Archive for May, 2013

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Front group finance: recommended reading

May 23, 2013
  • Are tea party groups subjected to greater scrutiny than Islamic charities? A nonprofit consultant says yes (h/t creeping)… more>>
  • How Saudi charitable fronts pump millions of dollars via hawala into Kashmir to transform it into a valley of Wahhabism… more>>
  • Islamic charities have exploited America to fund Chechen jihadists since 9/11… more>>
  • No longer confined to the blogosphere, the Associated Press reports on the legal battle between a Christian publisher and a terror-linked Muslim syndicate… more>>
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Word of the week: third party

May 22, 2013

The person making financial transactions for illicit purposes isn’t necessarily the person pulling the strings.  If you work for a money services business, you should try to ascertain if your customer is operating under instructions from a third party.  This guidance comes from Canada’s FinTRAC, but it’s useful information for anybody with know-your-customer responsibilities:

Find out if there is a third party

As a money services business (MSB), you have to find out if your client is acting on behalf of a third party when you:

  • conduct a large cash transaction and you have to keep a record of it
  • have to keep a record about a service agreement

Who is a third party?

A third party is anyone else who gave instructions to your client to request MSB services from you. It is not about who “owns” the money, but rather about who gives the instructions to deal with the money.

How to find out if there is a third party

Ask the individual in front of you if they are acting on someone else’s instructions. If the answer is yes, that someone else is a third party.

Examples of a third party:

  1. Tarek wants to send money to his son Roger in Lebanon. He gives his daughter Tara $13,000 in cash and asks her to go to the MSB to send the money. Tara gives the money to the MSB and requests that a money transfer be made to Roger in Lebanon. Tarek is the third party as he is the one who gave the instructions to Tara to request that a money transfer be made.
  2. Jacques, a financial officer and employee of Voyages Inc. in Canada, goes to the MSB every month to transfer money to their head office in France. Jacques’ employer, Voyages Inc., is the third party as Jacques is acting on his employer’s instructions.

Records to keep on a third party

You have to keep a record for five years after the day you created it, if you:

  • find out that there is a third party
  • suspect that there is a third party

You find out that there is a third party

If you find out that there is a third party involved, you have to keep a record with the following information about the third party:

  • name, address and job or main business
  • if it is an individual, their date of birth
  • if it is a corporation, their corporation number and place of incorporation
  • the nature of the relationship between the third party and:
    • the individual who gave you the cash if you are doing this because of a large cash transaction or
    • the organization entering into a service agreement.

Examples of how to describe the nature of the relationship include that the third party is your client’s accountant, agent, customer, employee, friend, legal counsel or relative.

You suspect that there is a third party

If you are not able to find out that there is a third party, but you suspect that there are instructions from a third party involved, you have to keep a record to indicate the following:

  • why you suspect the individual is acting on a third party’s instructions and in the case of a:
    • large cash transaction, whether or not the individual giving the cash indicated that the transaction was being conducted on behalf of a third party
    • service agreement, whether or not the client indicated that the agreement was being done on behalf of a third party
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Omer Abdi Mohamed gets 12 years in prison

May 21, 2013

Terror recruiter and financier sentenced in Minneapolis

Al-Shabaab has been able to wreak havoc in Somalia because of its combustible mix of money and jihadist ideology.  Unfortunately, some of al-Shabaab’s revenues originated from donations bundled together by terrorist supporters in Minnesota such as Amina Farah Ali and Omer Abdi Mohamed.

Here’s the latest from Minneapolis:

Four men in Minnesota sentenced to prison for aiding Somali rebel group

MINNEAPOLIS | Tue May 14, 2013

(Reuters) – A federal judge sentenced four men to prison on Tuesday for helping recruit young men in Minnesota to travel to Somalia and fight for the militant group al Shabaab.

Investigators believe about 20 young, ethnic Somali men left Minnesota from 2007 to 2009 to go to Somalia to fight for al Shabaab, which the United States designated a terrorist organization.

Three men who cooperated with investigators were each sentenced to three years and a fourth man was sentenced to 12 years in prison.

“These defendants, by providing material support to a designated terrorist organization, broke both the law and the hearts of family members across the Twin Cities,” U.S. Attorney B. Todd Jones said in a statement.

Eighteen men were charged after a four-year investigation. Eight were convicted and the rest are thought to be fugitives or to have been killed in Somalia while fighting for al Shabaab.

On Tuesday, Omer Abdi Mohamed, 28, was sentenced to 12 years in prison after pleading guilty in July 2011 to one count of conspiring to provide material support to co-conspirators who intended to murder, kidnap, or maim Ethiopian and Somali government troops.

Mohamed, of Minneapolis, admitted that he helped recruits get plane tickets and helped to raise money for them to travel to Somalia to fight with al Shabaab in 2007.

