Archive for February, 2010


Zakat committees “corrupt to the core”

February 28, 2010

In Pakistan, which has a fully Islamized tax system, local committees are used to collect and distribute zakat on behalf of the government.  The Punjabi zakat minister has admitted that those committees are totally corrupt, and that not enough has been done to replace the worst committee members.  From The Nation on Feb. 11:

LAHORE – The Punjab government on Wednesday admitted that the Zakat committees were corrupt to the core, and huge embezzlements had been identified in the audit of year-2007, while the present dispensation is yet to appoint ‘honest’ people to replace the corrupt and take action against them.

This ‘disclosure’ was made by Minister Zakat and Usher Haji Ehsan-ud-Din Qureshi while giving replies to questions about his Department here at the Punjab Assembly. As per usual, the Minister miserably failed in giving satisfactory answers despite Senior Minister Raja Riaz Ahmed’s repeated interferences with clarified statements, parchis from the gallery and continuous rephrasing of questions and statements – ‘carefully listen to the questions and properly answer them’ – by Speaker Rana Muhammad Iqbal Khan, which amply proved that ‘one cannot make others read or comprehend something if they do not have the capacity’.

Interestingly, regarding the formation of the Committee, both Senior Minister and Minister Zakat dragged in the Federal Government, when the former maintained that the Centre was yet to amend the Constitution for forming new committees. However, the Opposition seemed to have raised a valid point when it quizzed the Treasury about its performance and working during the last two years.

The Opposition members, mainly led by Aamir Sultan Cheema for this part of the session, launched a bitter diatribe against the govt as they believed that it had failed in distributing much-needed money to the deserving, as it did not trust the old committees, and had not yet formed the new ones.

Moreover, they bitterly criticised the Treasury for its failure in taking action against the corrupt chairmen Zakat committees, especially when it was admitting that these chairmen were dishonest. Simultaneously, they also asked for mentioning the reasons for not publishing names of the corrupt.


Dutch lawyer to U.S.: funding Islamists is not a crime

February 27, 2010

The U.S. Patriot Act made providing “material support” to a foreign terrorist organization illegal.

If you’re an attorney for a terrorist, “material support” may sound too vague, broad, and hostile to free speech.  You might even fight the concept of material support all the way to the Supreme Court on behalf of your client.

But the concept really doesn’t require Supreme Court scrutiny.  It is common sense (and perfectly constitutional) for Congress to prohibit supporting terrorists, whether than means financially, logistically, or verbally.

But they must not have a law like the Patriot Act in the Netherlands.  The Dutch don’t want to extradite Mohamud Said Omar, a jihadist who raised funds for Somali Islamists, back to the U.S., and they don’t have much to charge him with themselves.  From Monday’s Washington Post:

Mohamud Said Omar, 44, is suspected of providing money to the Somali Islamist group al-Shabab that was used to buy guns. Around 20 youths of Somali descent are believed to have traveled to Somalia from Minnesota since 2007 to help the group, which the U.S. says has ties to al-Qaida.

Omar’s lawyers say he never intended to help terrorists.

“In any case Omar denies that he has ever been involved in any way whatsoever with the financing of terrorism,” his lawyer Bart Stapert said.

Omar has been held in a high-security Dutch prison since his arrest at the request of the U.S. government in November. He has residency in the U.S. but had been living in a center for would-be asylum seekers in the Netherlands since December 2008, apparently before he was a suspect.

A total of 14 people have been charged in the ongoing U.S. federal investigation into the travels of as many as 20 young men who went to Somalia to fight over a period of two years starting in 2007. They face a variety of accusations from recruiting and raising funds for the trips, to engaging in terrorist acts in Somalia and perjury.

Omar was the only one in the Netherlands.

According to his extradition request, U.S. officials plan to charge Omar with providing or conspiring to provide “material support to a foreign terrorist organization,” and “conspiracy to kill, kidnap, maim or injure.”

Stapert argued that the specific acts Omar is said to have committed – including gathering money in the U.S., taking youths to the airport, and speaking and meeting with people who had been to Somalia – would not be considered crimes in the Netherlands (emphasis mine).

Read the rest of this entry ?


