Archive for the ‘News commentary’ Category

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Islamic charity pleads guilty to tax fraud

August 17, 2014

Al Haramain, a Saudi-based international charity which once maintained its U.S. branch in Oregon, has pleaded guilty to tax fraud 14 years after filing a false return designed to conceal a $150,000 check issued to Chechen jihadists.

The Associated Press reported on July 29:

…On Tuesday, the charity pleaded guilty in U.S. District Court in Eugene to one count of filing a false tax return with the Internal Revenue Service. The group was placed on probation for three years, and it agreed during that time not to resume operating as a tax-exempt charity in the U.S., prosecutors said.

The charity failed to report to the Internal Revenue Service that a $150,000 donation in 2000 went overseas to Saudi Arabia and was meant to be sent to Chechnya, prosecutors said. The charity falsely reported on its tax return that the money was used partly to buy a building in the U.S.

The foundation was disbanded after the U.S. government declared it was a terrorist organization and froze its assets…

Far from being a lawless series of raids in the early- to mid-2000s against innocent Islamic charities that CAIR and the ACLU have depicted, the successful convictions against the Holy Land Foundation and guilty pleas such a this illustrate that the Bush-era crackdowns on front charities was legitimate.

As part of the plea deal, Al Haramain’s former U.S. director, Pete Seda, who was previously convicted for his involvement in the case, is getting charges dropped against him.

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Mexican extortion scheme spreads to Texas

August 14, 2014

“Virtual kidnapping” ransom schemes have migrated from Mexico to El Paso according to border city medical doctors. Criminal groups call the physicians and tell them a loved one has been kidnapped, and demand that a ransom payment be wired to Mexico.

This development is ominous because it indicates the spread of socially destabilizing extortion rackets from the Northern Triangle and Mexico into a U.S. border state. Whether drug cartels, human smugglers, cuota syndicates, street gangs, or garden variety con artists are behind the scheme isn’t really the point.

The thing to do is to educate the people who are at risk for being targeted, to persuade them to report such incidents to law enforcement, and to refuse payment. Otherwise, if the ball really gets rolling and Americans comply with ransom demands more often, then that will drive up the amounts demanded and the trend will become more difficult to stop.

Gives a whole new meaning to the phrase, “doctors without borders”… From the El Paso Times (h/t @1389):

‘Virtual kidnapping’ scam targets El Paso doctors

Scam strikes area medical professionals, does not appear cartel-related

By Daniel Borunda / El Paso Times

Posted:   08/02/2014

A terrifying telephone scam known as a “virtual kidnapping” is targeting doctors in El Paso and other Texas border cities.

An El Paso Police Department spokesman on Friday confirmed that police are aware of the extortion scam and a warning that has been circulating among the local medical community about the threatening phone calls, which purportedly come from a drug cartel.

The scheme is a new version of similar telephone scams and “there is nothing to indicate” it is cartel related, police spokesman Officer Javier Sambrano said. The number of reported doctor scam cases was not available.

Virtual kidnappings sprung up in Mexico several years ago feeding off fears of drug violence and abductions. It is called a “virtual kidnapping” because the victim is made to believe a loved one has been abducted when no kidnapping has taken place.

In the latest version, a person calls a doctor’s office and asks for a doctor by name. The caller claims to be from a drug cartel and that the cartel has kidnapped the doctor’s son or daughter. There is sometimes a crying child on the phone. The caller barks instructions, demands a ransom amount and the victim is ordered to wire the money to Mexico.

The victim does not realize no one has been actually kidnapped until after sending the money.

“It is important to take a minute to step back, try to think and remain calm,” Sambrano said.

The scam has been reported in other parts of the Texas-Mexico border.

Last month in South Texas, KRGV reported that a doctor in McAllen received a call claiming that his daughter had been kidnapped by the Zetas cartel. The caller demanded $50,000 or they would deliver his daughter’s head in a bag. Then, a girl crying and begging for her life was put on the phone. The doctor said that the call seemed frighteningly real for about 30 seconds before he became suspicious.

No ransom was paid. The doctor’s daughter was safe and had never been kidnapped.

In April, the FBI website warned about virtual kidnappings targeting U.S. citizens staying in hotels in Mexico.

“Callers impersonate themselves as cartel members or corrupt police officers who claim they’ve kidnapped a loved one and demand a ransom,” according to an FBI podcast. The victim is told to follow instructions in a scam that can run for three days. The FBI said that scammers are suspected to be Mexican prisoners using smuggled phones.

The FBI said the calls have warning signs — the calls come from an outside area code, the ransom is only accepted by wire transfer and the calls never come from the victim’s phone.

