Archive for January, 2012


AQIM urges Algerians to wage money jihad

January 31, 2012

In the jihadists’ latest salvo in the Arab Spring, al-Andalus Media, the public relations wing of Al Qaeda in North Africa (AQIM), has released a video message by Sheikh Abu Abdul Ilah Ahmed urging Algerians to rise up, fund, and fight against their government.

Unlike its Arab Spring neighbors, the Algerian government has managed to stave off the pressure to surrender to the Islamists.  AQIM hopes to reverse the government’s fortunes, and the Jan. 12 al-Andalus message called forgiving aid until we are ruled by the Sharia” in Algeria.

The video was geared to appeal to fervent, young Muslim men of Algeria, saying “O’ lions of the capital, Blida, Chlef, Médéa, Boumerdès, and Bouïra, this is your day go out to give support to your religion.”

The AQIM message reminded its audience of Koran 9:41, a favorite verse cited by jihadists when soliciting funds, which reads, “Go forth, light-armed and heavy-armed, and strive with your wealth and your lives in the way of Allah!”

The video shows once again how inseparable Islamic law is from contemporary terrorist financing.


IED financier named as casualties fall

January 30, 2012

Earlier this month, a U.N. committee added Ahmad Zia Agha to its list of sanctioned terrorists.  The committee’s summary of the listing included these details about Agha’s participation in the financial pipeline behind the improvised explosive devices (IEDs) being used against coalition forces.

Ahmad Zia Agha is a senior Taliban leader with military and financial responsibilities. In 2010, Ahmad Zia Agha was the leader of the Taliban’s military shura (council), which directed Taliban military operations in western Afghanistan. In 2009, Ahmad Zia Agha served as a Taliban finance officer and distributed money to Taliban commanders. As part of his financial responsibilities, Ahmad Zia Agha transferred tens of thousands of dollars to Taliban shadow provincial governors; the Taliban’s shura treasurer also entrusted Ahmad Zia Agha with hundreds of thousands of dollars to fund improvised explosive device (IED) operations. In 2008, Ahmad Zia Agha was involved in distributing funds to Taliban commanders in Afghanistan and transferred money to individuals associated with the Taliban outside the country. He has also facilitated communications for a Taliban military leader.

Exposing the funding sources behind the IED ring is a helpful; however, the greatest factors leading to the decline of IED-related casualties are adaptive American military tactics, consistent counter-IED training within the military, and American ingenuity in the form of IED-jamming technologies.

IED casualties in Afghanistan spiked in 2010

Roadside bomb deaths on the decline

The decline in deadly IEDs in Afghanistan resembles the successful counter-IED measures by U.S. forces in Iraq prior to the American withdrawal. Unfortunately, the Taliban has shown far greater financial resilience over time than has Al Qaeda, which suggests the Afghan IED ring could remain solvent.


Taliban recordings openly sold in Kabul

January 29, 2012

Care to buy 50 Taliban songs for a dollar?  Just stroll down the avenues of beautiful downtown Kabul, where your local shopkeeper will be happy to make the sale.  From NPR on Jan. 23:

Reminds us of the West Bank.


Kenya BBQs al-Shabaab’s charcoal business

January 27, 2012

The West owes a hearty thanks to Kenya and its military for taking on the forces of al-Shabaab in East Africa.  In a year-end press conference, a Kenya Defense Force spokesman indicated that their war is successfully disrupting al-Shabaab from shipping charcoal—a market that Al-Shabaab has consistently exploited to fund its terror.

Al-Shabaab imposes at 2½ percent zakat tax on every stage of Somalia’s charcoal production and exportation.  NTV Kenya notes that “According to the military spokesman, Colonel Cyrus Oguna, charcoal business has been the main source of funding to the Al-Shabaab militants.”


Taliban chops trees, not just heads

January 26, 2012
Unlawful jingle truck

Truck with illegal Pakistani timber

Deforestation enriches jihadists

The Taliban may regard the trees as their right to exploit as they please due to Islamic laws on “unused” land, or they deem their takings as a form of zakat on timber or ushr taxation on Swat’s residents.  Via the Guardian on Jan. 17:

Pakistan’s forests fall victim to the Taliban

The forests of northwestern Pakistan have become the latest victim of the Taliban’s increasingly desperate quest for resources to sustain and fund its military programme

The landscape of Swat, an administrative district in the Khyber Pakhtunkhwa Province and once a luscious valley, is now dotted with thousands of tree stumps as militants decimate acres of forest for timber revenues.

“Nearly all the forested areas have been mercilessly stripped of trees but the Swat in particular has borne the brunt of the Taliban’s atrocities over the last two years,” Jamshaid Ali Khan, secretary of the Sarhad Awami Forestry Ittehad (SAFI), told IPS.

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Sharia lobbyists target Bermuda

January 25, 2012

In an extension of the ongoing Caribbean Islamization spanning from Venezuela to South Florida, the North Atlantic island of Bermuda is poised to become a gateway for sharia finance.  From EuroMoney on Jan. 18:

Bermuda looks to pioneer Western Shariah-compliant hub

The favourable tax haven is actively seeking to become the first Western centre to provide a Shariah-compliant platform by reviewing its existing legislation.

Bermuda is set to become the first Western centre for Islamic finance in a favourable tax domicile, as the region looks at existing legislation to accommodate a Shariah-compliant platform for such vehicles and products.

In an exclusive interview with Euromoney, executives at Business Bermuda, a non-profit business lobby group that works with the Bermudan government, revealed it is actively educating and pursuing potential clients in Asia and the Middle East, while also working on reviewing existing laws to eventually launch a Shariah-compliant platform for investors.

