At the peak of his deal-making activities, in the nineteen-seventies, the Saudi-born businessman Adnan Khashoggi brokered billions of dollars in arms and aircraft sales for the Saudi royal family, earning hundreds of millions in commissions and fees. Though never convicted of wrongdoing, he was repeatedly involved in disputes with federal prosecutors and with the Securities and Exchange Commission, and in recent years he has been in litigation in Thailand and Los Angeles, among other places, concerning allegations of stock manipulation and fraud. During the Reagan Administration, Khashoggi was one of the middlemen between Oliver North, in the White House, and the mullahs in Iran in what became known as the Iran-Contra scandal. Khashoggi subsequently claimed that he lost ten million dollars that he had put up to obtain embargoed weapons for Iran which were to be bartered (with Presidential approval) for American hostages. The scandals of those times seemed to feed off each other: a congressional investigation revealed that Khashoggi had borrowed much of the money for the weapons from the Bank of Credit and Commerce International (B.C.C.I.), whose collapse, in 1991, defrauded thousands of depositors and led to years of inquiry and litigation.

Khashoggi is still brokering. In January of this year, he arranged a private lunch, in France, to bring together Harb Saleh al-Zuhair, a Saudi industrialist whose family fortune includes extensive holdings in construction, electronics, and engineering companies throughout the Middle East, and Richard N. Perle, the chairman of the Defense Policy Board, who is one of the most outspoken and influential American advocates of war with Iraq.

The Defense Policy Board is a Defense Department advisory group composed primarily of highly respected former government officials, retired military officers, and academics. Its members, who serve without pay, include former national-security advisers, Secretaries of Defense, and heads of the C.I.A. The board meets several times a year at the Pentagon to review and assess the country’s strategic defense policies.

Perle is also a managing partner in a venture-capital company called Trireme Partners L.P., which was registered in November, 2001, in Delaware. Trireme’s main business, according to a two-page letter that one of its representatives sent to Khashoggi last November, is to invest in companies dealing in technology, goods, and services that are of value to homeland security and defense. The letter argued that the fear of terrorism would increase the demand for such products in Europe and in countries like Saudi Arabia and Singapore.

The letter mentioned the firm’s government connections prominently: “Three of Trireme’s Management Group members currently advise the U.S. Secretary of Defense by serving on the U.S. Defense Policy Board, and one of Trireme’s principals, Richard Perle, is chairman of that Board.” The two other policy-board members associated with Trireme are Henry Kissinger, the former Secretary of State (who is, in fact, only a member of Trireme’s advisory group and is not involved in its management), and Gerald Hillman, an investor and a close business associate of Perle’s who handles matters in Trireme’s New York office. The letter said that forty-five million dollars had already been raised, including twenty million dollars from Boeing; the purpose, clearly, was to attract more investors, such as Khashoggi and Zuhair.

Perle served as a foreign-policy adviser in George W. Bush’s Presidential campaign—he had been an Assistant Secretary of Defense under Ronald Reagan—but he chose not to take a senior position in the Administration. In mid-2001, however, he accepted an offer from Secretary of Defense Donald Rumsfeld to chair the Defense Policy Board, a then obscure group that had been created by the Defense Department in 1985. Its members (there are around thirty of them) may be outside the government, but they have access to classified information and to senior policymakers, and give advice not only on strategic policy but also on such matters as weapons procurement. Most of the board’s proceedings are confidential.

As chairman of the board, Perle is considered to be a special government employee and therefore subject to a federal Code of Conduct. Those rules bar a special employee from participating in an official capacity in any matter in which he has a financial interest. “One of the general rules is that you don’t take advantage of your federal position to help yourself financially in any way,” a former government attorney who helped formulate the Code of Conduct told me. The point, the attorney added, is to “protect government processes from actual or apparent conflicts.”

Advisory groups like the Defense Policy Board enable knowledgeable people outside government to bring their skills and expertise to bear, in confidence, on key policy issues. Because such experts are often tied to the defense industry, however, there are inevitable conflicts. One board member told me that most members are active in finance and business, and on at least one occasion a member has left a meeting when a military or an intelligence product in which he has an active interest has come under discussion.

Four members of the Defense Policy Board told me that the board, which met most recently on February 27th and 28th, had not been informed of Perle’s involvement in Trireme. One board member, upon being told of Trireme and Perle’s meeting with Khashoggi, exclaimed, “Oh, get out of here. He’s the chairman! If you had a story about me setting up a company for homeland security, and I’ve put people on the board with whom I’m doing that business, I’d be had”—a reference to Gerald Hillman, who had almost no senior policy or military experience in government before being offered a post on the policy board. “Seems to me this is at the edge of or off the ethical charts. I think it would stink to high heaven.”

Hillman, a former McKinsey consultant, stunned at least one board member at the February meeting when he raised questions about the validity of Iraq’s existing oil contracts. “Hillman said the old contracts are bad news; he said we should kick out the Russians and the French,” the board member told me. “This was a serious conversation. We’d become the brokers. Then we’d be selling futures in the Iraqi oil company. I said to myself, ‘Oh, man. Don’t go down that road.’ ” Hillman denies making such statements at the meeting.

Larry Noble, the executive director of the Washington-based Center for Responsive Politics, a nonprofit research organization, said of Perle’s Trireme involvement, “It’s not illegal, but it presents an appearance of a conflict. It’s enough to raise questions about the advice he’s giving to the Pentagon and why people in business are dealing with him.” Noble added, “The question is whether he’s trading off his advisory-committee relationship. If it’s a selling point for the firm he’s involved with, that means he’s a closer—the guy you bring in who doesn’t have to talk about money, but he’s the reason you’re doing the deal.”

Perle’s association with Trireme was not his first exposure to the link between high finance and high-level politics. He was born in New York City, graduated from the University of Southern California in 1964, and spent a decade in Senate-staff jobs before leaving government in 1980, to work for a military-consulting firm. The next year, he was back in government, as Assistant Secretary of Defense. In 1983, he was the subject of a New York Times investigation into an allegation that he recommended that the Army buy weapons from an Israeli company from whose owners he had, two years earlier, accepted a fifty-thousand-dollar fee. Perle later acknowledged that he had accepted the fee, but vigorously denied any wrongdoing. He had not recused himself in the matter, he explained, because the fee was for work he had done before he took the Defense Department job. He added, “The ultimate issue, of course, was a question of procurement, and I am not a procurement officer.” He was never officially accused of any ethical violations in the matter. Perle served in the Pentagon until 1987 and then became deeply involved in the lobbying and business worlds. Among other corporate commitments, he now serves as a director of a company doing business with the federal government: the Autonomy Corporation, a British firm that recently won a major federal contract in homeland security. When I asked him about that contract, Perle told me that there was no possible conflict, because the contract was obtained through competitive bidding, and “I never talked to anybody about it.”