Why terror financing is so tough to track down
British finance chief Gordon Brown envisions creating a center of national experts to crack the problem.*
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Despite the flurry of activity, however, actual convictions for financing terrorism have been few and far between. Last September, a Spanish court sentenced Imad Yarkas to 27 years for helping fund the 9/11 attacks; two months earlier, Yemeni cleric Mohammed Ali Hassan al-Moayad was sentenced to 75 years in the US for conspiring to provide financial support to Al Qaeda and Hamas.Skip to next paragraph
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The reason for the dearth of other convictions may be that the authoritieschoose to "follow the money," rather than haul in suspects, says Bill Tupman, a professor at Exeter University in Britain who has studied terrorism for decades.
While the 9/11 commission said that tracking Al Qaeda financing had proven "a very effective way to locate terrorist operatives and supporters and to disrupt terrorist plots," Professor Tupman explains that intelligence services face a difficult choice of whether to confiscate the money and bring a criminal case, or follow the cash and see where it ends up.
He adds that the lack of criminal convictions may also be due to the fact that terror funding is a complex jigsaw, and no one agency holds all the pieces. Banks may have one piece, counterterrorist units another, but others may be held by partners overseas, requiring better international cooperation. "There is plenty of information," says Tupman, "but then there was plenty of information at the time of 9/11 ... the problem is putting it all together."
If the problem is putting it all together, the solution, according to Britain's Chancellor of the Exchequer Gordon Brown, lies in unified action. Among a series of measures outlined last month was a plan to bring national experts together in a unit that would work at "cracking" terror finance in the same way that wartime mathematicians collaborated in cracking the Nazi Enigma code.
But while international efforts focus on the big money that helped finance 9/11 and establish terror cells in Europe, Al Qaeda has moved on. Experts say terrorists are no longer waiting for Osama bin Laden's moneymen to dole out the cash. Instead they are, according to Paul Wilkinson, a terrorism expert at St. Andrew's University in Scotland, "accumulating funds themselves for attacks through petty crime, ID theft, fraud of many sorts, money laundering, and smuggling of money and commodities across porous borders." [Editor's note: The original version omitted Wilkinson's position and area of expertise.]
Tupman says the metamorphosis mirrors that of groups such as Irish republicans and South American narcoterrorists.
"If you are going to survive, you have to create income streams," he says. "And if you stay in the legal world, it's confiscated, so you end up following the examples of people who run illicit businesses." The alliance between organized crime and terrorists is increasingly profitable, he says. But successful terror cells will always need to launder money to find somewhere safe to park it until it is needed, perhaps buying property for cash or investing in trusts that yield an income.
The trick for the authorities is to snare the dirty money at the point that it tries to enter the legitimate system. Those points should be the frontline in the war on terror, says a UN expert, who spoke on condition of anonymity because of continued involvement in the affair. "It's where you incorporate companies, it's with the bankers and fiduciary trusts and lawyers that help you mutate these things on a weekly basis, buying assets that are portable, that you can move easily, so you always get money wherever you go."
But for open societies that pride themselves on freewheeling financial centers, snaring the villains without hindering the operations of the innocent can be difficult. Are cities like London, whose easy-come-easy-go attitudes bring boundless international capital, going to sacrifice financial freedom to catch a few money launderers? Napoleoni thinks not.
"After all," she says, "you can open a bank account in Turkey and use a cashpoint anywhere in Europe to withdraw the funds. "How are you going to stop that?"
* [Editor's note: The original version mischaracterized the center's personnel. Also, the original version did not specify Brown's government position.]