Financing Terrorism

[Petronas]

Saudis Hindering Terror Fight?
Feb 17, 2005 7:31 am US/Eastern

WASHINGTON (AP) Saudi Arabia's less-than-full cooperation has hindered U.S. efforts to choke off terrorist financing, a lawmaker said Wednesday, and a Bush administration official indicated the Saudis were being prodded. Juan Zarate, the Treasury Department's assistant secretary for terrorist financing, also said Treasury investigators have not found a direct link between al Qaeda and the illicit diamond trade in Africa but did not rule one out. "We have not seen direct links," Zarate said in testimony before the oversight panel of the House Financial Services Committee. Even without a direct tie, U.S. authorities are concerned that al Qaeda leader Osama bin Laden could be involved indirectly in trade in diamonds, gold and tanzanite or could become a direct participant, Zarate later told reporters.

Rep. Sue Kelly, who heads the subcommittee, asked Zarate at the hearing whether the Saudis have followed through on promises to take up such measures as setting up a financial intelligence unit and seizing assets of individuals believed to help fund terrorism. Despite Saudi Arabia's announcement in 2002 that it had established such an intelligence unit, there still appears to be no unit operating, Kelly said. She said the absence of one probably "slowed or entirely prevented action against terrorist activity" in several cases.

A spokesman at the Saudi Embassy in Washington disputed that, saying that a financial intelligence unit was established in the country in July 2003. "It's been set up, it's been functioning," the spokesman, Nail Al-Jubeir, said by telephone after the hearing. "We are working with the United States government to develop it."

Zarate said the Saudis had shown improved cooperation in freezing assets of suspect charities and other measures and "are taking this issue very seriously." He added, "We are constantly working with the Saudis to ensure" that they follow through. Al-Jubeir said his government was cooperating in the effort. "Both sides could do better, but the cooperation is working very well," he said. "If there are areas that we can improve, we will look into it."

Since the U.S. government intensified efforts against terrorist financing after the Sept. 11 attacks, its relationship with Saudi Arabia has been delicate. The long-standing ally — which is also the birthplace of bin Laden and 15 of the 19 Sept. 11 hijackers — has at times appeared reluctant to be a full partner in the U.S.-organized anti-terror coalition.

Al Qaeda launched a campaign in Saudi Arabia in May 2003, bombing Westerners' housing compounds in the capital, Riyadh. Earlier this month, the kingdom played host to an international anti-terrorism conference, where Saudi leaders expressed their commitment to fighting terrorism.

Some experts say there is evidence of al Qaeda's ties to the illicit African diamond trade. But U.S. intelligence officials and the independent Sept. 11 commission have maintained there is no conclusive proof that the terror network laundered millions of dollars through diamonds before staging the U.S. attacks. Al Qaeda and its affiliates have been linked to the heroin trade in Afghanistan, credit card fraud in Europe and the lucrative trade in counterfeit goods as means of financing their terrorist activities.

http://wcbs880.com/terror/terror_story_048073312.html

[Ernie]

What disturbs me on the topic of funding terrorism is that if the free world places an embargo on petroleum from oil-rich, terrorist-funding middle eastern countries, that will only place other industrial giants (emerging China & soon-to-be giant, India) in a favored position to purchase their petroleum. We are fighting a financial war and industrial war indirectly when we (the US) place sanctions or embargos on terrorist states. Just an industrial point of view.

[Casey]

Steps Against Terrorist Financing Risk Backfiring
Wed Feb 23, 2005 1:48 PM ET

By Caroline Drees, Security Correspondent

WASHINGTON (Reuters) - U.S. efforts to regulate companies that transfer money are threatening to drive billions of dollars into an underground market where terrorist financiers can flourish, industry and other officials said.

The danger hinges on an increasing reluctance by banks to handle the accounts of thousands of so-called money service businesses that transfer much of an estimated $28 billion a year. Regulators have labeled the mostly small enterprises a "high risk" for money laundering or terrorist financing in the aftermath of the Sept. 11, 2001, attacks.

Without banks to transfer their funds, money service businesses face the choice of shutting down or moving money illegally through cash couriers or unlicensed businesses.

"We're shooting ourselves in both feet, with .44 Magnums. There are no toes left," said Michael McDonald, a retired special agent for the Internal Revenue Service's criminal investigation division.

"It will substantially increase the risk of terror financing," McDonald said.

U.S. Rep. Gwen Moore, a Wisconsin Democrat, said that with fewer banks doing business with MSBs, "There is added potential for funds to slip through the cracks of an under-regulated system into the hands of terrorists."

Isak Warsame, president of Ohio-based Dahabshil Inc., which says it remits roughly $80 million to $90 million a year to Somalia, said, "There are as many MSBs above ground as there are underground. Once this kind of situation arises, all of them or most of them will go underground."

Regulators are stepping up efforts to address the emerging risks.

"Money services businesses play a very important role in the U.S. economy and we certainly don't want to drive all that business underground," said Daniel Stipano, acting chief counsel for the Office of the Comptroller of the Currency, a banking regulator.

MULTIBILLION-DOLLAR INDUSTRY

Before and after the Sept. 11 attacks, al Qaeda used money transmitters, including "hawala" money brokers, to move funds swiftly, cheaply and with almost no paper trail, casting a sudden spotlight on the sector.

Money service businesses are legal in the United States if they register with the Treasury and comply with strict rules imposed after the hijacked airliner attacks. About 22,350 MSBs were registered with the Treasury at latest count in December.

MSBs are frequently used by immigrants to send remittances back home, often just $100 or $200 at a time. MSBs collect the funds and use banks to make the international wire transfers. The latest official U.S. figures put remittances from the United States at $28 billion in 2003. That compares with total U.S. foreign direct investment of $27 billion.

But many banks say it has become too hard to ensure that even the licensed MSBs have met regulatory requirements, and fear regulatory fines or punishment if there is a problem.

John Byrne, head of the American Bankers Association's Center for Regulatory Compliance, confirmed some banks were eliminating MSB accounts because regulators had warned of risks without issuing clear enough guidelines on how to avoid them.

New York Rep. Charles Rangel, the ranking Democrat on the U.S. House of Representatives' powerful Ways and Means Committee, called on Treasury Secretary John Snow this month to address the problem.

At Snow's request, the Treasury Department's Financial Crimes Enforcement Network is holding a meeting of regulators and industry officials on March 8, and says it is critical to address the concerns of both sides as soon as possible.

"Too many small businesses will be closed soon and too many fathers and mothers will lose their job if this situation continues," said Juan Tejeda of New York-based remitter Envios de Valores La Nacional, whose accounts are being closed by several banks.

Several letters sent to MSBs from banks, reviewed by Reuters, warned of account closures because of regulatory oversight demands or because it was not in the bank's interest to continue the service.

"My members are feeling like they're on death row," said David Landsman, head of the National Money Transmitters Association. "Some of our members are just counting the days until they are going to have to close their doors."

http://today.reuters.com/news/newsArticle.aspx?type=reutersEdge&storyID=2005-02-23T184810Z_01_N23395624_RTRIDST_0_PICKS-SECURITY-FINANCING-DC.XML

[al-Canine]

Don't buy that fake Rolex! It could finance terror

Thu Feb 24, 2005 01:56 PM ET
By Andrea Ricci

NEW YORK (Reuters) - Think twice before you buy that fake Rolex watch or knock-off designer handbag. The money you pay could be end up funding terrorists.

It's not something most shoppers think about when tempted by the cheap and increasingly abundant wares of street vendors. But law enforcers say the threat is real and probably growing.

There is evidence that counterfeiters operating in New York City have sent money to Hamas and Hezbollah, groups designated as terrorist organizations by the United States, Police Commissioner Raymond Kelly said at a conference on counterfeiting.

So far, said Kelly, there had been no clear link between the selling of counterfeit goods and al-Qaeda, the group blamed for the attacks on the World Trade Center and the Pentagon in 2001.

But he said the low cost of entry into the counterfeit business, low risk of penalties and the potentially big payoff made the making and selling of fake goods an ideal criminal enterprise, one that would appeal to terrorists in the same way it attracts organized crime.

"What we do know for certain is that the counterfeit trade has all the ingredients for an ideal criminal enterprise," Kelly said.

According to estimates by the International Chamber of Commerce, counterfeit goods accounted for 6 percent of world trade, valued at about $456 billion.

Kelly said that in New York, counterfeiting deprives the city of nearly $1 billion in tax revenues every year. The costs to security are more difficult to quantify.

Juan Zarate, the U.S. Treasury Department's top terror funding cop, said terror groups have become more sophisticated in funding their activities as the United States and other countries crack down on money laundering through banks and other financial institutions.

Counterfeiting is one of the methods used by terrorists to raise cash, he said.

Zarate said the Treasury had "seen examples where traded goods have been used to support terrorist groups." But he added that it was often quite difficult to draw clear lines between the counterfeit trade and terrorists.

DOING WELL BY DOING GOOD

The link between terrorism and counterfeiting has not escaped the attention of luxury goods makers, which have long been fighting a battle to protect their lucrative trademarks.

It's worth millions in lost revenues to the companies, but they say it's not just about money.

Glossy magazine Harper's Bazaar has been trying to make the case to its fashion-conscious readers that the bargain bags they buy on the street might be made by child labor or to line the pockets of drug dealers or terrorists.

"While purchasing just one fake accessory on a street corner might seem like an amusement, this is a far more serious crime than most of the public understands," said Valerie Salembier, publisher of Harper's Bazaar, the sponsor of the counterfeiting conference.

Frederick Mostert, chairman of the Intellectual Property Group of the Walpole Committee, a trade association of British luxury goods makers, said it was impossible to make goods counterfeit-proof. "Anything can be faked," he said.

Consumer education was the key. But it was hard to convince buyers to avoid cheap fakes when the fakes themselves often were considered chic.

People must understand "it's not a $10 product. It's cash, it's money laundering, it's organized crime, it's child labor, it's linked to terrorism and to drugs," said Bertrand Stalla-Bourdillon, general manager at Louis Vuitton.

PUT 'EM IN JAIL?

France, which already has taken aim at organized criminals involved in counterfeiting, is now targeting average consumers, who face huge fines -- up to hundreds of thousands of dollars -- and even jail time if they are caught with fakes.

Throwing shoppers into prison is probably not on the agenda in the United States. But fighting counterfeiters would be easier if international laws were streamlined, advocates said.

"When you have the restrictions and limitations of territoriality confronting a global problem, where counterfeiters and pirates act without any boundaries, we've got a mess," said Timothy Trainer, president of the International Anti-Counterfeiting Coalition, a lobbying group.

Slashing prices on luxury goods to put them more within reach of less well-heeled fashion lovers and discourage the purchase of cheaper knock-offs was not a viable option, said Armando Branchini, Secretary General of Altagamma, the Italian association of high-end fashion companies.

"It's impossible to finance the product innovation of these brands and to support the contents of excellence, of quality they put in every phase of their business with prices comparable to those you can pay for fakes on Fifth Avenue or on Canal Street," he said. "So, it's absolutely impossible."

© Reuters 2005

http://www.reuters.com/newsArticle.jhtml?storyID=7731310&type=worldNews

[al-Canine]

World leaders focus on terrorists' funding

Group suggests independent global financial body

MADRID, Spain - Financial experts urged world leaders Wednesday to create a new international institution under U.N. auspices to study how terrorists raise money so ways can be found to cut the funds to al-Qaida and other violent movements.

The draft recommendation, a copy of which was obtained by The Associated Press, and experts attending a terrorism conference said that some measures have been taken to curb terrorist financing — but not enough.

"Terrorist financing has not been recognized as a priority in the fight against terrorism," said Loretta Napoleoni, an expert on terrorist financing. "It would be much more efficient if we blocked the money. And we haven't done that."

World leaders and experts at the four-day summit on democracy, terrorism and security are grappling with ways to combat violence without jeopardizing human rights.

Fighting terrorism financing was seen as a possibility but is complicated, in part because terrorists raise funds by using legitimate businesses, besides kidnapping, drug dealing and credit card fraud.

"We don't have a clear image of how the money of terrorists moves around," said Petre Roman, a former prime minister of Romania. "We know that the most terrible acts have been committed with very little money."

The train bombings in Madrid on March 11, 2004, cost as little as $1,300, Roman said, while the Sept. 11, 2001, suicide attacks in the United States cost no more than $500,000.

"Without an international effort, we cannot tackle this problem efficiently," he said. "We need to know how to pursue this money, and this cannot be done within the current legal framework."

Former French Prime Minister Lionel Jospin stressed that international cooperation must take place within "the rule of law and respecting civil rights because they are the soul of democracy."

Jospin and others said the conference's draft recommendations will address the blocking of terrorists' financial networks.

The finance working group experts suggested that in addition to creating an independent finance center under U.N. auspices, a judicial review process should be put into place to place anti-terrorism measures within a legal framework.

The Club de Madrid group of former heads of government organized the conference and timed it to coincide with the anniversary of the Madrid train bombing, an attack that killed 191 people and wounded more than 1,500.

U.N. Secretary-General Kofi Annan was to present a special U.N. report on terrorism at the conference Thursday. Other world leaders to arrive Wednesday include Afghan President Hamid Karzai.

U.S. Attorney General Alberto Gonzales will represent President Bush.
Copyright 2005 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

http://msnbc.msn.com/id/7139641/

[Petronas]

Terror victims sought for lawsuit against Arab Bank
Updated Mar. 18, 2005 5:36

An American law company which sued the Arab Bank branch in New York in December has launched a public relations campaign in Israel to find more
terror victims to add to that lawsuit. The lawsuit, filed by Motley Rice LLP, was the second filed against the Arab Bank. In July, a group of American lawyers including David Wollmuth, Mark Werbner, Gary Osen and Andrew Friedman filed suit in the US District Court, the eastern district of New York, on behalf of the relatives of some 50 Americans and Israelis killed in terror attacks. A publicity firm in Israel involved in the new Motley Rice campaign did not know the exact number of victims represented in its suit. However, according to press reports, it already included 700 plaintiffs when it was originally submitted. The company has published large newspaper ads as part of its blitz, set up an Internet site and linked up with the Eitan Law Group in Israel, which will be processing the complaints. The New York-based company specializes in class-action suits and represented the plaintiffs in a successful lawsuit against the tobacco companies in the US, and is currently representing the families of the victims of the World Trade Center terrorist bombing on September 11, 2001.

Both of the lawsuits charged, among other things, that the Arab Bank served as a funnel for channeling donations from alleged Islamic charitable associations to terrorist organizations operating in the West Bank and Gaza. The money was allegedly used to pay allowances to the families of suicide
bombers.

http://www.jpost.com/servlet/Satellite?pagename=JPost/JPArticle/ShowFull&cid=1111030178298

[al-Canine]

U.S. Seeks Access to Bank Records to Deter Terror

http://www.wincoast.com/forum/showthread.php?p=120568

[Atlas]

World leaders focus on terrorists' funding

Group suggests independent global financial body

MADRID, Spain - Financial experts urged world leaders Wednesday to create a new international institution under U.N. auspices to study how terrorists raise money so ways can be found to cut the funds to al-Qaida and other violent movements.

The draft recommendation, a copy of which was obtained by The Associated Press, and experts attending a terrorism conference said that some measures have been taken to curb terrorist financing — but not enough.


http://msnbc.msn.com/id/7139641/

Ummmm, Yeeeeeah, I want Kofi to have access to my bank account. It's not enough that his outfit is running the food for oil program and other such clean as the driven snow programs.

I think he should have access to the worlds bank accounts too. That'll happen some time soon

:mad_13: :mad_13: :mad_13: :mad_13:

[al-Canine]

Middle Eastern bank under U.S. scrutiny

Arab Bank PLC has branch in New York City

NBC News Investigative Unit

U.S. officials tell NBC News that U.S. banking regulators have uncovered evidence that a prominent Middle Eastern bank with a branch in New York City, Arab Bank PLC, has had dozens of suspected terrorists as its customers. The customers, allegedly associated with terror groups including al-Qaida, Hamas and Hezbollah, are responsible for hundreds of transactions at the Arab Bank, according to the officials.

The U.S. officials also tell NBC News that the U.S. bank regulator, the Office of the Comptroller of the Currency (OCC), has now referred the Arab Bank case to the Justice Department's terror-financing section for potential prosecution. A Justice Department spokesman would not comment.

The OCC matched the names of suspected terrorists against lists of Arab Bank customers, as well as others who sent or received wire transfers through the bank, and got hundreds of hits, the U.S. officials say.

After completing its investigation, which started last summer, the OCC forced the bank to shutter most of its operations here in the United States -- forbidding the Arab Bank from taking deposits or transferring money through its New York City (Madison Avenue) branch.

The OCC announced that extraordinary action in February, but did not publicly reveal the basis for its findings.

Officials speaking on behalf of the Arab Bank tell NBC News that the bank has never knowingly moved money to, or done any business with, terrorists. The same officials say that OCC regulations prohibit them from discussing the specifics of the case. They point out that the bank does billions of dollars of business a year, and that it is extremely difficult to determine the true identity of customers and others who wire funds through the bank.
Most importantly, the officials say, the Arab Bank has never done business with anyone who at the time was officially designated a terrorist by the U.S. government. With regard to the criminal referral to the Justice Department, a spokesman for the Arab Bank had no comment.
A spokesman for the OCC would not comment on the allegations, describing the Arab Bank matter as an "open-enforcement case." But he added: "There were issues about the completeness and accuracy of information given to us, and materials provided to us, by the Arab Bank."

An Arab Bank spokesman denies that and tells NBC News that Arab Bank has fully cooperated with the OCC.

