Posts Tagged ‘India’

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Armed, funded jihad: recommended reading

April 17, 2014
  • “Although funding terrorism was criminalised in Finland 12 years ago, no-one has yet been convicted”… more>>
  • Anti-tank missiles are being shipped through Turkey and Saudi Arabia to Syrian rebels… more>>
  • Pakistani front charities like JKART are funding the Indian Mujahideen… more>>
  • A love for his friend or a love for jihad? Prosecutors say Khurram Syed Sher knew exactly who he was funding… more>>
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Thousands of NGOs get foreign money but don’t report it

April 14, 2014

MHA warns of terror fundings in NGOs

India’s home ministry has found that the number of non-governmental organizations receiving funds from outside India is on the rise, and that most of the groups receiving the foreign funds aren’t reporting it as they are required to do under the law, highlighting the vulnerability that such funding goes toward terrorist purposes.

Some of the external funding involved comes from Western nonprofits that send money to Islamic front charities or alleged Kashmiri relief groups that are actually turning over the cash to jihadi militants.

India isn’t alone in the struggle to get nonprofit organizations to disclose foreign sources of funding. Compliance in the U.S. with the Foreign Agents Registration Act is a joke. Penalties for noncompliance with 501(c)(3) filing requirements are miniscule. The tendency for regulators globally is to be tougher on existing groups that have gone through the registration process rather than on discovery of groups that have failed to register.

These noncompliant groups need a site visit from the police. The policemen can wait while a manager at the NGO completes the required paperwork.

From the Daily Mail‘s India edition:

Government warns of NGOs’ vulnerability to terror funding and money laundering

By Abhishek Bhalla

PUBLISHED: 21 March 2014

Thousands of NGOs which receive foreign aid, many of whom do not file returns on such contributions, are vulnerable to terror funding and money laundering, the home ministry has warned.

Though there are more than 22,000 NGOs registered under the Foreign Contribution Regulation Act (FCRA), intelligence inputs indicate that there are many others that work secretly and are not registered.

On the other hand, 19,000 of the registered organisations do not file returns on foreign contributions.

Foreign funding for NGOs has risen by almost 12 per cent in 2011-12, with Rs 11,549 crore being pumped into these organisations from abroad every year, according to the home ministry’s latest report on the FCRA.

According to the report, foreign contributions worth Rs 2,253 crore come for activities other than the most common causes listed by the Ministry of Home Affairs for foreign contributions.

The common sectors for foreign funding are rural development, welfare of children, health, awareness camps and religious purposes.

“We need to know where this money is being used. We need to coordinate with the authorities of the donor countries and crack down on some of these NGOs,” said an official in the home ministry.

The five major donor countries are the US, Britain, Germany, Italy and Netherlands. Countries like the UAE, Mauritius, Austria, Sweden and Spain are also among the top 15 donor nations…

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India’s currency change combats counterfeiting, but backdoor still wide open for money laundering

February 28, 2014

An email from our old friend Puneet aprised us to a new initiative in India to replace old currency notes with new notes with enhanced security features.

The reason for the change is speculated by many, including the BBC, to reduce the flow of black money (including undeclared, untaxed, counterfeit, and laundered money) through India’s economy.

Indeed, counterfeiting is a national crisis in India, and the new security features on the bills should help reduce the ability of counterfeiters to replicate the notes.

But in terms of getting illegally acquired but genuine notes off the street, this program doesn’t do much to cleanse the economy from the scourage of black money.

Live Mint points out that anybody who wants to exchange their old bills for new ones will be able to do so, and they won’t have to divulge their identities:

…If one looks at the RBI announcement, it is clear that the old currency notes can be exchanged for new ones at any bank branch from April to June 2014 without any questions being asked as to the name of the person giving the notes, her Permanent Account Number (PAN), address, etc. One can exchange the notes even at branches where one does not have a bank account. It is only after 30 June that one would have to give the name and PAN to exchange high denomination currency notes. Therefore, any person having undisclosed cash in her possession can easily exchange the old currency notes till June 2014 without disclosing her identity…

Also, Money Jihad notes that there doesn’t seem to be any provision in the new currency roll-out for bank tellers to report unusual amounts of cash that are brought in for exchange, or for them to report exchanges that they suspect are being made on behalf of undisclosed third parties.  Officials should move to incorporate such safeguards.

