The Bush administration based a crucial prewar assertion about ties between Iraq and Al Qaeda on detailed statements made by a prisoner while in Egyptian custody who later said he had fabricated them to escape harsh treatment, according to current and former government officials.
Jane Mayer has been reporting on this phenomenon in several outlets, especially the New Yorker. Here's a bit from her February expose on extraordinary rendition:
Ten hours after landing in Jordan, Arar said, he was driven to Syria, where interrogators, after a day of threats, “just began beating on me.” They whipped his hands repeatedly with two-inch-thick electrical cables, and kept him in a windowless underground cell that he likened to a grave. “Not even animals could withstand it,” he said. Although he initially tried to assert his innocence, he eventually confessed to anything his tormentors wanted him to say. “You just give up,” he said. “You become like an animal.”
There you have it. Our intelligence-gathering bodies are no longer in the business of gathering intelligence, but rather creating false intelligence. Not particularly useful for fighting a war on terror, but a handy way to skew information to support your pre-set agenda.