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  • Trump Vows U.S. ‘Locked and Loaded’ If Iran Was Behind Attacks

    (Bloomberg) -- President Donald Trump said the U.S. is “locked and loaded depending on verification” that Iran staged the attack on major Saudi Arabian oil facilities, an assertion already made by his secretary of state and backed by administration officials.“There is reason to believe that we know the culprit, are locked and loaded depending on verification,” Trump said on Twitter on Sunday without mentioning Iran or specifying what the response would entail. He said he’s awaiting word from Saudi Arabia about who it believed caused the attack and “under what terms we would proceed!”Several administration officials said Sunday that they had substantial evidence that Iran was behind the attack, not the Iranian-backed Houthi rebels in Yemen who claimed responsibility. On Saturday, Secretary of State Michael Pompeo said unequivocally in a tweet that Iran was to blame.Two administration officials who asked not to be identified discussing internal deliberations told reporters that cruise missiles may have been used in the attacks on a Saudi oil field and the world’s biggest crude-processing facility in Abqaiq. The range from Yemen was also far beyond the distance of anything the Houthis have ever done, the officials said.A third administration official, who also asked not to be identified discussing non-public findings, said precision-guided munitions had been used. The U.S. officials didn’t rule out that armed drones were used as well, even as they rejected the Houthi claims that they mounted the attacks using such pilotless aircraft.Now, the challenge that Trump and his advisers face is balancing a tough response to what it says is a clear act of of Iranian aggression, against concern that it’s rushing headlong into a conflict that could spiral out of control. Analysts also warn that doing nothing could send a message to Iran or its proxy militias across the Middle East that they can strike their enemies with impunity.“There’s no great response here,” said Aaron David Miller, senior fellow at the Carnegie Endowment for International Peace. “The question becomes how does the U.S. navigate between not allowing this precedent to stand on one hand, and avoiding a punitive escalation or one designed to deter future attacks without an escalation. And the answer is there is no answer.”Still, a major U.S. military response may be unlikely, according to experts who said they doubt Trump will be willing to use force against Tehran or risk escalating violence in the Middle East ahead of the 2020 presidential election. In June, Trump said he considered a military strike on Iran for shooting down a U.S. drone, only to call off the action at the last minute.Analysts also said the attacks may do little to deter the president from seeking a meeting with Iranian President Hassan Rouhani in an effort to broker a new nuclear agreement.Trump hasn’t ruled out a possible meeting with Rouhani when both are in New York in a week for the annual United Nations General Assembly. He tweeted on Sunday that the “Fake News is saying that I am willing to meet with Iran, ‘No Conditions’ That is an incorrect statement (as usual!).” But officials including Pompeo and Treasury Secretary Steven Mnuchin have told reporters publicly that Trump is willing to take a meeting with no conditions.‘Maximum Pressure’The administration’s “maximum pressure” stance against Iran is focused on imposing sanctions and isolating the country over its nuclear ambitions and malign activities in the region. That approach has come under renewed scrutiny at a time the president’s foreign policy team is in flux, after Trump’s firing of hawkish National Security Adviser John Bolton last week.U.S. and Saudi officials say they’re gathering more evidence that Iran was behind the attacks -- some of it on the ground in Saudi Arabia -- that will be released in due time. Iran’s Foreign Ministry described Pompeo’s comments blaming the Islamic Republic as “blind and fruitless accusations.”According to U.S. government information, there were 19 points of attack at state-owned Saudi Aramco’s crude-processing facility at Abqaiq and the Khurais oil field, all on the north or northwest-facing sides -- suggesting that the weaponry used came from that direction. Iraq lies to the north, and the U.S. in the past has accused Iran of stashing explosives with affiliated militias in the country. Yemen, by contrast, is hundreds of miles to the south.Saudi Aramco lost roughly 5.7 million barrels per day of output after the attacks, although officials cited progress in restoring production.Pompeo’s TweetPompeo tweeted Saturday that there is “no evidence the attacks came from Yemen” and accused Iran of being behind “an unprecedented attack on the world’s energy supply.”