Posts Tagged ‘ransom’


Britain bans ransom payments by insurance companies to terrorist groups

May 25, 2015

Earlier this year, Parliament passed a measure that prohibits insurance companies from paying ransoms to terrorists and provides for penalties if they do. The bill was debated in January, but it was not clear to Money Jihad at the time that the bill actually passed. The reliable Tom Keatinge has let us know that, yes, the bill has been enacted.

For more background on the law, check out Foreign Policy’s report on the subject from Jan. 8.

British legislators are considering a new bill that takes aim at a small, secretive niche in the insurance industry that deals with kidnapping and ransom, the latest money spinner for terrorists.

The new counterterrorism bill, proposed in November and being debated this week in the House of Commons, gives the British government broad powers to address new terrorist threats posed by the rise of the Islamic State.

One of the most controversial provisions would give ministers the ability to block British citizens suspected of fighting for terrorists from returning to the United Kingdom. Another section would require universities to limit the number of “extremist” speakers they host on campus.

But one part of the proposed bill that has gotten less attention would also make it a crime for British insurance companies to reimburse families or companies that pay a ransom to a terrorist in order to secure the release of a hostage. Critics argue that the provision is misguided, that it will do little to stem the flow of money to terrorists, and that it could disrupt the thriving industry of “kidnap and ransom” insurers and negotiators who successfully get people out of hostage situations.

Companies buy this insurance for employees working overseas who are in danger of being taken captive by terrorists, militants, or criminals. If that happens, the insurer connects the company to negotiators to help executives or families make a deal with kidnappers, send payment, and get the hostage back.

Kidnapping and ransom policies have come under scrutiny recently as British and U.S. counterterrorism officials have taken a stronger stance against paying ransoms to terrorists in order to starve Islamist militants of an important new source of funding. The Islamic State has used kidnapping for ransom to underwrite its gory campaigns in Syria and Iraq. A United Nations report in October estimated that the Islamic State had received $35 million to $45 million in ransom payments in the past year.

U.S. officials have long argued that making ransom payments encourages more kidnapping (though that hasn’t stopped Washington from acquiescing to ransom payments). The U.N. passed a resolution in January 2014 to discourage countries from meeting ransom demands, but a New York Times investigation published in July revealed that many European countries have been covertly making payments…


Where the D.C. sniper got his money

February 16, 2015

Thirteen years ago today, John Allen Muhammad and Lee Boyd Malvo began a series of shootings that would culminate with the Washington, D.C.-area sniper killings of October 2002. Their first victim was a then 21-year-old Keenya Cook, who survived a point blank gunshot to the head in Washington state in February 2002.

Livelihood before the killing spree

Muhammad served in the U.S. military from 1978 to 1994. With 17 years in service, he would have been three years shy of receiving an Army pension. As a civilian in the 1990s, Muhammad tried to make ends meet by starting a business, but the Washington Post called Muhammad “a serial loser” and “failed businessman whose karate school and car-repair business went bust.” He had hoped to teach karate to Muslim boys but there wasn’t enough demand.

In 1994, Muhammad began attending Nation of Islam meetings, and formally joined in 1997. The Nation of Islam Muhammad denied that Muhammad served as a paid security guard during the Million Man March in 1995, and said it ultimately “lost contact” with Muhammad in 1999.

Around that time, Muhammad traveled to Antigua, where he began making money by forging citizenship documents for Jamaicans at $3,000 per set. The buyers would use these forged documents to gain entry into the U.S. This is how Muhammad met Malvo, a Jamaican teen attempting to immigrate illegally into the U.S.


After shooting Keenya Cook, unemployed drifters Muhammad and Malvo left Washington on a cross-country odyssey until their main shooting spree in the fall. How did they pay for basic necessities and travel? The answer is probably through crime.

For example, Muhammad stole steaks from a grocery store in February. He and Malvo lived in homeless shelters. In March of that year, the pair stole a credit card from a Greyhound bus driver in Arizona. (Muhammad didn’t use this card for any expenses except for a $12 purchase at a gas station. But it was Muhammad’s intention to use this stolen account to receive a future ransom from authorities in exchange for stopping the October shootings.) In August, Malvo stole the wallet of one of their shooting victims in Louisiana. In September they robbed a liquor store in Alabama.

