- ' T - _ ~, I-Alms for JihadGiving to charity is incumbent upon every Muslim,Throughout history,Muslims have donated to the poor and to charitable endowments set up forthe purposes of promotingIslam through the construction of mosques,schools, and hospitals, In recent years, there has been a dramaticproliferation of Islamic charities, many of which were created in the decliningdecades of the twentieth century by the infusion of oil money into the Muslimworld, While most of these are legitimate, there is now considerable andworrying evidence to show that others have more questionable intentions,and that fundsfrom such organizations have been diverted to supportterrorist groups, such as AI Qaeda, The authors of this book examine thecontention through a detailed investigation of the charities involved, theirfinancial intermediaries,and the terrorist organizations themselves, Whatthey discover is that money from these charities has funded conflicts acrossthe world, from the early days in Afghanistan when themujahideen (Muslimwarriors) fought the Soviets, to subsequent terrorist activities in Central Asia,Southeast Asia, Africa, Palestine, and,most recently,inEurope and theUnited States, This ground-breaking book is the first to piece together, froma vast array of sources, the secret and complex financialsystems thatsupport terror,J.MILLARDBURR worked for many yearsin theDepartment of State andwas formerly United States logistics advisor for OperationLifeline SudanI,He has worked closely with international charities for more than forty years,ROBERT O. COLLINS isEmeritusProfessor of History at the University ofCalifornia, SantaBarbara,They have previously co-authored three books: Requiem for theSudan:War, Drought, and Disaster Relief on the Nile (1995),Africa'sThirly Years'War: Chad, Libya, and theSudan, 1963-1993 (1999), and RevolutionarySudan: Hasan a/- Turabi and the Islamist State, 1989-2000 (2003),Alms for JihadCharity and Terrorism in the Islamic WorldJ, MillardBurrRobert O. CollinsCAMBRIDGEUNIVERSITY PRESSCambridge,New YorK, Melbourne,Madrid,Cape Town, Singapore,Sao PauloCambridge University PressThe EdinburghBuik:ling,Cambridge CB22RU,UKPublishedin the UnitedStates of Americaby Cambridge University Press,New YorKWHW.cambridge.orgInformation on this title WHW cambridge orq/9780521857307GJ MillardBurr andRobert 0 Collins 2006This publicationis incopyright Subject to statutory exceptionand to the provisions of relevant collective licensingagreements,no reproductionof any part may take place withoutthe writtenpermissionof Cambridge University PressFirst publishedinprint format 2006ISBN-13 978-0-511-24741-5 mobipocketISBN-10 0-511-24741-9 mobipocketISBN-13 978-0-521-85730-7hardbackISBN-10 0-521-85730-9 hardbackCambridgeUniversityPresshasnoresponsibilityforthepersistenceor accuracyofURLsfor external or third-partyinternet websitesreferred tointhispublication, anddoesnotguaranteethat anycontent on suchwebsitesis, or will remain, accurateorappropriateContents1,34List of iIIusfrationsList offablesPrefaceList of abbreviationsIntroductionThe thirdpillar of IslamzakatCharitable recipientsZakat inhistoryZakat the Egyptian experienceZakat in the SudanSadaqaWag'Saudi ArabiaandIslamic educationSaudi ArabiaanditsIslamiccharitiesCharities andcharitable donations inSaudi ArabiaSaudi ArabiaRedCrescent SocietyMuslim Work! LeagueInternational IslamicRelief OrganizationAI HaramainIslamicFoundationWork! Assembly of Muslim YouthAI WafaHumanitarianFoundationBenevolenceInternational FoundationRiyadhbombings andSaudi ArabiancharitiesThe banksGok:JenChainInvestigating the banksSaudi bankingIslamicbankingAI Rajhi BankingandInvestment CorporationNational Commercial BankDallah AI BarakaGroup andBank AI TagwaHmvala systemContinuingbank scrutinyAfghanistanbeginningsAI OaedaOutb and the AfghansEmir of JihadOsamabinLadenandMAKAI KifahAymanal ZawahiriShaykhOmar Abdal RahmanPeripateticmuiahideenFoot sokliersWael HarnzaJulaidanand the Rabita TrustPakistanand the AI