In Re:
INSLAW, INC., Debtor.
CASE NO. 85-00070
(Chapter 11)
________________________________
INSLAW, INC., Plaintiff
v.
UNITED STATES OF AMERICA and the UNITED STATES DEPARTMENT OF JUSTICE, Defendants.
CASE NO. 85-00070
Adversary Proceeding
NO. 86-0069

AFFIDAVIT OF RICHARD H. BABAYAN

1. During the past several years, I have acted as a broker of sales of materials and equipment used by foreign governments in their armed forces, intelligence and security operations.

2. In the capacity described in paragraph #1, I attended a meeting in Baghdad, Iraq, in October or November, 1987, with Mr. Abu Mohammed of Entezamat, an intelligence and security organ of the Government of Iraq. Mr. Abu Mohammed is a senior ranking official of Entezamat and a person with whom I had had extensive dealings over the previous three years.

EXHIBIT 3

3. During the aforementioned meeting with Mr. Abu Mohammed, I was informed that Dr. Earl W. Brian of the United States had recently completed a sales presentation to the Government of Iraq regarding the PROMIS computer software. Furthermore, it is my understanding that others present at Dr. Brian's PROMIS sales presentation were General Richard Secord, of the United States, and Mr. Abu Mohammed.

4. In early to mid-1988, in the course of subsequent visits to Baghdad, Iraq, I was informed that Dr. Earl W. Brian had, in fact, provided the PROMIS computer software to the Government of Iraq through a transaction that took place under the umbrella of Mr. Sarkis Saghanalian, an individual who has had extensive business dealings with the Government of Iraq since the late 1970's in the fields of military hardware and software. I was also informed that the Government of Iraq acquired the PROMIS software for use primarily in intelligence services, and secondarily in police and law enforcement agencies.

5. During the course of the visits described in paragraph #4, I also learned from Mr. Abu Mohammed that the Government of Libya had acquired the PROMIS computer software prior to its acquisition by the Government of Iraq; that the Government of Libya had by then made extensive use of PROMIS; and that the Government of Libya was highly recommending the PROMIS software to other countries. I was informed that the high quality of the reference for the PROMIS software from the Government of Libya was one of the principal reasons for the decision of the Government of Iraq to acquire PROMIS.

6. In the capacity described in paragraph #1, I attended a meeting in early 1988 in Singapore with Mr. Y. H. Nam of the Korea Development Corporation.

7. The Korea Development Corporation is known to be a cutout for the Korean Central Intelligence Agency (KCIA).

8. I learned from Mr. Y. H. Nam during the meeting described in paragraph #6 that the KCIA had acquired the PROMIS computer software, and that Dr. Earl W. Brian of the United States had been instrumental in the acquisition and implementation of PROMIS by the KCIA.

9. In the capacity described in paragraph #1, I attended a meeting in Santiago, Chile, in December, 1988, with Mr. Carlos Carduen of  Carduen Industries. During this meeting, I was informed by Mr. Carduen  that Dr. Earl W. Brian of the United States and Mr. Robert Gates, a senior American intelligence and national security official, had just completed a meeting in Santiago, Chile, with Mr. Carlos Carduen.

10. I hereby certify that the facts set forth in this Affidavit are true and correct to the best of my knowledge.

FURTHER AFFIANT SAYETH NOT.

Signed: Richard A. Babayan