Terror Criminal Links Growing

By Dr. Rachel Ehrenfeld and Alyssa A. Lappen
FrontPageMagazine.com | Thursday, September 13, 2007

Al Qaeda’s sophisticated new media campaign clearly demonstrates that the group does not lack funding. Contrary to popular belief, organizing, maintaining, training, and operating terrorist groups require large and liquid sums. Most terrorist organizations circumvent funding prohibitions by creating “political” and “charitable” wings, a ruse that enables their individual and state supporters to contribute “clean” money to the terrorist organizations such as Hamas and Hezbollah. Interviewed by ABC News on September 11, 2007, U.S. Treasury Under Secretary for Terrorism and Financial Intelligence (TFI) Stuart Levey, said: “If I could somehow snap my fingers and cut off the funding from one country, it would be Saudi Arabia.”

Still, the U.S. government does not designate the Saudis, or other oil producing countries as terrorist entities, although they are the major suppliers of “clean” money that feed of the global proliferation of radical Islam. As the West consumes more oil, the higher the price tends to rise and more petrodollars are available to spread radical Islam.

But “charitable” donations alone do not satisfy the terrorists growing appetite. They also regularly generate funds through “common” transnational crimes. Yet inadequate official recognition of this convergence lets terrorists operate below the radar.

A major funding source for terrorist and criminals is the trade in illegal drugs. In contrast to oil revenues, pricing illegal drug works precisely the opposite. The more heroin, cocaine and methamphetamines are produced, the larger global supply and consumption grow. Increasing supply force prices to drop precipitously, thereby creating even larger markets. In 1981, a gram of heroin cost $1,974 on U.S. streets; in 2003, a gram of heroin cost only $362, according to a National Drug Control Strategy document. [1] By September 2006, a gram of heroin cost only $75 to $95, according to two 2007 criminal indictments, filed by two northeastern Federal Districts. [2]

In late August 2007, the United Nations Office on Drugs and Crime (UNDOC) reported that opium cultivation in Afghanistan had reached a new record. The area under opium cultivation grew 17%, to 193,000 hectares, compared with 165,000 hectares in 2006. Meanwhile, the opium yield grew by more than one third, to 8,200 tons, from 6,100 tons.

The UDOC attributes this amazing increase to the Taliban’s reversal of their 2000 edict banning cultivation, said Executive Director Antonio Maria Costa.[3] And Afghanistan now supplies some 95% of the world’s opiate/heroin market, according to Radio Free Europe.[4]

The nexus between transnational criminal organizations and terrorist groups does not end illegal drug trafficking. Their partnerships are complex, linking money, geography, politics, arms, and tactics to create a mutually beneficial relationship. These links yield hundreds of billions, of dollars in revenues worldwide.

On July 14, 2007, Deputy Chief of the Los Angeles Police Counterterrorism Criminal Intelligence Bureau, Michael Downing stated that laundered funds now “account for about 10 percent of the total global flow of money–up from about 2 percent in 1998.” In May 2001,[5] the FBI estimated that “the amount of money laundered each year is approximately $2.8 trillion.”

The former International Monetary Fund (IMF) managing director, Michel Camdessus, estimated that money laundered worldwide 1999, totaled between 2% and 5% of combined gross domestic product (GDP)—or approximately $1.8 trillion. By April 2006, the IMF’s World Economic Outlook estimate of the world economy was $65.174 trillion. Considering the rise of radical Muslim terrorist groups, and the dramatic increase in “ordinary” crime, as well as major technological advances, it is now estimated that at least $5 trillions are being laundered annually, 70% are thought to be generated from the illegal drug trade.

Even if only a little goes to terrorist groups, “it’s frightening,” Downing said. “Not only that, but you see the convergence of organized crime and terrorism occurring.”

In May 2007, Los Angeles Sheriff Department Lt., John Sullivan, stated: “organized crime groups in Los Angeles County are supporting international terrorists.” But this is not only Los Angeles’ problem.

