The world's terrorists are laundering money

The war on terrorists' financial networks will not be won overnight. It will probably not be won at all. bin Laden and his al-Qaeda operate in banks that are not subject to any control mechanisms, they receive support from humanitarian organizations and they raise large sums of money in the black money market related to drugs, prostitution and "ordinary" crime.

The flow of capital in the world has been liberalized, the business communities – both Western and other – lock their money into tax and financial paradises, wash the whites there if necessary, spread their money on a bunch of accounts in various banks around the world, create a conglomerate of straw companies, and conducts its shady business under the cover of the banks' close secrecy.

But as capital becomes global, terrorism also becomes global. bin Laden has bragged about the new orthodoxy, and in the days before the terrorist attack on the United States, he speculated wildly in the stock market, earning a pile of new millions of dollars.

Billions on the way

During the unveiling of bin Laden's finances, much has emerged about the huge sums that are at all times beyond all public control.

For example, every day, 350.000 barrels of oil are smuggled out of Iraq. No one knows where the money is going. Between 10 and 15 percent of the total EU budget disappears every single year. It amounts to between 53 and 83 billion a year. No one knows where the money is going.

Revenues from the drug trade amount to 2500 billion francs each year. Revenue from the world's total automotive industry – by comparison – is 2900 billion francs. The illicit trade in medicines amounts to 80 billion francs a year.

Revenue from various forms of counterfeiting is between $ 150 billion and $ 470 billion each year. Diamond traffic in Africa, the illegal market to get rid of waste, organized crime, prostitution… make up… no one knows how many hundreds of millions of dollars.

The fight against money laundering is now taking place across the globe. The accounts of suspicious individuals, groups and humanitarian organizations are blocked, as the United States did with Osama bin Laden's funds already in 1998. The world has received the knife to the throat from the United States, with threats that “either you help us or we will take action. to also block their funds and transactions with our country. ” The tax havens are told to lift the secrecy in the banks and international treaties and agreements related to terrorism, crime and money laundering are suddenly in the wind again.

But breaking bin Laden's – and others' – financial networks is no easy task. The networks are difficult to identify and often use small money offices that are not registered anywhere, in the Middle East and Asia. Osama bin Laden, whose personal fortune is estimated at about $ 300 million, has income from a number of humanitarian organizations, as well as from his financial interests in a number of countries around the world. His group is both engaged in diamond trading in Africa, owns fishing boats in Kenya, runs a timber business in Turkey and agriculture in Tajikistan, it says in The world.

Part of his wealth is in international banks, such as in British Barclays and Austrian Girocredit; but also in banks in Dubai, Singapore, Sudan, Yemen and Malaysia. Much of the money is in cash, and the accounts created in the banks are distributed among a bunch of people with partly false identities, with small sums in each account.

Therefore, blocking the accounts that can be traced directly to the man in the mountains will not hit very hard, even the CIA estimates. Instead, the battle must be waged against the system the Americans themselves have set out to create; the liberalization of the financial markets and the reduction of the national barriers to the free flow of capital. Call it now.

Where does the money come from?

But where does the money come from, in this supposed network of bin Laden, so specifically? You know something, you suspect something and you just suspect something. What is not known, and for which evidence has never been found, is whether the powerful bin Laden family in Saudi Arabia is in any way involved in the billionaire son's somewhat bizarre "business activities."

Possible source of money; Saudi bin-Laden Group, or SBG:

Officially, neither Saudi Arabia nor bin Laden's family have any contact whatsoever with the man up in the Afghan mountains. Saudi Arabia deprived bin Laden of its citizenship already in 1994, and his family broke all relations a few years before; early 90.

But is the break really as complete as everyone in his family says it is? Well, there is Western intelligence asking, and they have no answer to that. A few years ago, the American magazine published Forbes Osama bin Laden as one of the richest on this planet. The claim was never accepted, and in Sudan in the middle of the 90 century, bin Laden with financial resources made it difficult enough to build the road network and complete an airport.

However, this image – possibly the myth – of the cross-rich Saudi Arabia is denied by those who move in bin Laden's closest circle. They claim in an interview with The Independent on Sunday September 16 this year that bin Laden has a total fortune of "only" four to five million dollars after he was cut off from the family fortune in Saudi Arabia and elsewhere.

Anyway: what one knows about bin Laden's family is that they are rich; kingdoms, yes, in fact, inalienably rich. Over the past twenty years, SBG has had a monopoly on all construction projects in the two holy cities of Mecca and Medina, which have brought in the net sum of 165 billion, a French expert in Arab countries tells the newspaper The world.

This wealth has then formed the basis for a widely branched, transnational company with branches in a number of countries and with shares in a dozen companies across the globe. In Saudi Arabia, Saudi bin Laden Group builds roads, all kinds of infrastructure, airports, palaces, electrical installations and more, while producing equipment for the oil sector, electronics and being involved in telecommunications and satellites. The assets are invested in so-called "Islamic banks", in mutual funds and in banks in London.