-- By Adam Ciralsky and Jim Popkin

© 2005 MSNBC.com

URL: http://msnbc.msn.com/id/7565035/

[al-Canine]

Al Qaeda has cash flow problems: US

By Khalid Hasan

WASHINGTON: Al Qaeda, a senior US official says, is now “hurting for money” because of US-based oversight of money-transfer operation by charities in Islamic countries, principally Saudi Arabia, and pressure on Arab governments to tighten their control over money given for charity going to terrorist groups or towards the promotion of extremist ideologies.

Stuart Levey, Undersecretary at the Office of Terrorism and Financial Intelligence, Department of the Treasury, said this on Wednesday in testimony before the House Financial Services Subcommittee on Oversight and Investigations and the House International Relations Subcommittee on International Terrorism and Non-proliferation.

Levey said intelligence reports speak of the difficulty with which terrorists are raising, moving, and storing money. “We are seeing terrorist groups avoiding formal financing channels and instead resorting to riskier and more cumbersome conduits like bulk cash smuggling. And, most importantly, we have indications that terrorist groups like Al Qaeda and Hamas are feeling the pressure and are hurting for money.” He said the US is threatened not only by known financiers but also by those “we don't know and those who may join their ranks in the future.”

He said reports had confirmed that once-willing donors are now thinking twice or balking altogether at sending money to terrorist groups. “We are tracking and disrupting the flow of funds to terror in every area of the globe,” he added. On a recent visit to Syria, he told the committee, Deputy Assistant Secretary Daniel Glaser had delivered a series of demands to Syrian authorities, ranging from reform of their banking sector to immediate, effective action to cut the flow of funds and other support across the Syrian border to the Iraqi insurgency. “We made clear that Syria would either take effective steps to address our long list of concerns, or we would cut it off from our financial system,” he added. He expressed dissatisfaction with the adequacy of Syrian response to American demands.

Levey said terrorist groups have long exploited charities for their own reasons. The “legitimate” activities of these charities, such as the operation of schools, religious institutions, and hospitals, create fertile recruitment grounds, allowing terrorists to generate support for their causes and to propagate extremist ideologies. Charities attract large numbers of unwitting donors along with the witting, thus increasing the amount of money available to terrorists. To the extent that these charities provide genuine relief, which nearly all of them do, they benefit from public support and an attendant disinclination by many governments to take enforcement action against them. He said the US had persuaded other nations, including Saudi Arabia, to join Washington in bringing suspicious charities to the United Nations Security Council for designation, and to shutter these dangerous organisations in their respective countries.

He told the committee, “We are of course cognisant that well-intentioned donors have given money to some of the same charities abused by terrorist organisations. It is painful when funds and services donated with the intention of providing legitimate relief do not reach their intended and needy beneficiaries. But frustration with this situation must be directed at those who have corrupted the charities that have - either through wilfulness or wilful blindness -been used to support terrorism. We recognise that enforcement actions have sometimes also cut off sources of relief to communities in need and inadvertently decreased the support of charities and donors that deliver funds to legitimate causes. Our goal is not to deter charitable giving but instead to protect the charitable sector such that donors' generosity is not abused and they feel safe in providing their contributions.”

Turning to Kuwait, one of the Arab countries Levey dealt with in his testimony, he said the US had asked its government to intensify its battle against terrorist financing. “Saudi Arabia, too, has worked with us to some extent to address vulnerabilities in its charitable sector. The Saudis have taken proactive steps including the banning transfers of money from charitable accounts abroad. The Saudi government had announced that it would freeze all international transfers until it had established an oversight commission to regulate its charitable sector. “While that would represent a satisfactory short-term solution if actually implemented, it is important that the announced commission take shape. It is particularly important that charities like the International Islamic Relief Organisation (IIRO), the World Association of Muslim Youth (WAMY), and the Muslim World League (MWL) - expressly excluded from the commission - become subject to its oversight once it is finalised. In addition to the export of terrorist funds from Saudi Arabia, we are extremely concerned with the export of terrorist ideologies that promote war and killing in the name of religion. These distorted ideologies are just as indispensable to terrorists as money, and possibly even more pernicious. We must do all we can to ensure that extremist, violent ideologies are not exported under the cover of religious organisations, charities, or schools,” he stressed.


http://www.dailytimes.com.pk/default.asp?page=story_6-5-2005_pg7_39

[al-Canine]

Hezbollah pushes Prada?

Law enforcement officials testify that terror groups may be fund-raising through counterfeit goods.

NEW YORK (CNN/Money) - While the savvy bargain hunter can tell the real Coach handbag from a fake, many discerning buyers are missing one critical detail -- that purse or DVD for sale on the street corner might be funding a terrorist organization.

Testifying before the Senate Homeland Security Subcommittee in Washington yesterday, law enforcement officers warned that terrorist groups such as Hezbollah are generating revenue by pushing knockoff handbags, T-shirts and other accessories sold on the street and at flea markets across the country.

Lt. John Stedman of the Los Angeles County Sheriff's Department was among those who testified that items such as counterfeit Coach and Louis Vuitton purses as well as CDs, DVDs and tobacco were among goods that have been seized and linked to terrorist organizations.

In Los Angeles County alone, the Sheriff's Department reports that officers have arrested 125 individuals, and seized $16M in knock-off items and $3.5 million in cash.

The California law enforcement agency said it established a connection between the street vendors and the Lebanon-based Hezbollah mostly through admission by those arrested.

Despite the amount of revenue generated, many individuals have had a difficult time moving the money to overseas terror groups. According to the department, in the homes of one of the suspected individuals, an investigator discovered $800,000 in cash hidden in black trash bags under beds and more than $10,000 in a child's piggy bank.

"As a result of these kinds of cases, the joint task force is working effectively towards preventing these kinds of crime from occurring in the future and intercepting the money before it goes to its intended recipient," said Steve Whitmore, a spokesperson for the Los Angeles County Sheriff's Department, noting that the department is monitoring overseas wire transfers to Lebanon, Jordan and Syria. *
*
http://money.cnn.com/2005/05/26/news/terror_knockoffs/index.htm?cnn=yes

[al-Canine]

I'm not sure where this thread went, but I can't find it, so here's a new thread. Mod, feel free to merge.

U.S. regulators issue Bank Secrecy Act exam manual
Reuters
Thursday, June 30, 2005; 11:39 AM

WASHINGTON (Reuters) - U.S. banking regulators on Thursday issued a long-awaited set of unified standards for bank examiners evaluating financial institutions' compliance with the Bank Secrecy Act, an anti-money laundering law.

The 330-page manual does not set new rules or offer new guidance, according to the Federal Financial Institutions Examination Council, a group of financial regulatory agencies.

Instead, the compilation of existing guidance on a variety of BSA-related topics, including reporting suspicious activity and possible terrorism financing, is designed to end confusion about what banks should expect and to ensure examiners stick to a single framework at all financial institutions.

U.S. banks have complained that federal regulators kept moving the goalposts by using different examination standards when checking for BSA compliance -- a subject that has gained increased attention in the aftermath of the Sept. 11, 2001 attacks.

The concerns have been particularly strong since regulators last year imposed high-profile sanctions on Riggs bank, a unit of Riggs National Corp., for BSA compliance failures.

"This is not just a small step. This is a major step to what we've been asking for the past year, really since the post-Riggs reaction by all the agencies. This will address a lot of those concerns," said John Byrne, a senior official at the American Bankers Association.

The regulators said the new manual emphasizes banks' responsibility to establish and implement risk-based policies, procedures and processes to comply with the law and keep their institutions from being used for money laundering and terrorist financing.

Federal banking regulators will begin using the manual in the third quarter, the regulators said.

"This inter-agency manual is a significant step toward consistency in the area of anti-money laundering examination," said Federal Reserve Gov. Susan Bies. "The new manual promotes a shared understanding of the Bank Secrecy Act and anti-money laundering regulations and supervisory expectations."

The 1970 Bank Secrecy Act was enacted to prevent U.S. banks and financial service providers from being used as intermediaries for criminal activity, or to hide the movement of money derived from criminal activity. It has won renewed prominence in the aftermath of the Sept. 11 attacks.

Regulators also set dates in August for conference calls and meetings with the banking industry to discuss the examination manual and compliance programs.

"It's not going to be a silver bullet to (end) all confusion, but it is certainly a major effort to have all the agencies working together to produce this. There's a commitment on the part of the government that we've never seen before," the ABA's Byrne said.

"We're still going to monitor how it works in practice and ask our banks to give us examples where they think interpretations are being made up on the ground, but I think this will make it more difficult for that to occur because there will be something to point to," he said.
©*2005*Reuters

http://www.washingtonpost.com/wp-dyn/content/article/2005/06/30/AR2005063000845.html

[al-Canine]

U.S. Says Mideast Must Crack Down on Terror Finance

By REUTERS

WASHINGTON (Reuters) - Middle Eastern countries must do much more to fight terrorism financing, and Washington will push these states to take action if they fail to do it on their own, a senior U.S. Treasury official said on Wednesday.

Stuart Levey, the U.S. Treasury's undersecretary for terrorism and financial intelligence, said some progress had been made in the region, such as passing anti-money laundering laws and cracking down on the abuse of charities. But he called for more evidence that the steps were actually bearing fruit.

``We have a long way to go in the battle against terrorist financing in the Middle East,'' Levey said in testimony to the Senate banking committee.

``Where the threat of terrorism does not generate the will to take effective action ... my office, working in close cooperation with all of our interagency counterparts, will push for action,'' he said.

In the past, U.S. steps have included diplomatic pressure, as well as economic sanctions such as freezing funds.

Levey said some Middle Eastern countries had still not passed adequate anti-money laundering laws, ensured laws were actually enforced, established controls over informal cash transfers, or set up financial intelligence units to help fight dirty money.

Levey specifically cited long-standing shortcomings in Saudi Arabia and Syria. He said the United States was using a combination of pressure and cooperation to get the kingdom -- birthplace of most of the Sept. 11 hijackers -- to comply.

``Even today, we believe that private Saudi donors may still be a significant source of terrorist financing, including for the insurgency in Iraq,'' he said.

The undersecretary said Syria continued to ``meddle'' in the affairs of its neighbor Lebanon, was a source and conduit for funds to Iraqi insurgents, and allowed terrorist groups to flourish on its soil.

The United States has already slapped a series of sanctions on Syria and has blocked the assets of some of its nationals -- including its interior minister -- to press for change.

Levey also said cash couriers presented a particularly serious danger, in part because they were being used to fund militants in Iraq.

``It is critical that Gulf countries and countries throughout the Middle East lower their reporting thresholds for cross-border transfers of cash and enforce these provisions aggressively,'' he said.

Levey said the United States wanted to see proof -- such as arrests, cash seizures and blocking of accounts -- that policies against dirty money were not only being adopted, but implemented and enforced.

``Some countries, eager to curry favor with their neighbors or the international community, may believe that adopting an anti-money laundering and counter-terrorist financing law will keep observers at bay. Such half-steps will neither fool nor satisfy the United States and the international community.''


http://www.nytimes.com/reuters/politics/politics-security-usa-financing.html

[rectar]

Times Arabs knew that happening is several documents in the intelligence purchase (élamreekeea) . Existing had unfolded of a relation in Afghanistan what for the sheikh Mohammad Ben Rashed Al-Maktoum in Usama . Bin Laden private a distance appeared most automobiles which found are covered near caves Thor . Bura came from Dubai to Afghanistan and believes many these automobiles familiarize ownership. Mohammad for, the sheikh, Crown Prince Dubai which built a runway Qandahar was private near an airfield utilize also. Newspapers mentioned (élamreekeea) during the hunting trips and hunting conduct privately to Afghanistan in her . In most while Nashat Bin Laden and Mulla constructed a relation between him and between Usama made especially. Sheikh Mohammad of Al-Qaeda Organization (éhm) ..

The inquiry marks were Ben Rashed about the Mohammad relation Al-Maktoum in Usama Bin Laden . (étheert) lately a distance the captain (émreekeea) parties uncovered of the Laden son had received the treatment in. One the Dubai hospitals..

It is known the reform association was in Dubai a base. A association was major for Arabs (élafghan) enlisting and a senior officer chairs in the intelligence. The consequent for bear and Mohammad assumes Ben Rashed Al-Maktoum presidency.. And a harmony for this the sources. Sheikh Mohammad is (wabàada) for the suspicion were an airfield to accredit Sharjah in the Al-Qaeda supply and Usama . Bin Laden in needs.... And most the suspects and the exchange offices which implicated in events. September falls in Dubai.

Journalists exiled Balsheikh on an impending tag by an other Mohammad Ben Rashed is the sheikh on. A relation in the Usama operations Bin Laden and squad did not exile a tag existence between the two men. Strengthened during the hunting trips and hunting in the Afghanistan mountains... And a harmony are the sheikh. Mohammad known Ben Rashed in feeling in a node the inferior a permanent reptile on the of famous approach in. All domains on fame in the living intention.... And he an example thrusts benefit amounts for the singers. Awake Kazem model on and Majedah Al-Roumi for enrich weak poems wrote and she . (éghneeat) does not present Dubai except from a television and the definition occurs (élaghneea) appeared in foreground. Poems Ben Rashed Mohammad (élameer) Al-Maktoum (mà) (én) although titled (élameer) . Changed circulating in the emirates... Sheikh and Mohammad television fame (éàjbth) Youssef for the sheikh. (élqrdhaouee) and a senior finance reward accelerated to grants for name be linked in a name. (élqrdhaouee) .... And he what the sheikh makes with races repeals the horse (élanjleez) ....On him and are . Sheikh Mohammad watch over on in Usama a relation (éqama) Bin Laden and the travel to Afghanistan for Tunisia. With him and hunted the bustard and the birds enter only within this self-interested opportunist desire for the sheikh. Mohammad is not Bin Laden in the Usama ideas for the sheikh conviction.

The emirates sheikhs on Moloa the public Usama Bin Laden and Marwan Al-Shahiy . Which led the aircraft which hit the second turret a citizen was Emirates of Ras al-Khaymah . The two birds study and in Germany on the Abu Dhabi defense force charge Sheikh Mohammad chairs. Bin outbid and raved the ignorant sheikh which did not complete scholastic education enlisting occurred in the emirates. An association knew (élamoual) in grouping in role by the reform association in Dubai and she and enlisting. The men for Usama Bin Laden ..

Perhaps this annotates (élzeearatalmkoukeea) to Washington for the Zayid children. In an attempt forgiveness in front of (éladaraalamreekeea) because of the (wadla) documents existence on an involvement for whitening. Emirates physical and moral with the terrorists..... And raved he which thrust a minister. Off-shore Sheikh Hamdan and in helps from father in the flight. During which caught the photos privately in a sudden visit to Washington. With President Bush and appear the sheikh carried an application present with him to (washntoun) stay in an fold. The secrecy and a Saudi citizen name arrested a slave in Umm Al-Qaywayn . Al-Nasheri Gracious prescribed the " Al-Qaeda organization official in the Gulf area in universe, were. Receives lessons in the flight near the strategic ferries for the ships in the Hermes strait,. As usual and secret (émreeka) call for did not abide Emirates where deployment occurred. Forthwith the order thrust Emirates official communique confessed in him in a delivery to (ésdar) . Al-Nasheri to (émreeka) after detention in Umm Al-Qaywayn ..

And the question: what thrust Emirates to a Saudi citizen delivery to and for Yass (émreeka) . To Saudi Arabia an example?

It is known the emirates sheikhs apparently implicate in the terrorism or in an other.... And two bitter Al-Shahiy . Which hit the second turret as diminished not was a citizen. Emirates merely but he sent to Germany by the Abu Dhabi defense force.... And financing. The operation all occurred through Abu Dhabi in wildebeest.... And the automobiles which found in Afghanistan. Most Emirates automobiles but and discovered (élamreekeeoun) Sheikh Mohammad Ben Rashed had built. Two landing strips to handle in Afghanistan Usama Bin Laden ..... And a name passed Sheikh Mohammad. Bin Zayid the corners president Zayid and the sheikh son crisscross with all these detections where appear. He is were finance the reform association in Dubai and she an association related a document in Usama Bin Laden . And Taliban movement and eighties utilized enlisting for the Taliban as a shop in a beginning..

The emirates sheikhs which continue (émreeka) cursing realized in newspapers and televisions they are will. Are console (lamreeka) from Bandar (élameer) and wife accused. In financing one terrorists.... (ldha) therefore (éeeat) inspected the allegiance of a means for a submission. And the obedience for white peyote and found on her in Abed Al-Rahman, the Saudi citizen personality,. Required Al-Nasheri (émreekeea) .... Arrested privately (ldha) and (lamreeka) submitted privately call for and. The administration (élamreekeea) the retention on the theme in the secrecy fold.... But hunting valuable. Was bigger the closed rooms back remains (ldha) therefore (élamreekeeoun) accelerated to the declaration of him . The order which Sheikh Zayid had data which confessed in him to (ésdar) he is he which submitted. Al-Nasheri (lamreeka) ....

Except them from this and the emirates sheikhs stayed of the involvement in distant place facing open with. Al-Qaeda Organization for the organization elements in the emirates.... And possibility the reply. In emirates sheikhs hunt one one private demolish the summer in Britain mobile. Between stables and the gambling districts..

And the Al-Nasheri delivery story New York Times rote (louashntoun) .... Officials had reached. The intelligence (élamreekeeeen) to Al-Nasheri played a senior role in planning for the attack on. The destroyer " Kol the American mined in 2000 in a bay, and in planning for the embassy explosion. The American in Neirobi public..1998 and powers said the United Arab Emirates country he is. Were plan the United States in Gulf against interests for terrorist attacks,. The American ships, Qai seizing on him ..... And seems this Emirates declaration. Importance giving wanted Al-Nasheri and delivery for a detention (lamreeka) reduced the prison in a magnification and a magnification. Seriousness..

