More traffic cops along global money trails
US officials act in concert with banks and other nations. Terror cash is hard to trace.
WASHINGTON — They opened checking accounts and ordered debit cards in Florida banks. They were photographed at ATM machines in Maine. One $100,000 wire from the United Arab Emirates even triggered a suspicious-activity report.
Yet, as 19 terrorists plotted their Sept. 11 attacks, their financial moves - totaling about $500,000 in a $1.5 billion-a-day haystack of money transfers globally - failed to trigger an investigation. At least, not then.
But since Sept. 11, US officials have been rapidly developing a system of tracking the financial assets of terrorists that could make a difference in the future.
An outright shutdown of terrorist money supplies won't be possible, analysts say, given the vastness of the financial system and unknown identities of many would-be terrorists.
But an unprecedented worldwide effort is beginning to support what President Bush is calling the "financial front" of the war against terrorism - ensuring that acts of destruction will be harder to finance in the future.
"The horror of the events of Sept. 11 has focused international efforts to take more seriously the fight against terrorism and money laundering," says Jermyn Brooks, executive director of Transparency International, a Berlin-based group promoting global cooperation against financial corruption.
The US laws and the early response from the international community is a "huge step forward," he says. "It is a great opportunity for the international community to tackle this problem in the aggressive way that President Bush has outlined."
On Sept. 24, Mr. Bush signed an executive order to freeze the financial assets of suspected terrorist groups and individuals. To date, 98 countries have blocked accounts on the US list, and 176 have offered help in going after the money, according to the US Treasury Department.
In addition, Congress has given Washington strong new powers to regulate banks. And, in a little-noticed move, it applies money-laundering measures to other institutions. Now, securities brokers, insurers, credit-card companies, jewelers, real estate brokers, and even car dealers will have to maintain anti-laundering programs or face stiff penalties.
"Just like we're tightening up our border controls and our airport security, we have to tighten up our financial controls and be a lot more careful about the foreign people we allow into the US financial system," says Sen. Carl Levin (D) of Michigan, a sponsor.
At an emergency meeting in Washington last week, the 29-nation Financial Action Task Force agreed to join the US war on terrorism. Justice officials from those nations plan to follow the US in criminalizing the financing of terrorism, reporting suspicious transactions, and regulating informal money systems, known as hawalas.
It's a complex business. Here's one example of an individual the US has designated as a global terrorist. He's a Kenyan citizen with two listed dates of birth and at least eight aliases, including Ahmed the Tall, Sheikh Ahmed Salim, Hahamad, and Bahamad.
Until recently, he could have opened a bank account in many nations without much comment. That culture is changing.
For the first time, the US is adopting the strong "know your customer" requirements that Europe has - and is threatening to seize assets of foreign banks that do not respect that standard.
Also, the Treasury is heading Operation Green Quest, an unprecedented collaboration between banks, law enforcement, and intelligence agencies to track down terrorist assets in the US. Its new command center will analyze huge amounts of data on potentially suspicious transactions.
Critics worry about this concentration of information, because of the costs it imposes on banks and incursions on privacy.
"It's better to try to determine who is involved in terrorist activities, then go from the terrorist to their source of financing, rather than casting a wide net and hoping something will turn up," says Jacobo Rodriguez, a financial services analyst with the Washington-based Cato Institute.