SAN DIEGO, Calif—Despite his protestations to the contrary, Yassir Arafat must have known about the arms shipment bound for the Palestinian Authority before its seizure on the high seas by Israeli commandos, according to former U.S. Middle East Envoy Dennis Ross.

Ross said that Arafat keeps an extremely tight watch over the Palestinian Authority's finances, to the point that "he signs all the money orders."

"So $15 million, which is what was involved here, there is no way that thing was done without his knowledge," Ross told Heritage in an interview (excerpted on Page 8) Jan. 9 before he spoke at the United Jewish Federation¹s annual Men's Event.

The Palestinian Authority, after first denying the weapons shipment was bound for its territory, later announced an investigation into the shipment, which Israel has said is proof that the Palestinians want war and not peace.

The United States at first suggested that the arms, purchased from Iran, were bound for Hezbollah forces in Lebanon, but after a briefing by Israeli intelligence officers, it agreed that the shipment had been intended directly for the Palestinian Authority. However, a State Department
spokesman stopped short of saying that Arafat was directly involved.

With the Palestinian intifada entering its 17th month, Ross said another serious opportunity to bring overall peace to the Middle East probably will not be possible for some time. The first order of business, he said, must be to bring about a cease-fire and start reestablishing trust between the two countries.