Three men who cooperated with investigators were each sentenced to three years in prison by Chief Judge Michael Davis in Minneapolis federal court…

How exactly did Mohamed raise the money for the recruits?  From the trial brief:

…The defendant and his conspirators went to local malls and apartment buildings to ask for money, claiming it would be used to build a mosque or to assist with relief efforts in Somalia. In fact, the money was to pay for the airfare and travel expenses of the group of men to join in the conspiracy…

If these Somali fellows had to do all this legwork to finance their travel to Somalia, it makes one wonder how Tamerlan Tsarnaev secured funding to travel to Dagestan.  Public benefits and proceeds from casual drug sales may have been insufficient, and Tsarnaev didn’t have access to community donations in the same way the Minnesota Somalis have had.  Did Tsarnaev’s in-laws unwittingly pay for his trip?

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Terror finance termagant finally sentenced

May 20, 2013

Local Somali activist says financier “deserves the Nobel Prize”

Amina Farah Ali was convicted in 2011 of supporting terrorism by collecting donations and transferring them to al-Shabaab for jihad in Somalia.  Her sentencing took place last week.  Ali could have been sent to prison for 195 years, but the federal judge Michael Davis imposed a 20-year sentence.

Despite Judge Davis’s lenience toward Ali, CAIR is filing a complaint against him over questions he asked her during sentencing (h/t @1389).

The Minneapolis Star Tribune recorded the reaction from the Somali community following the sentence.  Activist Abdinasir Abdi declared “Amina was a good woman, a mother, a teacher, educator, humanitarian worker. I think she deserves the Nobel Prize because she is a great humanitarian.”  Other Somali leaders blamed the situation on U.S. foreign policy, and one woman brandished a sign saying that Ali is her hero:

Ali’s partner in crime, Hawo Mohamed Hassan, was sentenced to 10 years.  The Tribune also has the report:

Two Rochester women get 10, 20 years for aiding Somalia terrorists

Article by: RANDY FURST , Star Tribune

Updated: May 17, 2013

One got 10 years in prison, the other 20 for funneling money to a group fighting in Somalia.

Two Rochester women were sentenced to federal prison Thursday for their roles in funneling money to an organization the U.S. government has called a terrorist group fighting in Somalia.

Hawo Mohamed Hassan, 66, who got 10 years in prison, and Amina Farah Ali, 36, who got 20, were the last of nine people sentenced in federal court in Minneapolis this week.

The group was the first set of defendants sent to prison from Minneapolis in this country’s largest anti-terrorism investigation since Sept. 11, 2001.

U.S. Chief Judge Michael Davis handed down the sentences before a courtroom packed with the defendants’ families and members of the Somali-American community.

The drama capped a federal investigation that lasted more than four years in which U.S. authorities sought to shut down a recruiting effort that lured more than 20 young men to Somalia, several of whom died fighting or in suicide bombings.

The women, both U.S. citizens who came here from Somalia, were convicted in 2011 of conspiring to provide material support to Al-Shabab in fundraising in Rochester that prosecutors have called “a deadly pipeline” of money and fighters from the United State to Somalia.

They have had wide support in the Twin Cities’ Somali-American community, and many in the courtroom were stunned by the sentences, especially the 20-year sentence for Ali.

Hassan Mohamud, a St. Paul imam, said he believes the sentences were too long and that both women should have been released.

“All they did was aid the poor and the orphans,” he said.

But prosecutors said it was clear from the phone conversations they monitored that the women knew they were raising money for Al-Shabab, a group labeled a terrorist organization by the U.S. State Department in 2008.

While Ali said she never knew that funds she raised were going to Al-Shabab, Hassan claimed that she came to realize the organization was getting the money and broke with Ali, preferring that the money go to set up a senior health center.

But prosecutor Jeff Paulsen cited telephone wiretaps that he said showed there had been no rift between the two and that Hassan had a financial investment in the health center and planned to continue to work with Ali.

Ali, sentenced first, denied she did anything wrong. She said she had no knowledge that the money she collected went to Al-Shabab.

Asked by Davis what she knew about Al-Qajda, she indicated she knew nothing about it.

Her attorney, Dan Scott, said “she chose the wrong horse,” adding, “She thought she was doing good work. She was wrong.”

Defendants in the Somali cases have argued that Ethiopia invaded Somalia to support a newly created transitional government that lacked support from the Somali people. They have said that their clients backed the resistance to the invasion.

However, prosecutors argued that the transitional government was recognized by foreign nations, so any support for Al-Shabab, which was fighting the invasion, was against U.S. law as well as support for a terrorist group.

Steven Ward, who prosecuted the case, said Ali was heard on a wiretap supporting Al-Shabab, saying she supported a suicide bombing and “let the civilians die”…

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Suspects robbed banks to fund terror

May 19, 2013
Indonesian law enforcement detain a hooded jihadist

Indonesian police hauling off one of the suspects

Indonesian police have carried out raids against 20 terrorists who were involved with raising money for jihad.  The men were involved with bank robberies in at least three different cities, and at least one jewel heist in Jakarta.  Four of the detainees had immediate plans for a new bank robbery in central Java.

Indonesian jihadists have previously asserted that robbing banks to finance terrorism is compliant with Islamic law.

From the Jakarta Post on May 10:

Terror suspects linked to Poso

The National Police’s counterterrorism unit, Densus 88, conducted a series of successful overnight operations against terrorists with links to the Abu Omar and Autad Rawa groups, the police say.