Rashid Trust5 Islamiccharities and the revolutionary SudanBankingin the SudanEnter OsamabinLadenIslamiccharities and the SudanRevolutionary SudanPeople's Defense ForceTurabi's presenceYassin Abdullahal-Qadi andMuwafagSudanese charities inSomaliaAI OaedaandIslamiccharities inEast AfricaIslamiccharities inWest Africa6 Islam at war in the BalkansAfghanistaninBosniaAI MuwafagBrigadeSudanese connectionsThirdWork! Relief AgencyAftermathinBosniaAlbanianimbroglioWar inKosovoAfter 9/117Russiaand the Central AsianCrescentOutsiders begin to arriveIslam in Tai"kistanHeartlandof Central Asia UzbekistanTurKmenistanandKazakhstanKyrgyzstan door to ChinaTranscaucasiaRepublicof GeorgiaChechnyaLost oPDOrtunity andinvestigations8From Afghanistan to Southeast AsiaMoroIslamicLiberationFrontMuhammadJamal KhalifaAbuSayyaf GroupMalaysiaIndonesiaRevoK insouthern ThailandForgottenBangladesh9The Holy LandPalestine RedCrescent SocietyCharities inPalestineHAMASHAMASabroadThe UnitedStates respondsArafat's charitable corruptionReviving theIntifadaMore charitable support for Palestine andHAMASLebanonandHizbullah10The Islamizationof EuropeMuslim EuropeGermany's problemMuslims inItalyIslam andFranceIslamiccharities, AlgerianIslamists, andPalestiniansThe Netherlands,Belgium, and the DanesThe UnitedKingdom11 Islamiccharities inNorth AmericaInvestigatingcharitiesBIFandGRFAI Kifahand AI HaramainHoly LandFundfor Relief andDevelopmentCanadianconnectionsWISESAAR FoundationEpilogue12 ConclusionNotesSelect bibliographyIndexIllustrationsMaps1,Figure1The Peshawar AI OaedanexusThe Khartoum-AI OaedanexusThe Peshawar ConnectionTables2 1 The Saudi royal family andits charitable interests2 2 Charitable entities belonging to or associated with the AI Qaedaorganization3.1 TheGok:JenChain4 1 Islamisl terrorist organizationsPrefaceThisbookseekstounravel and bring claritytothecomplex, elaborate, and secretwor1d of Islamiccharitiesthat havefinancedterrorism. It isnot anattempt togivethekind of learned discourse on zakat, sadaqa, or waqf that can be found in theEncyclopaedia of Islam. Similarty, it cannot providean extensiveanalysisof eachof theregions whereIslamiccharitieshavesupportedterrorists. Thus, theindMdual chaptersaremorean abstract, aprecis, toprovideasuccinct explanation of thecomposition,financing, money-laundering, andmanagement of thosecharitiesthroughwhich runstheir commonobjective, theestablishment of theIslamist state. It must be abundantlyclear from theoutset that thereare thousandsof Islamiccharities toassist andsupportthepoor, the destitute,thesick, andtherefugee that havenothingto do withterrorismManyof thesecharitiespromoteIslamforitsreligiousmission, but that isnot what thisbook isabout Our objective was to have thereader, whenreachingthe lastpage, haveanappreciationfor the global extent, ferocity, and determinationof theIslamists who areperpetratingcrimesagainst humanityinthenameof religion, andtherolethat certainIslamiccharitieshaveplayedinsupportingthoseIslamists. Therhetoricofrevolutiontojustify terror toseize political power hasbecome a masquerade that denigrates the veryspiritual meaningandpower ofIslamAlthough the authors have hadto struggle to select thecritical evidence from ourmanysources to satisfy the practical constraints of publication, the genesis of this book beganduring the writing of RevolutionarySudan Hasan al-Turabi andthe Islamist State,1989-2000(Leiden Brill, 2(03) For those familiar with Khartoum, oneof the moststriking differences betweenthe cityin the19805 andinthe19905 was theappearanceof newIslamiccharitiesand their gratuitous proliferationinprominentlysituatedofficesWho were these charities? What was their purpose? Why theSudanof all places? Themore wesought theanswersto thisphenomenon, themore werealizedthat Khartoumhadactuallybeentransformedfroma rather somnolent outpost of theIslamicwor1dintoa center of the international Islamist movement, made possible by the enormousamounts of money made available to its leaders byIslamiccharities. The