And after detention - say New York Times - slow down Al-Nasheri to a private site for the inquiries. An agency established " (see). .A verse..E " in Jordan, until manage of the inquiry with the " Al-Qaeda elements. Away from taken the American laws.. And cans the countries in some for intelligence service . The friendly Arabic for the United States (élaouleea) aids with suspect in the inquiries. And interest and received on them , pursuant to the laws which close in state of war , calculated. The one statements officers " (see). .A verse..E "..

An official had declined (élajaba) of questions about the inquiry site which happens of him in the agency. Arab officials governments cooperate with the United States ..

As and the countersign (édlt) the (émneea) sources processed Al-Nasheri receiving in Gulf in him training on. The two birds in the minor Umm Al-Qaywayn emirate, depart a public sign to one commanders. " the Al-Qaeda planned aerial attacks in a stage for launching maybe after attacks 11 September (éeeloul) . ..2001 and Boust (élouashntoun) said not make succeed all attempts in the two birds school for the link. Through the telephone for obtainment ..

The officials are senior and with that said in the American administration that do not know an alarm. Plug in to the friendly countries after the detention incident, for the law application powers alert in that. The countries checked flight Madras in her to an importance and a tag any personalities were there. " the Al-Qaeda students media, especially joining in that Madras (meesour) for all call for ..
Reach American foreign minister Colin Powel , in the Al-Nasheri detention on 8 November Tishrin . Second past, Bin Sheikh Hamdan outbid of Emirates counterpart..

And an one American administration officials senior said that Powell thanked Sheikh Hamdan and acquiesced on an nonexistence. The detention uncovered. But after two weeks, leaked news. The detention for some newspapers and distance the Arabic the American officials emphasized a detention news. Al-Nasheri in the Gulf area, but declined details giving increased.. And declined uncovering also of. The Al-Nasheri activities in which find in her lessons in the two birds..

With and Al-Nasheri a child is intelligence officer in Mecca, say he is of a Yemeni ancestry.. . One uncovered February 1998 in February for, the first time, from " Al-Qaeda acitvists in consideration of him ,. Arresting a from suspect in them number lay down the Saudi powers were try. Missiles smuggling counteracting sovietism returns to the era for the tanks, from Yemen to. Saudi Arabia, dangle the former Saudi, the intelligence equipment president, in her according to statements and an ambassador. The kingdom new has Britain, Faysal Turkish (élameer) .. And said the Saudi officials. Received while confessed on them Al-Nasheri commander..

And during the years past (élarbà) , an shade Al-Nasheri works in Yemen in an open facsimile and departs. Freely there to Pakistan and Afghanistan, what caused the diplomacy of the tensions much.. And the American officials say that Al-Nasheri enlisted one relatives for the truck command. August exploded outside the American embassy in Neirobi on 7 August.1998 and for how clear Yass . Al-Nasheri managed, 36 years, United Arab Emirates accessing this autumn, and no parties. Which afforded from her , but was said that was a topic acquiesced under the emphasized censure for several weeks. Seizing on him .. And said the officials he is were live a lavish life regarding an acquisition especially. The majestic automobiles



خاص بعرب تايمز

علمت عرب تايمز ان وقوع العديد من الوثائق في قبضة الاستخبارات الامريكية الموجودة في افغانستان قد تكشف عن علاقة ما للشيخ محمد بن راشد المكتوم باسامة بن لادن بخاصة بعد ان تبين ان معظم السيارات التي وجدت مغطاة قرب كهوف تورا بورا جاءت الى افغانستان من دبي ويعتقد كثيرون ان هذه السيارات تعود ملكيتها للشيخ محمد ولي عهد دبي الذي بنى مدرجا خاصا قرب مطار قندهار كان يستخدمه كما ذكرت الصحف الامريكية خلال رحلات القنص والصيد التي يقوم بها الى افغانستان سرا في اكثر الاحيان حيث نشات بينه وبين اسامة بن لادن والملا عمر علاقة خاصة جعلت الشيخ محمد من اهم ممولي تنظيم القاعدة .

وكانت علامات الاستفهام حول علاقة محمد بن راشد المكتوم باسامة بن لادن قد اثيرت مؤخرا بعد ان كشفت جهات امريكية النقاب عن ان ابن لادن قد تلقى العلاج في احدى مستشفيات دبي .

من المعروف ان جمعية الاصلاح في دبي كانت قاعدة رئيسية لتجنيد الافغان العرب وهي جمعية كان يترأسها ضابط كبير في المخابرات التابعة لدبي والتي يتولى محمد بن راشد المكتوم رئاستها . ووفقا لهذه المصادر فان الشيخ محمد وابعادا للشبهة كان يعتمد مطار الشارقة في تزويد القاعدة واسامة بن لادن باحتياجاته ... ومعظم المشبوهين ومكاتب الصرافة التي تورطت في احداث سبتمبر تقع في دبي .

من جانب اخر نفى صحفيون على معرفة قريبة بالشيخ محمد بن راشد ان يكون الشيخ على علاقة بعمليات اسامة بن لادن وجماعته وان لم ينفوا وجود معرفة بين الرجلين توطدت خلال رحلات الصيد والقنص في جبال افغانستان ... ووفقا لهؤلاء فان الشيخ محمد بن راشد المعروف باحساسه بعقدة النقص داب دائما على التقرب من المشاهير في كل المجالات بقصد التعيش على شهرتهم ... فهو مثلا يدفع مبالغ طائلة للمطربين مثل كاظم الساهر واصالة وماجدة الرومي من اجل ان يغنوا قصائد ركيكة كتبها وهي اغنيات لا تعرض الا من تلفزيون دبي ويتم التعريف في مقدمتها بان الاغنية من قصائد الامير محمد بن راشد المكتوم مع ان لقب الامير غير متداول في الامارات ... والشيخ محمد اعجبته الشهرة التلفزيونية للشيخ يوسف القرضاوي فسارع الى منحه مكافأة مالية كبيرة من اجل ان يقترن اسمه باسم القرضاوي ... وهو ما يفعله الشيخ مع ابطال سباقات الخيل الانجليز ...وعليه فان حرص الشيخ محمد على اقامة علاقة باسامة بن لادن والسفر الى افغانستان للتونس معه وصيد الحبارى والطيور يدخل فقط ضمن هذه الرغبة الوصولية الانتهازية للشيخ محمد وليس لقناعة الشيخ محمد بافكار اسامة بن لادن .

شيوخ الامارات على العموم مولوا اسامة بن لادن ومروان الشحي الذي قاد الطائرة التي ضربت البرج الثاني هو مواطن اماراتي من رأس الخيمة كان يدرس الطيران ففي المانيا على نفقة قوة دفاع ابو ظبي التي يترأسها الشيخ محمد بن زايد وهذا الشيخ الجاهل الذي لم يكمل تعليمه المدرسي في الامارات تم تجنيده من قبل جمعية الاصلاح في دبي وهي جمعية عرفت بدورها في جمع الاموال وتجنيد الرجال لاسامة بن لادن . لعل هذا يفسر الزياراتالمكوكية لاولاد زايد الى واشنطن في محاولة لتبييض صفحتهم امام الادارةالامريكية بسبب وجود وثائق وادلة على تورط اماراتي مادي ومعنوي مع الارهابيين .... وهذا هو الذي دفع وزير الخارجية الشيخ حمدان وبتعليمات من ابيه بالطيران الى واشنطن سرا في زيارة مفاجئة التقط خلالها الصور مع الرئيس بوش وتبين ان الشيخ حمل معه الى واشنطون هدية طلب ان تظل في طي الكتمان وهي مواطن سعودي اعتقل في ام القيوين اسمه عبد الرحمن الناشري وصف بكونه مسؤول تنظيم "القاعدة" في منطقة الخليج، كان يتلقى دروسا في الطيران بالقرب من المعابر الاستراتيجية للسفن في مضيق هرمز، وكالعادة لم تلتزم امريكا بالسرية التي طلبها الاماراتيون حيث تم نشر الخبر فورا الامر الذي دفع الاماراتيين الى اصدار بيان رسمي اعترفوا فيه بتسليم الناشري الى امريكا بعد اعتقاله في ام القيوين .

والسؤال هو : ما الذي دفع الاماراتيين الى تسليم مواطن سعودي الى امريكا وليس الى السعودية مثلا ؟

من المعروف ان شيوخ الامارات تورطوا في الارهاب بشكل او باخر ... فمروان الشحي الذي ضرب البرج الثاني كما قلنا لم يكن مواطنا اماراتيا فحسب بل هو مبعوث الى المانيا من قبل قوة دفاع ابو ظبي ... وتمويل العملية كلها تم من خلال بنوك ابو ظبي ... والسيارات التي وجدت في افغانستان معظمها سيارات اماراتية بل واكتشف الامريكيون ان الشيخ محمد بن راشد قد بنى مهبطا للطائرات في افغانستان ليستعمله اسامة بن لادن .... ومر اسم الشيخ محمد بن زايد رئيس الاركان وابن الشيخ زايد متقاطعا مع كل هذه الاكتشافات حيث تبين انه كان يمول جمعية الاصلاح في دبي وهي جمعية ذات صلة وثيقة باسامة بن لادن وحركة طالبان واستخدمت في مطلع الثمانينات كمركز تجنيد لطالبان .

شيوخ الامارات الذين يواصلون شتم امريكا في صحفهم وتلفزيوناتهم ادركوا انهم لن يكونوا اعز لامريكا من الامير بندر وزوجته اللذين اتهما بتمويل احد الارهابيين ... لذا فتشوا عن وسيلة لتقديم ايات الولاء والطاعة للبيت الابيض وعثروا عليها في شخصية المواطن السعودي عبد الرحمن الناشري المطلوب امريكيا ... لذا اعتقلوه سرا وسلموه سرا لامريكا وطلبوا من الادارة الامريكية الابقاء على الموضوع في طي الكتمان ... ولكن الصيد الثمين كان اكبر من ان يبقى وراء الغرف المغلقة لذا سارع الامريكيون الى الاعلان عنه الامر الذي اضطر الشيخ زايد الى اصدار بيانه الذي اعترف فيه انه هو الذي سلم الناشري لامريكا ...

والاهم من هذا ان شيوخ الامارات ظلوا بمنأى عن التورط في مواجهة مكشوفة مع تنظيم القاعدة لان للتنظيم عناصرة في الامارات ... ولان بامكان التنظيم الرد بتصيد شيوخ الامارات واحدا واحدا بخاصة وانهم يقضون الصيف في بريطانيا متنقلين بين اسطبلاتهم ومحلات القمار .

وحكاية تسليم الناشري لواشنطون روتها نيويورك تايمز ... فقد توصل مسؤولو الاستخبارات الامريكيين الى ان الناشري لعب دوراً كبيراً في التخطيط للهجوم على المدمرة الاميركية "كول" في خليج عدن عام 2000، وفي التخطيط لتفجير السفارة الاميركية في نيروبي عام .1998 وقالت سلطات دولة الامارات العربية المتحدة انه كان يخطط لهجمات ارهابية ضد مصالح الولايات المتحدة في الخليج، بما في ذلك السفن الاميركية، عندما القي القبض عليه.... ويبدو ان هذا الاعلان الاماراتي اراد اعطاء اهمية لاعتقال الناشري وتسليمه لامريكا بتكبير حجم المعتقل وتكبير خطورته .

وبعد اعتقاله - تقول نيويورك تايمز - ارسل الناشري الى موقع خاص للتحقيقات انشأته وكالة "سي.آي.إيه" في الاردن، حتى تتمكن من التحقيق مع عناصر "القاعدة" بعيدا عن متناول القوانين الاميركية. ويمكن لأجهزة الاستخبارات في بعض الدول العربية الصديقة للولايات المتحدة ان تساعد في التحقيقات الاولية مع المشتبه فيهم والمقبوض عليهم، وذلك بموجب القوانين التي تطبق في حالة الحرب، حسب تصريحات احد ضباط "سي.آي.إيه".

وقد رفض مسؤول في الوكالة الاجابة عن اسئلة حول موقع التحقيق الذي تحدث عنه مسؤولون عرب تتعاون حكوماتهم مع الولايات المتحدة.

وكان التصريح الذي ادلت به مصادر امنية في الخليج حول تلقي الناشري تدريبات على الطيران في امارة ام القيوين الصغيرة، اول اشارة علنية الى ان احد قادة "القاعدة" ربما خطط لشن هجمات جوية في مرحلة ما بعد هجمات 11 سبتمبر ايلول .2001 وقالت الواشنطون بوست انه لم تنجح كل المحاولات للاتصال بمدرسة الطيران عن طريق الهاتف بهدف الحصول على تعليقات.

ومع ذلك فان كبار المسؤولين بالادارة الاميركية قالوا انهم لا يعلمون ان تحذيرا وصل الى الدول الصديقة بعد حادثة الاعتقال، لتنبيه سلطات تطبيق القانون في تلك الدول الى اهمية فحص مدراس الطيران فيها ومعرفة ما اذا كانت هناك اية شخصيات من "القاعدة" وسط طلابها، خاصة ان الانخراط في تلك المدراس ميسور لكل من يطلبه.
وابلغ وزير الخارجية الاميركي كولن باول، باعتقال الناشري يوم 8 نوفمبر تشرين الثاني الماضي، من نظيره الاماراتي الشيخ حمدان بن زايد.

وقال احد كبار مسؤولي الادارة الاميركية ان باول شكر الشيخ حمدان ووافق على عدم كشف الاعتقال. ولكن بعد اسبوعين، سربت اخبار الاعتقال لبعض الصحف العربية، وبعدها اكد المسؤولون الاميركيون خبر اعتقال الناشري في منطقة الخليج، لكنهم رفضوا اعطاء تفاصيل اكثر. ورفضوا كذلك الكشف عن نشاطات الناشري بما فيها تلقيه دروساً في الطيران.

ومع ان الناشري ولد في مكة، فان ضباط الاستخبارات يقولون انه من اصل يمني. وقد كشف عنه باعتباره واحداً من نشطاء "القاعدة"، لأول مرة، في فبراير شباط 1998، بعد أن ألقت السلطات السعودية القبض على عدد من المشتبه فيهم كانوا يحاولون تهريب صواريخ مضادة للدبابات ترجع الى الحقبة السوفياتية، من اليمن الى السعودية، حسب تصريحات ادلى بها رئيس جهاز الاستخبارات السعودي السابق وسفير المملكة الجديد لدى بريطانيا، الامير تركي الفيصل. وقال المسؤولون السعوديون ان المقبوض عليهم اعترفوا حينها بأن قائدهم هو الناشري.

وخلال السنوات الاربع الماضية، ظل الناشري يعمل بصورة مكشوفة في اليمن ويذهب بحرية من هناك الى باكستان وافغانستان، مما سبب كثيرا من التوترات الدبلوماسية. ويقول المسؤولون الاميركيون ان الناشري جند احد اقربائه لقيادة الشاحنة التي انفجرت خارج السفارة الاميركية في نيروبي يوم 7 اغسطس آب .1998 وليس واضحا كيف استطاع الناشري، 36 سنة، دخول الامارات العربية المتحدة هذا الخريف، ولا الجهة التي قدم منها، ولكن قيل انه كان موضوعا تحت الرقابة المشددة لعدة اسابيع قبل القبض عليه. وقال المسؤولون انه كان يعيش حياة مسرفة وخاصة في ما يتعلق باقتناء السيارات الفخمة.

[Petronas]

US says letter shows Al-Qaeda hurting for cash
Washington, November 17, 2005

A recent letter attributed by the United States to top Al-Qaeda official Ayman al-Zawahri is a fresh sign the militant network is facing financial troubles, a senior US Treasury official said on Wednesday. "There's ... a passage in there where Zawahri says to Zarqawi: I'm out of money. Send me money. I don't have any money," said Stuart Levey, undersecretary for terrorism and financial intelligence, referring to Abu Musab al-Zarqawi, the leader of Al-Qaeda in Iraq. "I'm a glass-half-full kind of guy, so I look at that as a good thing. Zawahri's out of money. Glass-half-empty people would say, well, he thinks Zarqawi has got so much money he's got it to spare," he said in a speech at the Heritage Foundation think tank.

US intelligence officials released the purported letter from Zawahri to Zarqawi last month, but Al-Qaeda's wing in Iraq rejected it as a fabrication. The letter has Zawahri telling Zarqawi: "We need a payment while new (financial supply) lines are being opened. So, if you are capable of sending a payment of approximately one hundred thousand (dollars), we'll be very grateful to you." US security officials have repeatedly said they are confident of the letter's authenticity, but some US terrorism experts say its style and some of the content -- including the request for money -- made them concerned it might be a fake.

http://www.hindustantimes.com/news/181_1548374,00050001.htm

[al-Canine]

U.S. Lacks Plan to Curb Terror Funds, Agency Says

By ERIC LICHTBLAU

WASHINGTON, Nov. 28 - The government's efforts to help foreign nations cut off the supply of money to terrorists, a critical goal for the Bush administration, have been stymied by infighting among American agencies, leadership problems and insufficient financing, a new Congressional report says.

More than four years after the Sept. 11 attacks, "the U.S. government lacks an integrated strategy" to train foreign countries and provide them with technical assistance to shore up their financial and law enforcement systems against terrorist financing, according to the report prepared by the Government Accountability Office, an investigative arm of Congress.

The findings expand on earlier concerns raised by that agency and others in the past few years about the government's ability to cut off money to terrorists. The report is to be released Wednesday, and an advance copy was provided to The New York Times.

The findings produced sharp dissent from American government officials, who said Congressional auditors overstated the bureaucratic problems in curbing terrorist financing overseas and the level of dissension between agencies. They described the intergovernmental effort to cut off the flow of terrorist money as one of the hallmarks of the Bush administration's campaign to fight terrorism since the Sept. 11 attacks.

"No interagency process is without flaws," the State Department said in its official response. But it said "there is much evidence" that the working group set up by the administration to combat terrorist financing "is one of the most successful examples of interagency cooperation."

