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Terror finance trio: Qatar, Kuwait, and KSA

July 22, 2014

They left out Turkey. It is great that more people are coming to this realization and that books are being written about it, but it doesn’t seem to be significantly changing the policies of the West (apart from a growing rift between the U.S. and the Sunni powers in the region over how we’re dealing with Iran). We have yet to designate the major institutional terror donors in Qatar Saudi Arabia as terrorist entities. Kuwait was never blacklisted by FATF even though it took it 10 years after 9/11 to outlaw terrorist financing. NATO has retained Turkey as a member even though it is partnering with Al Qaeda in Syria and helps Iran evade sanctions. And we mostly ignored attacks by Qatari-backed rebels in Mali fighting against our oldest ally, France. Instead of doing something significant, we just nod our heads and say, “yep, the Gulf is where the money for terrorism comes from,” and then we turn the page of the newspaper to something else.

From VOA on July 7 (h/t El Grillo):

Islamist Insurgency Fueled by Global Finance Web

Jeffrey Young

The little cans were at cash registers everywhere in Kuwait, where I lived during much of the 1990s. Covered with pictures of children in anguish amid burning rubble, these cans collected coins and cash for “Palestinian Relief” or the like. Sometimes, I put my change into these cans, causing the person behind the counter to often give me a puzzled look. Then, I learned from my Kuwaiti friends that these collection cans were not always helping those kids – many were funding Hamas, Hezbollah, Islamic Jihad, and other violent groups.

Now, 20 years later, there is an international web of finance that leads to deadly insurgents such as the Islamic State of Iraq and the Levant (ISIL). Part of it runs through so-called “charities,” while another funding stream for terrorists is enabled by official complicity. And, these sources also intersect.

Colin Clarke, author of an upcoming book titled “Terrorism Inc: The Funding of Terrorism, Insurgency, and Irregular Warfare” says much of the cash now pouring into ISIL and other violent groups comes from three regional sources.

“A key component of support to Sunni extremist groups [including ISIL] comes from wealthy individuals in the Arab Gulf states of Kuwait, Qatar, and Saudi Arabia,” Clarke told VOA, adding “The majority of donors likely know exactly where their money is going. Some are blatant about it, while others enjoy the plausible deniability of ambiguity.”

Clarke also contends these three states are using this funding stream as a means of achieving influence with insurgent groups. “The Saudis,” he said, “are reportedly fearful of the threat posed by ISIL, but certainly contribute to radical groups, battling for a leadership role with Qatar, another country active in this funding.”

Kuwait has also allegedly kept the flames of insurgency fueled with cash. Until recently, one of those streams reportedly ran through Kuwait’s Aqaf, its Ministry of Islamic Affairs. In May, Aqaf Minister Nayef al-Ajmi resigned in the wake of accusations by a senior U.S. official that he was enabling terrorists…

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CNN documents Qatari funding of terror

July 21, 2014

The jihad in Syria against the Alawites has been wholeheartedly funded by millionaires in Qatar. The Qatari ministry of culture oversees some of the volunteer operations to fund terrorism like this, and counter-terrorism expert Juan Zarate says the financial support for jihad comes “from the top.” This isn’t new information, but seeing video of the players involved may help some people to grow up and out of the old-fashioned 1990s view of Qatar as an ally in the Gulf.

CNN’s Erin Burnett reports:

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A million a day for ISIS and a grain of salt

July 20, 2014

Is a million dollars a day enough to sustain ISIS’s operations without dipping into its own reserves? Perhaps. There may be about 10,000 ISIS foot soldiers. Paying, feeding, clothing, and transporting that many men is expensive. But if each jihadist were getting a proportionate share of $100 a day, that still well exceeds the median Iraqi income of $15 a day, which probably helps with recruitment efforts.

That being said, such a rapid influx of money does not automatically translate into the ability to spend the money—either wisely or at all. Remember the movie “Brewster’s Millions” where Richard Pryor was challenged to spend $30 million in 30 days? It’s harder than it looks.

But it’s still ominous. From the Telegraph on July 11:

Iraq oil bonanza reaps $1 million a day for Islamic State

Exclusive: Islamic State strengthens grip on northern Iraq by raising millions from sale of oil through Kurdistan to Turkey and Iran

Islamic State jihadists are raising as much as $1 million a day from the sale of crude oil recovered from conquered oilfields in Iraq that is then smuggled on to Turkey and Iran.