According to a recent Gallup study, “counterfeiting and piracy costs Americans $250 billion in sales and 750,000 U.S. jobs annually.” [6] These involve counterfeiting of “CDs, DVDs, handbags, medications, cigarettes and even toothpaste.” [7]

Defrauding the U.S. Government of hundreds of billions of dollars and undermining local economies is just what Osama bin laden ordered on Dec. 27, 2001: “It is very important to concentrate on hitting the U.S. economy through all possible means…. Look for the key pillars of the U.S. economy. Strike the key pillars of the enemy again and again, and they will fall as one.”

Incredibly, despite substantial evidence that al Qaeda and other Islamic terrorist organizations need vast sums to sustain their operational infrastructures and broaden their bases, 9/11 Commission Vice-Chair Lee Hamilton and Commissioner Slade Gorton stated, “Making it harder for terrorists to get money is a necessary, but not sufficient, component of our overall strategy” (emphasis added). The willful blindness behind this attitude may partially explain inadequate power and implementation of existing laws and legal instruments to more efficiently combat terror financing and criminal activities.

Jihad is not committed by the sword alone. While less transparent, economic and financial jihads are far more insidious aspects of the jihadist war to defeat the West, and especially the U.S.

With this in mind, it would seem prudent for law enforcement to take a closer look at the identities and profiles of each and every “ordinary” criminal seized, be it a drug dealers, car thieves, or “white collar” criminals.

Notes:
[1] Table 45, “Avg. Price and Purity of Heroin in the U.S., 1981-2003,” http://www.whitehousedrugpolicy.gov/publications/policy/ndcs06_data_supl/ds_drg_rltd_tbls.pdf
[2] www.usdoj.gov/usao/pae/News/Pr/2007/may/monegro.pdf and www.usdoj.gov/usao/md/Public-Affairs/press_releases/press07/ThreeBaltimoreDrugDealersSentencedtoLengthyPrisonTerms.html viewed on Aug. 28, 2007
[3] Masood Haider, “UN Reports record production of opium in Afghanistan,” Dawn, Aug. 28, 2007, http://www.dawn.com/2007/08/28/top16.htm, viewed Aug. 28, 2007.
[4] Breffni O’Rourke, “Central Asia/Iran: Massive Afghan Opium Production Hits Neighbors,” Radio Free Europe/Liberty Radio, Aug. 28, 2007, http://www.rferl.org/featuresarticle/2007/08/f58f6951-ad74-4996-bbb3-50fa2dcd7112.html, viewed Aug. 28, 2007.
[5] “Criminal Justice Resources: Money Laundering,” Michigan State University Libraries – Criminal Justice Resources, www.lib.msu.edu/harris23/crimjust/moneylau.htm, Source: “Money Laundering”, FBI Law Enforcement Bulletin v.70 no.5 (May 2001): p.1-9
[6] “Congress needs to get tough on China trade,” The Oakland Press, August 17, 2007 http://www.theoaklandpress.com/stories/081707/opi_20070817134.shtml
[7] Troy Anderson, “Drug sales, counterfeiting funding terrorism. Sheriff’s office says it’s intercepted plots, traced money back to extremist groups,” L.A. Daily News, August 20, 2007

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Web of terror

By Rachel Ehrenfeld and Alyssa A. Lappen
Washington Times | August 16, 2007

On Aug. 8, the Treasury Department finally listed the Al-Salah Society as “one of the largest and best-funded Hamas charities.” The director of the Treasury Department’s Office of Foreign Assets Control (OFAC), Adam Szubin, said, “Today’s action alerts the word to the true nature of Al-Salah and cuts it off from the U.S. financial system.” An Aug. 1 report by the Gelilot, Israel-based Intelligence and Information Center, documents that while the U.S. government attempts to stop U.S. funds from benefiting Hamas, American companies continue to facilitate Hamas fundraising and incitement by selling them Internet and television services. They thereby enable Hamas — designated a terrorist organization by the United States in 1995 — to spread its virulent anti-American propaganda, and to recruit, communicate and raise money.

A recent example of Hamas propaganda available in the United States through its Palestinian Information Center, Palestine-info.com, is a cartoon of a sinister-looking Condoleezza Rice as the Wicked Witch of the West, riding a broomstick on yet another visit to the Middle East.