Sambrano said the calls are a variation of the “emergency” or “relative in Mexico” telephone scams that have previously hit the El Paso region. In those scams, a caller tricks a victim into believing they are a relative in Mexico. They usually start a call saying “Guess who it is?” They then claim to be the person that the victim guessed. The caller usually says they are coming to visit but then call to say they have been in an accident or arrested in Mexico and ask for money to be wired to save them from their predicament…

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HSBC closes accounts: 2 Islamic nonprofits and 1 mosque

August 12, 2014

HSBC has closed the accounts of the Islamic charity Ummah Welfare Trust (UWT), the Finsbury Park Mosque in north London, and an Islamic advocacy group called the Cordoba Foundation. The closures are part of the British bank’s effort to improve compliance with U.S. and British regulations and after being heavily criticized and fined in 2012 for being too lax about the customers and correspondent banks it chose to do business with.

UWT’s accounts were closed by Barclays in 2009. A student group has reported that UWT has conducted projects together with the Al-Salah Islamic Association, a Hamas front. The Finsbury Park Mosque was formerly pastored by hate preacher and jihadist Abu Hamza. The Cordoba Foundation advocates for Palestinian causes, invited a guest to speak from the radical group Hizb-ut-Tahrir, and is run by a member of Britain’s Muslim Brotherhood.

Alex Brummer, city editor of the Daily Mail, offers this insightful analysis of HSBC’s move:

The notion that HSBC is closing down the bank accounts of Muslim groups and charities because of some kind of Islamophobia could not be more wide of the mark.

Britain’s biggest and most international bank is engaged in a determined effort to clean up its reputation and preserve its banking licenses in the United States after settling charges of money laundering and sanctions busting brought by the US Justice Department.

A coruscating 2012 report by the powerful Senate sub-Committee on Investigations found that HSBC had exposed the US ‘financial system to a wide array of money laundering, drug trafficking, and terrorist financing risks due to poor anti-laundering controls’.

The bank subsequently agreed to pay £1.12billion ($1.9billion) in fines to settle the claims and was given a five year probationary period to clean up its act.

Under the chairmanship of the redoubtable Scotsman Douglas Flint, who has been in charge of HSBC since 2010, it has rigorously sought to eliminate the risks of further money laundering charges that might put in danger its American banking licenses.

It has ruthlessly closed down branches, cancelled relationships with overseas banks and shut down the accounts of customers that might conceivably be regarded as risky because of links to money laundering, sanctions busting or potential terrorist activities.

In the troubled Middle East alone, it has doubled the number of compliance officers—internal enforcers—to 3,500 over the two years since it reached a settlement with the American authorities…

Improving the bank’s standards has been hugely expensive, with the global cost of the internal enforcement operation climbing to £296million ($500 million) a year…

Among the relationships that HSBC has severed, as it has gone about its task, is that with the Vatican Bank, recently renamed the Institute for the Works of Religion, because of its past association with money laundering. Such a move involving a prominent Roman Catholic institution strongly suggests Muslim causes and accounts have not been singled out as HSBC seeks to rebuild its reputation in Washington…

If HSBC could be accused of anything it is of being over-cautious in its dealings with the authorities and its elimination of potentially risky clients.

Thanks to Rushette for sending in the news.

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Kosovo terrorists sold organs of 10 captives

August 10, 2014

Earlier allegations are true. An EU investigation has found that the Kosovo Liberation Army harvested organs for sale and carried out other atrocities, mostly against Serbs, during the late-1990s war in the Balkans. Evidence is still being gathered for organ trafficking charges, but indictments will be forthcoming for the other abuses.

Hamas and “Arab gangs” spanning from Sudan to the Sinai also make money from underground organ trafficking.  Generally the organ sales are arranged to make money to purchase weapons for further terrorism.

From the Associated Press (h/t Ultrascan HUMINT):

Handful of captives killed in Kosovo war so army could sell their organs on black market, EU probe suspects

Raf Casert, Associated Press | July 29, 2014

BRUSSELS, Belgium — A special European Union prosecutor said Tuesday he had “compelling indications” that up to ten captives were killed to have their organs harvested for illegal trafficking and black market sale during the 1998-99 Kosovo war.

The revelation was part of a presentation on a two-and-a-half-year investigation into atrocities that also largely confirmed human right reports that there was a campaign of persecution of Serb, Roma and other minorities by some people in the rebel Kosovo Liberation Army.

Clint Williamson, the chief prosecutor, said the Special Investigative Task Force would in future be “in a position to file an indictment against certain senior officials of the former Kosovo Liberation Army” for a series of crimes, including killings, disappearances, camp detentions and sexual violence.

The killing for organ harvesting has long been a key aspect of the probe. Williamson said that the level of evidence was not yet sufficient to prosecute the alleged crimes.

