Money, blood and sand

Like tossing raw meat to the sharks on the beach at Amity Island, the Saudis and Qataris keep supplying weapons and money to the rebels in Syria, keeping them in a state of frenzy that presents a danger to us all.

Even though we’ve been helping Saudi Arabia for decades by 1) containing its major rival (Iran), 2) buying their oil, and 3) providing them with military training, they’re double-crossing us once again.

Saudi Arabia and Qatar, or at least some of the “charities” and banks involved with funneling money to terrorists in Syria, should be designated by the U.S. as sponsors of terrorism.

From Bloomberg:

Saudis Said to Disregard U.S. on Aid to Syrian Islamists

By Glen Carey – Oct 23, 2013

Saudi Arabia’s support for rebels in Syria won’t be constrained by U.S. efforts to keep the money from Islamist groups, as the kingdom steps up efforts to battle Iranian influence in the region, a Saudi official said.

Syrian opposition factions backed by the U.S. are disorganized and largely ineffective, so directing assistance only to them would be handicapping the fight against President Bashar al-Assad, the official said, asking not to be identified because of the issue’s sensitivity. He said differences between the longtime allies over Syria and other Middle East issues don’t amount to a breakdown in relations.

The U.S. about-face on Syria, dropping threats of military action to back a Russian plan for Assad to surrender his chemical weapons, was greeted with dismay by allies in the Gulf, which are also concerned by the prospect of a thaw between the U.S. and Iran. Saudi Arabia, the world’s biggest oil exporter, dropped its bid for a United Nations Security Council seat, saying the UN body failed to end turmoil in Syria.

Gulf nations played a central role in efforts to organize the Syrian rebel factions that have some U.S. backing into a coherent political and military unit. Now, most Saudi and Qatari aid is going to radical Islamist groups, according to a U.S. official who also asked not to be identified because of the contentious nature of the assistance…

U.S. energy boom the “biggest strategic game changer since we won World War II”

Going back to the Wall Street Journal‘s remarkable finding that the U.S. is now the world’s largest energy producer, Fox News hosted a great discussion with Steve Moore and KT McFarland about the economic and strategic implications of the shift.  Please watch especially for McFarland’s insights on what this means for global affairs:

H/t to CJR for finding the video link on YouTube!

Back on top: U.S. world’s biggest energy producer

Hydraulic fracturing is quickly changing the global balance of power.  This year U.S. has become or will shortly become the #1 producer of oil and gas on the planet.  This analysis comes from the Wall Street Journal:

U.S. Is Overtaking Russia as Largest Oil-and-Gas Producer

The U.S. is overtaking Russia as the world’s largest producer of oil and natural gas, a startling shift that is reshaping markets and eroding the clout of traditional energy-rich nations.

U.S. energy output has been surging in recent years, a comeback fueled by shale-rock formations of oil and natural gas that was unimaginable a decade ago. A Wall Street Journal analysis of global data shows that the U.S. is on track to pass Russia as the world’s largest producer of oil and gas combined this year—if it hasn’t already.

The U.S. ascendance comes as Russia has struggled to maintain its energy output and has yet to embrace technologies such as hydraulic fracturing that have boosted American reserves.

“This is a remarkable turn of events,” said Adam Sieminski, head of the U.S. Energy Information Administration. “This is a new era of thinking about market conditions, and opportunities created by these conditions, that you wouldn’t in a million years have dreamed about.”

The U.S. produced the equivalent of about 22 million barrels a day of oil, natural gas and related fuels in July, according to figures from the EIA and the International Energy Agency. Neither agency has data for Russia’s gas output this year, but Moscow’s forecast for 2013 oil-and-gas production works out to about 21.8 million barrels a day.

U.S. imports of natural gas and crude oil have fallen 32% and 15%, respectively, in the past five years, narrowing the U.S. trade deficit. And since the U.S. is such a big consumer of energy, the shift to producing more of its own oil and gas has left substantial fuel supplies available for other buyers. Nations that rely on peddling petroleum for their economic strength and political clout face dwindling market power as a result. Oil prices so far remain high, however, closing Wednesday at $104.10 a barrel, up 18% from a year ago.

Many analyses of energy markets look only at crude oil. But Russia and the U.S. also are major players in natural-gas markets, where they far outproduce countries such as Saudi Arabia, the world’s largest oil producer.

The U.S. last year tapped more natural gas than Russia for the first time since 1982, according to data from the International Energy Agency. Russia’s exports have been crimped by rising competition and the economic slump in Europe. Russia forecasts that its gas production will increase slightly in coming years, but its forecast for this year is below current U.S. production.

