DAILY MAIL (London)

July 30, 2003

SECTION: ED_4TH; Pg. 8

HEADLINE: Fury at plan for betting on terror attacks

BYLINE: WILLIAM LOWTHER

THE Pentagon last night withdrew a plan that would have allowed the 
placing of bets on the likelihood of terrorist attacks.

The possibility of the assassination of Palestinian leader Yasser 
Arafat or a political event such as the overthrow of Jordan's King 
Abdullah would have been features of the scheme. 

It would have worked as in a stock exchange futures market where 
investors buy shares in what they think is going to happen.

Background information would have been provided by the London-based 
Economist Intelligence Unit. The Pentagon had allocated 5million to 
set in place the proposed Policy Analysis Market.

It was thought that the more businessmen who 'bought', the more likely 
an event was to happen.

Wall Street traders would have been invited to buy and sell contracts 
on possibilities.

If it happened within an agreed period, the investor would be paid an 
agreed price but if it didn't he would lose his money.

Senator Ron Wyden said: 'The idea of a federal betting parlour on 
atrocities and terrorism is grotesque.

Senator Byron Dorgan said: 'How would you feel if you were the King of 
Jordan and you learned the U.S. defence department was taking bets on 
your being overthrown?' Dr Christine Gray, of the Counter Terrorism 
Institute, said: 'A terror group could bet that a Middle East leader 
would be assassinated and make a fortune carrying that out. The idea 
is obscene.' A Pentagon source said: 'We intended to use the 
information to prevent such an assassination. Thus the market would 
have benefited people like Arafat.' U.S.

Deputy Secretary of Defence Paul Wolfowitz said of Pentagon planners: 
'It sounds like maybe they got too imaginative in this case.'