search wasonbefore the trail turnedcoklTheauthorsowea debtof gratitudetoOIMerRoyandStevenEmerson, investigatorswhoselone voices wereheardinthe earty19905 warninggovernments that an Islamistrevolutionary movement was germinating throughout the western wor1d Emersondistributeda videotoconvincethosewhowoukl lookand listenthat theIslamistshadestablishedintheUSA"an elaboratesupport andrecruitingnetworKcoast tocoast withbranchesin morethan 88American cities." They served asrecruiting centers thatsupported mujahideen operating aroundthe wor1d Despitethe Wor1d Trade Centerbombingin 1993, theKhobar bombingof theUSmilitarybarracksinSaudi Arabiain1996, andthesubstantial evidenceafterwardthatIslamist warriorshad declaredwarontheUSAandnowEurope, Emersonwasseenasanalarmist, perhapsbecauseof hiswell-knownIsraeli bias. Even thoughcertainintelligence officers understood the dangersof jihad in theUSA, the authors determinedas earty as1993 that the FBI was extremelycautious inits investigationofIslamiccharitiesAseconddebt of gratitudeisowed Rita Katz, the"anonymous" author of TerroristHunter, thestory of one woman's struggle to expose theactivities of seditiousoperatorswithinIslamiccharitiesfunctioningintheUSA. LikeEmerson, she wasa vox clamantisin deserto, a voicecryinginthe wiklerness, for theabundant evidencesheuncoveredduringa decadeof determinedinvestigation Herbookis essential toanunderstandingof howIslamic charities supported Islamist movements inthe USA, but it has beenlargely ignoredby WashingtonWe especially want to thankonceagainAlanGoullyforreading, ashehaddoneforRevolutionarySudan Hasanal-Turabi andtheIslamist State, 1989-2000, the eartychapters of Alms for Jihad before leaving the UK for demanding diplomatic duties asHerMajesty'sAmbassadortoTunisia Wealsowant toexpressour appreciationtoSteveHumphreys, Professor ofHistoryat theUniversityofCaliforniaSantaBarbara, for hisunflagging support in all mattersArabic, and to SyMa Curtis, the intrepid researchlibrarianat UCSB, who has always come to our rescueSpellings canbea curse that canresull inchaos, particularly when the documentationfor a book,like this one, comes inmany languages Motivatedby familiarity, practice, orethnic pride, Africans, Arabs, Asians, and Europeans have spelled the name of aperson, place, or event in a transliteration that reflects their own parochialism,patriotism, and panache The resull is often confusion rather than clarity The onlylegitimate principleisconsistencyof speningin the text. Consistency, however, isnotauniversal virtue and does notalways guarantee clarity In thesearchfor clarity, wehaveconsequentlyAnglicizedorgiventheEnglishequivalent for people, place-names, andevents recorded in different languages Place-names are spelled for understandingratherthan inthelocal patois Personal namesaremorepreciselyretained becausetheyarecomplex, for everyonespellshisor her name totheir satisfactionandnot bystandardized rules of transliteration As with place-names, variety can producebewiklerment in 7the reader that can best be resolved by consistency We haveabstainedfrom the useof diacritical mar1.__.".,, I. ,...... ''''''''.ry ,...... --..,..... ....e- _,USA . _"- '"",,, .'"......__, ".,AI Oaedahadsuccessfullypenetratedthe official Saudi bankingsector, andmembersof that looselyknit organizationwereabletotransfertheir fundsthroughout thewor1dwithrelative easebefore9/11 Thefinancial managerforBinLadenuntil 1996 testifiedthat AI Oaeda had "lots" of moneyin awebof bankaccountsin Europe, Asia, andAfrica Inthe SudanBinLadenmaintaineda personal account at the AI Shamal IslamicBank, and opened accounts in three other banks in Khartoumunder other namesTherewere also accounts "in Hong Kong and Malaysia and at Barclays Bank inLondon "ill!l Almost a decadelatertheFBI woukl confirmthat theterrorist MohamedAtta, whopiloted oneof thecommercial jetlinersintotheWor1dTradeCenter, "wiredmoneyto Mr. bin Laden's former paymaster in Sudan, Shaykh Said ai-Masri [akaMustafaMuhammadAhmad] on