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Hambali told his jailers that another recipient of his largesse was the Moro Islamic Liberation Front (M.I.L.F.), which is fighting for an independent Muslim state in the southern Philippines. The group denies that it has ties to J.I. or al-Qaeda, but Hambali and Lillie both described a transfer of some $27,000 to the M.I.L.F. this summer. Lillie said an M.I.L.F. contact reported by e-mail that the money would be spent on "cars and motorcycles," which were codes, Lillie indicated, for M-16s and pistols. Regional intelligence officials say J.I. operatives train in M.I.L.F.-protected camps, a point Hambali confirmed under interrogation. Hambali's interrogators say he told them it is "most likely a large number of members of J.I. Indonesia are hiding in the Philippines and supporting the M.I.L.F."
U.S. Ambassador to the Philippines Francis Riccardone told journalists last week the U.S. was "very, very concerned" about links between J.I. and the M.I.L.F. He warned that unless the latter group severed those ties, the U.S. would cut M.I.L.F.-controlled areas out of the $30 million in aid the U.S. has pledged if secessionists sign a peace accord with Manila.
Hambali and his lieutenants were also charged with casing targets, including the U.S and British embassies in Bangkok, various nightclubs in Thailand and shopping complexes frequented by Westerners in the elite Makati district of Manila. Jewish and Israeli sites received close attention. Though anti-Semitism is central to al-Qaeda's creed, the group has not traditionally focused on attacking Jews. That may have changed last November, when suicide bombers struck a Mombasa hotel frequented by Israelis, killing 13 people, and two shoulder-launched missiles were fired at an Israeli plane nearby. The Kenyan attacks may presage more to come: Lillie said he did surveillance on two Israeli-owned businesses on or near Bangkok's Khao San Street, the region's most famous backpacker district, as well as on the ticket counter and airplanes of Israeli carrier El Al at the city's airport. Hambali scouted the Israeli embassy and a synagogue in Manila. "The prisoner mentioned that Jewish targets were always the main priority," reads a report about Hambali.
One of the themes Hambali returned to repeatedly in his interrogation is the notion that J.I. is collapsing. He complained that the network is in a "very bad" state "because of those who had been captured," an interrogator wrote. "All the group's savings has been lost to raids and arrests," Hambali claimed. J.I. had been virtually "destroyed." Many intelligence officials and analysts disagree, saying J.I. has been wounded but remains extremely dangerous. Hambali was probably "trying to steer his interrogators," argues Zachary Abuza, author of a forthcoming book on al-Qaeda in Southeast Asia, "trying to make them feel complacent." Of the assertions Hambali made to his jailers, his assessments of J.I.'s powers were the ones they were least likely to trust. --Reported by Massimo Calabresi/Washington, Andrew Perrin/Bangkok, Nelly Sindayen/Manila and Jason Tedjasukmana/ Jakarta