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Until now rival intelligence agencies and the family of Omar Khan Sharif, 27, from Derby, have argued over how he died after his body was found washed up on a beach.
Islamic militants claimed that Israeli secret agents captured then murdered him. But Israeli authorities deny the accusation, claiming that Sharif was probably killed by the Palestinian terrorist group Hamas, which used him and another British-born Islamic student to carry out the bombing in April 2003.
Western security chiefs believe that Sharif killed himself after failing in his martyrdom mission, but his family have complained of a cover-up.
Yesterday a coroner in Derby said that it would never be known for certain how Sharif had ended up in the sea after his failed attack.
Bystanders who tried to seize Sharif told an inquest how the former public schoolboy fought off one man who held a knife to his throat. He fled and managed to evade a huge police hunt.
Sharif and Asif Hanif, 21, from Hounslow, West London, targeted Mike’s Place, a seafront bar close to the US Embassy. The idea was for them to become the first British-born suicide attackers.
The inquest in Derby was told how Hanif forced his way past security guards and detonated his explosives, killing himself and three others and wounding 65 people in the packed bar. Sharif fled after only the detonator on his bomb, strapped round his waist, went off.
Both men had made a martyrdom video before the attack boasting that it was “an honour to kill all these people”.
In a statement read to the inquest, a local resident, Shmuel Cohen, told how he had seen Sharif trying to dispose of the unexploded bomb in a nearby litter-bin.
“I noticed he had lifted up his shirt and taken out a white container with a black band of sticky tape. He then placed it into the bin . . . I approached him and asked what he was doing.” Sharif refused to answer and ran off, and Mr Cohen chased him for half a mile.
Sharif then attacked a guard at the nearby David Intercontinental Hotel, pinning him to the ground and stealing his wallet. Sharif fled and flagged down a taxi driver, Alex Faliq, offering to pay him any amount of money to drive him out of the area, which was swarming with police.
The inquest was told how Sharif leapt out of the cab when a car pulled alongside and the driver shouted: “Stop that man. He’s a terrorist!” Mr Faliq, who had a knife with him, described how he chased Sharif and finally cornered him. “I put the knife near his eye and said, ‘Who are you?’ I stood opposite him and kicked him in the testicles. It was a hard kick, but he didn’t move. I kicked him again, but again he didn’t move.”
Sharif managed to escape again. His body was discovered two weeks later floating face-down near the seafront.
Professor Guy Rutty told the inquest that he found nothing to support claims by Islamic groups that Sharif was captured, restrained or tortured.
He said: “I am of the opinion that the safest cause of death is that of ‘unascertained’. But on the balance of probabilities it would be drowning.”
Sharif worshipped at the Jamia mosque in Derby, where members of the now outlawed group al-Muhajiroun regularly tried to recruit young Muslims.
He and Hanif are believed to have been the first foreign citizens to be used by the militant Palestinian group Hamas to carry out terror attacks in Israeli territory.
Sharif’s brother Zahid, 49, sister Parveen, 38, and wife, Tahira Tabassum, 30, were later cleared at the Old Bailey of failing to disclose information about acts of terrorism.
Peter Ashworth, the Derby and South Derbyshire Coroner, recorded a narrative verdict.
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