The war on terror's money

Police say they discovered the proof against Bazaz in the home of top Kashmiri separatist politician, Syed Ali Shah Geelani, former chairman of a coalition of separatist parties called the All-Parties Hurriyat Conference and leader of the political party Jamaat-I-Islami. Police say they also found lists of "hundreds" of members of Hizbul Mujahideen, Kashmir's largest militant group.

To critics, Geelani's arrest – in the early stages of state elections to be held this October – was merely a way to harass a top politician advocating an election boycott. But for sources within the J&K Police, the arrests were a major breakthrough, based on some of the clearest evidence they've had dealing with such cases.

Police first targeted Bazaz, the go-between who began delivering money for British Kashmiri businessman Ayub Thuker, head of the World Kashmir Freedom Movement – an umbrella organization of groups that work toward Kashmiri self-determination through "all peaceful, moral, and political means."

According to the J&K Police, Bazaz received nearly $300,000 between March 2000 and May 2002. Police say Bazaz sent this money to Geelani and another Kashmiri separatist leader, Aasiya Andrabi, leader of the women's Islamist party Dukhtran-e-Millat.

According to police, the transactions were seamless: Bazaz would receive a phone call from Mr. Thuker, and days later, the money would be delivered directly to Bazaz's hotel room in Old Delhi. Like a spy changing vehicles to avoid being tailed, Bazaz would deposit the money in one bank account as funding for his magazine ventures. He would then write a check, depositing the amount into a second bank, and then a third. Finally he would transfer it to a bank in Kashmir, where he would withdraw and deliver the amount in person. To prove that these transactions were illegal, police say they need to show a direct link to terrorist groups.

On June 9, police say they received such proof while raiding Geelani's home. There, they reported finding nearly 1,200,000 Indian rupees and $10,000. But the plum discovery, police sources say, were lists of "hundreds" of "known terrorists" from Hizbul Mujahideen.

"It's a strong case, built on evidence from the raids and confessions from Imtiaz Bazaz," says inspector general Suri. Despite his confidence, Suri declines to show evidence proving that Geelani has sent money to these "terrorists." Geelani has long said that his party has collected money to help orphans and widows of Kashmiri activists.

O.P. Sharma remembers the day, in 1991, when he caught a major hawala dealer in the act of funding terrorism. And he remembers finding evidence that the same dealer was also funding top names in Indian politics.

It was the proudest day of his 30-year career, and the day he began to lose faith in the Indian criminal-justice system.

Soon after accounting books were discovered in the home of R.K. Jain, a top hawala dealer in New Delhi, Mr. Sharma says police were told to ignore the evidence against politicians and to simply go after the terrorists. When he refused, Sharma promptly lost his job. A few months later, charges against all but two of the politicians in the Jain case – including current Foreign Minister Yashwant Sinha and Deputy Prime Minister L.K. Advani – were dropped.

Such political interference could have the dangerous potential, experts say, of undermining cooperation between US and Indian police forces tracking down Al Qaeda funds in Indian banking channels.

"In 30 years, all the investigations and prosecutions by me have ended in conviction. But in the biggest case of all, I got taken out," says Sharma, who has since retired.

Today, the Jain case is being rekindled, in large part due to investigative journalist Vineet Narain. In 1994, Mr. Narain filed a lawsuit in the Supreme Court, releasing the names of the politicians implicated in the Jain cases. Even then, political interference continued. One justice complained that he was being "pressurized" to set the Jain case aside once more. Another justice admitted having socialized with one of the dealers, but refused to recuse himself from the case.

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