Oil industry experts believe the group formerly known as Islamic State of Iraq and al-Sham (Isis) is able to command $25 a barrel for crude its fighters are moving in tankers from the oil plains south of Mosul.

Middlemen based in the Kurdistan region of Iraq are able to turn a handsome profit on the supplies by selling its abroad for refining into the more valuable petroleum and diesel products.

The specialist Iraqi Oil Report said the centre of the $1million trade was the town of Tuz Khurmatu on the fringes of the Kurdish region. Traders there are buying convoys of tankers supplied by Islamic State…

The swift advance of Islamic State after last month’s conquest of Mosul gave it control over the path of the Kirkuk/Ceyhan oil pipeline, the country’s biggest, and the Baiji oil refinery, again the most important refinery in Iraq…

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Islamic Relief Worldwide programs staffed by Hamas

July 18, 2014

Islamic Relief Worldwide (IRW) activities in the Palestinian territories are run by Hamas operatives, according to Israeli officials.

The way it works is that IRW, a British-based charity, raises substantial funds from institutional donors, government funding, and zakat from individual Muslim donors. IRW also receives money from its affiliates around the world, including millions of dollars in gifts from Islamic Relief USA (IR-USA).

IRW then sends money to field offices and partnering organizations in the Palestinian territories. Israel’s Shin Bet security service says that several of the offices and projects that are carried out with IRW funding are being conducted by Hamas personnel.

IR-USA, a charity publicly cited by Obama appointees as a valued and trusted aid group, is privately tagged by Justice Department sources as the successor to the Holy Land Foundation, which was shuttered during the Bush administration for funding Hamas. The Clarion Project (h/t to Rushette) notes that IR-USA receives support from bigtime donors and enjoys close ties to the Obama administration.

Israel should share what information it can with the UK in order for the British to 1) strip IRW of its charity status and, 2) shut down IRW. There is no time to waste with the useless UK Charity Commission. This case should be dealt with at higher levels.

Canada Revenue Agency, which has been extremely successful in taking prompt action to remove the tax-exempt status from terror financing charities, should also review Islamic Relief Canada’s projects.

The U.S. should follow suit, and should strip IR-USA of its tax-exempt status, since IR-USA money is ultimately going toward Hamas projects, and not toward the charitable purposes for which 501(c)(3) status is intended.

Any banks providing services to IRW and IR-USA should take note of these developments, and minimize their own risks and exposure to terrorist financing by closing their accounts (as UBS already did in 2012) with these “charities.”

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Supporting mischief: recommended news reading

July 17, 2014
  • Are we in an age of unilateral easing of sanctions on rogue states without obtaining meaningful changes in behavior first? Case in point:  Japan on North Korea… more>>
  • A University of Texas student has pleaded guilty to luring recruits to wage jihad in Somalia, or, failing that, to prepare for World War IIImore>>
  • Boko Haram is illustrating how ineffective U.S. counter-terror finance policies can be… more>>
  • Smuggling eight guns from Minnesota to Nigeria stuffed in a brown paper bag between the seat cushions of a ’98 Mercury is one way to run afoul of authorities… more>>
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10 companies that make money from terror ties

July 15, 2014

Longtime Money Jihad readers already know that sharia banks are conduits for funding jihadist groups, but may not be aware of some of the other corporations and businesses that are in financial cahoots with terrorists.

