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FBI conducts Palmer-style raids against 'Terrorist' targets

A Washington post article dated 4:33 p.m. Wed., 11/7 on a series of Palmer-style FBI raids today in Seattle, Boston, Colombus, OH and Minneapolis against alleged 'terrorist' associates.
Agents Raid U.S. Businesses in Al Qaeda Crackdown


2 Arrests Made; Businesses May Have Helped Fund bin Laden





By Kathleen Day


Washington Post Staff Writer


Wednesday, November 7, 2001; 4:33 PM








Federal agents today raided at least 11 U.S. businesses and arrested one man believed to be part of a global Islamic money exchange that Bush administration officials say is partly owned by Osama bin Laden and a key channel that his al Qaeda terrorist network uses to move money and messages around the world.





FBI and U.S. Customs agents swarmed buildings in Alexandria and Falls Church, Va.; Minneapolis; Boston; Seattle and Columbus, Ohio, sealing them off and removing documents of the Al Barakaat International Companies, officials said. In addition to the arrest in Boston, officials are seeking to arrest another man associated with the network.





"Today, we are taking another step in our fight against evil," President Bush said this afternoon in announcing the crackdown on companies, organizations and people suspected of aiding terrorists from the United States. "By shutting these networks down, we interrupt the murderers' work," Bush said in appearance at a Treasury Department investigation center in Northern Virginia.





Al Barakaat, headquartered in Dubai in the United Arab Emirates, was founded in 1989 by Ahmed Nur Ali Jim'ale, a former banker in Somalia who has been an associate of bin Laden since meeting him in Afghanistan when the two were fighting the Soviets, sources said. U.S. government sources said bin Laden was a "significant investor" when Al Barakaat was created.





The actions were part of a crackdown here and abroad today that was orchestrated by the White House against Al Barakaat and a bank, Al Taqwa. Al Taqwa is a Swiss-based company that has been described as a financial adviser to al Qaeda.





In coordination with the U.S. Treasury, which oversaw today's operation, Swiss police arrested two Arab financiers said to be linked to the terrorists.





U.S. officials also asked other nations to freeze the accounts for more than two dozen Al Barakaat companies or affiliates around the world. In addition to those in Dubai, Al Barakaat has entities in Somalia, Lichtenstein, the Netherlands, Canada, Switzerland, Tunisia, Italy, Sweden and Egypt.





Among the accounts frozen in the United States was one at Key Bank in Portland, Me., that was opened on March 6, 2000, with an initial deposit of $180 by Liban Hussein, who federal officials say is a key member of the Al Barakaat network here who is being sought.





In all, the names of 62 entities and people were added to a list of suspected terrorist associates targeted by Bush in an executive order signed last month in the wake of the Sept. 11 attacks on the World Trade Center and the Pentagon. An earlier list included 88 groups or people whose assets had been frozen because of their ties to al Qaeda and other terrorist groups.





Investigators have long suspected that bin Laden uses the exchanges, known as hawalas, to move money and finance the activities of his al Qaeda terror network. This is the first time they have focused on a possible bin Laden ownership role in businesses operating openly in this country.





The Al Barakaat entities targeted in today's action include:





– Aaran Money Wire Service Inc. of Minneapolis.





– Al-Barakaat Wiring Service of Minneapolis.





– Barakaat Boston of Dorchester, Mass.





– Barakaat Enterprise of Columbus, Ohio.





– Barakaat North America Inc. of Dorchester, Mass., and Ottawa, Ontario.





– Barakat Wire Transfer Co. of Seattle.





– Global Service International of Minneapolis.





– Somali International Relief Organization of Minneapolis.





A White House task force headed by the Treasury Department, and including members from the CIA and FBI, has investigated the exchanges – large, global networks that essentially operate as unlicensed banks – as part of the broader campaign to find and shut down sources of terrorist funding.





Investigators have been able to trace some of the money used in the Sept. 11 attacks to a bin Laden aide because it was sent through the traditional banking system, by wire transfer or money order. The money exchanges now being targeted allow individuals to send and receive money around the world without leaving the paper and electronic trail of Western banks.





Experts say they have no clear idea how many hawala outlets there are in the United States, in part because the hawalas have not had to meet the reporting requirements of banks.





A member of the local Islamic leadership said he knew of six or seven hawalas in the Washington-Baltimore area alone, most operating out of storefronts.





Daud Yaar, an Afghan American who is a professor of economics at California State University at Hayward, said hawalas, which developed in India before the advent of Western banking, have been used in the United States since the 1980s. Some individuals use them to avoid taxes, he said, but they also serve the legitimate purpose of transferring money to Islamic areas, such as Afghanistan and Somalia, that are under – served by banks.





But because they are unregulated, authorities say, they can be used for criminal purposes. The money the hawalas under investigation funnel to terrorist organizations includes profits from the fees the exchanges charge customers in the United States, sources said. Investigators believe the clients are mostly unsuspecting immigrants using the hawala for the legitimate purpose of sending money to relatives in other countries.





Authorities think the suspect hawalas also have functioned as a communications network for terrorist groups, including several closely tied to al Qaeda, sources said.





In the United States, immigrants, especially those from Islamic regions in the Middle East and Africa, often find hawalas easier, cheaper and faster to use than regular banks when they want to send money back home.





But the hard-to-trace system lends itself to money movements are subject to abuse by drug traffickers, terrorists and other criminals, federal officials say. A 1999 Treasury report cited several cases in which criminals used the hawala network to hide or "launder" money obtained from or intended for an illegal activity.





Citizens of Pakistan and Afghanistan used the networks to launder money from heroin sales here, terrorists used them to finance a bomb attack in India in 1993, and assassins of an Indian politician used them "to transfer the proceeds of the sale of narcotics to arms dealers for the purchase of military hardware," the report said.





A hawala can have its own storefront or it can be something that a jewelry-store owner or shoe repairman runs alongside his main business.





However the money exchange is set up, the system is the same. A customer brings cash and asks that it to be sent to a specific person or company in a specific place – $100, for example, to a cousin in Dubai in the United Arab Emirates. The dealer charges a fee, that typically runs from 5 percent to 15 percent of the amount involved.





The dealer then calls, e-mails or faxes a counterpart around the world and tells him that $100 is to be given to the specified person, or a representative who uses a password. The U.S. dealer doesn't send any money. Instead both dealers mark the transaction in their books – the U.S. dealer owes $100 to the Dubai dealer, and the Dubai dealer has a $100 credit with his U.S. counterpart.





The assumption is that, eventually, the Dubai dealer will have a customer who wants to send $100 to the United States, and the books of the two dealers will balance. Occasionally, books become unbalanced, with one dealer having paid out much more than he has sent overseas. When that happens, a dealer might send goods, such as jewelry, or cash to his counterpart to even out their accounts.





In 1994, Congress passed a law requiring hawalas to register with the government. But the law lacked enforcement power, and the Bush and Clinton administrations never issued implementing regulations.





Under new anti-terrorism legislation passed by Congress last month, hawalas will be required by year-end to register with the Treasury Department and, like banks, to report suspicious activities, such as unusually large cash transfers. The new law also requires the Treasury to report to Congress within a year on the success of the new hawala rules.





Washington Post special correspondents Helen Jung and Pam Ferdinand contributed to this report.








© 2001 The Washington Post Company


 
 

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