relations, which are already strained because of the U.S. killing of Osama Bin Laden.

Headley testified as the federal prosecutors’ lead-off witness in the trial of Tahawwur Rana, a Chicago businessman accused of aiding the Mumbai attacks. Headley described a close working relationship between Pakistan’s ISI intelligence service and Lashkar-e-Taiba (LET), the anti-India militant group that is believed to have been behind the assault.

More investigations by Michael Isikoff in the Isikoff Files

“They coordinated with each other and ISI provided assistance to Lashkar,” Headley testified when asked by Assistant U.S. Attorney Dan Collins about the relationship between Lashkar and the Pakistani intelligence service.

What kind of assistance? he was asked.

“Financial assistance,” he replied.

Headley was a soft-spoken and at times reluctant witness. He appeared uncomfortable on the stand and often offered one-sentence answers that sometimes seemed to frustrate the prosecutor.

Headley already has pleaded guilty to laying the groundwork for the three-day siege in Mumbai that left more than 160 people dead, including six Americans. He agreed to testify against Rana to avoid the death penalty, making him one of the most valuable U.S. government counterterrorism witnesses.

How well Headley’s account will stand up remains to be seen. Pakistani officials have disputed his accusations and note that the country has banned the LET. Defense lawyers have indicated they will seek to impeach Headley as a liar and turncoat when they cross-examine him later this week.

Headley was arrested at Chicago’s O’Hare airport in October 2009 and has since pleaded guilty to conducting scouting trips for the Mumbai attacks as well as another plot to blow up a Danish newspaper hatched by Ilyas Kashmiri, a Pakistani who is believed to be a key figure in al-Qaida. At the time, Headley's arrest appeared to underscore the growing threat of homegrown terrorists inside the United States.

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Headley is now being used by federal prosecutors working for U.S. Attorney Patrick Fitzgerald to convict Rana as a co-conspirator in the Mumbai attacks. Rana ran an immigration consulting business and is accused of providing Headley, a childhood friend, with a phony business cover as an employee of the firm, thereby allowing Headley to open up an office and make repeated trips to Mumbai without arousing any suspicions.

Headley described how he joined Lashkar during a trip to Pakistan in 2000 and underwent training in combat missions, grenades and explosives to advance the group’s cause. Asked to explain the goal of LET, Headley said it was “to continue fighting with Indian soldiers” to force Indian compliance with United Nations resolutions calling for India’s withdrawal from “occupied” portions of Kashmir and to “avenge the death of civilians” killed by the Indians.

But his testimony emphasized the heavy role that the ISI allegedly plays in shaping LET decision-making. During one meeting with LET leaders, Headley said he suggested that the group go to court in the United States and challenge the U.S. State Department’s designation of it as a terrorist organization.

Headley said he was told “we would have to talk to ISI before taking such a move” and ISI could “veto” the idea. LET and several other terror groups “operate under the umbrella” of ISI, he said.

Story: Chicago terror trial could complicate US-Pakistan relations

Headley’s most damning testimony related to his talks with an ISI officer he identified as “Major Iqbal.” During eight trips to Mumbai, made for the purpose of conducing surveillance, Headley said Iqbal gave him specific instructions on potential targets, such as conference rooms of the luxury Taj Mahal hotel and diners and restaurants near an Indian nuclear facility. After each of his trips, Headley said he would meet separately with Iqbal and then his alleged LET handler, Sajid Mir, and review the locations he had videotaped and the plans for the attack. At one point, when the idea of scouting the Taj Mahal conference rooms arose, Headley said “the instructions emanated from Major Iqbal.”

Iqbal has been indicted as a co-conspirator in the case. But he remains at large and Pakistani officials have refused to confirm whether he is indeed the ISI officer that Headley contends. But to corroborate portions of their witnesses’ account, prosecutors entered as exhibits emails between Headley and Iqbal— purportedly using a Yahoo address under the name “Chaudery Khan” — showing they were indeed in communication during the time Headley claimed.

‘hi dave how r us I think so you are out of usa,” Iqbal/Khan wrote in one April 2008 email. He then asked Headley, “if you find some time you my contact me on this mobile number” – and then listed a number with a New York area 646 prefix.

Headley returns to the witness stand Tuesday.

© 2013 NBCNews.com  Reprints


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