The EU probe followed a 2011 Council of Europe report alleging that the rebel KLA ran detention camps on Albania’s border during Kosovo’s war for independence from Serbia. It alleged that civilian captives were killed there and their organs sold as part of an illegal trade linked to senior KLA commanders.

Without naming any individuals, Williamson said that “there are compelling indications that this practice did occur.” He went to lengths to make clear the alleged harvesting was not a wholesale practice, rejecting claims of hundreds of victims. Some 400 people — mostly Kosovo Serbs — disappeared near the end of the war.

“Handful was meant literally — 10,” Williamson said, holding up two hands with outstretched fingers. “That is the approximate range of the number.”

“The fact that it occurred on a limited scale does not diminish the savagery of such a crime,” he said…

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How Hamas skirts sanctions to fund terror ops

August 8, 2014

Since Western banks won’t work with Hamas, the terrorist organization has developed several methods of accessing cash: trade-based money laundering by getting foreign suppliers to under-invoice them for imports, bulk cash smuggling from Jordan, taking advantage of diplomatic pouch immunity to launder money through consulates, manufacturing counterfeit medicine, and crooked real estate deals.

Excerpts from a recent Worldcrunch article follow:

Financing Hamas: How Cash Gets In The Wrong Hands In Gaza

Tomer Ganon (2014-07-28)

…Smuggling of money by traders is a relatively simple example for the tactics the Hamas leadership has developed to funnel money to the organization in Gaza, the West Bank and inside Israel, as Israeli banks have refused to allow money transactions to and from Gaza fearing it will be used for funding terrorism.

These tactics have become increasingly sophisticated since 2010, a recent report from the Israel Money Laundering and Terror Financing Prohibition Authority (IMPA) found…

Another method for financing terror that IMPA had identified in past years is international commerce. According to one of its studies, terrorist elements have been using various business owners and traders for illicit fund transfers to Gaza.

This tactic, uncovered in 2008, has led to the indictment of two Israeli firms that traded foodstuff and customs representation. This is how it worked: Hamas leadership buys different goods, mostly basic food items, abroad for very low prices or even for free. It then employs straw men to contract a private company to import the goods to Israeli ports and then transfer them to the Palestinian territories. A local distributor, who is in fact a Hamas operative, receives the shipment and later sells the goods. The high revenues, thanks to the large profit margins, then go to terrorists’ coffers.

An additional pattern the IMPA study discovered was the use of accounts owned by diplomatic missions. Financial statements of an unidentified embassy, received by the agency, revealed a large number of transfers from its account to various elements in the Palestinian Authority, including those in Gaza.

An analysis has shown that one beneficiary was an entity suspected in facilitating money transfers to Hamas. IMPA believes the embassy’s transactions were made innocently, in what looked to be legitimate payments, without it being aware it could be aiding terror.

These tactics were identified by IMPA in the course of a review of financial transactions reporting as required by standing regulations. However, authorities are also looking elsewhere, including an emerging source of funding for terrorism in criminal activity, such as drug trade and the manufacture of counterfeit pharmaceuticals — activities that obviously go unreported, and whose extent is unknown.

According to sources in the enforcement authorities, it’s a simple equation. Drugs and fake medicine sold in Israel are often distributed by elements related to terrorist organizations such as Hamas and the Islamic Jihad

The article doesn’t touch on state sponsorship and weapons supplied to Hamas by Iran and Qatar, which is of course the bigger factor behind Hamas’s operations.  But for spare change the above tactics work quite well for Gaza’s terrorists.

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Ex-MI6 chief cites ISIS’s Saudi, Qatari donors

August 5, 2014

Iranian cartoon about Saudi funding of jihad

Richard Dearlove, the former head of the British spy agency MI6, made these comments last month about support for the Islamic State of Iraq by Saudi and Qatari donors:

They [Sunnis in the Middle East] are deeply attracted towards any militancy that can effectively challenge Shia-dom. How much Saudi and Qatari money – now I’m not suggesting direct government funding, but I am suggesting maybe a blind eye being turned – is being channeled towards ISIS, and reaching it? For ISIS to be able to surge into the Sunni areas of Iraq in the way that it’s done recently has to be the consequence of substantial and sustained funding. Such things simply do not happen spontaneously.

Indeed. As Money Jihad has previously observed, ISIS didn’t wake up one day and luck their way into seizing Mosul.  Video clips of Mr. Dearlove’s remarks are available on the Media Research Center’s website here.

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Somali in Holland funded al-Shabaab

August 4, 2014

Farhia Hassan, a Somali living in the Netherlands, has been arrested as part of a U.S. sting against an international cell of East African women who financed al-Shabaab. Additional arrests were made in Virginia and Washington state. The women sent the money back home to “brothers in the mountains,”—al Shabaab fighters in Somalia. The money was transferred in small increments probably to avoid scrutiny. Hassan is said to be pregnant, which her lawyers will probably use to argue against her extradition.