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This Valentine’s Day, give her diamonds. (Money is easier to launder that way.)

February 14, 2014

International financial watchdog FATF has issued a report that raises concerns about the use of diamonds to launder money in five countries that voluntarily disclosed information for the report.

India cited cases of overvaluation of diamonds sold abroad as a means of transferring illicit money back to India.  Trade-based money laundering is one of, if not the largest mechanism worldwide for transferring value without being detected.

As John Cassara and Avi Jorisch have noted in their book, On the Trail of Terror Finance, “diamonds are the most condensed form of physical wealth in the world. As a result, they are widely used in global laundering and value transfer schemes.”

Cassara and Jorisch also noted that Dubai, which maintains significant business relationships with diamond dealers in Mumbai, India, “are adept at invoice manipulation,” which Dubai traders can use to transfer significant amounts of value without transferring physical money.

Thanks to Sal Imburgia for first notifying Money Jihad about the report.

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Heroin is funding Hizbul Mujahideen

February 11, 2014

A Kuwaiti drug kingpin has been orchestrating an international operation to send narcotics through Kashmir into India.  A Pakistan-based “launch commander” of the jihadist organization Hizbul Mujahideen is a key middleman and beneficiary of the drug profits.  Khurshid Alam, a high-ranking police officer in Kashmir, has been arrested along with two other policemen for their involvement in the drug smuggling scheme.

CNN-IBN has the report:

PTI news service has additional details here.  Thanks to El Grillo for alerting Money Jihad to the story.

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ISI and Jamaat-e-Islami behind 10 truckloads of smuggled arms

February 7, 2014

Verdicts have been reached in a 2004 case involving the discovery of 10 trucks full of Chinese-made guns and ammunition intended to help fighters of the United Liberation Front of Assam (ULFA) break away from India.

While Assamese separatists are mostly non-Muslim, they have been sustained financially and logistically by Islamist elements in Pakistan and Bangladesh including the ISI spy agency and the Jamaat-e-Islami party.  Fracturing India would give Pakistan a strategic advantage in the subcontinent.

Motiur Rahman Nizami, a Jamaat party member who served as Bangladesh’s industries minister during a coalition government in the early 2000s, is the senior-most official convicted in the case, whose involvement demonstrates Jamaat’s desire to foster separatism in northeast India.

As for the involvement of Pakistan’s involvement through its ISI spy service, The Daily Star reports that former Bangladeshi intelligence official Shahab Uddin, one of the conspirators in the smuggling operation, admitted that, “the ISI had provided mobile monitoring equipment” as a “gift,” and that Shahab met with ISI officials to discuss gun-running plans.

Previous reporting by the Times of India has shown that ULFA fighters were trained by the ISI as early as 1991.

Thanks to Munazir Hussain Syed for apprising Money Jihad of these revelations.

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Terror funding & financial crime predictions for 2014

December 31, 2013
  1. As U.S. troops depart Afghanistan in 2014, the Taliban is poised for a banner year, financially speaking.  The Pakistani Taliban is laying the groundwork for a resurgence too, accumulating money from an extortion spree against businessmen (see here, here, here, here, and here) throughout 2013.
  2. The 28-page section of the 2002 report from Joint Congressional Inquiry into Sept. 11, 2001, implicating Saudi financing of the 9/11 hijackers could either be declassified or leaked in 2014.  Enough of a consensus is gathering that the section was redacted for diplomatic purposes, and should be disclosed so the American people know the truth (or at least more of the truth than is already known about Saudi Arabia’s role in financing global terrorism).
  3. “A major data destruction attack will happen,” and ransomware will be involved.  Websense explains, “Historically, most attackers have used a network breach to steal information for profit. In 2014, organizations will need to be concerned about nation-states and cyber-criminals using a breach to destroy data. Ransomware will play a part in this trend and move down market to small and medium sized organizations.”
  4. Narendra Modi could become elected prime minister of India next year.  Mr. Modi has spoken out against corruption, black money, hawala, and terrorism to a greater degree than the current ruling Congress party.  His victory would represent a significant threat to the established criminal and terrorist underworld in India and Kashmir that are being backed by Pakistan.
  5. New legislation including, at the federal level, renewed sanctions against Iran, and at the state level, sharia law bans (“American laws for American courts” initiatives), and anti-fraud legislation at the state level dealing with no-fault car insurance fraud and counterfeit airbags, may be enacted in 2014.