The government has identified 26 "priority" countries that it considered particularly vulnerable to exploitation by terrorist financiers, who may take advantage of lax financial controls and loosely regulated or nonexistent laws to launder money in support of terrorist attacks, officials said.

But officials at the State and Treasury Departments cannot even agree on who is supposed to be in charge of the effort to shore up defenses in vulnerable countries, the accountability office report concluded.

In at least one case, the State Department refused to allow a Treasury official to enter an unidentified foreign country last year to help with strategies to fight terrorist financing because of turf battles, investigators found. Because the country had recently been upgraded to a priority, State Department officials wanted to do their own assessment first before allowing the Treasury Department to conduct its work, causing a delay of several months.

Investigators found clear tensions between officials at State, Treasury, Justice and other departments.

One unidentified Treasury official quoted anonymously in the report said that the intergovernmental process for deterring terrorist financing abroad is "broken" and that the State Department "creates obstacles rather than coordinates effort." A State Department official countered that the real problem lies in the Treasury Department's reluctance to accept the State Department's leadership in the process.

In another problem area, private contractors used by the Treasury Department and other agencies have been allowed to draft proposed laws in foreign countries for curbing terrorist financing, even though Justice Department officials voiced strong concerns that contractors should not be allowed to play such an active role in the legislative process.

The contractors' work at times produced legislative proposals that had "substantial deficiencies," the report said.

The administration has made cutting off money to terrorists one of the main prongs in its attack against Al Qaeda and other terrorist groups. It has seized tens of millions of dollars in American accounts and assets linked to terrorist groups, prodded other countries to do the same, and is now developing a program to gain access to and track potentially hundreds of millions of international bank transfers into the United States.

But experts in the field say the results have been spotty, with few clear dents in Al Qaeda's ability to move money and finance terrorist attacks. The Congressional report- a follow-up to a 2003 report that offered a similarly bleak assessment - buttresses those concerns.

Senator Charles E. Grassley, the Iowa Republican who leads the Senate Finance Committee and was one of the lawmakers who requested the study, said he was disappointed to learn that in an area as critical as countering terrorist financing, "they haven't gotten very far yet."

In an interview, Mr. Grassley said: "It's as simple as learning to stop the infighting and turf protection and get on with the job. What's happening is just inexplicable in light of the war on terrorism."

The State Department said in the report that it has begun technical assistance and training to 20 of the 26 priority countries. The list is classified, and the countries were not disclosed. Officials say that letting terrorists know which countries are considered vulnerable would prompt them to move more money there and that publicizing such assessments would discourage cooperation from the countries on the list.

As part of their review, Congressional investigators conducted field work in Pakistan, Indonesia and Paraguay to assess American efforts to deter terrorist financing. But officials would not say whether those countries were on the government's classified list of 26 "vulnerable" nations.

Middle Eastern countries like Saudi Arabia and the United Arab Emirates have been the focus of intense scrutiny and diplomatic efforts since Sept. 11 because of concerns that charities, state-sponsored organizations and informal money-exchange systems known as hawalas are routinely used to funnel large amounts of money to Al Qaeda.


Copyright 2005 The New York Times Company


http://www.nytimes.com/2005/11/29/national/nationalspecial3/29terror.html?

[Petronas]

INDONESIA: AL-QAEDA FUNDED TERROR ATTACKS SAY POLICE
Mar-03-2006 05:49 pm

Jakarta, 1 March (AKI/Jakarta Post) - Osama bin Laden's al-Qaeda financed the major terror attacks in Indonesia over the past four years, a senior National Police detective has stated. Sr. Comr. Petrus Reinhard Golose said the global terror group sent money to its operatives in the world's largest Muslim country to carry out a series of attacks, including the 2002 and 2005 Bali bombings, the 2003 JW Marriott Hotel bombing and the 2004 Australia Embassy blast. The bombings, which were all blamed on the regional Jamaah Islamiyah terror network, killed a total of 244 people of more than 20 nationalities.

Petrus, formerly a senior member of police anti-terror squad Detachment 88 and the current head of the police cybercrime unit, was speaking at a two-day international conference on terrorism that ended Tuesday. He said the money had been delivered through couriers sent by an al-Qaeda leader. "They sent it through their channels from Khalid Sheikh Mohammed via Thailand and Malaysia before finally reaching here (Indonesia)," Petrus told the media after the conference. He declined to specify from which country the funds originated and who received them in Indonesia.

Mohammed, an alleged mastermind of the Sept. 11, 2001 attacks on the United States, was arrested in Pakistan in 2003 and handed over to US authorities. He is believed to be al-Qaeda's third in command.

Petrus said funds of up to 30,000 dollars were first delivered for the 2002 Bali blasts, and that al-Qaeda also sent tens of thousands of dollars to finance the JW Marriott bombing and the Australian Embassy attack. Leftover funds from the JW Marriott bombing, reportedly controlled by late terror mastermind Azahari bin Husin, along with a third delivery of an unspecified amount of money from al-Qaeda was used to finance the second Bali attack, Petrus said.

"The funds for the second Bali explosions were also collected from donations and fai operations," he added, the latter an Arabic word referring to the robbing of enemies of Islam to secure funds for defending the faith. Petrus added that remaining funds from the second Bali bombings were sent to the southern Philippines, where Jemaah Islamiyah (JI) trained its followers.

National Police chief Gen. Sutanto told a hearing with lawmakers early last month that in February 2002, Malaysian terror fugitive Noordin M. Top received 86,000 from al-Qaeda. Noordin also received 130,000 dollars in May 2003 from Palestinians to carry out attacks in Indonesia, Sutanto added without elaborating.

Petrus, who was a key police officer involved in the antiterror raid that killed Azahari near Malang, East Java, last year, said the Noordin-led group Tandzim Qoedatul Jihad had changed its structure amid the intensive hunt for its followers. "People say that if we catch Noordin, terrorism in Indonesia would be finished. No, it's still dangerous, because terrorists have changed the frame of their organisation," he added.

Petrus said that based on a letter signed by Noordin, which was found in a raid on his suspected hideout in Semarang, Central Java, his next operations were still targeting foreigners, especially Australians, Americans and their allies, with cafes, hotels and discotheques prime sites for attack. Apart from Noordin, he said the police were also searching for Abu Dujana, who is believed to be the new JI leader and was accused of helping hide terror suspects who allegedly planned attacks on US interests in Singapore

http://www.adnki.com/index_2Level_English.php?cat=Terrorism&loid=8.0.270927348&par=0

[Petronas]

NYC'S TERROR BANK
April 3, 2006

WASHINGTON - Manhattan District Attorney Robert Morgenthau has shut down a massive terror-finance pipeline in which a whopping $3 billion in profits from drug deals and other crimes flowed through a major New York bank to Middle East fanatics, The Post has learned. Morgenthau told The Post his office is pursuing a settlement involving possible penalties against one of the largest and most prominent banks in New York - which he declined to identify - for maintaining an account where funds that originated in South America's notorious "tri-border region" were rerouted to suspect accounts in the Middle East.

Evidence developed in the course of a three-year probe, which has already resulted in charges against other New York-based financial institutions, revealed that about $3 billion that flowed through the account over a two-year period was going to terror groups Hamas, al Qaeda and Hezbollah, Morgenthau said. "I can't go out and arrest Osama bin Laden. But I can try to cut off his money," Morgenthau said of his massive probe.

Morgenthau's new case is the latest shocking disclosure of how terrorist groups, rogue states and drug lords are exploiting continuing weaknesses in the American financial system - and how billions of dollars in dirty money continues to flow through unsuspecting banks in New York, the epicenter of the global dollar trade.

John Moscow, a former Assistant District Attorney for financial crimes under Morgenthau, told the House International Relations Subcommittee on Oversight and Investigations last week that there are hundreds of thousands of shady banks around the world that "are taking deposits from people they never met and from brass-plate companies with no assets except the bank account, and are inserting the money into the world monetary system." "Most of this is in dollars, and most of it goes through Manhattan," Moscow testified. Morgenthau would not name the latest New York bank under the gun, but said the case could be concluded - with possible penalties - "any day now."

He said most of the $3 billion in suspicious funds were generated, through criminal enterprises, in the lawless tri-border region of Brazil, Argentina and Paraguay. Over a two-year period, the $3 billion was sent to the New York bank account by a shadowy money-transmittal company in Montevideo, Uruguay. The money then flowed into bank accounts in the Middle East locations including Riyadh, Saudi Arabia, Beirut, Lebanon, and Ramallah in the Palestinian territories.

The probe of the New York bank grew out of the Manhattan DA's previous 2004 prosecution of the Beacon Hill Services Corp., an Upper East Side money transmitter that moved more than $9 billion in suspect funds through accounts in Chase Manhattan Bank and other institutions.

http://www.nypost.com/news/regionalnews/61931.htm

[al-Canine]

Congressmen Grill Swiss Bankers Over Ties to Bin Laden, Iran, Cuba

BY MEGHAN CLYNE - Staff Reporter of the Sun

WASHINGTON - The Swiss banking giant, UBS, may have helped Iran develop its nuclear program, may have held an account for Al Qaeda terrorist Osama bin Laden, and could find itself investigated as part of Congress's ongoing inquiry into the United Nations oil-for-food scandal, lawmakers said yesterday.

During an intense grilling on Capitol Hill, the bank was also accused of engaging in a pattern of resistance to congressional inquiries, as lawmakers cited years of non-cooperation with congressional probes into improper transactions between the bank and terrorist regimes.

One lawmaker disclosed that UBS had provided a witness for yesterday's hearing only under threats of subpoena, and another accused the bank's representative at the hearing of using "weasel words" to dodge tough questions.

Yesterday's hearing of the House International Relations Committee's Subcommittee on Oversight, chaired by Rep. Dana Rohrabacher, Republican of California, was a long-awaited public examination of UBS's alleged money laundering for state sponsors of terrorism, including Cuba and Iran.

It is the latest in a series of inquiries spawned in 2003 when American soldiers liberating Iraq discovered $762 million in American currency stashed in hideouts belonging to Saddam Hussein. The serial numbers on the banknotes were traced to UBS, which distributed the currency as part of the Extended Custodial Inventory Program run by the Federal Reserve Bank of New York.

The Federal Reserve program, in cooperation with international banks, allowed clients to exchange old American banknotes for new ones. One condition of the program was that the international banks were not allowed to accept cash from countries against which America maintains sanctions. They also were not allowed to transfer cash to such countries.

When American investigators probed the $762 million that emerged in Iraq, they found that UBS had also provided $3.9 billion in American currency for Fidel Castro's Cuba, $1 billion for Iran, and $30 million for Libya. Cuba, Iran, and Libya appear on the State Department's official list of state sponsors of terrorism.

As a result of an investigation by the Federal Reserve Bank of New York in cooperation with the Department of the Treasury, UBS was censured by the Swiss Banking Commission, and paid a $100 million fine to the Federal Reserve in spring 2004.

As The New York Sun reported in October, UBS, which operates under the secrecy of Swiss banking laws, had long frustrated members of Congress seeking further information about the nature of the improper transactions; whether they included money laundering for terrorist regimes, whether the abuse of the Federal Reserve program helped fund terrorism, and whether the bank had closed all of its accounts with Cuba and Iran.

At yesterday's hearing, the witness provided by UBS, managing director Michael Herde, offered few specifics in response to lawmakers' inquiries, at times appearing to provoke interrogators already seemingly irked by the Swiss bank.

Mr. Rohrabacher likened UBS's current silence to its well-publicized and documented abuses regarding accounts of Holocaust victims, adding that the Swiss bank's "current malfeasance" included "the fact that UBS once held an account for Osama bin Laden."

In 2004, a half-brother of Mr. bin Laden, Yeslam Binladin, testified in a French courtroom that two of his brothers had set up an account at the Swiss bank, and that his terrorist sibling was one of the principal beneficiaries on the account, according to press reports. Mr. Binladin's testimony was confirmed in 2004 by a UBS spokesman, who said that Mr. Bin Laden was not a bank customer but could draw money from it.

During yesterday's hearing, however, when pressed by Mr. Rohrabacher about whether Mr. Bin Laden had an account at the bank, Mr. Herde testified: "I don't believe so."

Mr. Herde did disclose that UBS decided in November, after years of congressional inquiries, to end its business in countries against which America maintains sanctions. He added that the bank was in the middle of closing down its accounts in Iran and Cuba, a process a spokeswoman, Christine Walton, later said would be "around 80%" complete at the end of April.

Mr. Herde also disclosed that "8 to 11" low-level employees had been terminated as a result of the scandal involving the Federal Reserve program, and said that to the best of his knowledge, no one involved in the improper transfers, including higher ups with potential knowledge of the illicit activity, was still employed by the bank.

"'To the best of my knowledge' indicates to me that there is probably somebody very high up in the bank who knows everything and is still there," Mr. Rohrabacher replied.

Grilled by Mr. Rohrabacher and Ms. Ros-Lehtinen about the employees' motives for engaging in the activity, Mr. Herde said the bank's investigation showed that the employees abused the Federal Reserve program because of a "misguided perception that operational efficiencies would be enhanced."

"That does sound like very suspicious language," Mr. Rohrabacher said. "Being a former journalist, I hear weasel words of how to get around things," the congressman added later about the UBS representative's testimony. Ms. Walton said after the hearing that Mr. Herde had been referring to efforts by UBS employees to streamline the exchange of American banknotes by not setting up a separate program for the Federal Reserve cash, as the program's terms required.

Earlier in the hearing, Mr. Rohrabacher said that the bank's transactions with Iran "may have put the whole world in danger," saying that the regime's nuclear ambitions pose "a grave threat that might be traced right back to a major financial institution in the world dealing with the Iranian government."

The bank may also have helped fund oppression and warmongering in Iraq, according to Ms. Ros-Lehtinen.

"Reports have stated that Saddam Hussein, even when Iraq was under U.N. sanctions, had accounts at UBS," Ms. Ros-Lehtinen said. "That has implications for this subcommittee's Oil-for-Food investigation." Committee staff said the UBS connection is of concern because of Saddam's use of the international financial apparatus to perpetrate the Oil-for-Food fraud.

After the hearing, Ms. Walton said that UBS had cooperated fully with the committee's inquiries.

http://www.nysun.com/pf.php?id=30062

[candypreet]

fantastic thread

[al-Canine]

Here is the NY Times' controversial article, in its entirety.

June 23, 2006

Bank Data Is Sifted by U.S. in Secret to Block Terror

By ERIC LICHTBLAU and JAMES RISEN

WASHINGTON, June 22 — Under a secret Bush administration program initiated weeks after the Sept. 11 attacks, counterterrorism officials have gained access to financial records from a vast international database and examined banking transactions involving thousands of Americans and others in the United States, according to government and industry officials.

The program is limited, government officials say, to tracing transactions of people suspected of having ties to Al Qaeda by reviewing records from the nerve center of the global banking industry, a Belgian cooperative that routes about $6 trillion daily between banks, brokerages, stock exchanges and other institutions. The records mostly involve wire transfers and other methods of moving money overseas and into and out of the United States. Most routine financial transactions confined to this country are not in the database.

Viewed by the Bush administration as a vital tool, the program has played a hidden role in domestic and foreign terrorism investigations since 2001 and helped in the capture of the most wanted Qaeda figure in Southeast Asia, the officials said.

The program, run out of the Central Intelligence Agency and overseen by the Treasury Department, "has provided us with a unique and powerful window into the operations of terrorist networks and is, without doubt, a legal and proper use of our authorities," Stuart Levey, an under secretary at the Treasury Department, said in an interview on Thursday.

The program is grounded in part on the president's emergency economic powers, Mr. Levey said, and multiple safeguards have been imposed to protect against any unwarranted searches of Americans' records.

The program, however, is a significant departure from typical practice in how the government acquires Americans' financial records. Treasury officials did not seek individual court-approved warrants or subpoenas to examine specific transactions, instead relying on broad administrative subpoenas for millions of records from the cooperative, known as Swift.

That access to large amounts of confidential data was highly unusual, several officials said, and stirred concerns inside the administration about legal and privacy issues.

"The capability here is awesome or, depending on where you're sitting, troubling," said one former senior counterterrorism official who considers the program valuable. While tight controls are in place, the official added, "the potential for abuse is enormous."

The program is separate from the National Security Agency's efforts to eavesdrop without warrants and collect domestic phone records, operations that have provoked fierce public debate and spurred lawsuits against the government and telecommunications companies.

But all the programs grew out of the Bush administration's desire to exploit technological tools to prevent another terrorist strike, and all reflect attempts to break down longstanding legal or institutional barriers to the government's access to private information about Americans and others inside the United States.

Officials described the Swift program as the biggest and most far-reaching of several secret efforts to trace terrorist financing. Much more limited agreements with other companies have provided access to A.T.M. transactions, credit card purchases and Western Union wire payments, the officials said.

Nearly 20 current and former government officials and industry executives discussed aspects of the Swift operation with The New York Times on condition of anonymity because the program remains classified. Some of those officials expressed reservations about the program, saying that what they viewed as an urgent, temporary measure had become permanent nearly five years later without specific Congressional approval or formal authorization.

Data from the Brussels-based banking consortium, formally known as the Society for Worldwide Interbank Financial Telecommunication, has allowed officials from the C.I.A., the Federal Bureau of Investigation and other agencies to examine "tens of thousands" of financial transactions, Mr. Levey said.

While many of those transactions have occurred entirely on foreign soil, officials have also been keenly interested in international transfers of money by individuals, businesses, charities and other groups under suspicion inside the United States, officials said. A small fraction of Swift's records involve transactions entirely within this country, but Treasury officials said they were uncertain whether any had been examined.

Swift executives have been uneasy at times about their secret role, the government and industry officials said. By 2003, the executives told American officials they were considering pulling out of the arrangement, which began as an emergency response to the Sept. 11 attacks, the officials said. Worried about potential legal liability, the Swift executives agreed to continue providing the data only after top officials, including Alan Greenspan, then chairman of the Federal Reserve, intervened. At that time, new controls were introduced.

