From Terror Group Founder to Libyan Rebel Military Commander

Aug. 29, 2011 — -- The same man who triumphantly led Libyan rebels into Gadhafi's compound last week first came to the attention of the U.S. intelligence community years ago -- as a founder of a terror group.

Abdelhakim Belhaj, who was recently appointed to Tripoli's rebel military council, was one of the original founders of the Libyan Islamic Fighting Group, an anti-Gadhafi group which was later designated by the U.S. State Department as a terrorist organization with links to al Qaeda, according to U.S. government reports.

"We proudly announce the liberation of Libya and that Libya has become free and that the rule of the tyrant and the era of oppression is behind us," a victorious Belhaj told reporters after the storming of Gadhafi's Bab al-Aziziya compound last week. Ousting Gadhafi had been the main objective of the LIFG since its inception in the early 1990s, even if some of the fighters believed that meant putting Americans in the crossfire.

The group carried out operations against the Libyan government including at least four suspected assassination attempts against Gadhafi in the 1990s and was also believed to be connected to a series of suicide bombings in Casablanca, Morocco, in 2003, the U.S. State Department reported. As relations between the U.S. and Gadhafi improved in the mid-2000s, some LIFG leaders cultivated relationships with top al Qaeda leaders including Osama bin Laden and were suspected of funneling fighters to Iraq to carry out operations against U.S. soldiers.

When the LIFG was designated a terror organization in 2004, it was meant as a "gesture of solidarity" with the Libyan government, according to a March 2011 congressional report.

DOWNLOAD: Libya, Unrest and U.S. Policy

Contrary to several U.S. government reports, Libyan rebel ambassador to the U.S., Ali Aujali, told ABC News that the LIFG was never connected to al Qaeda and did not carry out terrorist operations.

"They were only opposed to Gadhafi during his rule and paid the price for that by being oppressed by the regime," Aujali said.

The CIA first publicly voiced its concerns about the connection between the LIFG and al Qaeda in 2004 when then-director George Tenet testified before the Senate Select Committee on Intelligence and listed the LIFG among groups that represented an "immediate threat... [that] has benefited from al Qaeda links."

By that time Belhaj had been arrested and jailed in Libya where he would stay for years, but outside the prison walls, some other LIFG leaders reportedly tightened their relationship with al Qaeda. In 2007 al Qaeda's then-deputy Ayman al-Zawahiri announced a formal alliance between the groups, mentioning Belhaj personally.

"Dear brothers... the amir of the mujahideen, the patient and steadfast Abu-Abdallah al-Sadiq; and the rest of the captives of the fighting Islamic group in Libya, here is good news for you," Zawahiri said in a video, using Belhaj's nom de guerre. "Your brothers are continuing your march after you... escalating their confrontation with the enemies of Islam: Gadhafi and his masters, the crusaders of Washington."

Though a recent congressional report said the alliance was viewed by terror analysts at the time as "having political rather than operational relevance," a leaked 2008 State Department cable and a separate report by the Counter Terrorism Center at West Point noted that an inordinate number of anti-U.S. insurgents in Iraq came from Libya and the LIFG.

Hitting Americans, the fighters believed, was just another way to hit Gadhafi, the cable says.

"Many [Libyan] easterners feared the U.S. would not allow [the] regime to fall and therefore viewed direct confrontation with the [Government of Libya] in the near-term as a fool's errand. At the same time, sending young Libyans to fight in Iraq was 'an embarrassment' to [Gadhafi]," says the cable, posted on the website WikiLeaks. "Fighting against U.S. and coalition forces in Iraq represented a way for frustrated young radicals to strike a blow against both [Gadhafi] and against his perceived American backers."

READ: Libyan Rebel Strongholds Now, al Qaeda Wellspring Then

Still, other U.S. government documents describe the al Qaeda alliance announcement as a point of fracture within LIFG as many of their fighters were strictly anti-Gadhafi and did not view themselves as part of al Qaeda's global jihad against the West.

For his part, Belhaj waited in jail until 2009 when he and hundreds of other LIFG fighters were freed after negotiations with Gadhafi's son Saif al-Islam Gadhafi. As part of the deal to earn their freedom, Belhaj and other leaders penned a lengthy treatise denouncing political violence and terrorism, including al Qaeda.

An LIFG contingent in Britain went further, claiming the alliance with al Qaeda was a "personal decision [by one LIFG commander] that is at variance with the basic status of the group... The group is not, has never been, and never will be linked to the al Qaeda organization."

During a press conference following the release, Saif al-Islam said the men "no longer constituted a threat to Libyan society and would be reintegrated into their communities," according to the State Department's Country Report on Terrorism 2010.

DOWNLOAD: U.S. State Department's Country Report on Terrorism 2010

In a state-owned newspaper, after his release Belhaj reportedly praised Saif al-Islam for his intervention and told a Singapore-based think tank that he planned to live "under the law of the country."

Aujali said that former Islamist fighters like Belhaj must be seen in a different light now that the Gadhafi regime is gone.

"We should look differently at these organizations that dared oppose Gadhafi during his rule," Aujali said. "We should accept [Belhaj] for the person that he is today and we should deal with him on that basis -- as someone who is opposed to Gadhafi... People evolve and change."

A U.S. official told ABC News it appeared the faction of LIFG that survived in the rebel movement "seems, from their statements and support for establishing a democracy in Libya... to not support al Qaeda."

"We'll definitely be watching to see whether this is for real or just for show," the official said.