DC sniper attacks

Muhammad had larger ambitions than sleeping in cars and eating stolen food for the rest of his life. According to Malvo, Muhammad wanted to establish a terrorist training camp for orphans and homeless boys. Muhammad believed that he could blackmail the authorities to give him $10 million to stop his killing spree. With that $10 million, he and Malvo would flee to Canada and build their encampment there. Prosecutors discounted this theory, alleging instead that Muhammad mainly wanted to regain custody of his children from his ex-wife, but the judge found that motive implausible.

Here’s an excerpt from the $10 million ransom note Muhammad left for police in the middle of his killing spree:

Letter from the D.C. sniper

While there is no evidence of foreign sponsorship behind the D.C. sniper’s attacks, it is worth noting that the Taliban came into existence by recruiting from orphanages and madrassas in Pakistan. Like them, Muhammad somehow got the idea that starting such a camp would be a goal worth killing for. Law enforcement said that Muhammad “modeled himself” after Osama Bin Laden.


Publicity stunt: ISIS’s $200m ransom demand

January 27, 2015

Ransom demands by jihadist groups for the release of Western hostages have been averaging about $8 million per hostage over the last couple years. The $200 million recently demanded by ISIS to spare the lives of two Japanese captives was 12 times higher than the going rate. The $200 million amount also coincides with the amount of money that Japanese prime minister Shinzo Abe had just offered in aid to Middle Eastern countries fighting ISIS, and ISIS has as much as said that their demand is tit-for-tat. Thirdly, this is the first public demand for ransom by ISIS representing a departure from their standard practice of demanding dollar figures through back channels.  Lastly, one of the hostages has probably already been killed, suggesting that ISIS never intended to offer enough time for Japan to negotiate further much less actually deliver the money.

For these reasons, it is far likelier that the $200 million ransom demand was more symbolic than serious, and that ISIS probably never expected to cash in on this demand. Why not?  Eugenio Lilli offers an explanation to The Telegraph:

…In the context of this struggle for influence, Isil’s new strategy of demanding a costly ransom could be partly explained as an escalation of the propaganda war after gunmen reportedly affiliated to al-Qaeda in the Arabian Peninsula (AQAP) killed 12 people in an attack against the satirical magazine Charlie Hebdo in Paris.

The Charlie Hebdo attack gave al-Qaeda huge international exposure. An explicit request for a ransom could be Isil’s attempt to make the news and regain some lost terrain…


How extortion dropped 50% in Mexican town

January 23, 2015

Authorities report that complaints of extortion in Nezahualcóyotl, a city on the outskirts of Mexico City, fell from 172 in 2013 to 86 in 2014. Police chief Jorge Amador attributes the decline to prevention and guidance for the public about how to defend themselves from extortion attempts. Education is especially useful in combating telephone extortion (also known as virtual kidnapping schemes) in which the callers pretend to have carried out a kidnapping of a loved one and demand payment of a real ransom.

U.S. officials have begun catching onto the spreading threat as well. The FBI, New York City, and law enforcement in Texas have been trying to tell people how to deal with extortion threats by phone. That’s a step in the right direction because, if the numbers and explanation for the decline in the Nezahualcóyotl case are true, a public awareness campaign will help stop this outrageous scheme.


2011: France may have paid AQAP $12m ransom

January 13, 2015

In March 2011, three French citizens working for the Lyon-based charity Triangle Génération Humanitaire traveled to Hadramawt, Yemen. Agricultural engineer Pierre Perrault, age 29 at the time; fellow engineer and wife Leah Romary, age 25; and water treatment specialist Amelie Morgaut, age 32, intended to assist local authorities with infrastructure improvement projects, which they did until late May of that year until they were abducted by terrorist-affiliated tribesmen.

Perrault, Romary and Morgaut remained in captivity for six months in the typical fashion of kidnappers in that region of the world, which involves transferring hostages among different groups and locations.  But the strings were ultimately being pulled by Al Qaeda in the Arabian Peninsula (AQAP). In July, AQAP demanded $12 million from France for the aid workers’ release. French officials didn’t immediately comply, but began third party negotiations with AQAP through interlocutors of the sultan of Oman.