“We are looking at the Shariah side of Bermuda’s legislation to become the first Western centre for Islamic finance,” says Peter Hughes, group director of Apex Fund Services who also works with Business Bermuda. “We are looking to launch a Shariah platform that will allow us to have Shariah vehicles and products, which would enable us to become the first one of its kind. We have made a real push into this niche area.”

Islamic finance centres around Shariah compliancy – Islamic law derived mainly from the Koran and Hadith. Shariah-compliant finance has consistently grown during the past 10 years, with Western financial institutions looking to tap into the burgeoning markets.

Shariah-complaint finance has become a trillion-dollar business, with sukuks – commonly seen as an Islamic bond, but are actually certificates representing participation and ownership rights in an underlying asset – being one of the largest product sectors.

According to KFH Research, an Islamic investment research firm that is a direct subsidiary of the Kuwait Finance House, sukuk issuance in 2012 is set to increase by 25% to 30% and break the $200 billion barrier. The note says that despite a raft of challenges faced by industry, much like the rest of the world, sukuk issuance will continue to grow.

In 2011, sukuk market issuance grew by 88% compared to 2010.

Cheryl Packwood, CEO and deputy chairman of Business Bermuda, said that the continual growth of Islamic finance and stronger ties with Bahrain and Malaysia led to a focus on developing existing Bermudan legislation more than 18 months ago.

We now have strong links in Bahrain and there is a commonality of wanting to create a niche jurisdiction for Shariah compliancy, that is closer to the US timezone,” she says. “We are also focusing on Kuala Lumpur in Malaysia, as it has an enormous sukuk market. The process for getting this off the ground may be slow but we have the Bermuda Monetary Authority and the Bermuda Stock Exchange behind us.”

The burgeoning Bahrain-Bermuda relationship is not encouraging from an anti-money laundering standpoint.  Bahrain still has no legal means of freezing assets that are laundered or fund terrorism.  Bahrain’s Islamic finance sector recently received a major black eye when an audit of one of its major sharia banks revealed 58 potential criminal offenses by its CEO.

Shariah Finance Watch has speculated that the purpose of introducing sharia finance to Bermuda is to spread Islam and sharia law.  That is certainly a factor.  We must also be concerned that an island nation that is a known tax haven is being specifically targeted by sharia advocates.  One might even wonder if the ruling Sunni elites of Bahrain are attempting to off-shore their wealth and protect their long-term self-interests in case Bahrain’s Iranian-backed Shia majority succeeds in an Arab Spring coup.

Bermuda has growing internal problems as well.  Four ex-Guantanamo detainees live in Bermuda.  Bermuda also appears to be facing a rash of street gang violence with possible Muslim involvement.  The introduction of sharia wealth to the island will probably lead to new mosques and Islamic centers.  Given the history of Gulf-funded mosques, such future mosques are unlikely to be “moderate.”


For-profit halal board claims tax-exempt status

January 24, 2012

Wahhabi-backed U.S. halal certifier pays top officers 6-figure salaries, gets $5 million in business income, claims public charity status

If a food manufacturer wants to call its products halal, and obtain a label that attests to its halal compliance, that manufacturer must submit an application for review by a halal certification organization.

In the U.S., halal certifiers are not government entities and, unlike organic food certifiers, are not accredited by the government.  The halal boards are privately run.

One of the largest halal groups is the Islamic Food and Nutrition Council of America (IFANCA), a Chicago-based multi-million dollar enterprise.  But as Family Security Matters has noted, “There are very few transparent news reports of the expansion” of the halal industry in North America.  The time has come for fuller scrutiny.

First, IFANCA proclaims on its own website that it is recognized and endorsed by the Saudi-based, Wahhabi hegemon Muslim World League.  The MWL has funded Al Qaeda, Hamas, and other terrorist organizations throughout the world in an effort over several decades to export and ingrain Wahhabism across the planet.  But this doesn’t seem to bother IFANCA.

Second, IFANCA claimed tax-exempt status in its 2010 tax return even though the vast majority of its reported revenues comes from “inspection fees.”  These are fees that IFANCA charges to food producers for the “privilege” of sporting IFANCA’s halal food logo.  Such fees sound a lot more like ordinary business income that should be taxable rather than charitable or “public” contributions which would qualify the entity for tax-exempt status.  IFANCA’s Form 990 showed $5,519,829 in inspection fee revenue.  Its only other reported revenues were $14,466 in gifts.

To qualify for tax-exempt status, a charity needs to get over one-third of its income from donations or grants and no more than one-third of its income from business activity.  With 100 percent of its income from apparent business activity, IFANCA falls far short of federal standards for a nonprofit charity.  (IFANCA’s six-figure salaries to its president and vice-president documented in its tax returns may also raise a few eyebrows.)

IFANCA casts itself as an educational entity of sorts, promoting “knowledge” and “community development” with respect to halal foods.  But it does not base its claim for public charity status on its educational or religious mission, but rather by describing the inspection fees as public contributions.

IFANCA’s tax approach makes it relatively unique among food certification groups such as organic, vegan, and kosher certifying entities.  Several U.S. organic food certifiers are tax exempt on the bases of Section 501(c)(5) of the Internal Revenue Code because they have an agricultural mission—not on the basis of any professed public charity mission under 501(c)3.

The Vegan Awareness Foundation, which is a major certifying entity for vegan foods, maintains tax-exempt status on the basis that it receives a substantial portion of its revenues from donations or grants—not from site inspections.

Many kosher certifying entities are set up as regular businesses and pay taxes.

The IFANCA case illustrates a flawed federal system that accepts 99 percent of all claims for tax-exempt status.  The IRS can start making amends by revoking IFACNA’s tax-exempt status.

Moreover, due to its tax-dodging behavior and World Muslim League affiliation, consumers should avoid buying any IFACNA-certified foods, and grocers should refrain from stocking their shelves with such products.