The $6 million is only the tip of the iceberg. According to South African law enforcement, one of the men made the same trip every couple days. But even if it were only $6 million, that is a big amount of cash to smuggle anywhere. It’s surprising they could even squeeze that much money into 12 bags they were reportedly carrying. (Maybe it was vacuum packed?) No wonder why this report says there was inside help. From Fox News on Sept. 21 (h/t @AllSourceFusion):
JOHANNESBURG – Five men nabbed last month about to board a flight at South Africa’s busiest airport with $6 million stuffed in bags may have made hundreds of such trips — with inside help — as part of a cash pipeline to fund the Islamic State, police sources said Monday.
The suspected couriers were caught at Johannesburg’s main airport, OR Tambo, on Aug. 28, but news the money was headed for the terror network only emerged late Sunday. A senior police officer told Fox News Monday the suspects are believed to have been headed for the ISIS caliphate in Syria and Iraq by way of Dubai, and that one may have made the same trek hundreds of times.
“It is very likely that the money was going to ISIS,” the police officer said. “We are investigating who these five carrying the money were, and there is one … we are particularly interested in, as records show he was flying to Dubai every two days for a year”…
Watch this video to understand some of the basics about prostitution and human trafficking in the United Arab Emirates:
Money Jihad has previously noted that there are connections between jihadist groups and human trafficking syndicates. A study by West Point’s Combating Terrorism Center found that “Individuals [within the global illicit marketplace] involved in other illicit activities link to terrorists 35 percent of the time.” Although the video excerpt tends to focus on the women and their experiences, there are powerful networks operating behind them to coerce them into the sex business and skim millions of dollars off the top. Rest assured that the profits from the sex business aren’t being used to build schools and hospitals.
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.
…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”…
Islamic Relief Worldwide (IRW) has been designated as a terrorist group by the United Arab Emirates, the second Middle Eastern country to do so within the past five months. In June, IRW was declared illegal by Israel for being a financial conduit to Hamas, and it was banned from operating in Israel and the West Bank.
The Birmingham, England-based IRW is the largest international Islamic charity in the world with a £155 million (240 million USD) budget in 2013. IRW has over 280 employees and is active in more than 30 countries. IRW maintains over a dozen affiliates throughout the world, each with multi-million dollar operating budgets of their own including Islamic Relief USA, which is the largest Islamic charity in America.
IRW accepted a $50,000 check from Osama Bin Laden in 1999, had a Gaza program coordinator who aided Hamas from 2005-06, received over £60K from an Al Qaeda front group from 2003-08, has leaders who are closely aligned with the global Muslim Brotherhood, and had programs staffed by Hamas personnel in the Palestinian territories as recently as this year. Supporters of IRW have noted that the UK’s charitable regulator has not confirmed the evidence against IRW; however, a 2013 audit found that the Charity Commission is understaffed, too passive in its investigations, and is generally unfit for its regulatory duties.
UAE calls 15 Muslim groups in the West “terrorists”
In addition to the IRW designation, the UAE named 15 other Islamic charities and advocacy groups in the U.S. and Europe as terrorist entities:
Islamic Relief UK (the British affiliate of IRW)
Muslim Association of Britain (part of the U.K. Muslim Brotherhood)
Cordoba Foundation in Britain (once described by David Cameron as a Muslim Brotherhood front group)
Council on American-Islamic Relations (the self-described civil rights group which was an unindicted co-conspirator in the Holy Land Foundation Hamas-financing trial)
Muslim American Society (which was created by the U.S. Muslim Brotherhood)
Union of Islamic Organizations of France (a French Muslim group tied to the Muslim Brotherhood that profits from halal certification)
Federation of Islamic Organizations in Europe (an alliance financed by Gulf sources with ties to Hamas)
Islamische Gemeinschaft in Deutschland (the “main representative” of the Muslim Brotherhood in Germany)
Associazione Musulmani Italiani (Italian Muslim Association)
League of Muslims in Belgium (La Ligue des Musulmans de Belgique)
Muslim Association of Sweden (Sveriges muslimska förbund)
Islamic Society in Denmark (Islamsk Trossamfund)
Islamic Council Norway (Islamsk Rad Norge)
Finnish Islamic Association (Suomen Islam-seurakunta)
CANVAS in Belgrade, Serbia
The UAE designated over 80 groups overall, most of which are located in the Middle East. The practical effect of the designations are limited, designed for “transparency” and to “raise awareness.” In other words, the designations include not asset freezes, travel bans, or prohibitions on transacting business with the designated groups.
Money Jihad has long reported on how al-Shabaab profits from Somalia’s charcoal smuggling business, particularly by charging a checkpoint tax authorized by Islamic law. A new report from the United Nations Environmental Programme and Interpol confirms that this activity is ongoing despite a UN ban against Somali charcoal exports, saying that “Al Shabaab retains about one third of the [charcoal] income, which alone constitutes about USD 38–56 million” annually.
