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The struggle for political power in postwar Iraq began to take shape this week with the arrival of Ahmed Chalabi, a wealthy American-educated banker whose exile organization has received financial support from the U.S. government but whose leadership has provoked sharp divisions within the Bush administration.

The U.S. military airlifted Chalabi and 700 fighters, described as “Free Iraqi Forces” by Pentagon officials, to the southern Iraqi town of Nasiriyah. Chalabi and his troops are being trained and equipped there, and hope to participate in the taking of Baghdad.

The 58-year-old Chalabi, head of the London-based Iraqi National Congress, has spent much of the past decade cultivating relationships with bipartisan allies in Congress and conservatives who now hold key positions in the Pentagon.

Officials at the State Department and Central Intelligence Agency, however, have been critical of his organization and expressed doubts about the strength of his following in Iraq, which he and his family left after a 1958 coup unseated the British-installed monarchy.

Chalabi was convicted of bank fraud and embezzlement in Jordan in the 1980s and the State Department briefly froze payments to his organization because of concerns about its accounting practices.

Chalabi has “a leg up”

Though Chalabi has said he has no interest in becoming the future leader of Iraq, others doubt that claim and some around him have said they expect him to be the country’s next leader.

“It’s important that he is the first one flown in there,” said Bathsheba Crocker, a fellow at the Center for Strategic and International Studies. “We are giving him legitimacy. It depends on what he makes of it and how he is received on the ground. But it gives him a leg up.”

Speaking by satellite phone from the windswept grounds of an abandoned government warehouse that is temporarily housing Chalabi and his troops, an aide said the exile leader has been cultivating alliances since he arrived Sunday.

“He’s been meeting with tribal sheiks, village elders and community leaders. He’ll be reaching out to local people and making sure no misunderstanding arises between them and the U.S. forces,” said spokesman Zaab Sethna.

Chalabi’s presence highlights the challenges the U.S. will face as it tries to identify leaders during Iraq’s transition to self-governance. Some U.S. officials strongly favor longtime members of Iraq’s exile opposition, such as Chalabi, who espouse pro-Western positions.

Extremists also may emerge

But it is not clear how much support such figures will have in postwar Iraq, especially compared with those who have suffered under Hussein’s rule and may emerge as leaders after the war. U.S. officials also may see the emergence of leaders who hold extremist views but command widespread support among the Iraqi people.

For example, Ayatollah Mohammad Baqir al-Hakim, a Shiite cleric who heads the Supreme Council for the Islamic Revolution in Iraq, has signaled he will return to Iraq from exile in Tehran. His organization, the largest Iraqi opposition group, has close ties to the leaders of Iran, one of the nations President Bush has labeled an “axis of evil.”

Supporters say Chalabi envisions a secular, pluralist democracy in Iraq that would be friendly to U.S. interests in the Middle East. They also suggest Chalabi would pursue a moderate policy toward Israel; the director of his organization’s Washington office was warmly received at a meeting last fall of the American Israel Public Affairs Committee.

“He really would throw his lot in with the United States,” said Patrick Clawson, deputy director of the Washington Institute for Near East Policy. “He would want to see the Iraqi army work closely with the U.S. Army. I think he would be comfortable with U.S. troops staying in Iraq for many years.”

Significantly, Chalabi also has said he favors the creation of a U.S.-led consortium to develop Iraq’s oil fields. “American oil companies will have a big shot at Iraqi oil,” Chalabi told The Washington Post in September 2002.

With the second-largest oil reserves in the world, Iraq offers tremendous economic opportunities for energy development. The Baath regime nationalized the oil industry in the 1970s, and Saddam Hussein made deals with businesses from France, Russia and other friendly countries to develop oil fields and refurbish production sites. But Iraqi National Congress representatives have said a future Iraqi government should not be bound by those contracts.

Family rich, fled in 1958

Born in 1945, Chalabi grew up in a wealthy family that was one of the few among Iraq’s Shiite majority to hold high political positions under the Hashemite monarchy, which like Hussein’s regime was dominated by members of the country’s Sunni minority.

His grandfather held nine Cabinet positions at various time. His father was a Cabinet minister and later president of the Iraqi Senate. But his family fled Iraq when Chalabi was a teenager after the overthrow of King Faisal II in 1958.

He was educated at the Massachusetts Institute of Technology and earned a doctorate in mathematics from the University of Chicago. He later taught at the American University in Beirut and in 1977 moved to Jordan to establish Petra Bank, which soon became the second-largest commercial bank in the country.

In 1989, Chalabi was charged with embezzling millions of dollars from the bank. He fled the country and was convicted in absentia, receiving a sentence of 22 years at hard labor. Chalabi has denied the charges, saying the prosecution was a politically motivated attempt by Jordanian authorities to curry favor with neighboring Iraq.

The Iraqi National Congress was formed in 1992, in the wake of the Persian Gulf war, with Chalabi as its leader. It has emerged as an umbrella group for the Iraqi opposition, and Chalabi has since acknowledged receiving covert financing from the CIA.

A National Congress offensive in northern Iraq failed in 1996, and one of the group’s allies, the Kurdistan Democratic Party, turned against Chalabi and invited Hussein’s forces into the region to finish off National Congress troops. Fearing another Bay of Pigs, the Clinton administration declined requests to intervene on behalf of Chalabi’s forces.

Allies in Congress supportive

The CIA cut off assistance to Chalabi afterward, and the CIA and State Department have persistently questioned his following in Iraq. But Chalabi’s allies in Congress succeeded in passing the 1998 Iraq Liberation Act, which authorized spending $93 million to support Iraqi opposition groups, including the Iraqi National Congress, and several of his conservative admirers have taken key positions in the Defense Department.

Though some consider Chalabi haughty and a divisive influence among exiles, supporters emphasize that he has helped hold together a fractious coalition and devoted himself to the task for 12 years, even though his wealth would have allowed him to lead a life of leisure.

“He’s a charismatic individual who has been very dedicated to the cause of altering Saddam Hussein’s regime,” Clawson said.