Archive for May, 2010


Great Scot! RBS fined half a billion dollars

May 23, 2010

ABN Amro, a Dutch bank that was bought out by the Royal Bank of Scotland, has settled with the U.S. for violating American law.  Customers and banks affiliated with Cuba, the Sudan, Libya, and Iran channeled money illegally through the U.S. financial system with the assistance of ABN Amro.

Although no Western bank should do what ABN Amro (or Lloyds) has done, it’s unfortunate that only ABN Amro will pay.  Ultimately, it is the sanctioned countries themselves—especially Iran—that must be held to account for their persistent campaign to infiltrate our banks and circumvent U.S. sanctions.  ABN and RBS will be out of cash while Iran gets off “Scot” free.

From Reuters via ABC News:

LONDON – U.S. prosecutors have accused ABN Amro, now largely part of Royal Bank of Scotland , of turning a “blind eye” to U.S. laws, using special procedures to bypass U.S. sanctions against Cuba, Iran and other countries.

RBS, part of a trio of banks that bought ABN in 2007, said on Monday the consortium had agreed to a $500 million fine as part of a final settlement with U.S. authorities. The payment was covered by the provision made before ABN was bought.

In the latest of a series of fines levied by the United States on banks in connection with money laundering offences, ABN was charged with one count of violating the Bank Secrecy Act and a second of conspiracy to defraud the United States, violating laws including the Trading with the Enemy Act.

It involved transactions on behalf of customers from Iran, Libya, Sudan, Cuba and other sanctioned countries.

“ABN Amro facilitated the movement of illegal money through the U.S. financial system by stripping information from transactions and turning a blind eye to its compliance obligations,” Assistant Attorney General Lanny Breuer said.

According to court documents, for a decade until 2005 and, in a limited way, through to 2007, offices, branches, affiliates and subsidiaries of ABN removed or altered names and references to sanctioned countries from payment messages.

The stripping procedures, which also applied to traveler’s checks and letters of credit, allowed the bank to circumvent U.S. controls and pass undetected through filters at U.S. banks.

Prosecutors said the scheme allowed U.S. sanctioned countries to move “hundreds of millions of dollars through the U.S. financial system”.

ABN’s New York branch saw more than $3.2 billion from shell companies and “high risk transactions” flow through it…


Unoriginal media copycat party line

May 21, 2010

This time it’s CNN.  The remnants of the mainstream media tell you two things about the financing of terrorism today:  1) that the U.S. Treasury Department drained Al Qaeda of its money, and 2) that Saudi Arabia is “cooperating.”  And usually whenever they tell you that, Treasury official David S. Cohen usually features in the story.

For the record once again, it was the U.S. military and Iraqi leaders that sent Al Qaeda howling out of Iraq and into the poorhouse.  And “evidence” of Saudi cooperation is limited to public statements, meager proof, and multiple examples of Saudi duplicity.

From the introductory paragraphs of CNN’s “Security Brief”:

The U.S. Treasury Department may not have drones, but don’t underestimate the power of the pen in the battle with al Qaeda. Persistent pressure on the group’s sources of money over the past few years has left it “in significant financial distress,” says US Assistant Treasury Secretary David Cohen. “And we are urgently working to make it worse.”

The Taliban, funded by the multi-billion dollar heroin trade, are a different proposition, admits Cohen. He says they are not experiencing “much financial stress” and have the funding they need to buy allegiance and hold territory – and challenge American objectives in Afghanistan (more on the Taliban in Part 2 of this series.)

Cohen’s job includes choking off the money supply to an array of terror groups. To that end, he spends plenty of time trying to persuade other governments – especially in the Gulf – to tighten their financial controls. Cohen is pleased with the contribution that Saudi Arabia – once the largest source of funds for al Qaeda – has made. For example, the Saudi central bank now has to approve transactions between accounts of more than $15,000…

With an opening like that, CNN joins UPI, Deutsche Welle, and Forbes for the media’s ongoing terror finance puppet show.  The rest of the story gets marginally better, even acknowledging (very briefly) zakat and hawala.


Amidst global recession, jihadists get pay raise

May 20, 2010

The Times of India reports that wages for Muslim terrorists are on the rise.  Hat tip to Puneet Madaan for sending this in.  It’s important to remember while reading this article that these terrorists are being paid by Lashkar-e-Taiba, which itself receives funding from zakat collections in Kashmir mosques.

Kashmir terrorists get pay hike

Josy Joseph, TNN, May 17

NEW DELHI: Kashmiri terrorists and refugees from Jammu and Kashmir in PoK have both received a pay hike. According to the latest inputs from various agencies, Pakistani authorities are now offering terrorists coming to fight in J&K a monthly salary in the range of Rs 8,000 to Rs 10,000. This is a huge jump from the average pay of Rs 5,000 they were getting earlier.

The reason for this benevolence is not hard to imagine. There has been a drastic drop in violence levels in J&K and militancy needs a desperate revival if the separatist agenda has to continue to grab global attention. The number of terrorists operating in J&K is now hovering around 700, an all-time low since militancy erupted in the state in the late 80s.

The desperation among terror groups is also visible in the return of Furqan, one of the seniormost Lashkar-e-Taiba operatives who had been the group’s launch commander based in PoK for some years now. He infiltrated into J&K in April-end with a group but the Army was able to intercept them. Furqan is believed to have successfully evaded the Army and entered the state. His return, after more than four years, is being seen as a sign of LeT’s desperation to carry out a few sensational attacks.

It is not just the Kashmiri militants who got pay hikes in recent days. Those staying back in refugee camps of PoK too have been given increased financial benefits. From Rs 1,800 per month, their financial allowance has gone up to Rs 2,400 a month early this year, sources said.