You know this. What you do not know, but what you "assume" – as it is called – is that the company has shares in Motorola, and in companies (western) that operate in electronics, new technology, maritime transport, and which operate in the real estate market. In total, SBG will operate hundreds of subsidiaries, a number of which are registered in the tax havens of the Bahamas, the Virgin Islands and the Cayman Islands.

French intelligence also believes that Saudi bin Laden Group, through the foundations and humanitarian organizations they control, has been instrumental in funding Muslim extremists, primarily in the Philippines. 1999, Saudi Arabian authorities say, found evidence that five high-ranking businessmen had funneled tens of millions of dollars into bin Laden's network, via two humanitarian organizations.

But beyond that, no evidence of a direct link between SBG and bin Laden's financial resources has ever been found.

Possible source of money: Saudi Arabia

Officially, the Saudi authorities have stopped funding organizations that somehow have "Islamic struggle" on the agenda. But again, Western intelligence "suspects" that some of the enormous oil wealth is trickling down the system before the money finally reaches Osama bin Laden.

Since the oil shock in 1973, Saudi Arabia has seen its oil wealth multiply. The country owns 25 percent of the world's famous oil reserves, and in the mid-80s – with sky-high oil prices – earned about $ 200 billion a year on its black gold.

This fortune benefits first and foremost the country's large royal family – between five and six thousand princes -. But some of this wealth – through the religious treasure zakat – goes on to NGOs, which use the money for social welfare, school and other needs of the population. A few percent of these funds, experts suggest, go or have gone on to Islamic movements, such as Hamas, the Muslim Brotherhood, Bosnian mujahedin forces, Chechen liberation forces and others.

And some of this has gone on to bin Laden's terrorist network again, it is suggested.

Safe source of money: Opium / heroin production

When the Taliban came to power in Kabul in 1996, they vowed to eradicate all opium production in Afghanistan. Opium was incompatible with Islam, and the Taliban were moral fundamentalists who were to ensure that the country's overall activities were in accordance with the Qur'an.

But the rampant earnings related to opium, processed into heroin in Pakistan, became too tempting. Therefore, a religious measure was taken that banned all milder narcotics, such as hashish, because it was used by Muslims in Muslim countries.

Heroin, on the other hand, was produced for the "unclean" in Western Europe and the United States, and opium production was therefore allowed.

Afghanistan today produces 80 percent of the world's opium, about 4500 tonnes in 1999. The value of this production is estimated at $ 91 billion annually, and it is estimated that the amount is roughly shared between the Taliban and Osama bin Laden.

Safe source of money: Other financial interests

Osama bin Laden has his own small "empire" of companies, headquartered in Sudan. Through the holding company Wadi Al Aqiq, he previously operated a company with subdivisions in Yemen, Bahrain and Sudan. One of these companies is Gum Arabic Company, which controls virtually all rubber production and processing in Sudan.

When bin Laden had to leave Sudan in 1996, this company was restructured. In 1995, the company was jointly owned by the Sudanese government (30 percent) and private investors (70 percent). It is not clear whether Osama bin Laden still has access to the revenues of this company. But the suspicion is there.

Secure Money Source: The Black Market

Goods intended for Afghanistan are shipped free of charge through Pakistan from the ports in the south. The goods are then reloaded in Afghanistan, and then shipped back across the border, where thousands upon thousands of small Pakistani businesses have been knocked out by the fierce and illegal competition.

The value of this black market is huge; About half of Pakistan's official economy is estimated. The money goes back to Afghanistan, funding among other things bin Laden's al-Qaeda.

Secure Money Source: Speculation

Did the terrorists – in the days before 11/XNUMX – engage in massive speculation in the international financial markets? The answer seems to be yes.

The US, Japanese and German stock exchanges are now investigating a series of suspicious transactions in the days before – many of them the day before – the attacks on the World Trade Center and the Pentagon. The exchanges are particularly interested in what they perceive as a wave of speculation against companies and firms that would inevitably have to lose financially on the attacks, such as the company Morgan Stanley Dean Witter – the largest tenant in the World Trade Center. And the commercial bank Merrill Lynch, whose offices were located near the two twin towers.

In the days before the terrorist attack between 12 and 25, the share activity associated with these two companies was times higher than normal. The same trend is found for buying and selling shares in other losing companies, such as airlines and insurance companies.

On September 10 – the day before the attack – hectic activity was registered in connection with the company American Airlines, which lost two of its planes in the attack. The number of transactions was five times higher than normal, and it was obvious that "some" expected that the share price of this company would fall dramatically in the coming days. It did then too; to less than $ 18 on Monday after the terrorist attack.

Thus, the financiers – whoever it was – had earned as much as 1.3 million dollars just on speculation against this one company, the stock exchanges have calculated.

United Airlines – the other affected airline – experienced a similar wave of speculation. Here, the culprits have earned over two million dollars, is the estimate from the financial centers.

Other companies and banks that were exposed to speculation are the financial bank Citygroup, the insurance companies Bear Stearns and Cos & Marsh, and McLennan. This last company had 1700 of its employees located in the World Trade Center.

The way this type of speculation is carried out is to conduct so-called short-trading of shares in the companies. In short, it means that you "borrow" a certain number of shares, that you sell them on day one at a price of 100 percent, and then buy the shares back on day three, after "something" has happened, at a price of maybe 70 percent.