“The United States will work with our partners and allies to ensure that energy markets remain well supplied and Iran is held accountable for its aggression,” he added.Paul Pillar, a former U.S. Central Intelligence Agency officer, said the one “policy option left is de-escalation -- of the Saudi air war against Yemen, and of the Trump administration’s economic war against Iran.”Pillar, who’s now a non-resident senior fellow at Georgetown University in Washington, said “further attempts to escalate on either of those war fronts offers no reason to believe that they would be any more successful than the wars have been up to this point.”Trump would risk criticism from many of his Republican allies if he chose to meet with Iran’s leader barely a week after accusing the country of being responsible for a strike that caused a significant disruption to the world’s oil markets. Republican Senator Lindsay Graham of South Carolina has said the U.S. shouldn’t rule out a military strike on Iranian oil facilities in response.Graham Tweet“Iran will not stop their misbehavior until the consequences become more real, like attacking their refineries, which will break the regime’s back,” Graham tweeted Saturday.One Western diplomat, who asked not to be identified, said Trump sees what he wants to see in world events, so if he wanted to meet with Iran’s president, the strikes wouldn’t necessarily deter him. Trump has repeatedly brushed aside short-range missile tests by North Korea as he seeks to broker a historic nuclear pact with leader Kim Jong Un.White House Counselor Kellyanne Conway said on “Fox News Sunday” that the administration will continue its “maximum pressure campaign,” but she added that “the president will always consider his options,” including a meeting with Rouhani. That was hours before Trump seemed to rule out a meeting unless the Iranian president met unspecified conditions.UN MeetingNor is it clear the Iranian leader would be willing to take such a meeting -- even an informal chat on the sidelines of the UN gathering -- without the U.S. making some gesture to ease its sanctions on his country. The strikes in Saudi Arabia may all but rule out such a move anytime soon despite pleas by Western leaders led by French President Emmanuel Macron.The attacks on Saudi Arabia also pose a major test for Pompeo, who has an opportunity to consolidate power after Bolton’s departure.Pompeo and Brian Hook, the State Department’s special representative for Iran, have argued the U.S. could afford to ramp up sanctions and diplomatic pressure on Iran because there’s plenty of global oil supply. But there’s now little cushion in the market with the major disruption caused by the drone attacks, which could force the president and his team to look for ways to relieve the pressure.While analysts estimate Saudi Arabia may be able to restore half of the lost production as early as Monday, Trump said on Twitter Sunday that he’s authorized the release of oil from the Strategic Petroleum Reserve if needed based on the attacks “in a to-be-determined amount sufficient to keep the markets well-supplied.” The stock of about 645 million barrels of crude and petroleum products could help meet demand during the time it would take for the Saudis to repair the facilities. Trump also told U.S. agencies to expedite approvals of oil pipelines in the permitting process.There’s also the question of the administration’s credibility. Some foreign policy analysts said it’s hard to take at face value the claim that Tehran is responsible, given the hard line against Iran advocated by Pompeo, Bolton and others.“The Trump administration appears to have evidence of Iranian responsibility but will face skepticism from others, both because of policy disagreements between the US and its allies, and because declining to attribute an attack provides an excuse not to respond,” tweeted Michael Singh, managing director for the Washington Institute for Near East Policy.To contact the reporters on this story: Jordan Fabian in Washington at jfabian6@bloomberg.net;Nick Wadhams in Washington at nwadhams@bloomberg.net;David Wainer in New York at dwainer3@bloomberg.net;Glen Carey in Washington at gcarey8@bloomberg.netTo contact the editors responsible for this story: Alex Wayne at awayne3@bloomberg.net, ;Bill Faries at wfaries@bloomberg.net, Larry Liebert, Steve GeimannFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

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  • Steven Mnuchin’s Mysterious Link to Creepy Epstein Model Scout

    Photo Illustration by The Daily Beast/Photos Getty/HandoutIn the late 1980s-before he was a member of Donald Trump’s Cabinet, or even a high-rolling hedge fund manager-Treasury Secretary Steven Mnuchin served in an official capacity for a business run by one of Jeffrey Epstein’s most infamous associates. In official records, Mnuchin is listed as the official state point of contact for Next Management Corporation, a company formed in 1988 by modeling-industry insiders Jean-Luc Brunel and Armand Brunel. At the time, Brunel had just been the subject of a 60 Minutes documentary accusing him of drugging and raping at least three models. Later, he would be accused by two women of supplying girls to Epstein to be sexually abused. (Brunel has denied the allegations.)Records accessed by The Daily Beast list Mnuchin as the New York Department of State process for Next