Some other thoughts come to us from the Council on Foreign Relations, which has published an interesting forecast of 2014 based on surveys of public officials and experts, including the possibility of major terrorist attacks in the U.S., in Kashmir, and by al-Shabaab against Somalia’s neighbors.

Incidentally, prosecutors in the case against Dzhokhar Tsarnaev are pushing for a fall 2014 trial, although defense lawyers have argued that will be too soon.

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NIA: terrorists get fivefold pay raise

December 18, 2013

Money Jihad has previously covered the Islamic terrorist group Hizbul Mujahideen’s growing revenue sources in India, which include counterfeiting, donations from front charities, hawala, and illicit trade in animal hides.  Now we have some indication of how the money raised is being spent:  India’s National Investigation Agency has revealed in court documents that Hizbul Mujahideen operatives are being paid five times as much today as they were being paid in the 1990s.

From Press Trust of India via the Times of India on Dec. 3:

Hizb-ul-Mujahideen pays salary to active cadres: NIA to court

NEW DELHI: Terror outfit Hizb-ul-Mujahideen pays monthly salary to members associated with it and their “remuneration” has surged around five folds in 2011 compared to what was paid to them in 1990s, the NIA has said in its chargesheet filed before a Delhi court.

In its chargesheet filed against Hizb-ul-Mujahideen chief Syed Salahuddin and nine other members of the banned outfit for allegedly receiving funds of about Rs 80 crore from Pakistan for carrying out terror activities across India, the NIA said active HM caders receive monthly funds on regular basis.

“Investigation has revealed that each active cadre of HM receives monthly funds on regular basis for his association with the said outfit. This monthly remuneration has increased from Rs 2,000-3,000 per month in 1990s to Rs 10,000-12,000 per month in 2011,” the probe agency said.

It also said that the terror outfit had developed a set-up for distribution of funds to its sympathisers and others and also provides money to its cadres for contesting court cases.

“Investigation has revealed that HM developed an excellent set-up for distribution of funds to sympathisers, runners, over ground workers and underground workers, also a mechanism to systematically and regularly fund to next of kins of its cadres killed/injured terrorists is in place,” it said…

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Islamic terrorists pump money into real estate

November 13, 2013

Officials in India report that 14 million rupees (about 225,000 USD) of terror money has been seized.  The money was intended for investment in the real estate market in Bangalore.  Rediff News reports that “all the money” came from charity and extortion carried out by terrorist groups.  The seizure was the result of an investigation into a bombing at a political rally late last month.

Real estate purchases have been a tactic used by terrorist groups and their financiers in both the UAE (see here and here) and KenyaRediff points out that this isn’t the first time that terrorists in India have dabbled in real estate either.  This is a trend worth keeping an eye on…

NIA seizes terror money worth Rs 1.4 crore in Bangalore

The National Investigation Agency has seized Rs 1.4 crore, believed to be terror money, in Bangalore. The agency sources told Rediff.com that the money was sourced through modules in North East and was sent to Bangalore.

It is said that the money was part of a major transaction made during the planning of the Patna blasts of October 27.

The money was found following the interrogation of several suspects by the NIA and is believed to have reached Bangalore a few days back. It was sent to Bangalore to be housed safely.

The NIA sources said that the money could have been in transit to other parts of Karnataka where it was to be kept in a safe house and used for future operations by terror groups.

The NIA has been probing links between Islamic terror and North Eastern terror groups for some time now. This is a possible link to the same, sources in the agency felt.

Unholy terrorist-builder nexus

More details regarding the seizure of terror money from Bangalore have emerged and it is now learnt that the money was being invested into real estate. The money was transferred to Bangalore from Manipur by a terror group.

The money was received by a businessman in Bangalore called Shanti Meital who in turn was to pump the same into real estate.

All this money is collected by terror groups through extortions and charities. They then invest in real estate and rake in the profits later.

Sources in the NIA said that this is a major racket in the country today and all terror groups are indulging in the same.

“There have been several instances where Indian Mujahideen operatives have also parked money in real estate. Riyaz Bhatkal is an example of this. He was in a deal with a Mumbai-based businessman and was constructing apartments in Mangalore worth Rs 10 crore,” the source pointed out.