the eveof the terrorist attacks "[92]"Tensofmillionsofthe $100 million" with whichBinLadenhadprovidedthe Talibansince hehadarrivedinAfghanistan fromSudan in 1996was "directlytraced to Bin Laden entitiesthroughbankingandother transfers. "[93]When ateamof American officials visited Riyadh in June 1999to discuss theproblems of tracking the financial transactions of Saudi charitable and financialinstitutions, theywerealarmedtolearnthat Saudi officialsseemedgenerallyignorantandsurprised that there was a problem regulating these accounts. Worse, "Saudi policeandbankregulators hadnever worKedtogether beforeanddidn't particulartywant tostart "[94] WhenSaudi Arabiamadeno effort to changeits bankingpractices a secondtask forceheadedbyOFACof the USTreasury paida visit to RiyadhinJanuary2000The Treasuryofficialsreceivedteabutlittlesympathyfor theirappeals to theSaudis toreform their bankingregulationsInvestigating thebanksImmediately after 9/11, the US government moved quickly to establish a legalframeworK to investigate terrorist financial infrastructure. Names and locations offinancial institutions through which terrorist organizations banked and moved theirmoneywerepublished Thus, theUSAwasthefirst tolaunchadeterminedeffort to"follow themoney"inorder tothemovementof terrorist funds; othermajorbankingnations wereslow tofollow. Privacy was valuedmore thansafety Assets wereblockedandregulations were establishedby executiveorder under theInternationalEmergencyEconomicPowersAct that enabledUSfinancial institutionstofreezeforeignterroristaccounts. Three months later the EUissuedsimilar regulations, but many hadalready surfaced The wor1d of international finance had become incrediblycomplicated Banksecrecy, wire transfers, themyriadof transactions, automatedtellermachines(ATMs), andtheeaseand convenience of modern banking coukl just asreadilybe exploitedby terroristsaslegitimateusers Thetransferof moneycoukl alsobe disguisedbymovingsmall amountsfroma varietyof sources, andwhilebankingintheUSA, Europe, andthePacificRimmight benefit "bothfromthepresenceandtheuse of sophisticatedregulatorylaws: the"contraryoccurredinthe MiddleEast, Africa,Southeast Asia, and the former Soviet bloc"[951In the aftermath of 9/11 the international regulatory community was forced toreexamine its standards. The USA was the first to act On 24 September OFACpublicizedthe names of thirty-ninepeople and organizations on its list of SpeciallyDesignatedGlobal Terrorists (SDGTs) whoseassets mustbe "blockedimmediately"Onthe list were Yassin Atxlullah ai-Qadi, Saad ai-Sharif, Ibrahim Salih Mohammedai-Yacoub, and Ali Saed bin Ali ai-Houri, all well-known Saudi businessmen fromJidda[961Qadi, amanwithinterestsinbanksandbusiness throughout thewor1d, hadbeentheformer headof theMuwafaqcharitywhichwoukl beaccusedof channelingmillionsof dollarsfromSaudi businessmentoAI Qaeda Amonthlater, on24October,Congress passed withsurprisingspeed theUnitedStates Patriot Act, officially knownas"Uniting and Strengthening America by Providing Appropriate Tools Required toIntercept and Obstruct Terrorism." That Act established an interagencytask forcetofollowthe money-trail Next, Operation Green Quest combined agents fromthe USCustomsService, theInternalRevenueService(IRS), theFBI, andtheSecret Servicetoinvestigate suspect charities and corrupt financial institutionsthat funded terroristactMtiesbothintheUSAand aroundthewor1d Hundredsof agentsand intelligenceanalystsbegantodiscover wiretransfersof fundsthat linkedthe9/11 hijackerswithterrorist cellsinEurope InGermanya groupdominatedbyAI Qaedamember Ramzibin al-Shibh had provided both financial and logistical support tothe hijackers; theinvestigation ledtotheindictment of ZacariasMoussaoui, aterrorist leader[97] Andonce theroutesusedandthe dimensionof themoneyflow wasunderstood, it becameabsolutely essential to proscribe those institutions used by terrorists to fund theiroperationsOn29 and30 October2001at an extraordinary Plenary[Meeting] onthe