A senior aide to Colin Powell at the time of his pivotal speech to the United Nations said on Tuesday that Curveball's admission raised questions about the CIA's role.

Lawrence Wilkerson, who was chief of staff to the then US secretary of state Powell in the build-up to the invasion, said the lies of Rafid Ahmed Alwan al-Janabi, also known by the codename Curveball, raised questions about how the CIA had briefed Powell ahead of his crucial speech to the UN security council presenting the case for war.

In particular, why did the CIA's then director George Tenet and his deputy John McLaughlin believe the claim by Curveball, "and convey that to Powell even though the CIA's own European chief Tyler Drumheller had already raised serious doubts.

"And why did Tenet and McLaughlin portray the presence of mobile biological labs in Iraq to the secretary of state with a degree of conviction bordering on passionate, soul-felt certainty?"

Richard Perle, a prominent neocon who chaired the Pentagon's advisory board under the Bush administration at the time of the invasion, said the Janabi admission pointed to a clear failure in intelligence vetting. "It's the job of intelligence agencies to distinguish between defectors who claim to have something to say and defectors who are lying and they obviously didn't do their job. The Germans didn't, and we didn't."

Perle said that Janabi wrote to him directly shortly before the invasion, setting out his claims about weapons of mass destruction and bemoaning that he wasn't being taken seriously by the US.

Groups of US veterans involved in the invasion and occupation of Iraq expressed their dismay at the revelation that key information had been fabricated. "This is very damning testimony and an indictment of the work the US put into the pre-war intelligence. The decision to go to war, to spend billions on sending hundreds of thousands of soldiers to the region, was in large part taken on the basis of an admitted liar," said Ashwin Madia, head of an organisation of progressive US military veterans, VoteVets.

Stephen Biddle, an Iraq expert at the Council on Foreign Relations, said Janabi's admission undermined those critics who accused the Bush administration itself of having lied. "The source did actually tell them those things. But it does support the idea that they didn't do due diligence on checking out the information in part because they were being told what they wanted to hear."

Judith Yaphe, a former CIA analyst on Iraq now at the National Defence University in Washington, said there were "bitter lessons" from the handling of Janabi. "It was an intelligence failure and very poor tradecraft".

She said that the syndrome of "false confirmation" – where just one source was shared by many different intelligence outlets none of whom realised they were talking to the same person – had come heavily into play. And the Bush administration had been far too willing to believe incredible witnesses.

"There were people at the time who doubted what Curveball was saying, but if the administration doesn't want to believe it, it doesn't make much difference."