The U.S. is also catching up in the race to pump crude. Russia produced an average of 10.8 million barrels of oil and related fuel a day in the first half of this year. That was about 900,000 barrels a day more than the U.S.—but down from a gap of three million barrels a day a few years ago, according to the IEA.

The amount of crude from two of the hottest plays in the U.S.—the Bakken oil field in North Dakota and the Eagle Ford shale formation in South Texas—continues to rise rapidly…

Readers should take a look at this video from Fox News which addresses the strategic implications of this development for U.S. national security.  The shift means a reduced likelihood of U.S. entanglement in Middle Eastern affairs, less risk of disruption due to volatility in and hostility from that part of the world, and a reduced flow of petrodollars to regimes that fund terrorism.

Fueling ourselves leaves Saudi Arabia in the dust

Increased domestic energy production is enabling the United States to pursue its own foreign policy objectives without having to run a three legged race with Saudi Arabia.  Hydraulic fracturing allows America to begin to separate itself from a distant monarchy that imposes ruthless sharia law on its people and funds terrorism around the world.  Reuters has the story:

Word of the week: BSA

The Bank Secrecy Act (BSA) is the primary law in the U.S. against money laundering.  Cassara and Jorisch* explain the BSA as follows:

Officially known as the “Currency and Foreign Transactions Reporting Act,” it requires financial institutions to help various government agencies detect and prevent money laundering.  Specifically, the BSA requires banks and other financial institutions to file reports of currency transactions exceeding $10,000, to keep records of cash purchases of negotiable instruments, and to report suspicious activity.

The IRS notes that BSA requirements serve to “detect and deter money laundering whether it is in furtherance of a criminal enterprise, terrorism, tax evasion or other unlawful activity.”

*Cassara, John and Jorisch, Avi.  On the Trail of Terror Finance (Washington, D.C.:  Red Cell Intelligence Group, 2010).

Flash crash and the Obama hoax

When a fake news bulletin was distributed after the Associated Press’s Twitter feed was hacked on April 23, the stock market instantly dropped a full 1 percent. 

On his Global Economic Warfare website, Kevin Freeman tackles the implications of the fake tweet on the market, and how market manipulation can be used as a financial warfare tactic.  Read his important posts here and here.  An excerpt follows:

A Single, Man-Made Stock Market Crash is a New-Concept Weapon

When the two PLA Colonels wrote Unrestricted Warfare in 1999, they listed “a single man-made stock market crash” as one of three specific new-concept weapons for the 21st Century. They called it financial warfare.

We have been warning about market manipulation for several years, first in our report for the Department of Defense and then in the New York Times Best-Seller, Secret Weapon. Yet, most in the intelligence and defense community know little about the financial markets. And, those who understand the markets generally know little about defense. Unfortunately, our enemies have studied both.

This week, we saw a hacked Twitter account used as a weapon resulting in a mini flash crash for stocks. Even as the market recovered in minutes, estimates are that there was something like $150 or $200 billion lost even if only briefly. We mentioned this in an earlier post.

While any human could clearly see that the White House was not bombed as the hacked tweets claimed, computer algorithms that monitor social media sites could not tell the difference. As a result, massive sell programs began and other high-frequency algorithms picked up on it.

The Syrian Electronic Army claims that they were the source of the false tweet…

Mr. Freeman also included this graphic which showed the plunge in trading.  The person or entity responsible for the planned Twitter forgery could have anticipated the miniature flash crash and hedged against it in order to profit from the hack:

Wildlife smugglers can’t deceive these dogs

The illicit trade in endangered species has been a growing source of terrorist revenues.  A new dog training program will help detect items illegally trafficked through the U.S.  Take a look at this video from the Fish & Wildlife Service and a related article by Russell McClendon of the Mother Nature Network (h/t CITES):

U.S. trains dogs to sniff out wildlife traffickers

The first graduating class of ‘wildlife detector dogs’ will soon be stationed at ports around the U.S., part of a growing effort to stem the illegal trade of flora and fauna.

If you’re a poacher hoping to smuggle rhino horns through a U.S. port, Uncle Sam wants you to know you’re barking up the wrong tree. And he has a new team of elite, hard-nosed cops to help him deliver that message: Butter, Viper, Lancer and Locket.

The first class of “wildlife inspector dogs” graduated this week from the U.S. Department of Agriculture’s National Detector Dog Training Center (NDDTC) in Newnan, Ga., where they spent 13 weeks learning to identify the scent of endangered species — whether it’s South American rosewood or African elephant ivory. The four graduates, along with their human handlers, will soon be stationed at key ports around the country, where they’ll join a nationwide effort to stem the illegal trade in plant and animal parts.

