Posted on 02/23/2002 8:53:59 AM PST by Spar
Business - AP World Business
Money-laundering expert: No quick way to cut off al-Qaida funds
Fri Feb 22, 3:27 PM ET
By CATHERINE WILSON, AP Business Writer
MIAMI BEACH, Florida - Sources of money for the al-Qaida terrorist network will take a long time to shut down whether Osama bin Laden is dead or alive, a former Clinton administration official on money laundering said Friday.
"What we are talking about is not simply one person's bankroll," said William Wechsler, who headed a group tracking bin Laden's money. He believes a lot of time was wasted focusing simply on bin Laden's inherited wealth.
Like the Irish Republican Army and Hamas, al-Qaida's most important fund-raising tool has been charitable donations, said Wechsler, who spoke on a panel at an international money-laundering conference.
Panelists offered a quick tour of what is known about terrorist financing and a review of international efforts to detect and short-circuit it.
Moyara Ruehsen, an economist with the Monterey, California, Institute of International Studies, estimated 1,500 Islamic charities operate in the United States alone and much of their transactions are legitimate.
Daily fund-raising by unregulated charities in Saudi Arabia is estimated at dlrs 1.6 million, primarily due to an Islamic religious obligation to donate to charity, Ruehsen said.
Other key methods of al-Qaida fund-raising are money from wealthy donors who may or may not know the true destination, illegal businesses, notably Afghanistan's heroin trade, and legal businesses, Wechsler said.
Favorite ways of moving terrorist money are by carrying cash, diamonds, gold and other precious metals, the Islamic banking system and the global banking system, particularly offshore centers with lax regulations, he said.
In the world of Islamic banking, Ruehsen said Bahrain is one of the most important banking centers in the Persian Gulf, yet has the strictest anti-laundering laws in the Arab world. Albania, on the other hand, has Islamic banks and few controls.
U.S. banking regulations for detecting laundered money were tightened in the Patriot Act passed in response to the Sept. 11 terrorist attacks. But the hijacker's practice of relying on small, routine transactions never raised concern.
Ruehsen opposes recent attempts to embargo "conflict diamonds" from African nations with civil wars because the sanctions have created a black market that makes the uncut gems more attractive to terrorists.
"It's had lots of negative effects," she said.
It isn't clear whether al-Qaida has capitalized on the illicit diamond trade, but Hezbollah "undoubtedly" has," she said.
Ruehsen also offered an example of gold bought in Switzerland and Italy, routed through a Colombian city with a large Arab population and ending up as money transfers destined for Hezbollah.
Alan Brill, a security consultant, warned that the immediate, global nature of the Internet makes it vulnerable to abuse by terrorists, who can work anonymously in libraries and Internet cafes.
"The Internet is probably the best thing to come along since terrorists discovered plastic explosives," he said.
Clarie Lo, president of the international Financial Action Task Force on Money Laundering, noted its 29 members met in October in response to the attacks to draft an eight-point plan for combating terrorist financing.
"We hope this will make it more difficult for terrorists to move their money around," said Lo, who also serves as Hong Kong's drug czar.
Nations are guided primarily by a U.N. convention adopted in 1999. A new measure asks nations that aren't in the task force to review their banking system for compliance with anti-laundering rules.
More than 140 of the U.N.'s 189 members have submitted reports, but Lo said no decision has been made on what to do about nations that don't reply by the May 1 deadline.
Suddenly, Albania became slick willie's new best friend and the rest, sadly, horrifyingly, is history..to our everlasting shame.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.