Thousands of Kashmiri youth have moved across the border to PoK in the past two decades for the explicit purpose of becoming trained militants…

Read the rest of the story here.


Wednesday word: layering

May 19, 2010

Money laundering includes concepts like placement, layering, and integration, all of which are done to disguise the illegal nature of the money’s source.  This definition of layering comes from the Comptroller of the Currency:

Layering: The process of separating the proceeds of criminal activity from their origin through the use of layers of complex financial transactions, such as converting cash into traveler’s checks, money orders, wire transfers, letters of credit, stocks, bonds, or purchasing valuable assets, such as art or jewelry.

And here you thought layering referred to draping that extra hijab over your niqab.


Indian Muslim calls for government zakat

May 18, 2010

It’s troubling enough when there are government run, Islamized tax systems in Saudi Arabia and Pakistan.  It’s troubling enough because, staying with the Pakistan example where zakat and ushr are legally mandated, we find that unofficial jizya and fida’ collections against non-Muslims are quick to follow.  Perhaps its because the local Sunni populations become disgruntled that they are forced to pay the zakat, not just by the diktats of Islam but at by government force, and they buy into Koranic verses and Taliban explanations to tax dhimmis as well.

But to propose the institutionalization of an Islamic tax in a majority non-Muslim nation is even worse.  From on May 3:

…Zakat is a great institution given by the Qur’an to weaker sections of humanity. Zakat, according to the Qur’an is meant to be taken from the well off and given to weaker sections like orphans, widows, wayfarers, poor and destitute and for liberation of slaves and prisoners. Today, in India, either the rich do not pay Zakat at all or pay individually to some poor or feed the beggars in Ramadan and think they have done their duty.

Thus the very spirit of Zakat is killed. What needs to be done is to institutionalize it, collect it through a legally established body and then distribute it in three portions. One portion could be given to deserving students as scholarship to spread higher education, especially technical education, one portion could be given as interest-free loan to small traders including petty hawkers which will boost their income which in turn increase education and decrease rate of dropouts which is mainly due to poverty.

Interest-free loan is also a great institution meant to help weaker sections of society. Today even hawkers and petty traders have to borrow money from moneylenders at exorbitant rates and struggle to eke out their living. It is not rich traders who need interest-free loans but these poor artisans, hawkers and petty traders. Unfortunately, in the name of Shari’ah compatible loans and investments it is richer sections who are making hey while no one talks of poorer sections.

A portion of Zakat money, if properly canalized, can be given by way of interest-free loans to these weaker sections. Zakat boards could be established in every state, or even districts with people of known integrity and crores of rupees could be mobilized to help the poor of the community. However, Muslim leadership has neither vision, nor integrity nor will to do this.

The third portion could be spent as outright charity for extremely poor and needy people who have no possibility of even returning it.

Recently a two day seminar was held in Mumbai Hajj house to establish such a Zakat institution and ended in utter chaos. They invited some political leaders like Digvijay Singh of the Congress and the ulama began fighting on his speech. Firstly why a political leader should at all be invited? It is bound to result in controversy.

Thank goodness the seminar ended in chaos.  If India authorized legally sanctioned zakat committees in any majority Muslim location in India, even for supposedly benign causes like schools and charity, they would be putting the non-Muslim population in peril.  Many Muslims are comfortable with the zakat “pillar of Islam” only when accompanied by the jizya against non-Muslims.  It’s only “fair,” they argue.


IRS may revoke tax-exempt status of Islamic charities in Ga.

May 17, 2010

At least five Islamic charities in Georgia are at risk for revocation of their federal 501(c)(3) tax-exempt status.  In 2006, federal legislation required most nonprofit organizations to file 990 forms annually regardless of how little revenue the organization took in.  If an organization fails to file its forms for three years, then it will lose its tax-exempt status.  That means the organization would have to pay taxes and that donations to the organization aren’t tax deductible.

The deadline for charities to file is today, May 17.  The Urban Institute’s National Center for Charitable Statistics has made data available on all charities that have not filed as of last month.  A review of the data by Money Jihad shows these organizations as non-filers:

  • American Muslim Alert Foundation Inc (Atlanta)
  • Madrasat AL-Huda Islamic School of Augusta
  • Majlis Eid Committee of Greater Atlanta Inc
  • Murid Islamic Community in Atlanta Inc
  • Baytul Barham (Duluth)

Many charities, even legitimate ones, are in danger of losing their tax exempt status.  However, given the murky track record of Islamic charities in the United States using zakat to fund overseas jihadists such as Hamas, the lack of any reports being filed by these groups with the IRS give particular cause for alarm.


UPI parrots terror finance narrative

May 16, 2010

Here we go again.  UPI has joined the chorus (of which Forbes, Deutsche Welle, and Treasury official David S. Cohen are already members) to sing the praises of the U.S. Treasury and Saudi Arabia in the fight against terrorist financing.

In an Apr. 26 article, UPI wrote, “The U.S. Treasury Department has been able to score notable successes against al-Qaida, Hezbollah, Hamas and other groups,” and “The U.S. Government Accounting Office declared in September that the Saudis had made significant progress in the war against terrorism, including shutting down financial conduits to al-Qaida from individuals and charities.”

Thus UPI gives no credit to Iraqi leaders or the U.S. military for defeating and defunding Al Qaeda in Iraq.

In terms of Saudi Arabia, what the GAO actually found was that the Saudis have offered no proof of reductions in illegal cash smuggling out of the Kingdom.

And rather than effectively regulating its charitable sector, Saudi Arabia lets its central bank rubber stamp any requests by Saudi organizations to transfer money overseas.  Then lies about it.

UPI at least quotes views from a few skeptics, but they quickly move along to discuss the involvement of the other Gulf states.

It looks like the UPI is eager to carry the party line from government talking points.