Tut, tut, Turkmen

February 26, 2010

In addition to blacklisting Iran last week as a significant source of money laundering and terrorist financing, the Financial Action Task Force has declared that Turkmenistan has failed to address long-standing AML/CFT deficiencies.  FATF tried their hardest to sound polite in their public statement:

The FATF welcomes Turkmenistan’s continued progress in addressing its AML/CFT deficiencies, including by taking steps towards establishing a Financial Intelligence Unit (FIU). Given that the FIU is not yet operational, the FATF reiterates its 25 February 2009 statement informing financial institutions that these deficiencies constitute an ML/FT [money laundering/terrorist financing] vulnerability in the international financial system and that they should take appropriate measures to address this risk. Turkmenistan is urged to continue to take steps to implement an AML/CFT regime that meets international AML/CFT standards and to work closely with the Eurasian Group and the International Monetary Fund to achieve this.

This seems to be the latest in a series of black marks for the small, Central Asian state.  Money Jihad readers may remember that Turkmenistan was recently ranked 171 out of 179 countries in terms of economic freedom.  That put Turkmenistan in the “repressed” category just a couple notches below Iran.

The State Department’s annual report of religious freedom for 2009 noted several additional problems.  They found that in Turkmenistan (which is majority-Sunni Muslim with a large Russian Orthodox Christian minority), “Mosques and Muslim clergy are state-sponsored and financed. The Russian Orthodox Church and other religious groups are independently financed.”  The report also that Turkmenistan funded air fare for the hajj by some of their Muslim citizens.


In India, “terror fund flow may have increased”

February 25, 2010

An increase in suspicious financial transaction reports (STRs) filed by Indian banks to financial authorities in that country suggests that terrorist financial activities may also be on the rise, according to an article from Daily News & Analysis on Feb. 16.  However, as the story notes, the uptick in numbers may simply be the result of improved detection software at the banks.  From DNA:

After the terror attack in Mumbai on November 26, 2008, the government had indicated its intent to crack down on all activities linked to terror. It was, therefore, expected that the sources and channels of terror funding would be squeezed soon.

However, in 2009, the year following the carnage, there was a two-fold jump in suspicious transactions across the country. Most of these transactions are believed to be aimed at bankrolling terror activities.

The financial intelligence unit (FIU) of the department of revenue of the Union finance ministry has revealed that as many as 4,409 suspicious transaction reports (STRs) were received by the unit in 2009.

According to the report prepared by the unit, a copy of which is with DNA, the numbers were a staggering six times more than those in 2007 and more than double compared to 2008. The number of STRs for these years was 817 and 1,916 respectively.

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Forbes reporter acknowledges military impact on Al Qaeda’s wallet

February 24, 2010

Today’s post is for the more visually inclined–a video follow-up to the Forbes article covered here Saturday.

Nathan Vardi highlights the efforts of the Treasury Department again, but at least in this interview he acknowledges the effect of the pressure brought against Al Qaeda finances by the U.S. military.


Supreme Court to judge “material support” of terrorism

February 23, 2010

The Supreme Court will hear arguments today in Humanitarian Law Project v. Holder, a case that assesses the constitutionality of banning material support to foreign terrorist organizations (FTOs).

Counterterrorism Blog has linked to a helpful and detailed report by the Investigative Project on Terrorism (IPT) on the case.  As they point out, in enacting 18 U.S.C. § 2339B against material support, Congress intended to make FTO’s “radioactive” by allowing no support—whether that support comes in the form of money, safe houses, weapons, or personnel.

But some people just can’t take “no” for an answer, including supporters of the Marxist Kurdistan Workers Party, or PKK.  The PKK is the group that likes using IEDs to kill Turkish civilians periodically.

“Material support” is a major category of successful legal prosecutions of terrorist acts.  IPT found that 23 percent of all terrorism cases involve material support.

Chart by The Investigative Project for Terrorism

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Sick attacks & tax on Sikhs

February 22, 2010

One, two, or three (depending on which news account you ready) Sikhs in Pakistan were beheaded by the Taliban yesterday for refusing to be forcibly converted to Islam and for refusing to cough up ransom or jizya (depending on which account you read).  From The Times of India:

[A]ccording to security sources in New Delhi, Jaspal and Mahan [two of the Sikhs] were reportedly told to convert to Islam or face death. When they refused, their heads were chopped off and sent to the Bhai Joga Singh gurdwara in Peshawar.

The Indian government has taken serious note of this and is in touch with the high commission in Islamabad. “This incident is shocking. We are looking into it,” a source said.

The miniscule Sikh community in NWFP and Afghanistan has been under pressure from the Taliban to embrace Islam, official sources said. The Taliban, during their reign in Afghanistan, had imposed jiziya — a religious tax — on all minorities, mostly Hindus and Sikhs. They were made to wear a piece of yellow cloth on their breast pocket to identify themselves.

