Top official admits FBI had al-Awlaki in custody before letting him go in 2002

American Muslim cleric Anwar al-Awlaki, seen in this 2008 file photo, was killed by a U.S. drone strike in Yemen in 2011. (AP)

The FBI, for the the first time, has admitted publicly that it knew the radical Muslim cleric Anwar al-Awlaki was returning to the U.S. in October 2002 and that an FBI agent discussed the American's return with a U.S. attorney before he was detained and then abruptly released from federal custody.

Al-Awlaki, who would become the first American targeted for death by the CIA, eventually was killed last September in Yemen by a U.S. drone strike. Since September 2009, 26 terrorism cases have been tied to him and his digital jihad, according to the James  A. Baker III Institute for Public Policy.

“I really want to get to the bottom (of this),” said Republican Rep. Frank Wolf, chairman of the committee that has oversight of the FBI. The committee was holding a hearing Wednesday on the Webster report on the FBI’s intelligence failures leading up to the Fort Hood massacre. Al-Awlaki exchanged 19 emails with Maj. Nidal Hasan, accused of murdering 13 in the shooting.

Wolf noted Wednesday that the Webster report makes no mention of the 2002 incident and the FBI’s role in the cleric’s release.

“We’re going to send a letter on this. If we can, we’re going to get a hearing, and if we have to, we may even subpoena the thing," he said.

Mark Giuliano, the FBI's assistant director for national security, testified Wednesday that the FBI knew in advance that he was making his way back to the United States, though he didn't explain how.

Al-Awlaki was detained at New York City's JFK airport because a customs database flagged him based on an outstanding arrest warrant. Giuliano, under intense questioning by Wolf, also admitted Wednesday there were discussions between an FBI agent and the U.S. attorney in Colorado about the U.S.-born cleric’s re-entry and the warrant.

“Yes, sir, there was a dialogue, as there always will be,” Giuliano replied. “If a case agent has a case on somebody that is coming into the country, the system is triggered and set up so that there will be a call to that case agent.”

Former FBI agents say there are only likely two explanations: The bureau let the cleric into the country to track him for intelligence, or the bureau wanted to work with him as a friendly contact.

During Wednesday's hearing, Giuliano could not explain a significant time discrepancy. Al-Awlaki was being held in the early-morning hours of Oct. 10, 2002, when FBI agent Wade Ammerman told customs agents that "the warrant ... had been pulled back." But that couldn't have happened while al-Awlaki was in custody, since it was only 5:40 a.m. in Colorado where the arrest warrant originated and where the courts had yet to open for the day.

In fact, documents show the warrant was still active at that time and was only vacated later that day.

The FBI has consistently maintained that the arrest warrant was pulled because the case against the cleric was weak, and it has suggested the timing, coming on the same day the cleric re-entered the U.S. at New York City's JFK airport, was coincidental.

In a 2010 statement to Fox News as part an ongoing news investigation of the cleric, a Justice Department spokesman suggested that the review of the warrant was routine. In addition, al-Awlaki, who lied on his Social Security application as part of a foreign student scholarship scam, had gone back and corrected the record with Social Security.

“As the U.S. Attorney’s Office reviewed the Awlaki case in preparing for presentation before a grand jury for an indictment, the federal prosecutor assigned to handle the matter determined that additional investigation was required," the spokesman said. "The U.S. Attorney’s Office learned during the subsequent investigation that the Social Security Administration would testify only that Awlaki was entitled to a Social Security number, that the number was valid and that their records indicated that he corrected his place of birth.”

But current and former investigators tell Fox News it is not routine to review a warrant once a federal judge has signed off on the merits of the criminal complaint. These same investigators question why an exception was made for someone who was the subject of a full investigation by the FBI’s Washington office because of his contacts with three of the Sept. 11 terrorist hijackers.

And according to documents newly obtained by Fox News through a request under the Freedom of Information Act, there was no correction of the record, contrary to what the Justice Department has stated.

The documents show that al-Awlaki lied on his Social Security application in 1990, stating his place of birth was Yemen, to obtain $20,000 in taxpayer-funded scholarship money. Five years later, when his studies were done, the documents show he applied for a replacement card using his true place of birth, Las Cruces, N.M.

The FBI has never explained why it let al-Awlaki walk free at a time when dozens of young Muslim men were being held in detention centers on material witness warrants in the wake of the Sept. 11 terrorist attacks. Days after he was let go, al-Awlaki was back on the FBI's radar, in Ammerman’s investigation of Ali al-Timimi, whose terrorism conviction now is on appeal.

“If a prosecutor at that time, regardless of whether a call was made or not, looks at the evidence and decided there was not enough to be able to arrest that individual, the warrant would be dropped, “ Giuliano said Wednesday. “I assure you ... if we could have incarcerated al-Awlaki, we would have.”

Also at the hearing, the FBI responded for the first time to evidence that al-Awlaki was under a full FBI investigation by the Washington office when he was invited to lunch at an executive dining room at the Pentagon in February 2002, a story first reported by Fox News.

“Why was al-Awlaki approved by (Defense Department Security) to speak at the Pentagon?” Wolf asked.

“Sir, I can’t, I can’t speak for DOD. I can’t answer that question,” Giuliano replied.

While the Webster report makes 18 recommendations for change at the bureau, some of which already have been made since the Fort Hood shooting, lawmakers complained that while 13 people were killed and more than three dozen wounded, no one at the bureau had been fired, demoted or disciplined over the intelligence failures and turf battles with the Army over the investigation.

Republican Rep. John Carter explained the questions he gets about the lack of accountability.

“My son went into harm’s way four times. And he gets killed where he’s stationed by a member of his own military who begins his shooting career as a murderer by shouting 'Allahu Akbar,'" Carter said in recounting the stories he hears from victims' families.

Giuliano said the bureau would make a decision, based on the report by former FBI and CIA director William Webster, within 60 or 90 days.

“Sir, I don't think there's anything you can say to them that will take away the pain that they have suffered," Giuliano said.