Management Corporation. According to department officials, the DOS process is the person who files a company’s registration papers and receives lawsuits and other official documents on their behalf-usually a lawyer or some other legal representative.A Treasury Department official said Mnuchin did not know he was listed as the DOS Process for Next Management Corp. before The Daily Beast’s inquiry. He said it was “not clear” how Mnuchin wound up serving in that role, and added that the Secretary not recall ever meeting either Brunel brother and has never done business with either of them. Mnuchin’s office did confirm that he was longtime friends with Faith Kates, the owner of Next modeling agency. The Brunel brothers co-founded the Next agency with Kates in 1989, and their company, Next Management Corp. owned a 25 percent stake in the agency for several years. The address listed under Mnuchin’s name in State Department records is the first address for Kates’ company, Next Management Company.Models Say Jeffrey Epstein’s Closest Pal Drugged, Raped ThemJeffrey Epstein’s Modeling Ties Go Much Deeper Than Victoria’s SecretReached by The Daily Beast, Kates denied any involvement with setting up Next Management Corporation, and said she had nothing to do with Mnuchin serving as the DOS process. “Ms. Kates was never involved with Next Management Corp. in any way,” a spokesperson said. “Given that, she never designated anyone, including Sec. Mnuchin, to be a DOS process or any officer or director of Next Management Corp.”The spokesperson added that Kates’ agency sued Next Management Corp. 25 years ago, over allegations that the Brunel brothers had “raided” the agency, and said Kates has not had any contact with them since then. She said Kates had “no knowledge” of why her company’s address was listed in official records for Next Management Corp.Kates has her own connections to Epstein, as The Daily Beast previously reported. Former employees say the financier regularly dropped in on the agency’s New York offices, and tax filings show he donated tens of thousands of dollars to charities connected to Kates and her family. At least two former Next models have been romantically linked to Epstein, and a third appears in his infamous address book. A spokesperson for Kates said neither she nor the Next agency had any business or financial ties to Epstein, and that Kates never introduced the financier to any models.Mnuchin has been friends with Kates for approximately 30 years, according to the Treasury Department official, and once helped Kates set up a business “as a friend.” A spokesperson for Kates confirmed the two had been friendly for decades. She said Munchin had offered Kates business advice when she started Next Management Company, and served as her real estate broker.Mnuchin’s spokesperson said the Secretary had no ownership in any of Kates’ businesses or served them in any business capacity.The Daily Beast was unable to reach Jean-Luc or Arnaud Brunel for comment. The ties between Jean-Luc Brunel and Epstein, however, have been widely reported. Flight records show Brunel flew on the financier’s private plane more than 20 times between 1999 and 2005, and house staff said in depositions that the modeling agent was a regular presence at Epstein’s Palm Beach estate. When Epstein was arrested in 2008, Brunel visited him nearly 70 times in jail.One of Epstein’s first public accusers, Virginia Roberts (now Giuffre), claimed Epstein forced her to sleep with Brunel and many other powerful men in the years he kept her as his “sex slave.” She also accused Brunel of using his modeling industry connections to supply Epstein and other wealthy men with foregin girls to abuse.A former bookkeeper for one of Brunel’s agencies told the FBI in 2010 that Brunel used the company to bring in teenage models from around the world, and housed them in Epstein’s Upper East Side apartments. The bookkeeper claimed the girls were loaned out to wealthy clients for up to $100,000 a night, and were not paid if they refused to be “molested.” French authorities are currently seeking Brunel as part of their probe into Epstein, and recently interviewed two women who say they were victims of the modeling agent in the late 1970s and early ’80s, according to French newspaper Le Parisien.Brunel has denied all claims of sexual misconduct, as well as any knowledge of Epstein’s wrongdoings. In legal filings, he said the former bookkeeper had been fired from his agency for embezzling company funds.“I strongly deny having participated, neither directly nor indirectly, in the actions Mr. Jeffrey Epstein is being accused of,” Brunel said in a 2015 statement. “I strongly deny having committed any illicit act or any wrongdoing in the course of my work as a scouter or model agencies manager."Jeffrey Epstein Accuser Names Powerful Men in Alleged Sex RingMy Night With Epstein Pal Jean-Luc Brunel and His Terrified ModelsRead more at The Daily Beast.Got a tip? Send it to The Daily Beast hereGet our top stories in your inbox every day. Sign up now!Daily Beast Membership: Beast Inside goes deeper on the stories that matter to you. Learn more.