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Canada’s taxman cracks whip on Muslim Youth

March 14, 2012

And the Canada Revenue Agency deserves a standing ovation for it.

Prior to 9/11, the World Assembly of Muslim Youth (WAMY) and its close North American affiliate known as the Benevolence International Foundation (BIF) made up one of the three charitable front groups that Osama Bin Laden depended on the most for Al Qaeda’s funding (the other two being the Muslim World League and the Qatar Charitable Society).

Now the Canada Revenue Agency has stripped WAMY’s Canadian branch of its tax-exempt status for its failure to prove that it is distinct from its parent organization (WAMY in Saudi Arabia) or to maintain an actual charitable purpose.

In 2011, the Canada Revenue Agency also revoked the tax-exempt status of the Islamic, bogus front charities known as the World Islamic Call Society (an entity sponsored by Muamar Qaddafi) and IRFAN (a Hamas-tied charity).

Unfortunately, the decision does not close WAMY or prevent it from raising funds, but only prevents contributions to WAMY from being claimed as tax-deductible expenses.

H/t to GMBDR, which points to this story from the National Post as further evidence of WAMY’s financial difficulties over the last couple years.

Canadian Muslim youth group tied to al-Qaeda stripped of charitable status

Mar 6, 2012 – 8:47 PM ET | Last Updated: Mar 7, 2012 8:58 AM ET

A Canadian Muslim youth organization has been stripped of its charitable status after a Canada Revenue Agency investigation linked it to a Saudi-based group that allegedly financed Islamist terror campaigns.

An audit of the World Assembly of Muslim Youth revealed the charity had developed ties to a number of organizations that allegedly helped fund al-Qaeda operations around the world and failed to comply with a number of standards required for charities to maintain their status.

In a warning letter to the Toronto-area organization last summer, CRA director-general Cathy Hawara said “our analysis of the Organization’s operations has led the CRA to believe…[it] was established to support the goals and operations of its parent organization, located in Saudi Arabia, which has been alleged to support terrorism.”

WAMY, known in Canada for running Islamic camps and pilgrimages for youth, was stripped of its status on Feb. 11. It failed to keep proper books and records, maintain a specific charitable purpose and distinguish itself from parent organization WAMY (Saudi Arabia), which had been alleged to support terrorist activity, the CRA audit said.

“The audit findings did not reveal any apparent separation between the activities of WAMY (Saudi Arabia) and WAMY, with all related financial and operating positions being made by WAMY (Saudi Arabia),” it reads. “This leads to a reasonable inference that WAMY has little or no independent function; therefore it cannot be concluded that it is carrying out its own charitable activities for which it is registered.”

WAMY in Canada also appears to have a director, contact information and bank account in common with the Benevolence International Fund in Canada, whose assets were frozen by the Canadian government in 2002 because it was linked to attempts by Osama bin Laden to acquire nuclear and chemical weapons. WAMY, which had been inactive since at least 2005, also funnelled $50,246 to the Benevolence International Foundation (BIF) in the U.S. in 2001 to boost its orphan program, the audit reads.

Both BIF-Canada and BIF-USA were added to the Consolidated List of the United Nations Security Council’s al-Qaeda and Taliban Sanctions committee in November, 2002, for having specific ties to al-Qaeda.

Under the heading of “Adverse Reporting on WAMY and its Affiliates,” the Canadian government audit cites testimony by counter-terrorism consultants before a U.S. Senate committee that says bin Laden identified three Muslim charities, including WAMY, as the “primary sources of al-Qaeda financial and fundraising activity” back in 1993.

The testimony went on to say these three organizations laundered money originating from bank accounts belonging to bin Laden and his associates in the Arabian Gulf, provided entertainment and travel documents to al-Qaeda operatives around the world and helped move funds to areas where al-Qaeda was operating.

Ties between WAMY and the BIF were inextricably close, even involving some of the same members, the CRA audit alleges: Mohamed Khatib was president of WAMY in 1999-2000, the same period of time he was listed as secretary to BIF-Canada, according to tax and government documents. The mailing address on WAMY’s November, 1998, application for charitable registration and documents submitted to Industry Canada when BIF-Canada incorporated in May 2000 matched up —both were Mr. Khatib’s home address, the CRA said.

The shared director between BIF-Canada and BIF-USA, Enaam Arnaout, pleaded guilty to racketeering charges a decade ago, admitting in his plea agreement that the “charity had provided financial assistance to individuals engaged in violent activities overseas,” the audit reads.

“Charities have to remember their obligations under Canada’s anti-terrorism legislation,” the CRA’s paper on guidance for activities outside of Canada reads. “As with all individuals and organizations in Canada, charities are responsible for making sure they do not operate in association with individuals or groups that are engaged in terrorist activities or support terrorist activities.”

In 2003, counter-terrorism officials in the U.S. said the WAMY organization there had been founded by bin Laden’s nephew Abdullah. Canada’s branch, which had an office in Mississauga, Ont., was operating under the supervision of the U.S. wing, according to the group’s own literature.

Toronto charity lawyer Mark Blumberg applauded the CRA for its thoroughness when it comes to auditing charities and revoking their status, if need be, but he says more can be done to prevent mismanagement of charities with respect to terrorism ties or money laundering.

“People think that because CRA approves an application that that means the registered charity is a wonderful organization and that it will not stray or do anything that’s wrong,” he said. “In fact all the CRA’s really doing is making sure all of the objects and activities and the information provided in an application is appropriate in terms of it being a registered charity.”

National Post, with files from Stewart Bell

WAMY is actually a subordinate entity of the Muslim World League itself, along with IIRO and Al Haramain which have been implicated in terrorist financing from Indonesia to Oregon.  The Muslim World League and its components were founded and funded by the Saudi royal family, and have received major private donations from Saudi bankers and businessmen.

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One comment

  1. [...] Canada Revenue Agency stripped WAMY-Canada of its tax exempt status last year because WAMY’s Canadian branch could not [...]



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