A. Aaron Weisburd of Internet-Haganah.com reports that Hamas purchased more than 61 percent of its Internet services for 18 Web sites from U.S. and Canadian providers.

According to the Patriot Act, everyone affiliated with or supporting them are also deemed terrorists. Thus, North American corporations that sell server space and IP services to Hamas aid and abet a terrorist network. The Lebanon-based “Palestine-info” operation, run by Nizar Hussein, takes marching orders directly from Hamas chief Khaled Meshal in Damascus. Its 20 or so Web sites include news, media, “security force,” civilian and chat-forum outlets in eight languages targeting Middle East and Western Muslims alike, as well as the international community.
Besides English and Arabic, Palestine-info also transmits in Farsi, Urdu, Russian (for Chechens), French (for North Africans), Malaysian and Turkish. Their domains include: Palestine-info, Palestine-info-urdu.com, palestine-persian.info and palestine-info.net.Hamas also operates other Internet and television sites, including: paltime.net; palestiniangallery.com; alresalah.info; fm-m.com; felesteen.ps; al-fateh.net; mujamaa .org; islamic-block.net; alkotla.com; palestinianforum.com; aqsatv.ps and tanfithya.com.The U.S. network-access and domain-name register companies selling services to these Hamas Web sites include: Domainbank.com; register.com; Network Solutions LLC; OnlineNIC, Inc.; GoDaddy.com; eNom, Inc.; Defender Technologies Group; and Oversee.net.

Canadian firms selling service to Hamas include: Groupe iWeb Technologies. Inc., Tucows, Inc and NIC.ps.

It is an “irony of the digital age that that Internet — invented by the Department of Defense as a way to ensure undisrupted communications in the event of an enemy attack — is now being used to recruit and train the terrorists who plot such lethal attacks against Americans and other Western targets,” said Homeland Security and Governmental Affairs Committee Chairman Sen. Joseph Lieberman at a May 3 Senate hearing on “The Internet, a Portal for Islamist Extremists.”

We need not stand helplessly by while terrorist groups work to destroy us. Their Web sites can be shuttered, especially when IP companies are American. The Patriot Act, passed by a large bipartisan majority after September 11 and renewed on March 9, 2006, defines facilitation of terrorist communications services as a terrorist act.

While the United States blocks business and charitable assets of those linked to Hamas, and other Islamic terror organizations, it should enforce existing laws to stop American companies from doing business with terrorists. Designating more terrorist groups to the list — such as the Iranian Revolutionary Guards — would not be as effective as it could be if, like Hamas, they can continue to spread their propaganda and raise money through U.S. and Canadian Internet providers.

Congress could also further enhance the “Know Your Customer” requirements, as in the banking industry, for all Internet service providers, specifically for network-access and domain-name register companies. This idea was proposed previously but Congress has failed to act.

One alleged reason that Web sites and TV broadcasts are allowed to operate in North America is so that the intelligence community can monitor them.

But while intelligence “monitors” them, Islamist hate propaganda continues to poison millions of minds worldwide, drawing recruits and raising funds. And the terrorists go on killing.

Rachel Ehrenfeld is director of American Center for Democracy and a member of the board of the Committee for the Present Danger. Alyssa A. Lappen is a Senior Fellow at American Center for Democracy. Both authors are contributing editors to the American Congress for Truth.

The Fly in the bin Mahfouz Ointment

By Alyssa A. Lappen
FrontPageMagazine | Aug. 6, 2007

U.K. libel laws and courts have been among Saudi Arabia’s most successful tools to veil its Islamic proselytization and terrorist funding. The Saudi operator is billionaire Khalid Bin Mahfouz, who has sued or threatened to sue some 36 U.S. and U.K. publishers and authors and was given default judgments in all of them.

But there is a new fly in bin Mahfouz’ Saudi ointment—an U.S. legal precedent established by the Second Circuit Court of Appeals on June 8, 2007. In 2003, U.S. investigative reporter and director of the American Center for Democracy, Dr. Rachel Ehrenfeld, published Funding Evil: How Terrorism is Financed–and How to Stop It.