That the jizya is being imposed on Sikhs is not news.  Even the slumbering U.S. State Department acknowledged that in a report last year (which I have blogged about before), saying:

In April 2009 the Taliban began to extort money under the guise of a jizya tax (traditionally a tax on non-Muslims paid in exchange for government protection) in Orakzai Agency, FATA. In response to extortion and attacks, some members of the Sikh community fled the area after paying approximately $240,000 (20 million rupees) as jizya tax after the Taliban forcibly occupied their homes and kidnapped a Sikh leader, Kalyan Singh.

Remember, jizya (Koran 9:29) is mandated by Islam and ransom (Koran 47:5) is authorized by Islam.  Whether this particular case technically qualifies as jizya or ransom is immaterial:  the concepts are two wings of the same jihadist bird of prey.


Who really bankrupted Al Qaeda? U.S. Treasury or U.S. military?

February 22, 2010

The March 1 edition of Forbes runs a jarring cover story (with a close-up image of Osama Bin Laden) entitled “Is Al Qaeda Bankrupt?”

Well, maybe, but so is Greece, and it’s not going away anytime soon either.

The article is lengthy, but is well worth a read.  The writer, Nathan Vardi, is more thorough and balanced than others.  For today, however, I’d like to focus on one unpersuasive element of Vardi’s piece, which is the assertion that tougher financial screws from the U.S. Treasury Department are what have put Al Qaeda on the ropes.

Vardi writes that Abd al Hamid al Mujil, a money man for both Osama bin Laden and Khalid Sheikh Muammad, is “out of business,” “largely thanks to efforts by the U.S. Treasury Department and the UN Security Council.”

The article also points out the increasing trend toward self-financing of terror–that is, of Al Qaeda agents using their own funds to wage jihad rather than relying on transfers from Al Qaeda.  Vardi writes, “The change, U.S. officials like [Asst. Secretary for Terrorist Financing David S.] Cohen say, is a direct result of the pressures the U.S. government has placed on terrorist money men.  That has forced al Qaeda to go underground.”

Excuse me, Mr. Cohen, but the change is not a “direct result” of counterterror finance measures from Treasury and the U.N.  That is certainly a factor. 

But another key factor is often overlooked.  Pardon my language in advance, but Al Qaeda had its ass handed to it by U.S. forces in Iraq.  George W. Bush’s strategy worked.  Al Qaeda and the ISI (its Iraq affiliate) were defeated and embarrassed.  Given that most of Al Qaeda’s money came from donations, and that nobody likes to back a losing horse, Muslims stopped donating sadaqa and zakat to Al Qaeda.  Relatedly, this 2008 article from the Washington Post suggested that Al Qaeda alienated Iraq’s Sunni sheiks which led to decreased financial support in the Muslim world.

I cannot prove it at this time, but I believe the unfortunate side effect of Al Qaeda’s declining revenues has been that Persian Gulf donors simply shifted their sadaqa from Al Qaeda to the Taliban.  Why has the Taliban been doing so well financially?  Opium profits?  No, that’s not really the story according to people actually on the ground (Holbrooke, McCrystal, and the mayor of Karachi).

It is bureaucratic arrogance to assert that press releases from the Treasury Department designating terror financiers are going to bankrupt the global jihad against the West.


Weekly definition: Dar al-Harb

February 21, 2010

In the Oxford Dictionary of Islam, John Esposito defines Dar al-Harb as “Territory of war. Denotes the territories bordering on dar al-Islam (territory of Islam), whose leaders are called upon to convert to Islam. Refers to territory that does not have a treaty of nonaggression or peace with Muslims; those that do are called dar al-ahd or dar al-sulh. Jurists trace the concept to Muhammad , whose messages to the Persian, Abyssinian, and Byzantine emperors demanded that they choose between conversion and war…”

Esposito offers further details that I have excluded for brevity and relevance.  He concludes his full definition by saying, “the concept has little significance today.”

If it has “little significance today” why do I bring it up?  It’s relevant in terms of Islamic tax policy.  A harbi is a person from Dar al-Harb.  (Wikipedia elaborates that, “a person from ‘Dar al-Harb’ is a ‘harbi’ is a term classically referring to those countries where the Muslim law is not in force.”)