The source added that they have several more builders under the scanner who have been parking terror funds in their businesses.

The NIA will seek the help of the local police and other agencies in order to bust this financial nexus between builders and terrorists.

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The indirect expenses of jihad

October 1, 2013

Ernst & Young and the Federation of Indian Chambers of Commerce and Industry (FICCI) have issued a report on emerging trends in the financing of terrorism.  The central argument of the study is that piracy, smuggling, and counterfeiting have been growth sectors for funding terror, and that India and the world need to establish more mechanisms to combat these methods.

The full report is available here, and a news article about it is here (h/t El Grillo).

There is a lot of value to the report, but one component that readers should take special note of is Ernst & Young’s distinction between the direct expenses for terrorism on things like bombs, materials, and attack plans versus indirect expenses for the bigger picture infrastructure of terrorism:  recruitment, gathering intelligence, and public relations.  This chart comes from their report:

Two broad classes of terrorist expenditures

This is the distinction that Money Jihad has tried to make over the last several months about the Tsarnaev brothers and the Boston marathon bombing.  (See here and here.)  The attack wasn’t just about the costs of the explosives purchased by Tamerlan, or even his travel expense s to Russia, although that certainly still needs to be explained more thoroughly.

The larger question is the indirect expenses that were made toward jihad in the North Caucasus long before the Tsarnaevs hatched their plot.  These were expenditures made over several decades by the Saudis and Western-based Islamic front charities in spreading Salafism through the Caucasus.  It took millions of dollars to create and support radical new mosques, fake “relief” programs, to pay and provision Chechen militants and their leaders, to buy loyalties and pay-off ambivalent politicians, and to create a mushroom patch of jihadist websites in the mother tongue of the Tsarnaev family.

It doesn’t do much good for the federal government and banks to scrutinize and report on every single financial transaction that we undertake if, at the same time, we ignore the millions of petrodollars and zakat donations that go toward paying the indirect expenses of terrorism and inculcating the next generation of jihadists.

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Canadian auditors: Game over for Islamic charity

September 29, 2013

It’s final.  ISNA’s tax-exempt status has been revoked by the Canada Revenue Agency after an efficient and pointed audit that revealed ISNA sent nearly $300,000 to a terrorist organization in Kashmir.  Language from auditors and tax professionals is normally guarded, nuanced, and measured.  Read with that understanding of their profession in mind, the public announcement by CRA of their findings is scathing.  An excerpt follows.  Thanks to the reliable Gisele for sending this in:

…Our analysis of the information obtained during the course of the audit has led the CRA to believe that the Organization had entered into a funding arrangement with the Kashmiri Canadian Council/Kashmiri Relief Fund of Canada (KCC/KRFC), non-qualified donees under the Act, with the ultimate goal of sending the raised funds to a Pakistan-based non-governmental organization named the Relief Organization for Kashmiri Muslims (ROKM) without maintaining direction and control. Under the arrangement, KCC/KRFC raised funds for “relief work” in Kashmir, and the Organization supplied official donation receipts to the donors and disbursed over $281,696 to ROKM, either directly, or via KCC/KRFC.

Our research indicates that ROKM is the charitable arm of Jamaat-e-Islami, a political organization that actively contests the legitimacy of India’s governance over the state of Jammu and Kashmir, including reportedly through the activities of its armed wing Hizbul Mujahideen. Hizbul Mujahideen is listed as a terrorist entity by the Council of the European Union and is declared a banned terrorist organization by the Government of India, Ministry of Home Affairs, under the Unlawful Activities (Prevention) Act of 1967.

Given the commonalities in directorship between ROKM and Jamaat-e-Islami, concerns exist that the Organization’s resources may have been used to support the political efforts of Jamaat-e-Islami and/or its armed wing, Hizbul Mujahideen.”

The Government of Canada has made it clear that it will not tolerate the abuse of the registration system for charities to provide any means of support to terrorism. Canada’s public policy recognizes that the tax advantages of charitable registration should not be extended to organizations whose resources may have been made available, knowingly or unknowingly, to a terrorist entity, whether such financing is direct or indirect through organizations that claim to have nominally “charitable,” social, or cultural aims…

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