Freelance journalist Syed Shoaib Hasan reports that the Muraqaba shura, a council of regional Taliban and Al Qaeda faction leaders, routinely distributes millions of rupees to affiliated terrorist tribal organizations at two to six week intervals. In an example from May of 2012, the shura disbursed 70 million to the Pakistani Taliban, Rs 50 million to another Taliban faction, between RS 30 and 40 to the Islamic Movement of Uzbekistan, and smaller amounts to Harkat ul-Mujahideen and Jaish Mohammad.
In his piece, Hasan also analyzes the history of financing militancy in Afghanistan and Pakistan since 9/11. He argues that forcing front charities to register with the government actually worsened matters by giving terrorists the patina of legitimacy and access to the international financial system.
Complicating the fight against terrorist financing is the militants’ new tendency to steer donations to small trusts affiliated with mosques rather than madrassas, which is more difficult to track. Hasan reveals that one in three mosques in Karachi admits to funding militants.
The militant economy
The slush funds accumulated by the militants were fed into the global financial system and were fed into the global financial system and were used to buy legimate businesses involved in construction, shipping and transport. Revenues from these concerns are now fuelling the insurgency
By Syed Shoaib Hasan
On a bright May afternoon in 2012, five men with assault rifles strode into a two-storeyed building near the bazaar in Miramshah. All wore their hair long and oiled under their Chitrali hats but the rangy frame, the narrow, aquiline nose and deep-set eyes instantly betrayed Zulfiqar alias Hakimullah Mehsud, ameer of the Tehreek-e-Taliban Pakistan. An hour later the coterie emerged, with a staggering Rs70 million in cash.
The money was Mehsud’s share from a fund administered by the Taliban’s Shura-e-Muraqibat (Council of Common Interest), ostensibly an oversight committee that handles matters related to various militant groups headquartered in the tribal areas. (While some western news agencies have described it as an Al Qaeda-formed and managed entity, the shura is clearly of Taliban origin and character.) But managing and distributing funds from the Afghan Taliban structure – ‘the emirate’, as it is referred to in militant circles – is one of its primary functions.
Disbursed at two- to six-week intervals, these funds comprise the largest chunk of revenues for all militant groups in the tribal region – barring the Arab Al Qaeda – and, for some, are the only source. That May, other than the TTP, the Taliban factions headed by Hafiz Gul Bahadur and Mullah Nazir got Rs50 million each while the former Islamic Movement of Uzbekistan, now known as the Islamic Movement of Turkestan, got between Rs30 million and Rs40 million. Other recipients of these stipends from the emirate include the Taliban faction of Omar Khalid as well as splinter factions of the Harkatul Mujahideen and Jaish-e-Mohammad and the Takfeeri Group of the Lashkar-e-Taiba. (Some analysts believe that the TTP also funnels money from its share to the Punjabi Taliban.)
The money is to cover the operational costs of militancy. The bulk of it is, of course, spent on arms and ammo. The rest is distributed over transport costs; communications equipment (including satellite and cellular phones as well as walkie talkies) and – in an interesting sign of the times – media cells. (The Afghan Taliban themselves, for example, have a 100-plus dedicated media cell staff that operates a website available in five languages and manages high-tech studios with editing facilities.) Besides this, small amounts are also made available for the ‘shuhuda fund’, which enables payments between Rs5,000 to Rs10,000 for the families of the successful suicide bombers.
The 9/11 shift
The role of the emirate in funding is relatively new. Before 9/11, most militant groups operating in the Af-Pak region drew funds from two main sources: the Pakistani and Middle Eastern Islamic states and large and small private donors. From the times of the Afghan war till about the nineties, say militants, the size of this pie was around $6 billion. Historically, as much as two-thirds came from the states, with Saudi Arabia leading with contributions that went up to 50 percent of total funding. Close on the kingdom’s heels were Iraq and the Gulf Arab states.
Post 9/11, the situation changed. The US-led crackdown on militant groups began with the now-famous ‘follow the money’ directive and the US Patriot Act of 2001. As a result, funds from state sources all but dried up. As the world and Pakistan woke up to the abuse of hundi and hawala – the traditional trust-based system of money transfer in vogue for money transfer to militant organisations as well as conventional Islamic charities – private donations also disappeared.
Over the next 18 months, the flow of money to militant groups ebbed to an all-time low. The period coincided with the time militant operations were at decade-long nadir and many in Pakistan were quick to call it the ‘end of jihad’ in the region. That could well have happened – without funding, the militants could not have continued undermining the US-dubbed ‘War on Terror’. But a loophole emerged – inadvertently provided by the Pakistani authorities themselves, as they looked to close down all non-formal avenues for money transfer.
A better mousetrap
In their bid to screen all ‘suspicious’ transactions, the authorities hit many Islamic charities and some individuals suspected of transferring funds for militant operations. While a few were involved – the Al Akhtar Trust, for example – most were simply what they said they were: welfare organizations and people working primarily among the urban and rural poor. Accordingly, after a thorough examination of their sources of funding, these groups and individuals were allowed to continue their activities.
However, in order to distinguish them from the militant groups, the charities were required to register themselves and maintain bank accounts for financial transactions. This ensured that only those who had valid ID cards issued by the then newly instituted National Database Authority (Nadra) could open bank accounts. Further, the move also ensured that even where occasional hawala transactions were used, the monies did eventually cross banking lanes and were thus documented. The final salvo was the provision of a list of proscribed organizations – the Lashkar-e-Taiba, the Sipah-e-Sahaba Pakistan, Tehreek-e-Nifaz-e-Shariat-e-Muhammadi and Tehreek-e-Jafria Pakistan, among others – to the State Bank of Pakistan, which was to make sure their accounts were frozen.
At the time, this may have seemed a leak-proof system, especially to western observers. But in a corrupt third world bureaucracy, there were more holes in this ‘fool-proof’ mechanism than Swiss cheese.
Step up and identify yourself
For starters, the basis of the system – the newly introduced CNIC – could easily be subverted. Read the rest of this entry ?
Saudi charity workers on trial for funding terror
April 10, 2013Officials from a Saudi Islamic charity are on trial in an ongoing, multi-defendant prosecution in Riyadh. The Arab News is calling them members of the “Haramain Cell.”
The Saudi-based Al Haramain Islamic Foundation has been under international scrutiny since 9/11 for its role in financing terrorism around the world. Its Oregon branch was shut down by federal authorities and its leader was convicted in 2010. Its Saudi parent organization was said to have been rolled “along with several other charities, into a new government-run National Commission for Relief and Charity Work Abroad.”
Saudi investigators and prosecutors have provided cover for the Haramain Cell charity workers by claiming that they were “misusing” their positions through fraud and “using the names of reputable people as alibis.” Money Jihad has no doubt that “reputable people” were actually involved, and the Saudis have concocted the story of “misuse” as a public relations favor for their own elites. This case represents willful continuity, not an accidental deviation, from Haramain’s longstanding jihadist patronage.
Defendants have also been charged with arming militants in Iraq. From Arab News via Maktoob on Mar. 27:
Posted in News commentary | Tagged Al Haramain Islamic Foundation, charity, Saudi Arabia, terrorist financing, zakat | 2 Comments »