Thanks to Theo Prinse for sending over the story from Omroep Zeeland. An English account of the development comes from DutchNews:

Dutch Somali woman faces deportation to US over terrorist funding

A 30-year-old woman who lives in Terneuzen faces extradition to the US on charges of helping finance the al-Shabaab terror group.

The woman was arrested on Wednesday on the request of the US authorities, the public prosecution department said.

The woman, who was born in Somalia, has Dutch nationality. She will appear in court on Friday and the US has requested her extradition, the prosecution department said.

Brothers

The US department of justice said in a statement that two other women from Kenya and Somalia were also arrested in the US on Wednesday and two more remain ‘fugitives’.

Three defendants who were arrested face charges of providing material support to al-Shabaab, a designated foreign terrorist organisation that is conducting a violent insurgency campaign in Somalia’, the statement said.

The statement said the women referred to the money they sent overseas as ‘living expenses,’ and they repeatedly used code words such as ‘orphans’ and ‘brothers in the mountains’ to refer to al-Shabaab fighters, and ‘camels’ to refer to trucks needed by al-Shabaab.

The money transfers often were broken down into small amounts as low as $50 or $100, and the funds were intended for use by al-Shabaab insurgents operating in Somalia…

Prior Money Jihad coverage of terror financing based in the Netherlands is here. Posts about the financing of al-Shabaab are here. See this and these for the use of “orphans” as code for terrorist financing.  The AP and the Washington D.C. affiliate of ABC News have more information on the arrests here.

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Dahabshiil offices closed for skipping payment to al-Shabaab

July 26, 2014

Somali news outlets reported on July 12 that several Dahabshiil offices in southern Somalia were ordered to close after the money transfer company failed to make required “sako” [zakat] payments to the al-Shabaab terrorist organization.

According to Radio Kulmiye, Middle and Lower Juba offices in Bu’aale, Saakoow, Salagle, and Jilib have been ordered to close. The same development was also reported by Shiniile News, and the website Dayniile says that “feet dragging” by Dahabshiil on making the payments is what prompted the closures.

According to some Somali news outlets, Dahabshiil routinely gives money to al-Shabaab, which the remittance company denies. For whatever reason, payments are occasionally decreased or delayed, and al-Shabaab threatens Dahabshiil in order for payments to resume. The most noteworthy example of this was the April 2, 2013, bombing by al-Shabaab of Dahabshiil’s office in Mogadishu because of a short payment.

The reason you haven’t read about this elsewhere is because English-language media simply don’t report on Dahabshiil’s ongoing financial relationship with al-Shabaab. But the compliance division of Barclays bank is likely aware of such reports, which has why it has tried desperately and rightly to sever ties with Dahabshiil.

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Singer shot dead after saying Somali bank funds terror

July 25, 2014
Somali super star singer

MP Saado Ali Warsame

Saado Ali Warsame, a well-known singer and member of parliament in Somali, was assassinated Wednesday on the streets of Mogadishu near the Ambassador Hotel. The jihadist organization Al-Shabaab claimed responsibility for the murder.

The BBC reports that “a spokesman for the Islamist al-Shabab group, Abdulaziz Abu Musab, told the BBC that she was targeted for her politics.”

Warsame herself believed that a bounty was offered for her killing by Dahabshiil, a UAE-based money transfer business that operates primarily in Somalia. In 2013, the news website Suna Times reported that Warsame had “accused Dahabshiil of putting a two million dollar bounty for her death, shortly after she released a song called Dahabshiil ha dhigan (‘Don’t Deposit with Dahabshiil’).” Money Jihad has been one of the only other English-language websites to cover those allegations.  Dahabshiil’s attorneys have previously denied the allegations in correspondence with Money Jihad.

Warsame’s album warned fans about Dahabshiil’s ‘linkage to tribalism and extremism,’ and satirized the company’s name, which means “goldsmith” by calling it Dhiigshiil, which means “bloodsmith.” Dahabshiil makes regular payments to al-Shabaab.

A dual U.S. citizen, Warsame’s family should demand a full investigation by federal authorities, and the family should consider legal action against the perpetrators.

Despite all the warning signs, prominent charities and spokesmen such as Olympics medalist Mo Farah have insisted that Barclays bank continue offering remittance services in conjunction with Dahabshiil. Those advocates for partnership with Dahabshiil should review this tragic case of Ms. Warsame.

Speaking at her funeral, Prime Minister Abdiweli Sheikh Ahmed said, “We will never stop to hunt the criminals and we will punish them.” Let’s hope that is the case. Another East African musician, Nimo Djama, has also sung out against Dahabshiil’s role in terrorist financing. Officials in the UK and U.S. need to wake up about the threat of Dahabshiil before this happens again.

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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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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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