FinancingofTerrorismhekl inWashingtonDC, FATFannouncedit had beguntocrackdown onspecific institutions [98] Officials at FATFweredetermined toexpand its mission to"focus its energy andexpertise: anda crucial aspect of the FATFeffort was toimposesevere for financingterrorism, terrorist acts, andterrorist organizations Inaddition, UN countrymemberswere urgedtotakeimmediate steps toratify and toimplement the1999UnitedNationsInternational Conventionfor theSuppressionof theFinancingof Terrorism. TheUNSecurityCouncil andEUrespondedbypromulgatingregulationsdesignedtodiscourage money-laundering andthe flowof terrorist fundswhile expandingtheauthorityof FATFandtheEuropeanWolfsbergGrouptointerdictandh a ~ the flow of terrorist fundsTheUNSecurityCouncil adoptedResolution1373requiringmember states tofreezeand confiscateterrorist assets. It published information concerning funds frozen orsequestered, andestablishedprocedurestoensurethat non-profit organizationswerenot being usedtofinanceterrorism. Itestablished aCounter-TerrorismCommitteetomonitor theimplementationof theresolution Andfollowingtheinvasionof Afghanistanby coalition forces and the subsequent defeat of theTaliban regime, the SecurityCouncil passed a newresolution (UNSCR1390) which strengthened the sanctionsagainst remainingelementsof the Talibanand AI Qaeda UNSCR 1390 also establishedthe AI Qaeda Monitoring Group charged with investigating, reporting, and makingrecommendationsagainst AI Qaeda, Osama binLaden, andtheTaliban FATFwouklintensifyitscooperation withthe numerousfinancial investigativeagencies includingthose inthe UN, the EgmontGroup ofFinancial Intelligence Units, theGroup of Twenty,the Basle Committee on Banking Supervision, and the Asia-Pacific EconomicCooperationForum [99] Within two months after 9/11some siKly-six countries, includingUAEandSaudi Arabia, togetherknown tobe thesourceof mostof AI Qaeda'smoney,introducedprocedures toblock theassetsof those terrorist organizationsidentifiedbythe USA. TheUK establishedananti-terrorist financeunit, andin theEUonlyItaly wasreluctant tointroduce transnational financial regulations, andactually enacteda law thathinderedany investigationof the flow of funds across its bordersThe United States Patriot Act of October 2001 had given sweeping authority forcoordination among intelligence agencies, which had previously been legallycircumscribed TheTreasurycoukl nowrequireUSfinancial institutionsto"terminatecorrespondent accountsmaintainedfor foreignshell banks" andensurethat domesticbanks woukl not "indirectly provide banking services to foreign shell banks." TaxInformation Exchange Agreements were negotiatedwithknown tax-havensincludingtheBahamas, theBritishVirginIslands,theCaymanIslands,theNetherlands Antilles, andAntiguaandBarbuda The Patriot Act required Americanfinancial institutions to have byApril 2002aprograminplacetopreventmoney-laundering, andtoallaythefearsthat"intelligencesourcesandmethods"woukl becompromised, italsopermittedin-camerajudicial review of classified information used to freeze terrorist assets. Theseinvestigations soonled to the Netherlands, UAE,andSaudi Arabia By thenUSofficialswereconvinced that Osama bin Laden had "an archipelago of bank accounts" thatstretched"from Barclays Bank inLondon toGirocredit in Vienna to several banksinDubai" Indeed, UAEwas saidtobeBin Laden'sbanking hubof choicebecauseitmaintained official relations with the Taliban government in Afghanistan, and thusprovideda direct connection to BinLadenhimself [100]By 1999 USintelligenceservices were aware that the Dubai IslamicBank servedasamajorconduit for OsamabinLaden'sfunds. Dubai'slaxbankingpractices wereeasilycircumvented, andfunds sent by the Dubai Islamic Bank to AI Qaedaagents were linkedtothebombingof theUSembassiesinKenyaandTanzaniain 1998. Nearlyhalf the$500,000 usedby terrorists toprepare the 9/11 attack.hadbeenwiredto theUSAfromDubai banks Eventually, UAEwoukl enact lawsagainst moneylaundering "withintheframewor1h AI '''''"',-.."'_