A map in the report shows a key al-Shabaab tax checkpoint at Buulo Xaaji, main points of embarkation from Kismayo and Barawe, major delivery locations at Jizan (Saudi Arabia), Dubai and Sharjah (UAE), and Khasab (Oman), with additional deliveries in Egypt, Yemen, and Kuwait.
In addition to “normal” smuggling of charcoal from Somalia to the Gulf states, it is Money Jihad’s belief that rampant trade-based money laundering is occurring between al-Shabaab and these states in which wealthy Arabs are transferring funds to al-Shabaab through over-invoicing for charcoal purchased. In other words, terror financiers in the UAE and Saudi Arabia are intentionally overpaying for Somali charcoal as a means of funding al-Shabaab without simple detection. The Gulf states are doing this to pursue larger strategic interests in Africa.
Criminal and terrorist groups are highly interconnected according to new analysis of data by West Point’s Combating Terrorism Center. The conventional wisdom was that criminals worry that working with terrorists may draw unwanted scrutiny from their governments, and they are only inclined to cooperate only in resource-poor environments where it is necessary to survive. But the CTC finds that transnational traffickers and criminals appear to be more than willing to partner with terrorists, and that they benefit from these relationships in a wide variety of environments.
The full report can be read here. It is very thorough (89 pages) and includes academic language and models. Here are a just a few of the salient points from the study about members of the global underworld that may be of interest to practitioners and analysts outside of academia:
Interconnected: 98 percent of the individuals in the global illicit marketplace are within two degrees of separation of each other.
International: One in three individuals in the network have international relationships.
Distributed power: Unlike typical hub-and-spoke networks where 80 percent of the connections rely on 20 percent of the actors involved, the global illicit network is somewhat less dependent on a small number of powerful actors/kingpins. Twenty percent of participants are responsible for only 65 percent of underworld connections. This diffuse hub-and-spoke model makes the network tougher for law enforcement to disrupt.
Willingness to work with terrorists: “Individuals involved in other illicit activities link to terrorists 35 percent of the time” (p. 43). Terrorists often serve as “boundary spanners,” that link and form introductions between disparate groups such as drug traffickers, arms dealers, and organized crime.
Frequent bilateral links with the United Arab Emirates: The top two bilateral connections in the criminal underworld–the U.S. and Colombia and the U.S. and Mexico–are probably unsurprising to Americans. The third most prevalent bilateral connections are between India and the U.A.E., and the sixth most common are between Pakistan and the U.A.E.
Organized crime, not just terrorism, benefits from state sponsorship. We know that state sponsorship of terrorism exists, but for some reason we erroneously assume that state sponsorship of crime does not. The evidence from North Korea, Russia, the Balkans, and Pakistan indicates that criminals can carry out national interests—a phenomenon deserving further study.
Convergence is not driven by poverty. Terrorists and criminals are drawn together in a variety of environments, not just in countries where there are little money or resources. The evidence indicates that the opposite is often true—that criminal masterminds prefer climates where there is some level of predictability and economic development, such as Monzer al-Kassar operating in Spain and Dawood Ibrahim in Dubai. Focusing only on failed states could be a red herring.
Acknowledgment: Thanks to Twitter user @El_Grillo1 for sending in a link to the CTC study.
Thirty-four billion Pakistani rupees (approx. 10.4 million USD) have been transferred to major cities in Pakistan near the border of Afghanistan over the past two years; the beneficiaries of the transfers may have included terrorist groups. The transfers were revealed by Pakistan’s Federal Investigation Agency earlier this year to the Express Tribune:
Funding terrorism: Illegal cash flows may be aiding terrorists
KARACHI: Terrorist groups in the Federally Administered Tribal Areas (Fata) and Balochistan have been receiving billions of rupees each month through banking channels and money exchange companies, sources in Federal Investigation Agency (FIA) have revealed.
These companies in collusion with some bankers have been transferring huge amounts to unnamed bank accounts in Quetta and Peshawar. The FIA has recently found evidence of transfer of billions of rupees to the two cities in the last few months.
According to sources, the FIA made these discoveries during its investigations into the multibillion rupee Trade Development Authority Pakistan (TDAP) scam.
Ironically, the Financial Monitoring Unit (FMU) and other institutions, whose task is to curb the illegal business of hundi and hawala, are completely unaware of these dubious transactions, made right under their nose.
If the law enforcers can trace the people receiving billions of rupees through unnamed accounts in Peshawar and Quetta, they will possibly be able to unearth terrorist activities funded by this money…
The Business Recorder provided more details a few weeks ago, reporting that TDAP and commerce ministry officials set up shell companies that claimed trade subsidies known as “general freight subsidies” or “freight subsidies” for the export of “live seafood.” The subsidy checks were then deposited in 10 banks which transferred the $10 million over a 30 month period. Ninety percent of the money obtained through bogus trade subsidy claims was later withdrawn in cash, and some money was subsequently sent to banks in the United Arab Emirates and the West.
