From The Associated Press, 6/1/04:
http://www.cbsnews.com/stories/2004/05/20/iraq/main618637.shtml

(CBS/AP)

CBS News has learned new details involving the Iran espionage
allegations against Ahmad Chalabi, the Iraqi exile leader who was one
touted as a possible president to lead Iraq in the post-Saddam
transition.

On May 20, Iraqi police backed by American soldiers raided the Baghdad
home and offices of Chalabi.

Chalabi is a controversial figure who provided the Bush administration
with prewar intelligence on supposed weapons of mass destruction in
Iraq -- including the now-discredited information about mobile labs
whose true use is still a matter of debate.

After the raid, 60 Minutes Correspondent Lesley Stahl reported that
the U.S. had evidence Chalabi has been passing highly-classified U.S.
intelligence to Iran.

CBS News has since learned that Chalabi recently told an Iranian
intelligence official the U.S. has cracked Iranian codes, allowing it
to read communications on everything from Iran's sponsorship of
terrorists to its covert operations inside Iraq

CBS has also been told FBI agents are questioning Defense Department
officials about who gave such top secret U.S. information to Chalabi
in the first place.

Chalabi is still active and visible on the scene in Iraq where he is a
member of the handpicked Iraqi Governing Council.

Over the Memorial Day weekend, Chalabi was reportedly involved in
negotiations to maintain a falter cease fire in the city of Kufa
between U.S. military and radical Shiite cleric Muqtada al-Sadr.
Chalabi and other Shiite leaders met with al-Sadr representatives and
declared there was "a momentum for peace."

But Chalabi's star has definitely fallen in U.S. eyes. Despite his
seat on the Iraqi Governing Council, it seems the Bush administration
is going out of its way to ensure that the man who made a career
lobbying to get rid of former Iraqi President Saddam Hussein has no
American-backed political future in Iraq.

Other tense situations in recent months between the Bush
administration and Chalabi include:

American officials have complained privately that Chalabi was
interfering with an inquiry into money skimmed from the U.N.
oil-for-food program.

Chalabi has recently accused the U.S.-led coalition of not going far
enough to give Iraqis sovereignty.

He also fiercely resisted U.S. military commanders' recent decision to
soften rules blocking former members of Saddam's ruling party from
government jobs.

Chalabi still has strong supporters in Washington, and the Pentagon
continued to pay for intelligence provided by his organization until
recently.

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That's $335,000 taxpayer bananas a month this Bush-approved guy was
gettin'.

Harry