“The recent rapid growth in the global trade in protected wildlife is pushing some species perilously close to extinction,” says Ed Grace, deputy chief of the U.S. Fish and Wildlife Service’s Office of Law Enforcement, in a press release. “Elephant and rhino populations in particular are declining at alarming rates. The battle to stop wildlife smuggling is one we simply cannot afford to lose, and using dogs and their phenomenal sense of smell to catch smugglers will give us a real leg up in this effort.”

Dogs already have a long history in law enforcement, from hunting fugitives to helping police detect bombs and drugs. But while they’ve been man’s best friend for millennia, their high-powered noses are increasingly ingratiating them to Mother Nature, too. Florida wildlife officials train dogs to sniff out invasive pythons in the Everglades, for example, while conservationists at the University of Washington train them to track endangered native animals by smelling their scat. On a small island in Australia, sheepdogs have even been entrusted to protect a population of endangered penguins.

But the task facing Bullet, Viper, Lancer and Locket — as well as future NDDTC cadets — is much broader than patrolling a single ecosystem. They will soon accompany agents with the U.S. Fish and Wildlife Service on the front lines of an expanding battle, one that pits international crime syndicates against a wide array of rare wildlife.

This comes on the heels of an unusually fruitful wildlife-trade summit held in Bangkok last month, one that highlighted both the gravity of the problem and the emerging possibilities for containing it. Conservationists pulled off several victories during the 2013 Convention on International Trade in Endangered Species (CITES), including new trade protections for sharks, turtles, elephants and great apes. But as critical as such regulations are, they’re only as effective as their enforcers. The U.S. is a major market for illegally traded wildlife, and human officers can only inspect so many packages.

“On an average day, I as a human being can physically inspect, if I’m pushing myself hard, anywhere from 70 to 100 packages,” FWS wildlife inspector Denise Larison says in a video about the new dog program. “And as you can see, the dogs can do 70 to 100 packages in a matter of minutes”…

Related:  Stella the dog finds €3m in illicit cash

Smuggling cash with foreign prepaid cards

ACAMS MoneyLaundering.com is reporting that while know-your-customer requirements and other safeguards are in place to prevent abuse of prepaid, reloadable cards obtained from American financial institutions, the freedom of foreign banks to issue such cards remains a potential area of terror finance vulnerability.

Here is an excerpt from MoneyLaundering.com’s featured article by Colby Adams on Apr. 9:

…Final rules issued by the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) in July 2011 imposed anti-money laundering (AML) program duties on American providers and sellers of certain prepaid products, including customer identification, suspicious activity reporting and transactional recordkeeping requirements.

But reloadable cards that can be acquired in person or over the Internet from foreign financial institutions remain an immediate threat to the United States, according to a senior compliance officer at a major U.S. financial institution linked to the prepaid industry.

“The rules are way too focused on what’s leaving the United States—on bulk cash smuggling on a card,” said the person, who spoke on condition of anonymity. “The giant elephant in the room is that the regulators aren’t checking what’s coming here, and that could mean trouble sooner rather than later.”

In such a scenario, a member of a terrorist organization living in a high-risk jurisdiction could purchase a network branded prepaid card from a non-U.S. bank with little trouble. Should the person travel to the United States, he or she could use the card to withdrawal money from any one of thousands of ATMs, or receive additional funds from another foreign-issued prepaid card holder…

Why would Muhammad Atta need a SunTrust account if he could have just brought a preloaded payment card with him from Hamburg?  Especially when that card is branded with the familiar logo of Visa or Mastercard, such as this product being offered on the website of Cyprus-based Hellenic Bank:

Screenshot of foreign p-card promising anonymity and a Visa logo

So much for know-your-customer provisions when a bank in the EU is encouraging customer anonymity.  Moreover, Mr. Adams notes that “the Visa logo means that it can be used anywhere Visa is accepted – including ATMs.”

Attacks on banks resume

Despite the track record of the 60-year Arab League economic embargo of Israel, and despite the Arab oil embargo of the 1970s, some Islamic scholars have said that Islam does not permit economic warfare against infidels.

Yet when it comes to infidel banks that charge interest—a concept forbidden in Islam—many Islamists agree that banks are legitimate targets for robbery or attack, especially if the result of the action will ultimately benefit Islam.  Islamists also rationalize their assaults on Western financial institutions because they believe the banks are “controlled” by Jews.

Is it any wonder then that we’re now seeing a third wave of attacks by Islamist hackers against American financial institutions that began last fall.  From the Global Post on Mar. 7:

Muslim hackers target US banks in third round of cyberattacks

In the third round of what they’re calling Operation Ababil, Muslim hackers belonging to the Izz ad-Din al-Qassam Cyber Fighters are attacking US bank websites and demanding that more copies of the “Innocence of Muslims” YouTube video be removed.