It is this kind of deliberate speculation that has taken place in the days before and after the terrorist attacks, the authorities reckon.

The stock exchanges around the world, including in Oslo, are now working to track down the suspicious transactions, which the head of the US Stock Exchange's controlling body, Harvey Pitt, believes is directly linked to the terrorist attacks in New York and Washington. By analyzing and following the financial flow these first September days, the control authorities expect to have a reasonably good chance of uncovering who is behind it.

So far, no one has come this far, and nothing on the Oslo Stock Exchange has revealed anything suspicious.

Europe's largest insurance company, Munich Ré, – hard hit by the terrorist attack – was also subjected to extensive "short trading" in the days before the terrorist attacks. The tracks go to Italy, where the military intelligence has found a brokerage firm in Milan that is known for operating in the European financial market. The name of this brokerage firm has not been released, but the firm is suspected of having ties to Osama bin Laden.

Secure Money: Islamic Banks

Those who enjoy interest will be condemned, just as the devil did them wrong.

They are based on the principles of the Qur'an, and seek to prove that it is possible to combine religion and economics in an interest-free world. More than 160 banks and financial institutions in the world offer their customers an "Islamic" management of money and wealth.

Most of these banks were created in the 80 century. They manage a capital of about 100 billion and have the same breadth in their services as other banks, with some exceptions related to interest rates, alcohol and swine.

Banks get paid for these services, not through interest rates but by taking part in the profits of the business.

London is the nerve center of this network of Islamic banks, led by Saudi Arabia – such as the Arab National Bank, the National Commercial Bank and the Saudi International Bank. Billions of oil dollars flow through these banks every year, while "pure" Islamic banks such as Al-Rajhi and Al-Baraka take care of Muslim customers who have medium incomes and medium fortunes.

In addition, Iranian, Sudanese and Pakistani banks – countries that have fully Islamized their financial systems – are central to this network. Today, Muslim clients are offered investment opportunities in 80 purely Islamic funds.

So far, so good. But the problem, in the eyes of those now fighting the terrorists' financial networks, is that these banks often enjoy "sovereign immunity" because they are linked to the royal family and / or the political elite in the Middle East. This means that the English control body Financial services authority have no mandate to check what is going on in these banks. This in turn complicates the fight against money laundering, while the banks can send their tithes – from the "pure" profits – tax-free and without any control – on to it humanitarian organizations, some of which are suspected of supporting terrorist networks.

It is worth emphasizing that none of the aforementioned Islamic banks are suspected of providing direct support to terrorists. The problem is rather that bin Laden's and others' networks have money in their hands, and that they use the banks and other financial institutions to "earn interest" on their capital. However, other banks are suspected of having given money to bin Laden directly. This includes the Al Shamal Islamic Bank in Sudan, where bin Laden injected $ 50 million in start-up capital in 1991. This bank – and three, four others – are now under the supervision of the US Office of Foreign Assets Control, which has been given the task to stop the flow of money to all the world's terrorists.

Secure Money Bond: Western Banks

There is no sharp distinction between Islamic and other banks. Arab banks operate according to the Western pattern, but have "Islamic" branches and subdivisions. Western banks, such as US Citybank, British HSBC, German Dresdner Kleinwort Benson, and French BNP Paribas and Société Générale, offer "Islamic investments" to their Muslim customers.

But these "ordinary" Western banks also manage bin Laden's fortunes, according to Western intelligence. The British bank Barclays and the Austrian Girocredit have frozen accounts that they believe can be traced back to the world's most famous terrorist.

Much of the attention of the world's intelligence agencies is now directed at the banks that operate as "correspondents" for shady – as it is called – banks in the Middle East. Both the British Arab Commercial Bank, American Express, Banque francaise de l'Orient, German Commerzbank, Credit Lyonnais in Geneva and Standard Bank in Johannesburg are "correspondent banks" for the Sudanese Al-Shamal Islamic Bank, which was established by bin Laden in 1991 for to fund precisely the al-Qaeda network. This means that these banks carry out payment orders for Al-Shamal Islamic Bank, a business that is extremely lucrative for the world's large and serious banks. The assignments take place in such a way that Al-Shamal Islamic Bank transfers large sums of money to the Western banks in advance, which facilitates the flow of payment orders.

Both interest income and the fees for services rendered benefit these banks.

Banks that cannot afford to establish branches in Europe often use US, French or UK banks to take care of their clients abroad. It is a legacy from the colonial era, and every day there are billions of transactions of which the vast majority are absolutely legal. But in between all these legal transactions, they come illegally. Nobody has an overview of them.

In the world today, it takes about twenty minutes for any amount of money to cross the world. Billions of dollars flow every single day from one edge of the globe to the other. With his higher education in economics and administration from the University of Jeddah in Saudi Arabia, and with his experience from the family business, bin Laden – like other capitalists – knows how to take advantage of an international financial regime that allows most things to flow freely.

This article was written on the basis of a number of articles in the French newspaper Le Monde in recent weeks, including a special document on the financing of international terrorism the 18. September. Much of this information is taken from Western intelligence.