Hamas' French Funds?

By Massimo Calabresi, Jamil Hamad and Adam Zagorin

As Secretary Of State Colin Powell traveled to the Middle East last weekend to try to get President Bush's road map back on track, U.S. frustrations with the stalled peace efforts have begun to focus on a familiar target: France. State Department and White House sources tell TIME the U.S. has lodged complaints that Paris is turning a blind eye to fund raising in France by front organizations for Hamas, the terrorist group that has claimed responsibility for most of the recent wave of suicide attacks. The U.S. also claims France is blocking European Union efforts to restrict these front groups elsewhere. "There's a lot of intelligence to suggest that the French have become increasingly a conduit for funds to Hamas and that they're just not taking the steps that are necessary," says a State official. Some Administration hard-liners suspect the French of positioning themselves to influence the Arab-Israeli peace process by leveraging Hamas' European funding. France says it has found no evidence of such funding. "We fight against any terrorist groups who might have bases in France or find financing from France," says embassy spokeswoman Natalie Loiseau.

The pressure is also on Palestinian Prime Minister Mahmoud Abbas to crack down on Hamas. He's getting some much needed behind-the-scenes help from the head of Egyptian intelligence, Omar Suleiman, who dispatched assistants to the Gaza Strip to push the terrorist group into talks on a cease-fire with Israel. But those talks are dragging on, and Abbas continues to have his own problems. Last week his security chief, Mohammed Dahlan, met with Abbas' rival Yasser Arafat, a senior Palestinian official tells TIME, and assured him that "I am loyal to you. I am willing to implement your orders." Dahlan seems to be playing both sides of the Abbas-Arafat feud to protect his interests. It's another sign that Abbas' hold on power is weak--and his chances of helping the road map by reining in the terrorists may be slipping away. --By Massimo Calabresi, Jamil Hamad and Adam Zagorin