As noted in our Islamic tax chart, harbi merchants are subject to higher customs duty rates than Muslims.  Tax discrimination against the harbi is a recurring theme in Islamic law.


FATF blacklists Iran

February 20, 2010

The Financial Action Task Force, the world’s major watchdog for anti-money laundering and terrorist financing measures, has identified “substantial deficiencies” in Iran.  From FATF’s public statement yesterday:

The FATF welcomes the recent steps that Iran has taken to engage with the FATF, but remains concerned by Iran’s failure to meaningfully address the ongoing and substantial deficiencies in its anti-money laundering and combating the financing of terrorism (AML/CFT) regime. The FATF remains particularly concerned about Iran’s failure to address the risk of terrorist financing and the serious threat this poses to the integrity of the international financial system. The FATF urges Iran to immediately and meaningfully address its AML/CFT deficiencies, in particular by criminalising terrorist financing and effectively implementing suspicious transaction reporting (STR) requirements.

The FATF reaffirms its call on members and urges all jurisdictions to advise their financial institutions to give special attention to business relationships and transactions with Iran, including Iranian companies and financial institutions. In addition to enhanced scrutiny, the FATF reaffirms its 25 February 2009 call on its members and urges all jurisdictions to apply effective counter-measures to protect their financial sectors from money laundering and financing of terrorism (ML/FT) risks emanating from Iran. FATF continues to urge jurisdictions to protect against correspondent relationships being used to bypass or evade counter-measures and risk mitigation practices, and to take into account ML/FT risks when considering requests by Iranian financial institutions to open branches and subsidiaries in their jurisdiction. If Iran fails to take concrete steps to improve its AML/CFT regime, the FATF will consider calling on its members and urging all jurisdictions to strengthen counter-measures in June 2010.

Several countries were cited for deficiencies, and The Guardian notes that, “This the first time in 10 years that the taskforce has published such an extensive list.” 

However, Iran was the only country FATF singled out as a jurisdiction that FATF member nations should take active countermeasures to guard themselves against.

One wonders whether Venezuela, a member of the Caribbean Financial Action Task Force (a FATF regional body) will heed FATF’s urgent warning, or whether Venezuela will continue its financial relationship with Iran including support for its acquisition of uranium.


Islamic charity to Haiti helps…mosques

February 19, 2010

Zakat is paid by Muslims for Muslims.  Sahih Bukhari says that sadaqa or zakat is “to be taken from the rich amongst them and given to the poor amongst them” (5.59.634).  Non-Muslims are ineligible to receive the zakat.

The only possible exception is that zakat may be used to attract new converts to Islam, or “those whose hearts are to be won over” to Islam (Koran 9:60).

The prohibition is why relief from Muslim nations to Haiti has been meager compared to European, North American, and Japanese donations.

A news release from the U.S. State Department bears that out.  Mosques and Islamic charities are giving money to Haiti, but it is going to Haiti’s Muslim leadership, mostly in Cap-Haitien (the where the largest Haitian Muslim population is located) for distribution at mosques.  Here’s an excerpt from the State Department piece:

Abu Bakr Xavier, founder of the Haitian American Islamic Community Inc., met Imam Haneef on his recent relief trip to Haiti and is trying to send supplies to Cap-Haitien and to the rest of the country. On temporary leave from his job to help with Haitian humanitarian relief, the Muslim American of Haitian descent said a lack of centralized government is felt everywhere.

“If Port-au-Prince is in shambles, areas like those around Cap-Haitien take a back seat in terms of attention and services,” Xavier told after returning from a five-day relief tour of Haiti.

Xavier said supplies and doctors from Cap-Haitien have traveled to Port-au-Prince while many Haitians have fled north from the city, returning to their areas of origin. The lack of medical supplies and doctors, coupled with the sudden influx of people, is placing stress on smaller cities like Cap-Haitien. 

After flying to Cap-Haitien and visiting Bilal Mosque, Xavier traveled to Port-au-Prince with his medical supplies — bandages, antiseptics, gloves and surgical masks — to deliver them to local aid group A.I.M.E.R. Haiti for distribution.

Mosques in Haiti are also playing a vital role in distributing humanitarian relief. Locals are flocking to Muslim houses of worship for food and medical aid supplied by organizations like Islamic Relief USA.

Read the whole article here.  I’m sure the recipients appreciate the aid.  That’s what the imams are counting on.  But is the zakat to Haiti like ordinary secular disaster relief?  No, in this instance, it’s for Muslims and for those whose hearts may be won to Islam.