Among other things, Funding Evil reported bin Mahfouz’ well-documented terror funding. As always after such reports, bin Mahfouz sued Ehrenfeld for libel in Britain. In the High Court, bin Mahfouz’ attorneys informed Justice David Eady that former CIA director R. James Woolsey had written the foreword for Funding Evil. “Say no more,” declared Eady. “I award you a judgment by default, and if you want, an injunction, too.”

Justice Eady then ordered Ehrenfeld to apologize, retract, pay bin Mahfouz $225,913.37 in damages and destroy copies of her book.

A fearless U.S. citizen, published in the U.S., Ehrenfeld ignored the British default judgment. Rather than respond to false claims of libel, never tried on their merits, Ehrenfeld applied to the Southern District Court of New York to rule the U.K. court judgment unenforceable in the U.S.

On June 8, 2007, the Second Circuit Court of Appeals justices unanimously found that Ehrenfeld’s case merits hearing in an U.S. federal court–and that the case has implications for all U.S. authors and publishers, whose First Amendment rights are threatened by foreign libel rulings. Continue reading “The Fly in the bin Mahfouz Ointment” →

Business…Russian Style

By Dr. Rachel Ehrenfeld and Alyssa A. Lappen
Human Events | Posted: 06/27/2007

The Transparency International 2007 global report released on May 24 documents widespread Russian corruption and lack of independence in Russia’s legal system, and its courts in particular. This, according to the report, is due to the government’s growing political interference. Novaya Gazeta, Russia’s best-known opposition newspaper, claims that corruption in Russia is the rule, and “business is impossible without it.”

Moreover, Russian Minister of Economic Development and Trade German Gref, speaking at an investor conference in Moscow last week, admitted that “everyone knows the Taxation Service is corrupt.” Leading investigative reporter Roman Shleinov claimed recently in London, that attempts to expose this corruption resulted in more than 2,000 dead journalists in the last decade.

Russia’s economic growth — more than $515 billion in foreign currency and gold reserves — make Putin very popular among his people, despite the corruption and his regime’s growing restrictions on civil and human rights, freedom of the press, and private, public and foreign entities. Most recently, his popularity reached over 70% approval ratings. Not surprisingly, Putin disregards whatever domestic and foreign criticism of his centralized and authoritarian government. He even declared: “I am an absolute, pure democrat— I am the only one, there just aren’t any others in the world.”

Russia’s long tradition of autocratic regimes seems to empower Putin’s undermining of Russia’s recent history of democratic capitalism. With ever-increasing frequency, Russia uses its corrupt courts to legitimize nationalizing and confiscating private and public corporations from entrepreneurs who built their wealth and the Russian economy on the ashes of the crumbling Soviet infrastructure. Those allowed are holding onto their corporations and vast personal wealth, carrying out Putin’s agenda of centralization and consolidation of domestic and even global strategic resources and industries such as aluminum and steel, and above all, energy. Continue reading “Business…Russian Style” →

Show Me the Money and I’ll Show You the Agenda

By Andrew Cochran
Terrorfinanceblog | April 10, 2007

I’m trying to determine why senior U.S. government officials or Congressmen continue to entrust their precious time to those with an extremist or Islamist agenda when they’re searching for “moderate Muslims” with whom to hold a dialogue. It still happens all too often, even years after the 9-11 attacks (I have another example about which to post soon). And I have to conclude that too many government officials around the world and experts are still trusting what they hear from a foreign leader or long-standing Islamist, instead of watching what they actually do. My golden rule, probably due to my experience as a CPA and consultant, is simple: see how the Islamists and their supporters (or their opponents, for that matter) spend their money, and stop trusting what they say.