The 20 terror suspects — seven killed and 13 arrested — in the raids across Java are linked to the groups that collect money to support the activities of mujahidin (those engaged in jihad) in Poso, Central Sulawesi.

Early investigations indicated that the men had been involved in armed robberies at Bank Rakyat Indonesia (BRI) offices in three cities.

“They stole Rp 790 million [US$81,192] from BRI in Batang and Rp 630 million from BRI Grobogan [both in Central Java]; and Rp 460 million from BRI Lampung. They also attempted to burn down Glodok Market in West Jakarta,” said National Police spokesman Brig. Gen. Boy Rafli Amar on Thursday as quoted by Antara news agency.

The suspects carried out various initiatives to collect money, including robbery.

“Four alleged terrorists were planning a robbery in Kebumen [Central Java], when they were arrested in an overnight raid in the regency,” said Boy.

It is alleged that one suspect, Abu Roban alias Untung, had been involved in some robbery cases — a jewelry store in Tambora, West Jakarta; as well as the three BRI offices — before Densus 88 officers killed him in Batang.

Police linked the suspects with Santoso, who is believed to be behind a series of attacks in Poso over the past few years.

Santoso himself is a former member of a terror group led by Basri, a member of the Jamaah Islamiyah (JI) group. Basri surrendered to police after a gunfight on Feb. 1, 2007, in Poso where a Muslim-Christian conflict killed at least 1,000 people over the course of 1998 to 2002.

On Wednesday and Thursday, Densus 88 personnel raided areas in Batang, Kebumen and Kendal in Central Java; Bandung in West Java; and Banten. During the raids, the officers shot dead seven suspects and 3 others were captured alive.

“The terror suspects killed during the raids were identified as Abu Roban, Bastari, Toni, Bayu alias Ucup, Budi alias Angga, Junet alias Encek and Sarame,” Boy announced.

The suspects captured alive in Jakarta were Agus Widharto, Agung, Endang, Faisal alias Boim and Iman.

Iwan and Puryanto were arrested in Kendal. While four others — Budi, Farel, Slamet and Wagiono — were apprehended in Kebumen.

The two suspects arrested in Bandung were Haris Fauzi alias Jablud and William Maksum, alias Acum alias Dadan.

The bodies of the three dead men were flown to Dr. Sukamto Police Hospital in Kramat Jati, East Jakarta, on Thursday after being examined at Bhayangkara Hospital in Semarang.

During the raid in Ciputat, Densus 88 officers confiscated Rp 25.48 million, while in the Bandung raid, the police found two revolvers, an FN Browning pistol, hundreds of bullets and Rp 6 million in cash…

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Mujahideen paid by D-Gang’s hawala

May 17, 2013

The Indian Mujahideen finance their jihadist operations with money distributed through terror mogul Dawood Ibrahim’s illegal hawala network.  While it has long been known that Dawood Ibrahim is a bankroller for terrorism, his specific ties to the Indian Mujahideen are what makes this article from the Hindustan Times newsworthy:

Is Dawood funding Indian terror?

Presley Thomas     Mumbai, May 03, 2013

Dawood Ibrahim, the man who maimed Mumbai on March 12, 1993, has emerged as the face behind homegrown terrorist outfit Indian Mujahideen (IM). Dawood and his intricate network of bogus hawala firms, spread across the country, have been covertly financing IM’s network in India, said sources in the central agencies and counter-terrorism units investigating blast cases across the country.

The Financial Action Task Force (FATF) has been informed of Dawood’s alleged extensive hawala network in the Middle East and South Asian countries. A detailed probe by the Anti-Money Laundering / Suspicious Cases Unit (AMLU) is underway in the Middle East, sources said.

The involvement of Dawood’s  gang, the D-Company, in financing terror through his network of hawala firms was unearthed during investigations into the July 13, 2011 blasts in Mumbai, (where the IM was allegedly involved) said sources in central agencies and counter-terrorism units. Many key players in the attacks are suspected to have links with Dawood.

A sum of Rs. 10 lakh had been sent by alleged hawala operator Muzzafar Kola to IM kingpin Yasin Bhatkal through Delhi-based Kanwar Nain Pathrija, police sources said. The investigating agencies then suspected the involvement of the D-Company and intercepted telephone conversations from across the border showed directions being given to certain people, along with details of the money flow and transfers through hawala transactions. Kola, sources said, was a Mustafa Dossa man who later became a Dawood associate.

These reports led agencies to believe that Bhatkal, a Fazal-ur-Rehman gang member who now heads the IM, was working closely with Dawood and his company…

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Clandestine finance news: recommended reading

May 16, 2013
  • It took Kuwait 12 years after 9/11 to outlaw the financing of terrorism. That was still faster than Sweden…  more>>
  • A Dubai subsidiary illegally transfers software to Syria, and incurs the second biggest fine in the history of export controlmore>>
  • Bitcoin‘s sales pitch was based on freedom from regulation. Not so fast, say the feds… more>>