"The Ties that Bind: Barclays, a Bin Laden relative, Carlyle and the BCCI boys" by Kevin Dowling dated 3 November 2001, published on Online Journal (www.onlinejournal.com).

In a letter dated 19 March 2004 to Kendall Freeman, solicitors representing Sheikh Khalid bin Mahfouz, Kevin Dowling wrote:

"You have drawn my attention to the fact that the Article which I wrote in November 2001 contains erroneous and highly defamatory allegations about your client, Sheikh Khalid bin Mahfouz. I also understand that the article is being relied upon in other publications to justify similar allegations about Sheikh Khalid bin Mahfouz.

The Article was not intended by me for publication. I wrote the Article based on other material which I had read. I was not in a position to, and did not check, the truth of the Article. I sent the Article to various other people in order for them to review and, unknown to me, one of them passed the Article to Online Journal who published the Article, and certainly did not authorise the Online Journal to publish the Article on its website; indeed the Article was not intended for publication at that stage, nor was it ever published by me in any other publication. I have taken every measure to ensure that the Online Journal remove the Article from its website and prevent any further access to it on the internet.

In order to prevent the further dissemination of the article as a source to justify damaging allegations about Sheikh Khalid bin Mahfouz, I would now like to correct the record and acknowledge the following:

1. Sheikh Khalid bin Mahfouz is not Osama bin Laden's brother-in-law and was not born in Yemen;
   
   
2. The U.S. Secretary of Sate, Madeline Albright, did not tell the Saudi Defence Minister, Prince Sultan, that Sheikh Khalid bin Mahfouz "….had channelled tens of millions into terrorist accounts in London and New York";
   
   
3. Sheikh Khalid bin Mahfouz was not suspected by U.S. intelligence services of funding front groups who secretly funnelled money to Osama bin Laden's Al-Qaeda organisation;
   
   
4. Sheikh Khalid bin Mahfouz has no direct connections to Osama bin Laden whatsoever, whether through banks, holding companies, foundations or charities;
   
   
5. There was no Saudi Government audit of the National Commercial Bank which resulted in Sheikh Khalid bin Mahfouz being forced to sell his shares in the bank and take early retirement;
   
   
6. Sheikh Khalid bin Mahfouz was not placed under house arrest in Saudi Arabia;
   
   
7. Sheikh Khalid bin Mahfouz's son, Sheikh Abdulrahman bin Mahfouz, was not a director of an Al-Qaeda front.
   
   

I accept that there is no truth whatsoever in any of these serious and highly defamatory allegations. I acknowledge that Sheikh Khalid and his family abhor terrorism in every way and apologise to him for the grave distress and embarrassment that the allegations in the article have caused."

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