Among the safeguards, government officials said, is an outside auditing firm that verifies that the data searches are based on intelligence leads about suspected terrorists. "We are not on a fishing expedition," Mr. Levey said. "We're not just turning on a vacuum cleaner and sucking in all the information that we can."

Swift and Treasury officials said they were aware of no abuses. But Mr. Levey, the Treasury official, said one person had been removed from the operation for conducting a search considered inappropriate.

Treasury officials said Swift was exempt from American laws restricting government access to private financial records because the cooperative was considered a messaging service, not a bank or financial institution.

But at the outset of the operation, Treasury and Justice Department lawyers debated whether the program had to comply with such laws before concluding that it did not, people with knowledge of the debate said. Several outside banking experts, however, say that financial privacy laws are murky and sometimes contradictory and that the program raises difficult legal and public policy questions.

The Bush administration has made no secret of its campaign to disrupt terrorist financing, and President Bush, Treasury officials and others have spoken publicly about those efforts. Administration officials, however, asked The New York Times not to publish this article, saying that disclosure of the Swift program could jeopardize its effectiveness. They also enlisted several current and former officials, both Democrat and Republican, to vouch for its value.

Bill Keller, the newspaper's executive editor, said: "We have listened closely to the administration's arguments for withholding this information, and given them the most serious and respectful consideration. We remain convinced that the administration's extraordinary access to this vast repository of international financial data, however carefully targeted use of it may be, is a matter of public interest."

Mr. Levey agreed to discuss the classified operation after the Times editors told him of the newspaper's decision.

On Thursday evening, Dana Perino, deputy White House press secretary, said: "Since immediately following 9/11, the American government has taken every legal measure to prevent another attack on our country. One of the most important tools in the fight against terror is our ability to choke off funds for the terrorists."

She added: "We know the terrorists pay attention to our strategy to fight them, and now have another piece of the puzzle of how we are fighting them. We also know they adapt their methods, which increases the challenge to our intelligence and law enforcement officials."

Referring to the disclosure by The New York Times last December of the National Security Agency's eavesdropping program, she said, "The president is concerned that once again The New York Times has chosen to expose a classified program that is working to protect our citizens."

Swift declined to discuss details of the program but defended its role in written responses to questions. "Swift has fully complied with all applicable laws," the consortium said. The organization said it insisted that the data be used only for terrorism investigations and had narrowed the scope of the information provided to American officials over time.

A Crucial Gatekeeper

Swift's database provides a rich hunting ground for government investigators. Swift is a crucial gatekeeper, providing electronic instructions on how to transfer money among 7,800 financial institutions worldwide. The cooperative is owned by more than 2,200 organizations, and virtually every major commercial bank, as well as brokerage houses, fund managers and stock exchanges, uses its services. Swift routes more than 11 million transactions each day, most of them across borders.

The cooperative's message traffic allows investigators, for example, to track money from the Saudi bank account of a suspected terrorist to a mosque in New York. Starting with tips from intelligence reports about specific targets, agents search the database in what one official described as a "24-7" operation. Customers' names, bank account numbers and other identifying information can be retrieved, the officials said.

The data does not allow the government to track routine financial activity, like A.T.M. withdrawals, confined to this country, or to see bank balances, Treasury officials said. And the information is not provided in real time — Swift generally turns it over several weeks later. Because of privacy concerns and the potential for abuse, the government sought the data only for terrorism investigations and prohibited its use for tax fraud, drug trafficking or other inquiries, the officials said.

The Treasury Department was charged by President Bush, in a September 2001 executive order, with taking the lead role in efforts to disrupt terrorist financing. Mr. Bush has been briefed on the program and Vice President Dick Cheney has attended C.I.A. demonstrations, the officials said. The National Security Agency has provided some technical assistance.

While the banking program is a closely held secret, administration officials have held classified briefings for some members of Congress and the Sept. 11 commission, the officials said. More lawmakers were briefed in recent weeks, after the administration learned The Times was making inquiries for this article.

Swift's 25-member board of directors, made up of representatives from financial institutions around the world, was previously told of the program. The Group of 10's central banks, in major industrialized countries, which oversee Swift, were also informed. It is not clear if other network participants know that American intelligence officials can examine their message traffic.

Because Swift is based overseas and has offices in the United States, it is governed by European and American laws. Several international regulations and policies impose privacy restrictions on companies that are generally regarded as more stringent than those in this country. United States law establishes some protections for the privacy of Americans' financial data, but they are not ironclad. A 1978 measure, the Right to Financial Privacy Act, has a limited scope and a number of exceptions, and its role in national security cases remains largely untested.

Several people familiar with the Swift program said they believed that they were exploiting a "gray area" in the law and that a case could be made for restricting the government's access to the records on Fourth Amendment and statutory grounds. They also worried about the impact on Swift if the program were disclosed.

"There was always concern about this program," a former official said.

One person involved in the Swift program estimated that analysts had reviewed international transfers involving "many thousands" of people or groups in the United States. Two other officials placed the figure in the thousands. Mr. Levey said he could not estimate the number.

The Swift data has provided clues to money trails and ties between possible terrorists and groups financing them, the officials said. In some instances, they said, the program has pointed them to new suspects, while in others it has buttressed cases already under investigation.

Among the successes was the capture of a Qaeda operative, Riduan Isamuddin, better known as Hambali, believed to be the mastermind of the 2002 bombing of a Bali resort, several officials said. The Swift data identified a previously unknown figure in Southeast Asia who had financial dealings with a person suspected of being a member of Al Qaeda; that link helped locate Hambali in Thailand in 2003, they said.

In the United States, the program has provided financial data in investigations into possible domestic terrorist cells as well as inquiries of Islamic charities with suspected of having links to extremists, the officials said.

The data also helped identify a Brooklyn man who was convicted on terrorism-related charges last year, the officials said. The man, Uzair Paracha, who worked at a New York import business, aided a Qaeda operative in Pakistan by agreeing to launder $200,000 through a Karachi bank, prosecutors said.

In terrorism prosecutions, intelligence officials have been careful to "sanitize," or hide the origins of evidence collected through the program to keep it secret, officials said.

The Bush administration has pursued steps that may provide some enhanced legal standing for the Swift program. In late 2004, Congress authorized the Treasury Department to develop regulations requiring American banks to turn over records of international wire transfers. Officials say a preliminary version of those rules may be ready soon. One official described the regulations as an attempt to "formalize" access to the kind of information secretly provided by Swift, though other officials said the initiative was unrelated to the program.

The Scramble for New Tools

Like other counterterrorism measures carried out by the Bush administration, the Swift program began in the hectic days after the Sept. 11 attacks, as officials scrambled to identify new tools to head off further strikes.

One priority was to cut off the flow of money to Al Qaeda. The 9/11 hijackers had helped finance their plot by moving money through banks. Nine of the hijackers, for instance, funneled money from Europe and the Middle East to SunTrust bank accounts in Florida. Some of the $130,000 they received was wired by people overseas with known links to Al Qaeda.

Financial company executives, many of whom had lost friends at the World Trade Center, were eager to help federal officials trace terrorist money. "They saw 9/11 not just as an attack on the United States, but on the financial industry as a whole," said one former government official.

Quietly, counterterrorism officials sought to expand the information they were getting from financial institutions. Treasury officials, for instance, spoke with credit card companies about devising an alert if someone tried to buy fertilizer and timing devices that could be used for a bomb, but they were told the idea was not logistically possible, a lawyer in the discussions said.

The F.B.I. began acquiring financial records from Western Union and its parent company, the First Data Corporation. The programs were alluded to in Congressional testimony by the F.B.I. in 2003 and described in more detail in a book released this week, "The One Percent Doctrine," by Ron Suskind. Using what officials described as individual, narrowly framed subpoenas and warrants, the F.B.I. has obtained records from First Data, which processes credit and debit card transactions, to track financial activity and try to locate suspects.

Similar subpoenas for the Western Union data allowed the F.B.I. to trace wire transfers, mainly outside the United States, and to help Israel disrupt about a half-dozen possible terrorist plots there by unraveling the financing, an official said.

The idea for the Swift program, several officials recalled, grew out of a suggestion by a Wall Street executive, who told a senior Bush administration official about Swift's database. Few government officials knew much about the consortium, which is led by a Brooklyn native, Leonard H. Schrank, but they quickly discovered it offered unparalleled access to international transactions. Swift, a former government official said, was "the mother lode, the Rosetta stone" for financial data.

Intelligence officials were so eager to use the Swift data that they discussed having the C.I.A. covertly gain access to the system, several officials involved in the talks said. But Treasury officials resisted, the officials said, and favored going to Swift directly.

At the same time, lawyers in the Treasury Department and the Justice Department were considering possible legal obstacles to the arrangement, the officials said.

In 1976, the Supreme Court ruled that Americans had no constitutional right to privacy for their records held by banks or other financial institutions. In response, Congress passed the Right to Financial Privacy Act two years later, restricting government access to Americans' banking records. In considering the Swift program, some government lawyers were particularly concerned about whether the law prohibited officials from gaining access to records without a warrant or subpoena based on some level of suspicion about each target.

For many years, law enforcement officials have relied on grand-jury subpoenas or court-approved warrants for such financial data. Since 9/11, the F.B.I. has turned more frequently to an administrative subpoena, known as a national security letter, to demand such records.

After an initial debate, Treasury Department lawyers, consulting with the Justice Department, concluded that the privacy laws applied to banks, not to a banking cooperative like Swift. They also said the law protected individual customers and small companies, not the major institutions that route money through Swift on behalf of their customers.

Other state, federal and international regulations place different and sometimes conflicting restrictions on the government's access to financial records. Some put greater burdens on the company disclosing the information than on the government officials demanding it.

Among their considerations, American officials saw Swift as a willing partner in the operation. But Swift said its participation was never voluntary. "Swift has made clear that it could provide data only in response to a valid subpoena," according to its written statement.

Indeed, the cooperative's executives voiced early concerns about legal and corporate liability, officials said, and the Treasury Department's Office of Foreign Asset Control began issuing broad subpoenas for the cooperative's records related to terrorism. One official said the subpoenas were intended to give Swift some legal protection.

Underlying the government's legal analysis was the International Emergency Economic Powers Act, which Mr. Bush invoked after the 9/11 attacks. The law gives the president what legal experts say is broad authority to "investigate, regulate or prohibit" foreign transactions in responding to "an unusual and extraordinary threat."

But L. Richard Fischer, a Washington lawyer who wrote a book on banking privacy and is regarded as a leading expert in the field, said he was troubled that the Treasury Department would use broad subpoenas to demand large volumes of financial records for analysis. Such a program, he said, appears to do an end run around bank-privacy laws that generally require the government to show that the records of a particular person or group are relevant to an investigation.

"There has to be some due process," Mr. Fischer said. "At an absolute minimum, it strikes me as inappropriate."

Several former officials said they had lingering concerns about the legal underpinnings of the Swift operation. The program "arguably complies with the letter of the law, if not the spirit," one official said.

Another official said: "This was creative stuff. Nothing was clear cut, because we had never gone after information this way before."

Treasury officials said they considered the government's authority to subpoena the Swift records to be clear. "People do not have a privacy interest in their international wire transactions," Mr. Levey, the Treasury under secretary, said.

Tighter Controls Sought

Within weeks of 9/11, Swift began turning over records that allowed American analysts to look for evidence of terrorist financing. Initially, there appear to have been few formal limits on the searches.

"At first, they got everything — the entire Swift database," one person close to the operation said.

Intelligence officials paid particular attention to transfers to or from Saudi Arabia and the United Arab Emirates because most of the 9/11 hijackers were from those countries.

The volume of data, particularly at the outset, was often overwhelming, officials said. "We were turning on every spigot we could find and seeing what water would come out," one former administration official said. "Sometimes there were hits, but a lot of times there weren't."

Officials realized the potential for abuse, and narrowed the program's targets and put in more safeguards. Among them were the auditing firm, an electronic record of every search and a requirement that analysts involved in the operation document the intelligence that justified each data search. Mr. Levey said the program was used only to examine records of individuals or entities, not for broader data searches.

Despite the controls, Swift executives became increasingly worried about their secret involvement with the American government, the officials said. By 2003, the cooperative's officials were discussing pulling out because of their concerns about legal and financial risks if the program were revealed, one government official said.

"How long can this go on?" a Swift executive asked, according to the official.

Even some American officials began to question the open-ended arrangement. "I thought there was a limited shelf life and that this was going to go away," the former senior official said.

In 2003, administration officials asked Swift executives and some board members to come to Washington. They met with Mr. Greenspan, Robert S. Mueller III, the F.B.I. director, and Treasury officials, among others, in what one official described as "a full-court press." Aides to Mr. Greenspan and Mr. Mueller declined to comment on the meetings.

The executives agreed to continue supplying records after the Americans pledged to impose tighter controls. Swift representatives would be stationed alongside intelligence officials and could block any searches considered inappropriate, several officials said.

The procedural change provoked some opposition at the C.I.A. because "the agency was chomping at the bit to have unfettered access to the information," a senior counterterrorism official said. But the Treasury Department saw it as a necessary compromise, the official said, to "save the program."

Barclay Walsh contributed reporting for this article.

Copyright 2006 The New York Times Company

http://www.nytimes.com/2006/06/23/washington/23intel.html?hp&ex=1151121600&en=18f9ed2cf37511d5&ei=5094&partner=homepage

[Alli]

Under a secret Bush administration program initiated weeks after the Sept. 11 attacksSince when is this a secret? I remember clear press releases announcing they would go after terror-affiliated accounts and freeze them.

[Petronas]

Britain freezes Muslim charity
August 26, 2006

A CHARITY at the centre of concerns over the funding of the alleged terrorist plot to attack trans-Atlantic aircraft has had its assets frozen. The Charity Commission is investigating the activities of Crescent Relief, which raised large sums from British Muslims for the humanitarian operation after the earthquake in Kashmir last October.

The inquiry follows the revelation that one of the men arrested at High Wycombe, a town near London, in connection with the alleged plot was a fundraiser for the charity. It has also emerged that a co-founder of the charity was Abdul Rauf, from Birmingham, whose son Rashid is in custody in Pakistan, where the authorities claim that he is a "key figure" in the conspiracy. Another of Mr Rauf's sons, Tayib, 22, was arrested before being released without charge.

The action against the charity came as British authorities charged a 12th person over the alleged plot to blow up US-bound passenger jets and amid indications that Britons are feeling increasingly threatened by Islam. Umair Hussain, 24, was one of 25 people arrested since police staged pre-dawn raids on August 10 in connection with the plot. Five have since been released without charge.

Police have been granted warrants by a court to question the remaining eight until next Wednesday. Under British anti-terror laws, suspects can be detained for up to 28 days without charge, subject to regular court approval.

Hussain was charged under anti-terror legislation for failing to disclose information about his brother, Nabeel Hussain, who is believed to be one of the eight still in custody.

As the Government launched an attempt to tackle inter-faith tensions, a survey published in The Daily Telegraph found 53per cent of respondents were concerned about the impact of Islam - not just fundamentalist elements - up 21 per cent from 2001.

There had also been a near doubling of the number agreeing that "a large proportion of British Muslims feel no sense of loyalty to this country and are prepared to condone or even carry out acts of terrorism".

Addressing the freeze on the Crescent Relief's accounts, Kenneth Dibble, the director of legal and charity services at the commission, said: "We are working with law enforcement agencies to get to the bottom of allegations of possible terrorist abuse of Crescent Relief funds. The allegations made are very serious, and we are taking this action to protect the charity's funds while the investigation is under way. At this early stage in such a complex and sensitive investigation, it is difficult to say how long our inquiry may take."

As a temporary measure, the commission said it had frozen the bank accounts of the charity. Funds now cannot be used by the charity without the commission's consent.

Umair Hussain was due to appear at City of Westminster Magistrates Court overnight. Hussain "had information which he knew or believed might be of material assistance in preventing the commission of another person, namely Nabeel Hussain, of an act of terrorism and failed to disclose it as soon as reasonably practicable", a police spokesman said.

Of the 11 others facing charges, eight are facing the most serious ones of conspiracy to murder and preparing acts of terrorism, and were told to return to court on September4 to appear before the Old Bailey criminal court in central London - the traditional venue for Britain's biggest criminal trials. The three others are to return to the magistrates court on Tuesday.

http://www.theaustralian.news.com.au/story/0,20867,20254774-2703,00.html

[Vancouver]

About Crescent Relief being frozen:
http://www.charitycommission.gov.uk/news/crescent.asp

[Vancouver]

A Hizbullah group -- Islamic Resistance Support Organization -- joins the US banned-entity list:
http://www.treas.gov/press/releases/hp73.htm
The whole list is maintained here:
http://www.ustreas.gov/offices/enforcement/ofac/sdn/sdnlist.txt

[candypreet]

good links there

[Petronas]

Jihadists and Jews
October 16, 2006

Democratic strategist and former Michael Dukakis campaign manager Susan Estrich, and the former American Civil Liberties Union president in Massachusetts, Harvey Silvergate, recently joined the attorneys representing two alleged Boston al Qaeda funders.

Emadeddin Z. Muntasser and Muhammed Mubayyid face charges in U.S. District Court of Massachusetts for the soliciting and expenditure "of funds to support and promote the mujahideen and jihad, including the distribution of pro-jihad publications." Their Care International "charity," a now-defunct Boston-based al Qaeda front organization, published, among other things, the English version by al Qaeda co-founder Abdullah Azzam of "Join the Caravan," which states: "[t]he obligation of Jihad today remains [individually required] until the last piece of land, which was in the hand of the Muslims, but has been occupied by disbelievers, is liberated."