The FIA has urged the State Bank of Pakistan to carry out a forensic audit into the transfers. Yeah, might be a good idea, fellas.
BNP Paribas may have disguised transactions with Iran. A major settlement with the U.S. over the alleged sanctions violation may be in the offing… more>>
Credit Agricole and Societe Generale are under investigation by U.S. officials for helping Iran skirt sanctions too… more>> (h/t Sal)
During this current sanctions pause, delegates representing 120 French corporations have traveled to Tehran about potential business deals… more>>
U.S. regulators are concerned about France’s intentions to build satellites for the United Arab Emirates with U.S. components… more>>
French anti-money laundering regulator Tracfin finds that crime rings are increasingly reliant on bitcoin and other virtual curriencies… more>> (Fr)
International financial watchdog FATF has issued a report that raises concerns about the use of diamonds to launder money in five countries that voluntarily disclosed information for the report.
India cited cases of overvaluation of diamonds sold abroad as a means of transferring illicit money back to India. Trade-based money laundering is one of, if not the largest mechanism worldwide for transferring value without being detected.
As John Cassara and Avi Jorisch have noted in their book, On the Trail of Terror Finance, “diamonds are the most condensed form of physical wealth in the world. As a result, they are widely used in global laundering and value transfer schemes.”
Cassara and Jorisch also noted that Dubai, which maintains significant business relationships with diamond dealers in Mumbai, India, “are adept at invoice manipulation,” which Dubai traders can use to transfer significant amounts of value without transferring physical money.
The chief money man behind the Haqqani network, Nasiruddin Haqqani, has been shot dead. He has been under U.S. sanctions since 2010; at the time the Treasury Department said, “From at least 2005 to 2009, Nasiruddin Haqqani collected funds for the Haqqani Network, including during a 2008 fundraising trip to a Gulf state and during regular travel to the (UAE) in 2007. As of mid-2007, Haqqani reportedly received funding from donations from the Gulf region, drug trafficking, and payments from al-Qa’ida. In 2004, he traveled to Saudi Arabia with a Taliban associate to raise funds for the Taliban.”
Nasiruddin Haqqani used to live next door to the headquarters of ISI, the Pakistani spy agency, with whom he collaborated.
… As the group’s main fundraiser, Nasiruddin frequently travelled to the oil-rich sheikhdoms of the Middle East to solicit donations.
He represented the Haqqani network in last year’s efforts to set up a Taliban office in Doha for peace talks with the United States.
He was also the group’s main contact person for pro-Taliban elements in Pakistan, as well as its representative with the Afghan Taliban.
‘Well-dressed networker’
Unlike his father and many of his brothers, Nasiruddin Haqqani and two of his uncles did not live in Miran Shah in North Waziristan. He chose to base himself near Islamabad, from where he made his many journeys abroad to secure funds.
Some sources said he had major business interests in the Gulf, including a transport company.
Nasiruddin is not thought to have been publicly photographed.
Those who have met him describe a tall, educated, well-dressed man who travelled in expensive cars and networked an extensive list of contacts all the time.
They say his appearance gave no clue to his militant connections. His code name was “the doctor”, possibly because of a degree that he had studied for.
His death will be a major blow to the Haqqanis, who will need to find someone else to spearhead their efforts to secure financing…
Shouldn’t be too hard for the ISI to anoint somebody else.
“Go forth, light-armed and heavy-armed, and strive with your wealth and your lives in the way of Allah!”—Koran (Sura 9, Verse 41)
“The warrior gets his reward, and the one who equips him gets his own reward and that of the warrior”—Muhammad (Sunan Abu Dawud, Book 14 No. 2520)
“Your duty is to support the Mujahideen with money and men... The Zakat of one affluent Muslim merchant is enough to finance all the Jihadi front against our enemies”—Osama Bin Laden
*Technorati ceased providing blog rankings in May, 2014. Not sure how high we ended at that time, but were previously ranked as a top 500 U.S. politics blog in 2010 when our readership was much lower
Money Jihad 
5 men caught smuggling $6m for ISIS
September 24, 2015The $6 million is only the tip of the iceberg. According to South African law enforcement, one of the men made the same trip every couple days. But even if it were only $6 million, that is a big amount of cash to smuggle anywhere. It’s surprising they could even squeeze that much money into 12 bags they were reportedly carrying. (Maybe it was vacuum packed?) No wonder why this report says there was inside help. From Fox News on Sept. 21 (h/t @AllSourceFusion):
Posted in News commentary | Tagged cash courier, cash smuggling, Islamic State of Iraq, mule, South Africa, UAE | 1 Comment »