Riyadh / KING ABDULLAH FINANCIAL DISTRICT

Karl Miller’s new report says the Gulf paid for protection it never got, and that it is time to walk away

For years the Gulf monarchies have been told that the path to security runs through Washington and Tel Aviv. Sign the Abraham Accords, buy Israeli defense and surveillance technology, invest in the right American funds, and you will be protected. Then came this war. Refineries in Saudi Arabia, LNG trains in Qatar and energy facilities across the region were hit, and none of those partnerships kept the missiles and drones away.

Karl Miller, whose assessments of the Gulf energy crisis I have relied on throughout this war, has now turned to the money and the politics behind that security bargain. His new report is titled, provocatively, “How the Gulf Countries Were Extorted to Fund Economic and Individual Genocide in Palestine.” The title states his allegation. What makes the report worth reading is that Miller is careful to separate what he alleges from what the documents prove, and the documented record is damning enough on its own.

Follow the money: Affinity Partners

At the center of the report is Affinity Partners, the investment firm Jared Kushner founded after leaving his post as senior adviser in his father-in-law’s first administration, where he was a principal architect of the Abraham Accords. Gulf sovereign money flowed in almost immediately. Miller reconstructs the publicly reported commitments:

[Table]
Investor | Reported commitment | Note
Saudi Public Investment Fund | $2.0 billion | Initial commitment
UAE investor(s), initial round | More than $200 million | 2023 reporting
Qatari investor(s), initial round | About $200 million | Similar to UAE
Qatar Investment Authority and Abu Dhabi’s Lunate | $1.5 billion | 2024 round, reported March 2025
Total fund commitments | About $4.5 billion | Of which about $3.9 billion identifiably Gulf
[/Table]

Source: Karl W. Miller, The Promise of False Security (16 October 2026), compiled from public reporting. Commitments are not the same as cash paid in.

The fees followed. By September 2024 Affinity had collected about $157.5 million in management fees from foreign investors, including $87 million from the Saudi Public Investment Fund. A congressional letter in March 2026 estimated more than $60 million more for 2025. That is over $217 million across those two periods. Yet by July 2024 the fund had deployed only about $1.1 billion, roughly 37% of what investors had committed. Miller’s verdict: too much compensation for too little demonstrated delivery. Affinity did make investments, he notes, but the manager was paid handsomely before its Gulf backers saw proven returns.

Where the money led

The most explosive part of the report concerns where some of that capital ended up. Affinity bought into Phoenix, one of Israel’s largest insurance and investment groups, under a permit allowing indirect holdings of up to 10%. After selling a quarter of its shares in July 2026, it still holds about 7.4%. Phoenix, in turn, holds positions in a long list of Israeli defense companies, including a reported stake of at least $265 million in Elbit Systems, the country’s largest arms maker, and holdings in makers of drone cameras, artillery fuzes and armored-vehicle components. Research on its portfolio also reports Phoenix financing for housing in the West Bank settlements of Emmanuel and Efrat, and an 80% interest in a shopping mall in occupied East Jerusalem.

The International Court of Justice found in its July 2024 advisory opinion that Israel’s settlement enterprise in the occupied territories is unlawful, as did UN Security Council Resolution 2334. In other words, Gulf money that was raised in part on the promise of Arab-Israeli peace now sits, through a minority stake, in a company with exposure to Israel’s arms industry and to settlement-linked business.

Miller is precise about the limits here, and so should I be. The exposure is indirect. A 7.4% stake in Phoenix does not mean Affinity owns or directs everything in Phoenix’s portfolio, and the settlement loans he cites were made before Affinity invested. But for Gulf governments that publicly champion Palestinian statehood, the fact that their sovereign wealth is anywhere in this chain should be intolerable.

The UAE: dependence sold as protection

The second strand of the report concerns security. Since the Abraham Accords the United Arab Emirates has built deep ties with Israel’s defense industry. In March 2021 the Emirati defense conglomerate EDGE and Israel Aerospace Industries agreed to develop a counter-drone system together, explicitly linking the project to the Accords. In November 2021 the same partners announced unmanned surface vessels with uses that included maritime security and oil and gas operations. Separately, Abu Dhabi’s Mubadala paid $1.025 billion for 22% of Israel’s Tamar gas field in 2021.

In Miller’s assessment, this integration has compromised the UAE’s security autonomy, embedding foreign suppliers in critical institutions and constraining the government’s freedom of action. He does not claim, and the record does not show, that Israel controls the Emirati government. His argument is subtler and, I think, more important: a country that cannot operate, repair or replace its own critical systems without a foreign supplier is not sovereign over them.

The false-security thesis

This is the heart of the report. Political access and advanced weapons are not the same as protection. Gulf states bought counter-drone systems, surveillance tools and privileged access in Washington. What they needed, Miller argues, was the ability to keep oil and gas flowing from the wellhead to the paying customer: production, processing, power, pipelines, ports, shipping and payment systems. A counter-drone system can defeat a defined threat; it cannot guarantee that a refinery stays online, a pipeline keeps pumping or a tanker reaches its buyer. The events of this year have proved the point. The partnerships were announced with great fanfare. The infrastructure was hit anyway.

Exit, recover, regain control

Miller’s recommendation is blunt. Gulf governments and their sovereign funds should exit the Trump-Kushner financial relationships and replace their dependence on Israeli defense and surveillance suppliers. Specifically, they should:

First, stop all new commitments, renewals and expansions. Second, use every available contractual right to withdraw, transfer or sell their fund interests and recover capital, while demanding a full accounting of the fees, carried interest and other benefits the manager has received. Third, take back control of data, software keys and administrative access from foreign suppliers, but in a careful sequence that does not shut down essential systems. Fourth, buy replacement security on the basis of tested performance and sovereign control, not political promises. And fifth, protect the oil and gas revenue chain throughout.

He is equally clear about what his report does not prove. It does not establish extortion in the legal sense, a single command structure linking Washington, Tel Aviv and Affinity, or personal criminal responsibility for anyone. Those questions require investigators to connect specific promises, threats, decisions and payments. Miller’s point is that the Gulf does not need that proof to act. The fees are documented. The exposure is documented. The failure of the promised protection is visible in the smoke over the Gulf’s refineries.

My view

The Gulf states were sold a bargain: normalize with Israel, buy its technology, invest with the President’s son-in-law, and America and Israel will keep you safe. They kept their side. The protection did not arrive. Their money paid fees to a politically connected manager and found its way, indirectly, into Israel’s arms industry and settlement economy, while their own oil and gas infrastructure burned.

Miller’s advice is the right advice. Get out, get the money back and take control of your own security. The rulers in Riyadh, Abu Dhabi and Doha should ask themselves a simple question: what exactly did they buy?

---

Colonel Wilkerson and I start off Friday with Nima:

Today’s INTEL Roundtable featured Scott Ritter, Joe Kent and Larry Johnson:

Sulaiman and I discussed whether Trump will use a MOAB:

---

I thank you for your invaluable support by taking time to read or comment. I do not charge a subscription fee nor do I accept advertising. I want the content to be accessible to everyone interested in the issues I am discussing. However, if you wish to make a donation, please see this link .