In their Oct. 5 request for a dismissal, the defendants effectively -- and unwittingly -- explain all the reasons why the federal government should outlaw Islamic charitable giving in the United States. In their motion, attorneys Mrs. Estrich, Malick Ghachem, Norman Zalkind and Elizabeth Lunt, argue that the defendants merely exercised their religious freedom and obligation to give "zakat" (Islamic charity). Their motion cites Chapter 9, verse 60 of the Koran, which describes "those entitled to receive zakat." According to the definition of zakat in The Encyclopedia of Islam, "category 7" of eligible recipients are "volunteers engaged in jihad" for whom the zakat cover "living expenses and the expenses of their military service (animals, weapons)."

Incredibly, the suspects' attorneys also argue that such charitable giving, to support the jihad and mujahideen, is rightfully tax-exempt under U.S. constitutional protection of religious freedom. Moreover, they compare their support of Islam's "holy war" to the Jewish National Fund (JNF) appeals for tax-deductible "donations to finance the purchase of bulletproof vests, helmets and firetrucks in connection with the 2006 Israel-Lebanon conflict." Equating the supply of bulletproof vests to defend Israeli civilians from Hezbollah's jihad with the funding of weapons and martyrs (holy warriors) for the jihad is preposterous. The JNF does not promote religiosity. Rather, it was incorporated in the United States in 1926 to develop the ancient Jewish homeland and to maintain and encourage the connection of the Jewish people to it. In contrast, Care was established to promote and advance al Qaeda's version of Islam.

Messrs. Muntasser and Mubayyid, the respective founder and treasurer of Care International, were indicted on May 11, 2005, for lying about the true nature of their organization and their charitable, tax-exempt activities. They now claim that their fund-raising from 1993 to 1996 conformed to the "teachings of an Abrahamic faith." Moreover, they claim, their activities correspond to those that "other 501(c)(3) religious groups conduct on a regular basis." Their own publications, according to an FBI affidavit, state that Care was established in 1993 in Boston by Mr. Azzam, and not by Mr. Muntasser, as he stated in Care's Articles of incorporation, and on Care's application for tax exemption as a "charity." Mr. Azzam was also a key leader of the Muslim Brotherhood.

According to the FBI affidavit, Care's publication "Al-Hussam" (the Sword in Arabic) actively advocated for "jihad" or holy war, involving "mujahideen" or Islamic holy warriors. In addition, the affidavit states that Care was "the outgrowth of and successor to the Al-Kifah Refugee Center branch in Boston." After September 11 the U.S. designated Al-Kifah -- Sheikh Abdul Rahman's outfit in Brooklyn -- as a terrorist organization for "its involvement in the 1993 World Trade Center bombing." Care documents show that between 1993-2003 it "collected more than $1.3 million in contributions... specifically directed towards mujahideen." Court records show Care's deposited checks with handwritten notes such as: "for jihad only" and "Bosnia Jihad fund" and "Chechen Muslim Fighters."

Although the U.S. Constitution provides protections for religious freedom, it most certainly was never intended to protect religiously sanctioned or encouraged war in or against America. Yet, that is exactly what the legal team for Messrs. Muntasser and Mubayyid argues. Apparently, Mrs. Estrich once again is banking on political strategy, in the assumption that jurors from Eastern Massachusetts -- notable for having one of the highest geographic concentrations of liberals in the United States -- are likely to side with al Qaeda, against the U.S. government.

The First Amendment bars Congress from enacting laws "respecting an establishment of religion, or prohibiting the free exercise thereof." Yet even the flightiest prospective juror will surely see that the Constitution offers no protection to any group supporting "holy war" against the United States or its citizens -- whether in the name of Islam, or anything else.

http://www.washtimes.com/op-ed/20061015-101426-7581r.htm

[Petronas]

U.S. tries to cut off terrorists' cash flow
October 30, 2006

The U.S. military is not only trying to stop terrorists and arms from leaking into Iraq from Syria and Iran but also another just as dangerous commodity -- cash.
It's the lifeblood of the enemy -- whether they be al Qaeda terrorists, death squads or Sunnis trying to evict American forces and bring back dictator Saddam Hussein -- and U.S. raiders have seized millions of dollars in cash during the conflict.
Military officials point to Syria and its secretive banking system as the main source of Sunni walking-around money, while Iran's Revolutionary Guard funnels money to Shi'ite militias, such as cleric Muqtada al-Sadr's Mahdi Army.
The enemy's money began flowing into Iraq with the start of the insurgency in the summer of 2003, and the shipments are still coming in.
"There are billions coming in," said Daniel Gallington, a former aide to Defense Secretary Donald H. Rumsfeld. "The Middle East is the center of graft and corruption in the universe. It really always has been. The fight in Iraq is about who controls what area is really all about who controls the money."
Money, of course, is just as essential to the insurgents as budget dollars are to the American armed forces. Terrorists need it to buy loyalty from local villagers, bomb-making gear, vehicles and electronics to communicate and to detonate improvised explosive devices (IEDs).
Perhaps the most important expenditure is salaries: Sunnis have enlisted thousands of disaffected youths, some enjoying their first paydays ever, by giving them cash to attack Americans, plant IEDs and run messages from one leader to another, say defense sources and officers who served in Iraq.
"The average IED is an attack form carried out by people that are really not ideologically committed," Gen. John Abizaid, who heads U.S. Central Command, told a group of reporters. "They get paid, and they're getting paid because they don't have any money and they're getting paid because they've got people [who] are generally members of the old army that don't have work."
Army Maj. Gen. William Caldwell, the chief military spokesman in Baghdad, gave a glimpse of the money trail earlier this month when describing a raid in Tikrit, Saddam's hometown. Raiders hit a number of businesses in the city, seizing millions of dollars that had come in from Syria.
"These funds, estimated to be in the millions of dollars per week, were used to finance insurgent operations, to include attacks against Iraqi civilians, as well as Iraqi and coalition security forces," Gen. Caldwell said.
Although the raid was designed to block the cash flow, defense sources say there is more where that came from.
Retired Marine Corps Lt. Gen. Michael DeLong, the former deputy commander of U.S. Central Command, said literally tons of cash moved from Baghdad into Syria as the U.S. invasion neared in March 2003. That money is now going full circle to feed the Sunni insurgency.
"We watched caravans going into Syria," Gen. DeLong said. "They took their money; their jewels. They took everything."
But not all the cash got out.
"We found U.S. money all through the capital," Gen. DeLong said. "Saddam and the Ba'ath Party had caches of U.S. money stashed everywhere. One day, one guy found $10 million in cash."
The Ba'ath Party had built up huge cash stocks via the United Nations oil-for-food program, mostly from illicit sale of goods and oil. The U.S. military seized $926 million from the Iraq regime as of the summer of 2004, according to a report from the special inspector general for Iraq reconstruction.

http://www.washingtontimes.com/national/20061030-122604-4318r.htm

[Petronas]

Will 5 new unregulated virtual banks become money laundering centres?
11 January 2007

Entropia Universe, one of the largest online role-playing games, and where subscribers can do business in a virtual universe, has announced that it will auction off five virtual banking "licenses" this month. These are full-service cyberbanks without any governmental regulation, meaning absolutely no compliance requirements, presenting a golden opportunity for money launderers and terrorist financiers to thrive there, and to do so with impunity. Is the phrase "Barbarians at the Gate" appropriate here ?

Entropia, a Swedish-based online game from MindArk PE AB, claims to have 500,000 subscribers that moved $ 160m through its virtual economic system. It actually has a fixed rate of exchange, where virtual currency is convertible to US Dollars at ten to one, which can be accessed through an established real-world ATM system reportedly from over 1m automated tellers worldwide. The website says " the first virtual universe with a real cash economy."

The economic aspects are far from theory; players have paid up to $100,000 to purchase virtual properties on Entropia. Whilst financial transactions in the game may seem imaginary to most financial professionals, they do indeed require real dollar funding, which is input into the primitive, but effective, virtual economy. The website boasts " Make real money on virtual planet Calypso." Will the presence of virtual banks accelerate its growth ?

The licenses, which will be exclusive for a period of two years, allow lending to subscribers, and appear to have no restrictions whatsoever on the scope of banking business which may be transacted. This mean that typical virtual transactions might look like this :

Money launderers, using financial professionals in their employ as front men, purchase a virtual bank license. They choose a name for the bank that is deceptively similar to that of a well-known international financial institutions, and open correspondent accounts in some of the more unsavory offshore tax havens.
They create bogus "loans" to fund the criminal activities of their clients on a global basis. Inasmuch as there is neither compliance nor regulatory structure, they can pretty much accept anyone as a customer. Of course, all the "customer identification" documents they accept as proof of identity are bogus.
Narcotics traffickers, arms dealers, counterfeiters, and all other types of financial criminals flock to the virtual banks, where no questions are asked about source of funds, whether you are a fugitive from justice, or even if you are financing global terrorist operations. Anything goes.
Since the virtual banks do not exist in any physical sense, there are serious jurisdictional issues confronting law enforcement and regulators. The virtual banks exist on the science-fiction planet of Calypso When one bank is closed up, through action against the company sponsoring the website, another opens up in a faraway country where enforcement is lax and corrupt, or where the law has not yet developed sufficiently to allow enforcement.
Money launderers adapt to enforcement by operating a string of virtual banks, moving on when one is eventually terminated.

In short, this is a potential money laundering nightmare. The virtual banks have no government-issued licenses, and we trust that this virtual financial "industry" can be promptly terminated under existing laws. Online role-playing games simply cannot create financial structures without real-life regulation. It would open the floodgates for financial criminals.

http://www.world-check.com/articles/2007/01/11/will-5-new-unregulated-virtual-banks-become-money-/

[Petronas]

HAWALA: BASED ON TRUST, SUBJECT TO ABUSE
Mohammed El-Qorchi

Hawala is one of a number of informal systems used in many regions around the world to transfer money domestically or across borders, often in cash. Regulation of hawala is complex and demands a practical understanding of the environment in each country where hawala dealers work. Regulation should attempt not to eliminate hawala but to prevent such misuse as financing terrorism.

Since the 9/11 terrorist attacks on the United States, public interest in informal systems of transferring money around the world, particularly the hawala system, has increased. The reason is the hawala system's alleged role in financing illegal and terrorist activities, along with its traditional role of transferring money between individuals and families, often in different countries. Against this background, governments and international bodies have tried to develop a better understanding of these systems, assess their economic and regulatory implications, and design the most appropriate approach for dealing with them.

Informal funds transfer (IFT) systems are in use in many regions for transferring funds, both domestically and internationally. The hawala system is one of the IFT systems that exist under different names in various regions of the world. It is important, however, to distinguish the hawala system from the term hawala, which means "transfer" or "wire" in Arabic banking jargon. The hawala system refers to an informal channel for transferring funds from one location to another through service providers — known as hawaladars — regardless of the nature of the transaction and the countries involved. While hawala transactions are mostly initiated by emigrant workers living in a developed country, the hawala system can also be used to send funds from a developing country, even though the purpose of the funds transfer is usually different (see box).

Why hawala developed

In earlier times, IFT systems were used for trade financing. They were created because of the dangers of traveling with gold and other forms of payment on routes beset with bandits. Local systems were widely used in China and other parts of East Asia and continue to be in use there. They go under various names — Fei-Ch'ien (China), Padala (Philippines), Hundi (India), Hui Kuan (Hong Kong), and Phei Kwan (Thailand). The hawala (or hundi) system now enjoys widespread use but is historically associated with South Asia and the Middle East. At present, its primary users are members of expatriate communities who migrated to Europe, the Persian Gulf region, and North America and send remittances to their relatives on the Indian subcontinent, East Asia, Africa, Eastern Europe, and elsewhere. These emigrant workers have reinvigorated the system's role and importance. While hawala is used for the legitimate transfer of funds, its anonymity and minimal documentation have also made it vulnerable to abuse by individuals and groups transferring funds to finance illegal activities.

Economic and cultural factors explain the attractiveness of the hawala system. It is less expensive, swifter, more reliable, more convenient, and less bureaucratic than the formal financial sector. Hawaldars charge fees or sometimes use the exchange rate spread to generate income. The fees charged by hawaladars on the transfer of funds are lower than those charged by banks and other remitting companies, thanks mainly to minimal overhead expenses and the absence of regulatory costs to the hawaladars, who often operate other small businesses. To encourage foreign exchange transfers through their system, hawaladars sometimes exempt expatriates from paying fees. In contrast, they reportedly charge higher fees to those who use the system to avoid exchange, capital, or administrative controls. These higher fees often cover all the expenses of the hawaladars.

The system is swifter than formal financial transfer systems partly because of the lack of bureaucracy and the simplicity of its operating mechanism; instructions are given to correspondents by phone, facsimile, or e-mail; and funds are often delivered door to door within 24 hours by a correspondent who has quick access to villages even in remote areas. The minimal documentation and accounting requirements, the simple management, and the lack of bureaucratic procedures help reduce the time needed for transfer operations.

In addition to economic factors, kinship, ethnic ties, and personal relations between hawaladars and expatriate workers make this system convenient and easy to use. The flexible hours and proximity of hawaladars are appreciated by expatriate communities. To accommodate their clients, hawaladars may instruct their counterparts to deliver funds to beneficiaries before expatriate workers make payments. Moreover, cultural considerations encourage expatriate workers to remit funds through the hawala system, and such considerations also apply to family members in the home country. Many expatriate communities are exclusively male because wives and other family members remain in the home country, where family traditions prevail. These traditions may require family members, especially women, to maintain minimal contacts with the outside world. A trusted hawaladar, known in the village and aware of the social codes, would be an acceptable intermediary, protecting women from having direct dealings with banks and other agents. Thus, a system based on national, ethnic, and village solidarity depends more on absolute trust between the participants than on legal documents.

On the receiving side, repressive financial policies and inefficient banking institutions, which have often lacked interest in the remittance business, have contributed to the development of IFT systems. In addition to overly restrictive economic policies, unstable political situations have offered fertile ground for the development of the hawala and other informal systems. Most IFT systems have prospered in areas characterized by unsophisticated official systems and during times of instability. They continue to develop in regions where financial development has been slow or repressed. Overall, financial development tends to check the spread of informal fund transfer systems, even though they exist in financially mature countries as well.

Economic implications

Despite its informality, the hawala system has direct and indirect macroeconomic implications — for financial activity as well as for fiscal performance. One aspect is its potential impact on the monetary accounts of countries on either end of the hawala transaction. Because these transactions are not reflected in official statistics, the remittance of funds from one country to another is not recorded as an increase in the recipient country's foreign assets or in the remitting country's liabilities, unlike funds transferred through the formal sector. As a consequence, value changes hands, but the broad measure of money is unaltered. However, hawala transactions may affect the composition of broad money in a recipient country. In the remittance business, such transactions are conducted mainly in cash, even though hawaladars may use the banking system for other purposes. Individuals from developing countries who transfer funds abroad through the hawala system for investment or other purposes are usually members of wealthy groups. They supply local hawaladars with cash by making withdrawals from their bank accounts. As a consequence, hawala-type transactions tend to increase the amount of cash in circulation. Furthermore, IFT systems have fiscal implications for both remitting and receiving countries because no direct or indirect tax is paid on hawala transactions. The negative impact on government revenue applies equally to both legitimate and illegitimate activities that involve the hawala system.

Hawala transactions cannot be reliably quantified because records are virtually inaccessible, especially for statistical or balance of payments purposes. This holds true for both the remitting and, especially, the receiving sides of the transactions. Hawala transactions from developing countries are sometimes driven by capital flight motivations; they may also be driven by a desire to circumvent exchange control regulations and the like, leaving no traceable records. Nevertheless, the authorities of some countries have sporadically made estimates of hawala activity based on their expatriate populations and balance of payments data. In any case, all crude estimates should take into account both hawala and reverse hawala transactions (see box) as well as transactions driven by illicit activities. Although it would be impossible to provide a precise figure, the amounts involved in hawala transactions are likely to entail billions of dollars.

Difficulties for regulators

There is also a consensus that, in the wake of heightened international efforts to combat money laundering and terrorist financing, more should be done to keep an eye on IFT systems to avoid their misuse by illicit groups. Policymakers believe that the potential anonymity afforded by these systems presents risks of money laundering and terrorist financing that need to be addressed. Yet selecting the appropriate regulatory and supervisory response requires a realistic and practical assessment and an understanding of the specific country environment in which the IFT dealers operate.

Regulation of IFT systems in various jurisdictions will be a complex endeavor. The variety of legal systems and economic circumstances across countries make a uniform approach technically and legally impractical. In a number of countries, the hawala system is prohibited. Any attempt to regulate this system in these countries would, therefore, be at odds with existing laws and regulations and would be seen as legitimizing parallel foreign exchange operations and capital flight.

Where IFT regulations are conceivable, there is agreement that overregulation and coercive measures will not be effective because they might push IFT businesses, including legitimate ones, further underground. The purpose of any approach is not to eliminate these systems but to avoid their misuse. Against this background, policymakers tend to favor two options, which are already in force in some countries: registration or licensing of IFT systems.

While these measures could deter illegal activities, they will not, in isolation, succeed in reducing the attractiveness of the hawala system. As a matter of fact, as long as there are reasons for people to prefer such systems, they will continue to exist and even expand. If the formal banking sector intends to compete with the informal remittance business, it should focus on improving the quality of its service and reducing the fees charged. Therefore, a longer-term and sustained effort should be aimed at modernizing and liberalizing the formal financial sector, with a view to addressing its inefficiencies and weaknesses.


How does the system work? [the "box" referred to above]

A person in Country A wants to send funds to a person in country B. He initiates the transaction by giving the money to a hawaladar in country A and receives from the hawaladar an authentication code. The hawaladar in country A then instructs the hawaladar in country B to deliver an equivalent amount of funds in the local currency to the intended beneficiary. To receive the funds, the beneficiary must disclose the authentication code given to the customer in country A.