In November, the negotiations concluded. A “senior Yemeni tribal mediator” confirmed to the Associated Press that a ransom had been paid for the hostages’ release. The formal payment was made jointly by a Yemeni businessman living in Oman, Ahmed Ben Férid al-Souraimeh, and by the government of Oman, but Oman was most likely reimbursed by French intelligence behind the scenes.

Officially, France says it does not pay ransoms and did not pay a ransom in this case.  But diplomats, security experts, and terrorist groups themselves know that France does in fact pay ransoms quietly through third parties. France has paid $58 million to terrorist groups for the release of French hostages worldwide since 2008 according to the New York Times.

The Triangle Génération Humanitaire aid workers’ captivity overlapped the July to August 2011 time period in which French-Algerian brothers Said and Cherif Kouachi traveled to Yemen (via Oman) for weapons training and to meet with terrorist imam Anwar al-Awlaki.

The payment of a ransom in Yemen within a few months of the Kouachi brothers’ Yemen tour would have been useful to AQAP to fund the continued purchase of weapons for use in Yemen, to maintain training camps in Yemen, to pay wages of militants and marksmanship trainers Yemen, to cover the air travel and border crossing expenses for prospective recruits, to fund the possible remote purchase of AK-47s and RPGs on the black market in France, and to fund planning and communications for future attacks.

After slaying 12 people at the offices of Charlie Hebdo in Paris last Wednesday but shortly before his death on Friday, Cherif Kouachi said that he had been financed by AQAP.

In order to have an honest discussion about whether it is proper to pay ransoms to terrorist groups, we must—as grateful as we are all for the release of the Triangle Génération Humanitaire aid workers—acknowledge the distinct probability that the ransom paid in that case may have been more detrimental than helpful to the long-term security interests of France.


Follow the francs: the Kouachi brothers’ links

January 9, 2015

Said and Cherif Kouachi, the main suspects in the terror attack on Charlie Hebdo on Wednesday, each have their own relationships to jihadist groups.

The older brother, Said Kouachi, reportedly trained with Al Qaeda in the Arabian Penisula (AQAP) in Yemen. AQAP makes about $10 million a year from ransoms, and is also funded by robberies (including banks, post offices, and payroll delivery trucks), and Saudi donors.  AQAP’s leader has previously said that ransoms make up about half of AQAP’s revenues, suggesting that their overall budget is about $20 million a year.  France’s quiet policy of paying ransoms to terrorist groups to release French hostages may be revisited in the near future given how ransom money can be used by groups like AQAP to train recruits in marksmanship and making bombs.

How Kouachi funded his airfare to Syria, and how the brothers paid for the AK-47s used in the attack (which cost $1,200 to $1,800 on France’s black market), have yet to be determined.

Younger brother Cherif Kouachi was a member of a recruitment ring in Paris known as “Nineteenth Arrondissement Iraqi Networks” or the “Butte-Chaumont network” that funneled Muslims from France to wage jihad in Iraq in the mid-2000s. The ringmaster was Farid Benyettou, an Algerian fed on a steady diet of jihadist texts and websites. As the case of the Tsarnaev brothers in Boston illustrated, the websites that Tamerlan learned from didn’t host, administer, and fund themselves. There is usually an extensive, costly infrastructure behind so-called “lone wolves,” who are actually borrowing information, ideas, and tips from the wider jihadist network. The wider network is much more expensive to maintain than the few hundred or thousands of dollars it may have taken to carry out a single attack.

The Kouachi family is from Algeria, where jihadists including Al Qaeda in North Africa (AQIM) are heavily funded by ransom payments and drug trafficking.


Jihad funding news: recommended reading

December 24, 2014
  • A Pakistani jihadist group’s front charity is now operating in Gazamore>>
  • How Sokolow v. Palestinian Liberation Organization could help bankrupt the PLOmore>>
  • Several countries have funded terrorists by paying ransoms to Al Qaeda; 6 those countries have been named… more>>
  • When it comes to financing terrorism, Qatar runs with the hare and hunts with the houndsmore>>

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