Posts Tagged ‘piracy’


Italy paid $500K ransom to Somali pirates

October 13, 2015

A separate report from Al-Jazeera claims that Italy has also paid a multi-million dollar ransom to al-Nusra Front in Syria.

Informative reports, but it’s not just Italy that misleads the public about paying ransoms to villains and terrorists.  Many, if not most, European governments facilitate the payment of such ransoms.  We used to call it “funding both sides of the conflict.”  It causes wars to last longer.  European diplomats act like they are contributing to world peace, but their government-backed ransom payments are just prolonging the pain and strife.

From The Guardian on Oct. 8:

Italian intelligence lied about hostage rescue to hide ransom payment

Leaked document shows Italy made up story about 2012 rescue of Bruno Pelizzari and Debbie Calitz to hide ransom payment

Italy’s intelligence service helped concoct a false story about a rescue of hostages by security forces to hide a ransom payment, according to a leaked spy agency document.

The payment was made for the release of Bruno Pelizzari, an Italian, and South African Debbie Calitz, who were taken by Somali pirates in 2010 and released in 2012.

The document marked “secret” says the Italian intelligence agency AISE paid a ransom of $525,000 (£346,000). “To conceal the payment of the ransom, AISE, SNSA (Somalia’s national security agency) and the hostages agreed to inform the media and public that the release of the hostages was the result of a successful rescue operation by the Somali security forces.”

The document highlights the contradictions in the international response to kidnapping. Both the US and UK governments refuse to pay ransoms, but other European countries have a more ambiguous approach, routinely making payments while publicly denying it.

The Italian government response to the case of Pelizzari and Calitz reflects the confusion and obfuscation…


Financial war on terror news: suggested reading

November 27, 2014
  • “No doubt” that halal certifiers fund extremism, says member of parliamentmore>>
  • ISIS wants to mint its own coins—not for practical, economic reasons—but to impose sharia lawmore>>
  • How to defend against piracymore>>
  • Fresh analysis puts cold water on claims that looted antiquities are ISIS‘s 2nd biggest revenue source… more>>
  • The fine line between paying informants for intelligence and paying ransoms to terrorists just got fuzzier… more>>
  • Yusuf Qaradawi, the world’s most prominent sharia finance advocate, calls on Muslims to take arms against Israel… more>>

UAE: ISIS licking chops over vital sea channels

November 20, 2014

Threats to key choke points like the Strait of Hormuz from a joint venture between al-Shabaab and the Islamic State of Iraq and Syria (ISIS) are possible according to the foreign minister of the United Arab Emirates.  The UAE foreign minister’s comments are being construed somewhat narrowly as a warning that ISIS could engage in piracy with al-Shabaab. But that overlooks the wider influence that al-Shabaab wields over shipping, controlling Somali ports and exacting taxes on illegal charcoal exports to the Arabian peninsula.  In other words, al-Shabaab could help ISIS undermine freedom of the seas not just through piracy, but through smuggling and illicit business relationships with Gulf states.  The foreign minister’s warnings should be read within that wider context.

From DefenseNews (h/t El Grillo):

…On Oct. 29, UAE Foreign Minister Sheikh Abdullah bin Zayed al-Nahyan raised the piracy concerns, calling for the international community to be more vigilant regarding new threats at the fourth UAE Counter Piracy Conference in Dubai.

“As groups like Daesh [Islamic State] develop ties to criminal networks and arms networks like al-Shabab, it is essential that we prevent them from expanding their operations into the sea and threaten vital channels such as the Strait of Hormuz, the Red Sea, Bab al Mandab and the Gulf of Aden,” he said.

“The nexus of criminal groups, violent extremists, and weak states will require a coordinated response from governments and the private sector,” he said. “We have to ask ourselves these questions and prepare ourselves in case a union of [the Islamic State group] and al-Shabab occurs”…


Police: Lebanese expat transferred $50K-$200K per deposit to fund terrorist training

January 29, 2013

Hezbollah banks in Syria and Turkey received proceeds from Wassim el Abd Fadel’s CD and DVD pirating scheme along with cocaine trafficking profits according to Interpol and Paraguayan police.

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Piracy still a viable business model

January 4, 2013

It is remarkable that “In the past six months, there has been no successful hijacking of a merchant vessel off Somalia.”  This is thanks largely to more armed guards on merchant vessels and the presence of NATO forces.

Yet, warns the NATO commander, “the business model is still intact” for Somali pirates, who have soaked corporations, insurance companies, and their governments of hundreds of millions of dollars.  The opportunity here is to build on recent successes and bring the Somali pirates to their knees once and for all.  It’s not the time for the NATO fleet to sail home yet.