The hawaladar in country A can be compensated by charging a fee or through an exchange rate spread (the difference between the asking and buying price of a currency). After the remittance, the hawaladar in country A has a liability to his country B counterpart, which is satisfied with a payment of money or with goods and services.

The settlement of the liability also can be done through a "reverse hawala" or through imports of goods. A reverse hawala transaction is often used for investment purposes or to cover travel, medical, or education expenses from a developing country. In a country subject to foreign exchange and capital controls, a customer in country B interested in paying his son's university tuition fees, for example, provides local currency to the hawaladar in his country and requests that the equivalent amount be made available to the customer's son in country A. The hawaladar in country B may transfer funds directly to his counterpart in country A or use this transaction to settle his previous claims on the hawaladar in country A. He may also instruct an indebted hawaladar in country A to transfer funds to another hawaladar in a third country to where funds are to be delivered to settle this transaction. Furthermore, the settlement can also take place through import transactions; the hawaladar in country A would settle his debt by financing exports to country B where the hawaladar in country B would be the importer or an intermediary.


Mohammed El-Qorchi is deputy area chief in the International Monetary Fund's Monetary and Financial Systems Department. The following text presented here has been adapted from his article in the December 2002 issue of Finance and Development, IMF's quarterly magazine.

http://usinfo.state.gov/journals/ites/0904/ijee/qorchi.htm

[candypreet]

dawood ebrahim controlled the hawala racket is Asia and Africa

[candypreet]

http://www.wincoast.com/forum/showthread.php?t=6626

[candypreet]

another very nice thread by bman

http://www.wincoast.com/forum/showthread.php?t=27679&highlight=dawood

[Petronas]

Soon on your mobile phone- money transfers to al Qaeda
Posted by Rachel Ehrenfeld on February 12, 2007 at 17:26

Al Qaeda, Hizbollah, Hamas members and their ilks the world over are delighted. Soon, they and other criminals can use cell phones to transfer money around the globe.

The GSM Association, the mobile telephone operator trade body, announced that 19 mobile phone companies will allow more than “600 million customers in over 100 countries,” to use their cell phones to transfer money internationally. “The system will allow a person to put cash onto their mobile, and order it to be sent to a mobile phone number abroad, where the recipient receives a text message saying that money has arrived.”

“The system will allow a person to put cash onto their mobile, and order it to be sent to a mobile phone number abroad, where the recipient receives a text message saying that money has arrived… the initiative could double the number of recipients of international remittances to more than 1.5 billion." This new initiative, which is said to help migrant workers to send money to their families, would undoubtedly defeat most efforts to identify the users and follow the money trail. A terrorist dream comes true.

http://www.terrorfinance.org/the_terror_finance_blog/2007/02/soon_on_your_mo.html

[Petronas]

Interesting site:

The Terror Finance Blog
http://www.terrorfinance.org/the_terror_finance_blog/

[candypreet]

nice intersting link

[Petronas]

Terrorists trading on bourses: NSA
THURSDAY, FEBRUARY 15, 2007 04:30:21 AM]

NEW DELHI: Terrorists are not only getting tech-friendly but market-savvy as well. A good part of terror funds is being sourced from manipulation of the bourses, particularly the Mumbai and Chennai stock exchanges, through fictitious or notional companies, according to national security adviser M K Narayanan. The NSA, who made this revelation during his address to the 43rd conference on security policy held last week in Munich, said many of the fictitious companies found to be engaging in stock market operations were traced to terrorist groups.

“Isolated instances of terrorist outfits manipulating the stock markets to raise funds for their operations have been reported. Stock exchanges in Mumbai and Chennai have, on occasions, reported that fictitious or notional companies were engaging in stock market operations,” news agencies here quoted Mr Narayanan as having told his counterparts in Munich.

Also expressing deep concern at the transfer of terror funds through valid banking channels from Dubai and UAE for use by groups like Jaish e Mohammad and Hizbul Mujahideen, Mr Narayanan stressed on the need to lift banking secrecy and the corporate veil to facilitate proper investigation of terror-related cases.

Terrorist groups, he said, generally make small transactions to avoid detection. “Use of both real and fraudulent ATM cards has also been resorted to at times,” he added. “Security agencies have detected many instances of funds received via banking channels from so-called safe locations like Dubai and UAE that were intended for terrorist groups,” he noted.

Squarely blaming certain “official agencies” in Pakistan for pumping millions of dollars for militancy in India, he said jehadi groups had started to establish a network of legitimate businesses to fund their activities. The terrorist groups are involved in legally running restaurants, real estate agencies and shipping firms and use their proceeds for their terrorist activities.

“Among terrorist outfits,” said Mr Narayanan, “the LTTE has a very well-established network of legitimate business, which provides both funds as well as logistics for their activities. Jehadi terrorist organisations have begun to follow suit.”

He said a combination of conventional money laundering techniques, including routing money through hawala channels, has made it extremely difficult to track funds utilised for terrorist purposes since no audit or paper trail is available.

Referring to 11 common ways of terrorist funding, the NSA said among them were voluntary contributions, on which terrorist groups like Al Qaeda and LTTE thrive, and compulsory donations including forcible subscription to their publications.

http://economictimes.indiatimes.com/News/PoliticsNation/Terrorists_trading_on_bourses_NSA/articleshow/1614745.cms

[Petronas]

Pakistan freezes funds of two Islamic charity groups
18 February 2007

KARACHI - Pakistan on Sunday froze the bank accounts of two Islamic charities and shut down their offices as part of a crackdown on militants after several recent suicide bombings in the country, officials said.

‘Offices of Al Akhtar Trust and Al Rashid Trust have been sealed and their bank accounts have been frozen,’ senior government official Ghulam Mohammad Mohtaram told AFP. ‘They will not be allowed to give ads in local newspapers for donations.’ He said the move followed reports that the two organisations were ‘providing funds to other organisations involved in illegal activities.’ The government also banned any publications by the two organisations, he said. However, there will be no restriction on their welfare activity, he added.

The Interior Ministry in Islamabad said action was being taken against the two charities as well as some militant organisations. ‘We have banned these organisations and are taking action to seal their offices, close their websites and publications and freeze their bank accounts,’ the chief of the ministry’s Nation Crisis Management Cell, Javed Iqbal Cheema, told AFP.

Al Rashid Trust was accused by the United States of links to the Al Qaeda terror network and Afghanistan’s ousted Taleban regime. The central bank of Pakistan had frozen its accounts after it was placed on a US terrorist list in the wake of the September 11, 2001 attacks. However, a Pakistani court in August 2003 overturned the central bank’s ban.

The trust’s spokesman Bashir Abdullah at the time said the verdict showed that allegations against it were ‘baseless’. ‘We have no links with any terrorist group and it is purely a welfare organisation,’ Abdullah had told AFP. ...

http://www.khaleejtimes.com/DisplayArticleNew.asp?xfile=data/subcontinent/2007/February/subcontinent_February678.xml&section=subcontinent&col=

[Petronas]

From the 2007 Intelligence Summit:
I. One important means of financing for Al Qaeda is stolen cars in the US. Cars are stolen all over the country and funneled to various used car dealerships, who often don’t even sell to walk-in customers. Sometimes the stolen vehicles are given the VIN numbers of wrecks of the same description that have been acquired by these dealerships. Then they are shipped to Dubai and Saudi Arabia, where they are re-titled and sold all over the Middle East, where a late model luxury car can easily fetch $50,000 or more. A company controlled by the family of Abdel Qader Faqeeh (member of the “Golden Chain” of billionaire donors to Al Qaeda) plays a role in importing these vehicles into Saudi Arabia. Certain large SUVs like those used by the Americans in Iraq are sent there and used in attacks where the attackers impersonate Americans. Junk cars are also sent on to Iraq and converted into car bombs. For example, a car found in a bomb factory in Fallujah was traced back through its VIN number to a Tampa, FL used car dealer.

It should not be surprising that Mohammed Atta was a used car dealer, as was Adnan al-Shukrijumah and 6 of those arrested in the 2006 transatlantic airplane bomb plot.

II. In some parts of the US, gas stations, mechanics shops and convenience stores are popular with terrorists who are engaged in money laundering. The money is then carried to the Middle East by “mules” who carry $125,000 to $150,000 strapped to their waists.

[Petronas]

Rochester men accused of helping terrorist group in court today
March 12, 2007

Three Yemeni men who run Rochester groceries are accused of illegally sending money overseas in the belief it would benefit the terrorist organization Hezbollah. Yehia Ali Ahmed Alomari, 26; Mohamed Al Huraibi, 49; and Saleh Mohamed Taher Saeed, 27, are scheduled to appear today for a detention hearing before U.S. Magistrate Judge Marian W. Payson.

Federal agents who conducted a sting operation charged them with conspiring to launder money and laundering monetary instruments for allegedly transferring $200,000 outside the United States after being told that the money had been generated by illegal activities and that the money was intended for Hezbollah. None of the money actually made it to Hezbollah, a radical Islamic group that the U.S. Department of State designated as a foreign terrorist organization in 1997.

The men were arrested in late February after a sealed complaint was filed in U.S. District Court in Rochester. The complaint, filed by a senior special agent of the Bureau of Immigration and Customs Enforcement of the U.S. Department of Homeland Security, said the three were arrested after a two-year-long investigation that included the use of a confidential witness and an undercover agent.

Unsealed court documents said the investigation was triggered when investigators learned that Saeed’s Social Security number was used in 324 currency transfers totaling $12.3 million from October 2002 through November 2004 and that Alomari’s Social Security number was used to transfer $2.6 million during the same time period.

Saeed is operator of Durnan Mini Mart, 934 Hudson Ave., and Alomari runs Short Deli & Grocery, 711 N. Goodman St. Huraibi was part owner and manager of Mojo Star’s Restaurant, 651 Jefferson Ave.

http://www.stargazettenews.com/apps/pbcs.dll/article?AID=/20070312/UPDATE/303120026

[Petronas]

US Treasury blacklists charity with alleged Hamas ties
Tue Aug 7, 12:38 PM ET

The US Treasury said Tuesday it had blacklisted one of the largest charitable groups in the Palestinian territories alleging it is a front for Hamas which is branded a terrorist organization by Washington. The Treasury said its blacklisting also affected the Al-Salah Society's director who it named as Ahmad Al-Kurd. The US move cuts the charity off from access to the US financial system.

"Hamas has used the Al-Salah Society, as it has other charitable fronts, to finance its terrorist agenda," said Adam Szubin, a Treasury official. The Treasury said Al-Salah had received "substantial funding" from Middle Eastern countries, including hundreds of thousands of dollars from Kuwaiti donors.

The Islamist movement Hamas seized power of the Gaza Strip in mid-June after winning a parliamentary election in January 2006. The Treasury said Al-Salah had helped finance the purchase of land for Hamas, as well as providing funding for kindergartens and commercial stores.

http://news.yahoo.com/s/afp/20070807/pl_afp/usmideastpalestinian_070807163814

[Vancouver]

US Treasury blacklists charity with alleged Hamas ties
Tue Aug 7, 12:38 PM ET

The US Treasury said Tuesday it had blacklisted one of the largest charitable groups in the Palestinian territories [Al-Salah] alleging it is a front for Hamas which is branded a terrorist organization by Washington. The Treasury said its blacklisting also affected the Al-Salah Society's director who it named as Ahmad Al-Kurd.
http://www.treas.gov/offices/enforcement/ofac/actions/20070807.shtml

[Petronas]

Other estimates I have seen are approximately $2,000 for the 7/7 London attacks and approximately $10,000 for the 3/11 Madrid attacks.

Small money transfers finance terror
Thu Sep 6, 3:13 PM ET

Every few weeks, the Tunisians would stop at a bank or Western Union office and wire funds to a city in Europe or the Middle East. No one took much notice. The sums were small — sometimes only a few hundred dollars — and thousands of other people were doing the same thing across Italy, many of them immigrant workers sending money home. This group, however, allegedly had dark motives.

In June, Italian officials broke up the ring with the arrest of four people, three in Milan and one in London, after examining financial records showing a steady transfer of funds allegedly used to recruit Islamic extremists and send them to terrorist training camps in Afghanistan. "They were small amounts, below the limits that require reporting," said an assessment by Italian financial police.

The Associated Press interviewed key officials and uncovered previously undisclosed details about how terrorist cells move money — often by transferring sums so small they elude programs that track terrorist financing. It's a loophole that raises questions about the effectiveness of the vast post-9/11 effort governments have made to choke off funding.

"How much do you think it takes to carry out a terrorist attack?" Milan prosecutor Elio Ramondini asked during an interview in his office in Milan's Palace of Justice. "Not very much," he said. The operation that blew up three London subways and a bus in July 2005, killing 52 commuters, used readily available materials and cost just $15,000, the British government says.

For the March 2004 bombings on four Madrid trains that killed 191 commuters, some analysts say the perpetrators spent less than $1,360. Others say the total was closer to $136,000, including explosives, a rental house, cell phones and other items. Police say most of the money came from low-level drug deals.

In its recruiting activities, the cell uncovered by Italian authorities provided false documents, as well as apartments, cars and communication devices registered under false names. Ramondini said it is suspected of providing logistical and financial support to an al-Qaida affiliate linked to April bombings in Algiers that killed 30 people.

Italian law only requires transfers above $14,400 to be reported to Italy's Foreign Exchange Office. Senders of smaller sums must show IDs, which officials acknowledge can be forged. Despite the tightening of other laws since the Sept. 11, 2001, attacks in the United States, the limit for automatic reporting has remained much the same in Europe.

As shown by the arrests of militants in Germany and Denmark for allegedly planning bomb attacks, one thing is clear: Europe with its growing immigrant populations and open borders has become a major target for Islamic radicals.

While authorities have given few details, the reports of the lifestyles of the suspects — the Germans were unemployed and living on welfare — and the kind of chemicals they were allegedly using was an indication that great expense was not involved.

Many of the recent plots in Britain, and the alleged plot in Germany, featured hydrogen peroxide, which is very cheap, as the principal bomb-making ingredient. At a recent police briefing, London's chief counterterrorism officer said a failed plot to attack the city's transport network_ two weeks after the July 7, 2005, attacks — cost just $1,000.

The German plan "is part of the tendency to carry out attacks with the most simple means," said Germano Dottori, an analyst at Rome's Center for Strategic Studies. "The danger of catastrophic attacks has diminished, but there is now a widespread threat of smaller attacks."

Western Union, which according to Ramondini was used by the Tunisians in Italy, said it cooperates fully in fighting terrorism. It invested more than $30 million in its worldwide compliance efforts in 2006 and planned to invest more than $35 million in 2007, Sherry Johnson, the company's director of media relations, said in an e-mail. She declined to comment on the arrests in Italy, saying Western Union doesn't comment on active legal investigations. In Italy, "Western Union agents are required to report all suspicious transactions, regardless of dollar amount," she said. But they rely on information provided by governments and are entirely dependent on its reliability, Johnson said.

Loretta Napoleoni, a London-based expert on terrorism financing, acknowledges that governments are in a bind: Their filters are weakened by their inability to catch small amounts, but if Western Union and others had to report every transaction of a few hundred dollars, "there would be a revolution."

Ramondini, the prosecutor, emphasized that the money transfer agencies did no wrong and that it would be unreasonable to demand more of them. "You would bring the economy to a halt," he said.

Col. Antonio Grimaldi of the Guardia di Finanza, who led the Milan investigation, said Islamic extremists are increasingly resorting to small transfers to evade detection. "In this and other investigations we have come across this 'tactical' kind of financing that keeps the cell alive and still allows it to organize attacks," he said.

Officials said the key to cracking the Milan cell was an informer who enabled investigators to work backward and trace the paper trail. Ramondini said investigators tracked some 40 money transfers by the group between 1999 and 2001, totaling about $68,000, to a wide range of countries in Europe and the Middle East, including Tunisia, Pakistan, Yemen, Algeria, Turkey and the United Arab Emirates. The cell was allegedly part of the Salafist Group for Call — or GSPC. The group changed its name to "al-Qaida in Islamic North Africa" when it announced its alliance with al-Qaida in January and is on the U.S. list of terrorist organizations.

http://news.yahoo.com/s/ap/20070906/ap_on_re_eu/italy_terrorism_on_the_cheap

[candypreet]

good post

[makeshiftpatriot]

U.S. troops capture al-Qaida financier near Baghdad

U.S. and Iraqi troops has detained an al-Qaida financier who is suspected of receiving 100 million U.S. dollars from al-Qaida sympathizers, the U.S. military said on Thursday.

During an operation in Baghdad's central neighborhood of Kindi on Tuesday, the troops detained the suspect who is "believed to have received $100,000,000 this summer from terrorist supporters who cross the Iraqi border illegally or fly into Iraq from Italy, Syria and Egypt," the U.S. military said in a statement.

The detainee is suspected of handing over 50,000 dollars a month to al-Qaida "using his leather merchant business as a front to smuggle weapons and explosives from surrounding countries,"according to the statement.

It added that intelligence reports said that the suspect has stores in Iraq's Fallujah, Syria and Jordan respectively.

In addition, the financier believed to be involved in purchasing explosives that were used in destroying the golden dome of one of the most revered Shiite shrines in Samarra in 2006.

He was also suspected of involving in another attack on June 13 this year, which destroyed the two marinates of the al-Askari shrine, according to the statement.

The two attacks were widely seen as the thin end of the wedge that sparked Iraq's sectarian strife that killed dozens of thousands of Iraqis.

The suspect is also wanted to the U.S. forces for allegedly shooting a U.S. patrol in Baghdad's western district of Mansour in April, which killed three U.S. soldiers and wounded another, said the statement.

Source: AFP

[Petronas]

Financial Jihad
Wednesday, November 28, 2007

Frontpage Interview’s guest today is Dr. Rachel Ehrenfeld, Director of the American Center for Democracy. She has a 25-year track-record of following terrorist financing, especially Islamic radical groups and states. In the late 1980’ she identified how Saudi Arabia, the Gulf States and Iran bankrolled terrorism, and how they developed Islamic banking to advance the Islamic agenda.

