US intelligence agencies were "dead wrong" in assessing Iraq's weapons programmes and still know dangerously little about current nuclear and biological threats, a presidential commission has said.

After a year-long inquiry, the panel on US intelligence capabilities said in a scathing report on Thursday that the decision to invade Iraq in March 2003 - based on dubious intelligence - had irreparably damaged US credibility.

"We conclude that the intelligence community was dead wrong in almost all of its pre-war judgments about Iraq's weapons of mass destruction," the commission said. "We simply cannot afford failures of this magnitude."

The commission warned that US intelligence on the capabilities and intentions of Iran and North Korea - both locked in nuclear disputes with the United States - may be "disturbingly" shaky.

Contemporary intelligence

"The bad news is that we still know disturbingly little about the weapons programmes and even less about the intentions of many of our most dangerous adversaries," the commission said.

"Across the board, the intelligence community knows disturbingly little about the nuclear programmes of many of the world's most dangerous actors. In some cases, it knows less now than it did five or 10 years ago," it said.

The commission's report unravelled that in buildings its case for the Iraq war, the Bush administration relied on bogus intelligence from a mysterious Iraqi chemical engineer codenamed "Curveball".

Dubious source

Assertions that Iraq was cooking up biological agents in mobile labs to elude international inspectors and Western intelligence services - based almost exclusively on Curveball's information - became what the report called one of the "most important and alarming" assessments in the October 2002 National Intelligence Estimate cited by President George Bush and Vice-President Dick Cheney in justifying the war.

Despite Curveball's mysterious background before turning up in Germany and internal doubts about his reliability, the Iraqi's assertions appeared in more than 100 government reports and shaped then-Secretary of State Colin Powell's February 2003 address to the United Nations detailing Iraq's weapons programmes.

The commission faulted intelligence officials within the CIA for failing to raise these doubts, which emerged after the October 2002 intelligence estimate was published but before Powell's speech at the UN.

Only in May 2004, more than a year after the invasion, did the CIA formally deem Curveball's reporting "fabricated".

Misplaced emphasis

The commission also accused CIA analysts of placing "undue emphasis" on Curveball's information "because the tales he told were consistent with what they already believed".

The CIA suspects Curveball fabricated the information in an attempt to gain permanent asylum and avoid being returned to Iraq.

The commission said Curveball was not the only bad source the intelligence community relied upon.

Another asylum-seeker reporting through defence channels provided one report in June 2001 that Iraq had transportable facilities for the production of biological weapons. He recanted in October 2003.

Putting up a brave face, Bush welcomed the report and said he had directed his homeland security adviser, Fran Townsend, to review the 600-page document and take "concrete action" on its recommendations.

"The central conclusion is one that I share: America's intelligence community needs fundamental change to enable us to successfully confront the threats of the 21st century," he said in remarks at the White House. 

PHOTO CAPTION

US intelligence agencies were 'dead wrong' in their pre-war assessments of Iraq's weapons programs and still know dangerously little about nuclear programs in Iran and North Korea, a US presidential commission said. Picture shows President George W. Bush (3rd R) meeting with members of the commission including co-chairmen Charles Robb (2nd L) and Laurence Silberman (2nd R), in the Cabinet Room. (AFP)