  1. Tajco Ltd.—A Lebanese-based company that uses supermarkets to launder South American drug money through grocery stores in Gambia back to Lebanon for dispersal to Hezbollah. According to former Treasury official Stuart Levey, Tajco and its subsidiaries constitute a “multinational network [that] generates millions of dollars in funding and secures strategic geographical strongholds for Hizballah.”
  2. Dahabshiil—A money services business (technically a remittance company, not a bank) that pays a $500K stipend twice a year to al-Shabaab. Somali journalists and musicians have alleged that the payments aren’t just for “protection,” (ie, the freedom to operate in Somalia without being bombed) but that Dahabshiil shares tribal links and policy goals with the terrorist group.
  3. Al-Aqsa TV—The U.S. describes the media outlet as “a television station in Gaza financed and controlled by Hamas.” Hamas raised the initial capital to create Al-Aqsa TV, negotiated for a satellite provider, and allocates money for its budget. Its programming seeks to prepare children to join and fight for Hamas as they age.
  4. Crescent Foods—the “caterers of the Muslim Brotherhood.” Crescent Foods is routinely selected to provide food at conferences and functions held by a variety of North American Muslim Brotherhood front groups and affiliates including the radical American Muslims for Palestine and organizational co-conspirators of the Holy Land Foundation, a defunct Hamas front charity. Crescent Foods also markets halal foods to the constituencies of these Islamist groups.
  5. Sniper Africa—A South African hunting gear company which is majority owned by a dentist who raised $120,000 for Al Qaeda. OFAC has listed Sniper Africa under its specially designated global terrorist category.
  6. Zurmat Group—A company operating in Afghanistan that sells components that wind up in roadside bombs against our troops. Additionally, the Army Times found that “approximately $1-2 million per month — flow to [the Haqqani network] to finance its activities” from Zurmat Group profits. CENTCOM describes the company as actively supporting the insurgency.
  7. Darkazanli Export-Import Sonderposten—Owned and operated by Imam Mamoun Darkazanli, a longtime Al-Qaeda financier and manager. Darkazanli supports al Qaeda from Hamburg, Germany, and behaved as a type of godfather figure to the Muhammad Atta cell as it prepared for the 9/11 attacks. Darkazanli’s company has provided “cover, business collaboration and communications” for Al Qaeda figures visiting Germany.
  8. The Bank of China—The Chinese bank funded Hamas and Islamic Jihad when it “carried out dozens of wire transfers for the two terror organizations, totaling several million dollars,” from 2003 to 2007 according to a lawsuit by victims of terrorist attacks in Israel. The bank knowingly continued making such transfers even after being warned against it by the Israeli government in 2005.
  9. Jihad al-Bina—Hezbollah’s construction company in Lebanon. Its relationship with Hezbollah apparently transformed it from a $1.8 million business in the 1990s into a $450 million operation by 2006. It has been able to cash in on public contracts to rebuild Lebanese infrastructure through international development aid even though the firm is basically controlled by Hezbollah leaders and Iran.
  10. Al Manar/Lebanese Media Group—This Hezbollah news outlet serves as a “Beacon of Hatred” that runs advertisements encouraging donations to Hezbollah and airs commercials for Hezbollah. The television channel’s programming includes vitriolic anti-Semitic messages and glorification of suicide bombing operations.

In addition to the companies above, there are conventional Western corporations like Chiquita and Echo Bay that have have paid bribes or protection money to rebels or terrorists to prevent their employees and facilities from being attacked, and banks such as HSBC that have dropped the ball on anti-money laundering, sanctions compliance, and counter-terror finance programs. This is totally unacceptable behavior which ultimately helps finance terrorism and increases the odds that more corporations will be exploited by terrorists. At the same time, it should be recognized that these abysmal compliance programs resulted from a combination of mismanagement, lousy judgments, and long-term business motives, but not because of ideological alignment with the terrorists themselves.

A final note: there was an extremely popular article within the past year circulating the Internet about corporations making money off of the global war against terrorism (which itself was only the latest in a decade-long stream of Internet tirades and social media screeds against “war profiteering” in Afghanistan and Iraq). It should just be remembered that for every company allegedly making ungodly profits from providing basic security services that there are companies like those above that are actually funding or making money directly from terrorism. So when you run across articles like that, ask yourself a question: which seems worse to you—a greedy corporation that fights terrorism, or a greedy corporation that funds terrorism?

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Who finances Hamas’s rockets?

July 14, 2014

Short answer: Iran.

Iran manufactures missiles, loads them up at its Bandar Abbas port, ships them to Sudan, where they are transported by ground to the Sinai for final transfer through smuggling tunnels to Hamas and Palestinian Islamic Jihad in Gaza.

Smuggling was rampant particularly when the Muslim Brotherhood controlled Egypt under Muhammad Morsi, making a significant contribution to Hamas’s 10,000 missile stockpile. “Under Morsi it was almost a highway,” said one observer.

Shorter-range missiles are built in Gaza itself. Technical expertise lent by Iran is helping develop Hamas’s homegrown rocket program, although even as recently as two years ago one analyst observed that Hamas lacks the capacity within Gaza to build a banana plantation, much less a missile factory.

Some missiles, such as the M-302, are manufactured by Syria “under license” from China, which designed it. Assad would not be able to produce these weapons or remain in power without Iranian backing in the first place.

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