Posts Tagged ‘cash smuggling’

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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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UK probes aid to Al Qaeda-linked Syrian rebels

August 18, 2013

A Islamist group called “Aid Convoy” is being investigated by police and the UK Charity Commission for arranging aid for jihadists in Syria.  Part of the plot, a bulk cash smuggling scheme, has already been foiled:  “A Kent police spokeswoman confirmed officers seized three sums of cash worth £36,066, 10,600 dollars (£6,934) and 1,400 euros (£1,216) from a group of men at Dover who were on their way to the Middle East.”

A group of Aid Convoy supporters was allowed to travel overseas anyway.  Thanks to El Grillo for sending this in from The Sunday Times:

British aid charity in ‘terror’ inquiry

Dipesh Gadher Published: 4 August 2013

POLICE are investigating a British charity amid fears that extremists in the UK are channelling money to fighters in Syria who are backed by al-Qaeda.

Officers launched their inquiry after seizing tens of thousands of pounds in cash at Dover from a group of Muslim men on their way to the Middle East. They were travelling on behalf of a charity called Aid Convoy. Its trustees include a British-based Syrian who was accused — but later acquitted — of involvement with the Madrid train bombers who killed 191 people.

The Sunday Times has learnt that supporters of Aid Convoy have previously been stopped and questioned at Folkestone under anti-terrorism laws before being allowed to continue their journey abroad.

Other individuals linked to Aid Convoy include a radical cleric who allegedly praised the 9/11 attacks in front of children and an extremist who set fire to giant poppies on Armistice Day…

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Smuggling cash with foreign prepaid cards

April 15, 2013

ACAMS MoneyLaundering.com is reporting that while know-your-customer requirements and other safeguards are in place to prevent abuse of prepaid, reloadable cards obtained from American financial institutions, the freedom of foreign banks to issue such cards remains a potential area of terror finance vulnerability.

Here is an excerpt from MoneyLaundering.com’s featured article by Colby Adams on Apr. 9:

…Final rules issued by the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) in July 2011 imposed anti-money laundering (AML) program duties on American providers and sellers of certain prepaid products, including customer identification, suspicious activity reporting and transactional recordkeeping requirements.

But reloadable cards that can be acquired in person or over the Internet from foreign financial institutions remain an immediate threat to the United States, according to a senior compliance officer at a major U.S. financial institution linked to the prepaid industry.

“The rules are way too focused on what’s leaving the United States—on bulk cash smuggling on a card,” said the person, who spoke on condition of anonymity. “The giant elephant in the room is that the regulators aren’t checking what’s coming here, and that could mean trouble sooner rather than later.”

In such a scenario, a member of a terrorist organization living in a high-risk jurisdiction could purchase a network branded prepaid card from a non-U.S. bank with little trouble. Should the person travel to the United States, he or she could use the card to withdrawal money from any one of thousands of ATMs, or receive additional funds from another foreign-issued prepaid card holder

Why would Muhammad Atta need a SunTrust account if he could have just brought a preloaded payment card with him from Hamburg?  Especially when that card is branded with the familiar logo of Visa or Mastercard, such as this product being offered on the website of Cyprus-based Hellenic Bank:

https://www.hellenicbank.com/easyconsole.cfm/id/576#contentDisplay

Screenshot of foreign p-card promising anonymity and a Visa logo

So much for know-your-customer provisions when a bank in the EU is encouraging customer anonymity.  Moreover, Mr. Adams notes that “the Visa logo means that it can be used anywhere Visa is accepted – including ATMs.”

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News on the money jihad: recommended reading

February 28, 2013

• The Muslim Brotherhood played midwife to the birth of contemporary Islamic banking.  All it took was $100 million, an open door policy in Luxembourg, and the blessings of a Saudi king… more>>

• Al Qaeda insurgents in Iraq were paid about $40 a month.  Hezbollah agents in Cyprus?  $600… more>>

• Their tunnels flooded, Gaza’s bulk cash smugglers search for a workaround.  Bank compliance officers, be forewarned… more>>

• Israel’s civil defense minister exposes the “real base” of Hezbollah’s revenues—Europe… more>>

• No longer content to tax coca farmers and drug traffickers, Peru’s Shining Path may target tourists for kidnapping.  Time to reconsider that trip to Machu Picchu… more>> (h/t Jose Maria Blanco)

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Stella the dog finds €3m in illicit cash

October 12, 2012

Stella, a yellow lab with a nose for cash, has discovered $4 million in her career as a bulk cash sniffing dog at the international airport in Naples Italy.  While this report from CNN Money highlights the dog’s role in detecting tax evasion, her skill can be, and probably has been, applied to currency smuggling for any reason including money laundering and terrorist financing.

A dog and a terror finance detector—a jihadist’s worst nightmare!

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Worrying about couriering

May 13, 2010

Last Sunday’s talk shows were sprinkled with statements from Obama administration officials that  Faisal Shahzad’s Times Square car bomb was funded by the Pakistani Taliban.  Did Shahzad pick up the money on one of his many visits to Pakistan, was a courier involved, or both?

From CBN on May 7:

Investigators are looking for a second suspect in the failed terror attack in New York City’s Times Square.

Police said a money courier helped funnel cash from overseas to finance Faisal Shazhad’s [sic] attempt to blow up a car in the heart of New York last weekend.

Investigators have the name of the courier who they believe helped pay for the used SUV and other materials used to rig the car.

They are also looking into possible financing of the plot by foreign groups.

“We are directly looking at who did he have contact with while in Pakistan, what did he do, who is supporting him and why,” State Department spokesman P.J. Crowley said.

On Thursday, a spokesman for the Pakistan Taliban said the group had nothing to do with the attempted bombing, but added that “such attacks are welcome.”

Meanwhile, authorities said Shazhad has admitted to the attempted bombing and is cooperating with the investigation.

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