Analyses of the Muslim Brotherhood illustrate this point perfectly. Douglas Farah took issue with the Foreign Affairs article by the Nixon Center’s Robert Leiken and Steven Brooke, “The Moderate Muslim Brotherhood,” starting a mini-debate here and on the Nixon Center site (see Doug’s last post on it). But look at the angle each party takes in their analysis: Leiken and Brooke barely mention how MB leaders spend their money; it’s all about “expressions of confidence that it would honor democratic processes.” Yes, there is some discussion of “a painstaking educational program,” but nothing about the directions for the “big money.” To the contrary, Doug’s method is to follow the money. Everything he writes on MB, from his recent piece on Sudan to his 2006 analysis of the MB’s international financial network, focuses on the cash flow. Lorenzo Vidino explores the financial angle in his April 6 post, “The Muslim Brotherhood in Holland,” discussing how the MB has worked in Europe since World War II. Other articles in the debate break down along this fault line – see Alyssa Lappen’s response to Nick Fielding, in which she cited MB’s financial support for terrorism, while Fielding discounted or ignored such instances.

I recently mentioned to a senior Congressional staffer that “if you show me the money, I’ll show you 80% of the agenda.” He corrected me – “it’s 90%.” And he’s certainly right in the CT world, in the U.S. and abroad. Find out where a group gets it money and where it spends it, and you’ll know the group’s agenda.

What Ails Mainstream Journalism

By Alyssa A. Lappen
FrontPageMagazine.com | March 22, 2007

Why do otherwise thorough reporters lose their professional skepticism when covering the Middle East and Islam? This peculiar journalistic phenomenon has puzzled me since I began covering the Middle East and Islam, in lieu of the investigative financial reporting work I had done for most of my career. Indeed, it largely motivated my personal professional shift.

An informal conversation with a part-time journalism professor recently gave me important clues. Our professional dialogue was private; therefore, it would be a gross violation of trust to identify this person in any way, excepting to note that the professor lived and reported from the Middle East for a time and now teaches how to cover current-day religious affairs and relations at a major university.

The professor’s classes often cover reporting on the Islamic community in the U.S. today. Therefore, I was keenly interested to determine the professor’s familiarity with sacred and historical texts that motivate modern Islamic activity and dogma.

In financial reporting, it goes without saying that one cannot write a major investigative piece on a corporation, industry or economic issue without first reading a great deal. For public companies, this requires extensive review of all Securities and Exchange Commission (SEC) filings—recent annual reports (10-Ks, or F-20s for foreign firms), quarterlies (10-Qs), and changes to business strategy (8-K) or ownership (13-D). A good sleuth also consults the filings of major competitors and customers, in addition to interviewing as many of them as possible.

Only after laying this groundwork will the thorough reporter contact executives at the subject corporation.

A similar procedure—research first, interviews later—applies to private companies. Before 1995, Fidelity Investor chairman Edward C. Johnson III (Ned Johnson) rarely if ever spoke to reporters. Therefore before requesting an interview, I read everything available on the giant money management firm—and talked to more than 140 industry analysts, consultants, competitors, former and then-current Fidelity employees, and so on. The resulting September 1995 Institutional Investor cover story was subsequently emulated by Fortune, The New York Times and the Wall Street Journal, among others.

Likewise, for a May 1989 Forbes report on the world’s largest private textile firm, Milliken & Co., which had never previously been profiled, before asking the secretive magnate Roger Milliken for an interview, I spent six weeks filling more than 12 notebooks with every shred of data I could gather from every available source. The late Senator Strom Thurmond, then 86, for example, sent me to Florida U.S. Representatives Sam Gibbons, who, in turn, described Milliken as “a protectionist hog, H-O-G.” And former President Richard M. Nixon replied to an interview request in writing.

Of course, not all my financial stories required so many advance interviews, but a large number did. This point is not boastful. Indeed, without intensive advance work, interviewing hard-to-get, controversial, evasive or famous sources would be wasted opportunities or completely fruitless.

Such exhaustive reportage has often helped to expose corporate, Wall Street or other financial corruption. Similarly, investigative journalists have similarly raked corrupt politicians over the coals.

But when it comes to interviewing Muslim community or religious leaders, mainstream reporters are little inclined to submit them to tough or probing questions. Frequently, the U.S. media present leaders of the Council on American-Islamic Relations (CAIR), Muslim American Society (MAS), Islamic Circle of North America (ICNA), or Muslim Brotherhood (MB) as civil rights “activists,” “soft-spoken,” “regular guys” to be taken at face value, “moderate,” “really respected,” and so on. Continue reading “What Ails Mainstream Journalism” →