Ehrenfed, a Ph.D. in criminology from the Hebrew University of Jerusalem, has published hundreds of articles and 3 books on these issues. Her last book Funding Evil; How Terrorism is Financed – and How to Stop It, documents who funds terrorism, as well as the expansion of radical Islam.

Funding Evil accused Khalid bin Mahfouz, a Saudi billionaire from Jeddah, of funding terrorism. Mahfouz, who is notorious for using British libel laws to silence those who expose him, sued Dr. Ehrenfeld in a British court and she was ordered to destroy all copies of her book in England. She is now counter-suing Mahfouz in the United States.

A new short-form documentary film, The Libel Tourist [ http://www.thelibeltourist.com/cgi-local/content.cgi ] has just recently been released, documenting Dr. Ehrenfeld’s experience.

FP: Dr. Ehrenfeld, welcome to Frontpage Interview.

Ehrenfeld: Thank you, Jamie. It is a pleasure.

FP: So let’s start at the beginning. Who sued you and for what reason?

Ehrenfeld: Khalid bin Mahfouz, a Saudi billionaire, former owner of the National Commercial Bank of Saudi Arabia, the royal family banker, and founder and owner of the Muwafaq Foundation, which funded al- Qaeda and Hamas, sued me for libel in London, soon after my book Funding Evil; How Terrorism is Financed – and How to Stop It, was published in the U.S. In 2003. He claims that he never knowingly funded terrorism. I never said he “knowingly” did.

FP: Why did this individual sue you in the U.K?

Ehrenfeld: Unlike the U.S. where free speech is protected constitutionally, the libel laws in the UK. are pro-plaintiff.

FP: Can you talk a bit more on this issue of libel laws? Expand for us on how free speech is protected constitutionally in the U.S. in this context and also how the libel laws in the UK. are pro-plaintiff.

Ehrenfeld: Unlike American laws, where free speech is protected by the First Amendment, and truth is the complete defense, England’s libel laws favor the individual’s rights over the public. They put the burden of proof on the defendant rather than the plaintiff. Moreover, there are harsh restrictions on the evidence that writers can present in their defense. U.S. libel laws put the burden of proof on the public figure who claims he has been defamed; the Plaintiff has to prove that the writer was wrong and that he published the false information recklessly and maliciously.

Moreover, the British threshold for establishing “jurisdiction,” is very low, thus accepting bin Mahfouz’s claim against me, based on 23 copies of my book Funding Evil, which were sold in the U.K. However, the book, which was just published only in the U.S., was most likely purchased by his representatives over the Internet -- in order to claim jurisdiction.

British laws earned the U.K. the label—“libel capital of the Western world.” Bin Mahfouz, and other terror financiers, known as “libel tourists,” use the British laws to veil in secrecy their funding of al Qaeda, other Islamic terror organizations and global propagation of radical Islam. Bin Mahfouz’s legal “victories” in London - he never won on merit- had the desired affect he and other Saudi terror financiers sought: silencing of the media even in the U.S. where the First Amendment protects writers and publishers. But most American book and newspaper publishers are not willing to risk expensive lawsuits in London. In fact, most refuse to publish even the most comprehensively documented reports on alleged wealthy Middle Eastern funding terrorism. And most refrain from writing about this case.

FP: Who else did this Saudi sue? What differentiates you from the other parties?

Ehrenfeld: Bin Mahfouz threatened and or sued more than 36 publishers and authors, including many Americans who exposed unpleasant details about him. All apologized and retracted. Many paid the huge legal fees to his legal team in the U.K., as well as penalties and “contributions” to charities of his choice. Some (23), but not all are listed on his website. None of the other American writers or publishers challenged the jurisdiction of the British court, and European and British writers and publishers, did not have much choice.

I alone refused to acknowledge the British court, and declined to comply with its demands and default judgment – and furthermore countersued him in the U.S.

FP: How come you were not like all the others? How come they all apologized, retracted, paid legal fees etc., and you declined to comply etc.?

Ehrenfeld: Your question is better directed at them. I can not speculate on their decisions. Undoubtedly though, monitory and financial considerations were a premier concern; with British libel laws stuck against them, all who have property in the U.K. had a lot to lose. But since there is so much officially documented information about bin Mahfouz’s alleged financing of al- Qaeda, one could have expected that the media would challenge him and stop his campaign to silence his critics. Indeed, the Wall St. Journal fought successfully a multi-million dollar libel lawsuit brought against the paper by the Saudi Arabian businessman Mohammed Jameel. The House of Lords ruled in favor of the Journal reporting that Jameel have been investigated by the Saudis at the request of US authorities, to ensure that neither he nor his company funded terrorist groups. Lord Hoffman said that preventing publications of articles, which are “in the public interest, is too risky and would discourage investigative reporting.”

FP: What are the consequences of the U.K. lawsuits on the American media?

Ehrenfeld: The consequences are very grave. Bin Mahfouz single handedly stopped all American newspapers and publishers, not to mention individual reporters, from covering him specifically, and most Saudi terror financiers, in general. Apparently, through him, the Saudis have successfully imposed a wholesale chilling effect on U.S. instigative reporting on Saudi terror financing.

FP: What can we do about these consequences of the U.K. lawsuits?

Ehrenfeld: We can counter-sue in the U.S., as I have done. And although my case is still pending (we are awaiting the decision of the New York State Court of Appeals on jurisdiction), on June 8, the Second Circuit Court of Appeals unanimously declared my case is “ripe” for hearing in a U.S. court, noting that the case has implications for all U.S. authors and publishers, whose First Amendment rights are threatened by foreign libel rulings.

The ruling thus established that all U.S. writers and publishers sued for libel in other countries, can ask U.S. courts to rule the foreign decisions unenforceable here - provided they have jurisdiction over the person who sued for libel overseas. This important legal decision weakened bin Mahfouz’ ability to threaten or sue U.S. authors and publishers. Shortly afterwards, bin Mahfouz threatened to sue Cambridge University Press (CUP), the publisher of Alms of Jihad: Charity and Terrorism in the Islamic World, but refrained from including the book’s two American writers, J. Millard Burr and Robert O. Collins.

Winning my case against bin Mahfouz will not change the British ruling against me. But judging by the impact my case has had already one can hope that U.K. , and the House of Lords ruling in favor of the Wall St. Journal in the Jameel case, U.K. writers and publishers would be encouraged to demand changing their libel laws, to allow the freedom of responsible publications without the fear of intimidating, expensive lawsuits.

If foreigners wish to sue Americans for exposing threats to our national security, they are welcome do so in the U.S., under the First Amendment laws. But Congress should terminate this form of Financial Jihad – silencing the media by intimidation – and costly foreign libel suits on matters governed by U.S. jurisdiction.

To better protect our freedom of speech, Congress could reinforce the First Amendment with a new statute prohibiting enforcement of foreign libel judgments in the U.S., whenever American authors and publishers report responsibly on terror -related and other national security threats.

We are at war with enormously wealthy and determined enemies. We should prevent their use of their tremendous wealth to deprive American writers of their constitutional rights to expose actions that threaten our safety and freedoms.

FP: So you are now fighting back, counter-suing Mahfouz in New York. Tell us exactly what inspired you to counter-sue.

Ehrenfeld: As an American citizen I see no reason to abide by English law, since we declared our independence from Britain in 1776. I felt that this matter should be resolved by U.S. Courts within U.S. jurisdiction.

FP: Has any other American counter-sued him in the U.S.?

Ehrenfeld: None.

FP: There are impressive Amice Briefs in your case by major American publishers. Has anyone offered financial support? After all, you are fighting to protect everybody’s freedom of speech.

Ehrenfeld: I have received no financial support from any publisher.

FP: Why do you think your case has not reached the mainstream media?

Ehrenfeld: There is no logical explanation. Except that maybe they are afraid of offending the Saudis, in which case, it would further evidence my point.

FP: What are the personal implications of this case on you?

Ehrenfeld: Apparently, Saudi influence on the media, politics and business interests is so pervasive that only the most courageous and honorable, professionals, colleagues and friends have stood by me. Others keep a silent distance--and some even try to harm me.

FP: What is the significance of this case in relation to national security?

Ehrenfeld: One of the most important foundations of American Democracy is freedom of the press. Bin Mahfouz's libel suits are an important part of an enormous campaign to severely curtail press and media willingness and ability to freely investigate and report the great financial powers diligently working to destroy our nation and indeed the entire Western civilization.

FP: Dr. Ehrenfeld, thank you for joining us. And thank you for your valiant and courageous fight for freedom.

Enhrenfeld: Thank you, Jamie. I appreciate the opportunity Frontpage Magazine has given me to be heard.

http://www.frontpagemag.com/Articles/Read.aspx?GUID=0B75EC5B-6CA4-4484-A77A-AE956C5CBB7E

[Petronas]

Very true, going back to the first WTC attack in 1993, which was partially funded with the sale of counterfeit products.

Could buying that knock-off item fund the next terrorist attack?
December 26th, 2007 by Ed Dickson

While this story is from a British perspective, it reveals how the trade in counterfeit (knock-off) merchandise is funding some pretty nasty characters beyond the borders of the British Isles.

Richard Elias recently revealed in Scotland on Sunday:
The sale of fake CDs, DVDs, clothing and perfumes in Glasgow and other British cities is helping to raise money for one of the world’s most-notorious terror outfits – the group held responsible for the slaughter of US journalist Daniel Pearl in 2002.

MI5 is now targeting British-based supporters of Jaish-e-Mohammed (JeM), a pro-Kashmiri group dedicated to gaining the disputed territory its independence. Its aims include the “destruction” of the United States and India.

This isn’t the first time the words terrorist organization and counterfeit merchandise have been used in the same sentence. And in reality, the problem goes far beyond the borders of the United Kingdom....

http://www.bloggernews.net/112659

[Petronas]

This ruling should make harder the work of organizations such as this one: http://www.israellawcenter.org/template.php?section=AU

Landmark Terrorism Case Reversed
Posted: January 3, 2008

As we report this week on page 3, a federal appeals court, by imposing an unrealistic burden of proof on the victims in any lawsuit, has emasculated a federal law designed to enable American victims of terrorism abroad to recover damages from those who supply terrorists with funds.

The law, as interpreted by several federal appeals courts, provides for victims of terror to sue financial supporters of those groups known to engage in terrorist acts, in addition to the terrorist groups themselves. Until the appeals court decision last week, it was thought that it was enough for victims to get a judgment against supportive contributions by showing that an organization was a knowing financial supporter of a terrorist group that committed a terrorist act – without needing to show a direct connection between the contributed funds and the particular act of terrorism.

Last week’s appellate ruling, however, declared that victims must show a link between the contributed funds and the particular terrorist activity complained of. The decision came in the case of David Boim, a 17-year-old American citizen studying in Israel who was murdered in 1996 by an admitted Hamas gunman. The court said the victims must also prove the funds were contributed to further the terrorist agenda of the group and not any humanitarian projects in which the group might be engaged. Because the trial court did not impose these requirements on those suing the groups funding Hamas, the appellate court vacated a jury award of millions of dollars against the Holy Land Foundation and several other alleged supporters of Hamas.

It’s ironic that in the Boim case there was never any doubt about the transfer of funds or that the Holy Land Foundation was a principal financial supporter of Hamas terror. Several years ago, U.S. agents seized the Holy Land Foundation’s assets on the grounds that it was “the primary fund-raising entity for Hamas.” The Holy Land Foundation sued the government, claiming it was not involved in funding terror. They lost that lawsuit, with the court ruling it was “incontrovertible” that the Holy Land Foundation funded Hamas “and its terrorist activities.”

Yet the Seventh Circuit has now ruled that Mr. Boim’s family had to prove that Holy Land contributions to Hamas were earmarked for terror activity – something a court has already said was “incontrovertible” – and that the funding was a “cause in fact” or had a “causal link” to the particular terrorist act at issue, i.e., Mr. Boim’s murder. The former is daunting for a private litigant, the latter virtually insurmountable. ...

http://www.jewishpress.com/displayContent_new.cfm?mode=a&sectionid=59&contentid=28134&contentName=Landmark%20Terrorism%20Case%20Reversed

[Petronas]

This article does not mention the requirement that an amount (usually between 2.5% and 6%) has to be contributed to an Islamic charity. Many Islamic charities have been unmasked as Al Qaeda or Hezballah front organization or have been shown to have diverted a portion of the funds raised to terrorist organizations.

Shari'a-Compliant Financing Described As New Islamist Threat
April 21, 2008

Radical Islamists not only want to destroy America with bombs and weapons of mass destruction, they also are infiltrating U.S. financial markets and influencing the flow of credit and capital, according to the Center for Security Policy (CSP), a conservative think-tank.

CSP President Frank Gaffney, a former Reagan administration assistant secretary of defense, has launched a national campaign to counter what he calls "an insidious threat" -- shari'a-compliant finance.

He says U.S. financial institutions and businesses engaged in shari'a-compliant financing are exposing themselves to civil and criminal liability. That type of investment poses a serious risk not only for U.S. financial institutions but also for ordinary investors and the national security of the United States, he said.

The finance method involves investments or transactions that have been structured to conform with the 7th century code of Islamic law, which is known as shari'a. Prohibitions include financial transactions involving interest, excessive uncertainty, or assets such as alcohol, tobacco, pork or gambling.

Gaffney said shari'a-compliant financing "legitimizes and institutionalizes" repressive Islamic law that conflicts with Western values.

"Shari'a-compliant finance, also known as 'Islamic finance' or 'Islamic banking,' is a vehicle for effecting in America and in other Western capital markets, what its proponents have called 'financial jihad' -- a kind of soft jihad, but one arguably going after the lifeblood of our capitalist system and economy," Gaffney told a briefing of Capitol Hill staffers Friday at the National Press Club in Washington, D.C.

Gaffney said the shari'a code is is best known for beheadings, floggings, and amputations for petty crimes.

"Shari'a is a totalitarian program for bringing about a global caliphate (Islamic kingdom), for ruling the world, for governing religious conduct, personal practices and family relations," he said.

Shari'a-compliant financing is becoming more popular as a way to tap into petrodollars. Even Dow Jones has created its own Islamic Index for shari'a-correct investments, Gaffney said.

How does it work?

Gaffney said that shari'a-compliant instruments are now being offered for everything from zero-coupon bonds to hedge funds to mutual funds to life insurance.

To offer these products or investments as shari'a-compliant, financial companies must submit to "shari'a advisers"-- almost all of whom are Islamist ideologues. Many of the advisers are dedicated to the destruction of the United States, Gaffney said.

These advisors "bless" the products or investments, certifying that they have been modified in such a way as to involve no interest payments, no speculation and no investments in proscribed items such as pork or alcohol or tobacco.

"It puts (Islamist ideologues) in a position whereby they can steer very substantial capital and credit flows to activities they favor - and away from activities they don't favor," Gaffney said.

The boards frequently are made up of shari'a "advisers" who are either Islamists or have ties to Islamist organizations such as Hamas or Hizballah, Gaffney said.

"As a result, you may wind up hiring people like a fellow named Sheikh Usmani, who has published works explicitly calling for violent jihad against America," he said.

Usmani reportedly has links to Harvard University, and Gaffney is calling on Harvard's board of trustees to disclose its ties to shari'a-compliant funds this weekend (April 17-19), during the university's eighth annual forum on Islamic finance.

Harvard itself, Gaffney said, is "bending over backwards" to accommodate shari'a law to attract Islamic investment.

"(There are) separate hours for Muslim women to exercise at Harvard University so that they can dress immodestly without being immodest, (and) there are calls to prayer, for that matter, being issued on the Quad at Harvard," he added.

Gaffney noted that those who speak against shari'a in the Muslim world face possible death sentences. He cited psychiatrist Dr. Wafa Sultan, a Muslim woman forced into hiding in America for being "a courageous opponent of shari'a law and Islamist extremism."

Sultan garnered death threats from Sheikh Yusef al-Qaradawi, the head of the European Council on Fatwa and Research, and one of the driving forces behind shari'a-compliant finance.

America, Gaffney warned, must either proactively address the issue of shari'a law now, or face it later when it has ensnared the financial markets.

"Later we will find ourselves dead or enslaved," he concluded. "And we enable them, and we empower them and we underwrite them at our extreme peril."

http://www.cnsnews.com/ViewNation.asp?Page=/Nation/archive/200804/NAT20080421a.html

[Petronas]

Saudi Arabia is prime source of terror funds, U.S. says
April 2, 2008

Saudi Arabia remains the world's leading source of money for Al Qaeda and other extremist networks and has failed to take key steps requested by U.S. officials to stem the flow, the Bush administration's top financial counter-terrorism official said Tuesday.

Stuart A. Levey, a Treasury undersecretary, told a Senate committee that the Saudi government had not taken important steps to go after those who finance terrorist organizations or to prevent wealthy donors from bankrolling extremism through charitable contributions, sometimes unwittingly.

"Saudi Arabia today remains the location where more money is going to terrorism, to Sunni terror groups and to the Taliban than any other place in the world," Levey said under questioning.

U.S. officials have previously identified Saudi Arabia as a major source of funding for extremism. But Levey's comments were notable because, although reluctant to directly criticize a close U.S. ally, he acknowledged frustration with administration efforts to persuade the Saudis and others to act.

"We continue to face significant challenges as we move forward with these efforts, including fostering and maintaining the political will among other governments to take effective and consistent action," Levey said, later adding: "Our work is not nearly complete."

Levey was the sole witness before the Senate Finance Committee, which Tuesday ordered an independent review of the efforts to choke off financing used by Al Qaeda and other extremist groups. ...

http://www.latimes.com/news/nationworld/nation/la-na-terror2apr02,1,1851447.story