NEW DELHI – An American convicted in the 2008 Mumbai attacks said Pakistan's main spy agency was deeply involved in planning that strike, monitoring the preparations and providing funding and advice to the attackers, according to an Indian government summary of his interrogation.
The report gives the strongest indication of the involvement of Pakistani authorities in the attack, which killed 166 people, paralyzed India's business capital and froze peace efforts between Pakistan and India.
Under questioning by Indian officials, David Headley painted a detailed picture of how intertwined Pakistan's Inter-Services Intelligence agency was with the Lashkar-e-Taiba group accused of carrying out the attack, according to the report.
Headley, 50, from Chicago, was born Daood Gilani to a Pakistani father and an American mother. In March, he pleaded guilty in U.S. federal court to laying the groundwork for the Mumbai attack as well as preparing for an attack in Denmark.
According to the report, Headley said the Pakistani spy agency provided individual handlers — many of them senior officers — for all the top members of Lashkar and gave them direction and money to carry out their reconnaissance of prospective targets.
The group's chief military commander, Zaki-ur-Rahman Lakhvi, was close to the director general of the spy agency, Lt. Gen. Ahmed Shuja Pasha, the report said.
"According to Headley, every big action of LeT is done in close coordination with ISI," the report said, using a common abbreviation for Lashkar-e-Taiba.
A senior intelligence official in Pakistan said the allegations in the Indian report were baseless. He spoke on condition of anonymity because he was not authorized to talk to the media on the record.
"These are allegations we've heard before," U.S. State Department spokesman Mark Toner told reporters in Washington. "We believe the government of Pakistan has pledged its cooperation in bringing the perpetrators of the Mumbai attacks to justice. And we fully expect that these pledges of cooperation are going to be carried out."
"Pakistan itself has been, obviously, greatly touched by extremist violence, and it is also in an existential struggle with these groups. So we believe Pakistan understands the threat and is committed to working cooperatively," Toner said.
ISI has long been suspected of links to terror groups. The spy agency is believed to have nurtured Lashkar to attack Indian security forces in disputed Kashmir. U.S. officials have accused ISI of working with the Taliban to coordinate attacks on NATO forces in Afghanistan.
In July, Indian Home Secretary G.K. Pillai caused a ruckus ahead of high-level India-Pakistan talks when he accused the spy agency of orchestrating the Mumbai attacks. Pillai cited Headley as the source of the information.
According to the report on the interrogation, which was marked secret and obtained by The Associated Press late Monday, Headley said the spy agency was having problems with militant groups in Pakistan, because fighters based in Kashmir were beginning to join Taliban groups fighting along the Pakistan-Afghanistan border.
Launching a huge attack on India would prevent further defections from these groups by raising their morale and would move the "theater of violence" from Pakistan to India, the report said.
In Chicago where he is being held, Headley spoke to Indian investigators for 34 hours in June about the planning behind the 60-hour siege attack by 10 Pakistani militants of two luxury hotels, a Jewish center and a busy train station.
Headley described for Indian officials a Lashkar-e-Taiba organization that was filled with former Pakistani army officers and veterans from the conflicts with India over Kashmir, the report said.
At one Lashkar camp, Headley was trained by a Pakistani army instructor, he said, according to the report.
Every major official with the group had a handler from the spy agency, most of them majors and colonels. Lakhvi's handler was known as Brig. Riyaz, he told interrogators, according to the report.
Headley met repeatedly with his own handler, whom he identified as Maj. Iqbal, during the preparations for the Mumbai attacks.
Iqbal first called Headley in March 2006, and the two of them met, along with Iqbal's superior, Lt. Col. Hamza, for more than two hours, according to the interrogation report. Hamza assigned Iqbal to be Headley's handler and assured him of financial backing.
Iqbal assigned Headley a trainer to drill him in intelligence basics, including how to cultivate sources and take cover, the report said.
Before Headley's first scouting trip to India in September 2006, Iqbal gave him $25,000. He later gave him a camera phone and showed him how to take surveillance videos, the report said.
Headley met with Iqbal in Pakistan after each of his nine trips to India, debriefed him and gave him copies of the photos and videos he took of potential Indian targets, the report said.
Iqbal gave Headley suggestions on how the Mumbai attackers could best reach the city by sea, and asked Headley to conduct some surveillance for him of an atomic research center in Mumbai and of locations in the city of Pune, the report said. They also discussed a plan to attack a Danish newspaper over cartoons depicting the Prophet Muhammad.
On at least one occasion, Iqbal gave Headley counterfeit Indian currency to try to use on his trips, the report said. That accusation would irk India, which has grown increasingly worried about Pakistani smugglers bringing fake currency into India via neighboring Nepal.
In return for the cooperation, Iqbal helped Headley after he was taken into custody by police in the Pakistani city of Lahore on a complaint from one of his wives, the report said.
The two continued to meet even after the attack, but with pressure mounting on Pakistan to take action against the accused, Iqbal told Headley they had to cut off contact in 2009, the report said.
Earlier this month, Interpol alerted its members that India had filed an arrest warrant for Maj. Iqbal.
Over the weekend, U.S. officials said that two of Headley's wives had raised concerns with U.S. authorities about their husband's possible links to terrorism before the Mumbai attacks.
Headley was born in the United States but spent most of his childhood in Pakistan, moving back to America as a teenager to be with his mother after his parents divorced. At one point he ran his mother's bar in Philadelphia and also a video store in New York. He joined Lashkar-e-Taiba in 2001 after hearing a lecture by the group's leader, Hafeez Saeed, on the need for holy war.
In 2006, he changed his name to David Headley — anglicizing his first name and adopting his mother's maiden name — because he felt that would help him cross international boundaries easier.
Under a deal with prosecutors in the United States, Headley will not face execution if he continues to cooperate with their terrorism investigation. He could face up to life in prison and a $3 million fine when he's sentenced. As part of the plea bargain, the U.S. government agreed not to extradite him to India, Pakistan or Denmark for the charges for which he has admitted guilt.
Associated Press Writer Nahal Toosi in Islamabad and Matthew Lee in Washington contributed to this report.