Muslim hackers in the Izz ad-Din al-Qassam Cyber Fighters launched the third phase of their Operation Ababil campaign against US-based banks on Wednesday, making further demands that the YouTube video “Innocence of Muslims” be removed from the web.

Known to many as the Muslim world’s Anonymous, Izz ad-Din issued an ultimatum on Tuesday that their distributed denial of service (DDoS) attacks against American banking institutions would continue unless insults against the Prophet Mohammed were removed from YouTube.

“During runnnig [sic] Operation Ababil Phase 3, like previous phases, a number of american [sic] banks will be hit by denial of service attacks three days a week, on Tuesday, Wednesday and Thursday during working hours,” read the group’s latest statement.

Outages have been reported by customers of Bank of America, Capital One, Citibank, PNC Bank, Union Bank and Wells Fargo, according to Site Down, a website that tracks reported online outages. However, no banks have reported experiencing any issues with their online services.

“At this point, we’ve had no issues on our end,” Bank of America spokesman Mark T. Pipitone told Information Week Wednesday.

Unlike Anonymous, the Izz ad-Din Cyber Fighters seem to abide by strict, self-imposed regulations. During phase two of Operation Ababil, YouTube removed the original version of “Innocence of Muslims” from the site — as promised, the hacker collective ceased attacks once their demands were met.

But new copies of the video have reappeared on YouTube, and the Izz ad-Din Cyber Fighters say they will not tolerate more insults levied against Prophet Mohammed.

“Now at the end of one month time it is seen that other copies of the film yet exist in YouTube so we announce the Phase 3 of Operation Ababil will start this week,” read the group’s statement.

For phase three, Izz ad-Din is using a complex calculation to issue banks an exact dollar amount each will lose in the attacks. Using a combination of the video’s traffic statistics, Izz ad-Din determined that US Banks should pay $874.7 million in compensation.

A loss at that levels requires about 11 weeks of DDoS attacks.

Taking their name from a Syrian preacher that fought against French, British and Zionist elements in the Levant in the 1920s and 1930s, the collective has wrapped itself in the rhetoric of anti-imperialism.

However, the goals of the organization are now limited to removing “Innocence of Muslims” from YouTube. The insults made against Prophet Mohammed served as a catalyst for uniting the collective.

The Izz ad-Din al-Qassam Cyber Fighters collective is the first hacker group that acts in defense of Islam.

Since the founding of the Izz ad-Din al-Qassam collective, several other Muslim hacker groups rose to prominence in attacks carried out against Israeli domains during the Israeli Defense Forces’ assault on Gaza late last year. Muslim hackers from Algeria, Morocco and Pakistan, among others, carried out DDoS attacks and defacement of Israeli domains during the cyberattack campaign.

Under attack from Iran, banks seek federal help

Having spent millions of dollars to defend themselves from a hostile foreign power, American banks are now asking the federal government for assistance.  U.S. officials say that all options are being weighed including retaliation.  Here’s a two-minute interview on the subject with reporter Siobhan Gorman on the radio program The Wall Street Journal This Morning last month:

Hopefully they won’t have to use it, but the Pentagon would have good reasons for keeping a cyber-counteroffensive plan on its shelf.

View previous Money Jihad coverage of the allegedly Iranian-based technological assaults here, here, and here.

Money laundering expert accuses Venezuela of massive uranium exports to Iran

One of Money Jihad‘s favorites, the Financial Crimes Blog by Kenneth Rijock, is making a disturbing allegation:  that Venezuela is illegally exporting massive amounts of uranium for Iran’s nuclear program, and that U.S. officials have rejected the evidence.  The “reliable sources” aren’t named and the “irrefutable, documentary evidence” isn’t specified, so take it with a grain of salt, but Mr. Rijock has proved to be very insightful and prescient before.

From Jan. 10:

US POINTEDLY IGNORES VENEZUELAN URANIUM EXPORTS

The United States, for reasons not known to this writer, appears to be deliberately ignoring the mounting indications of massive exports of Uranium, from Venezuela, to its end user, the Government of Iran. Reliable sources have confirmed that irrefutable, documentary evidence of same, from unimpeachable sources, has been politely declined when offered. America opposes Iran’s WMD programme, somebody has chosen to ignore the truth, when  it comes from Venezuela.

Given that close monitoring of Iran’s developing illegal Weapons of Mass Destruction programme has become an American obsession, I am baffled as to why actionable intelligence, regarding these outbound shipments is of no interest to America’s intelligence community. Vessels laden with Uranium  are leaving Venezuela’s Caribbean ports, steaming direct to Iran with their illicit cargo…

There’s a little more to the full post including Rijock’s speculation on the reason for the U.S.’s hear-no-evil, see-no-evil attitude here.