From Reuters:

World must not let up pressure on Somali pirates – NATO

By Adrian Croft

BRUSSELS | Mon Dec 17, 2012

(Reuters) – Pirate attacks off the coast of Somalia have dropped sharply this year but piracy remains a viable “business model” and could bounce back if international naval forces in the region are cut back, the outgoing commander of the NATO mission said on Monday.

Hijackings of ships in a vast area of the Indian Ocean off Somalia have dropped to seven in the first 11 months of this year compared to 24 in the whole of 2011, although Dutch Commodore Ben Bekkering said 136 hostages were still being held.

In the past six months, there has been no successful hijacking of a merchant vessel off Somalia, said Bekkering, who has handed over command of NATO’s Ocean Shield anti-piracy force to Italian Rear-Admiral Antonio Natale.

Pirates operating from the Somali coast have raked in hundreds of millions of dollars in ransoms from hijacking ships, leading NATO, the European Union and other nations to dispatch warships to patrol the area.

Merchant ships responded with tighter security measures, including greater use of private armed security guards.

Bekkering attributed the decline in piracy to the naval patrols, the heightened security on the merchant ships, putting suspected pirates on trial outside Somalia and the Somali authorities’ counter-piracy campaigns.

Some pirates had abandoned their camps, seeing them as too risky, and taken refuge in villages, he said.

But the gains in fighting piracy were reversible if the world’s navies eased up on their efforts, he said.

“I am convinced, if navy ships would disappear, the piracy model would still be intact,” he told a news conference.

“Yes, they don’t deploy that much to sea but the leadership of the piracy is still there and if they hold their breath for a little while and nations (take) their navy ships back, I am pretty sure that the business model is still intact.”


The financial crisis has led many Western countries to slash their defence budgets, but Bekkering said he saw no sign NATO nations’ commitment to the anti-piracy operation was waning.

In March, the alliance extended its counter-piracy mission until the end of 2014.

Bekkering said about 16 to 18 ships from all international forces were on patrol in the Indian Ocean at any one time and this was the “bare minimum” needed to patrol such a vast area.

Pirates are still holding five ships with 136 hostages of various nationalities…


The risks of paying ransoms to pirates

March 7, 2012

From the February edition of Anti-Money Laundering Magazine, a very good article by its editor Joy Geary (who incidentally was one of this blog’s first readers)…  Internal citations are omitted:

Murky seas—The pirate, the ship owner, the intermediary and the financial institution

Maritime piracy is a lucrative criminal activity: almost all ransom payments are in the form of physical cash. That cash, usually US dollars, must be transported from financial institutions to the pirates. It is at this point that AML/CTF controls seem to be breaking down, particularly in the countries where the cash is sourced.

Border controls for movement of cash seem to be ineffective in detecting these cash movements. Once a ransom is paid, it is difficult to determine how the money is laundered given the infrastructure constraints of the countries where the pirates are based. Ship owners and insurers are not motivated to co-operate with anti-PFR efforts; they seek the easiest path to getting their vessel and crew back in service.

The FATF recently published a report summarising a body of work undertaken on organised piracy for ransom (PFR) and kidnapping for ransom (KFR). The PFR work focused on the financial implications of piracy as a major revenue-generating offence, and the KFR work looked at the significance of revenue generated by KFR for terrorist groups and criminal organisation and the role played by the formal financial sector.

This article looks at issues for financial institutions arising from PFR. Much of what is said about those issues applies to KFR.

The financial impact of PFR has grown exponentially and led to the deployment of flotillas of warships near Somalia, the Gulf of Aden, the Indian Ocean and the Arabian Sea. PFR increases shipping costs, inflates insurance premiums, interferes with commerce on the high seas, and causes threats to the safety of human lives and property. In the case of Somalia, the impact is severe with shipping of vital commodities such as food and medicines on the decline because of the risks to shipping trying to reach the country.

The World Food Program (WFP) uses a navy escort to reach Somalia and despite agreements by the pirates not to attack WFP ships, they continue to do so. Fishing has dropped by 30 percent in the coastal waters off Somalia because the fishermen are frightened of piracy. Pirates select their targets using carefully gathered intelligence regarding the vessel’s size, the wealth of its owners and the nature of its cargo.

On the upside, there is a housing boom in an area home to many pirates in Somalia and the price of marriage dowries is believed to have increased. Both of these have been linked to the success of PFR. On the flip side, corruption is on the increase because the pirates have more money than the government.

PFR is not a drug trafficking issue: no contraband is moved, no illicit market serviced. Rather, it is a violent, acquisitive crime.

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How ransoms are paid to Somali pirates

December 11, 2011

Ever wonder about the exact logistics of the payments that shippers, insurers, and governments make to effect the release of hostages and cargo?  Rick MacInnes-Rae from CBC Radio’s Dispatches spoke with author Jay Bahadur on Thursday for the details in this 1 minute long clip:

If the West had spines of steel instead of spines of spaghetti, we’d be air dropping bombs onto the decks of the ships rather than bags of money.