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Countering Terror Finance:  How America Follows the Money

December 2012

  • Counter-terror finance is extremely effective way of combating terrorism.
  • Treasury’s Office of Intelligence & Analysis (OIA) is one of the most effective arms of intelligence community.
  • Terrorists have infiltrated the Islamic institution of charity (Zakat) and have corrupted it from within.
  • The US government has responded with targeted financial sanctions against these charities, as a means to block them from serving as financial conduits to terrorist groups.
  • These terrorist designations have had a chilling effect. Many Muslims in America are now afraid to give to charities for fear of investigation.
  • Some critics of American measures to halt terror finances from Muslims charities call Treasury’s measures “Islamophobic.”  This is wrong.  In these cases, the government is forced to intervene because the Muslim community is not providing adequate oversight.  When the corruption ends, so too will the interventions.
  • Some examples of terror-financing charities in recent years include:
    • Holy Land Foundation, based in Texas, was designated 2000 for support to Hamas.
    • Islamic American Relief Agency, based in Missouri, was designated in 2004 for supporting al-Qaeda.  The charity also funneled funds to Hamas and al-Ittihad al-Islamiyya, a terrorist group in Somalia.
    • Kindhearts, based in Ohio, had its activities suspended in 2006 based on its reported support to Hamas.
  • The US government also imposes sanctions against states that sponsor terrorism.  The list of state sponsors is maintained by the State Department.
  • The primary concerns at the moment are Syria, Sudan and Iran.
  • Sudan was the country where al-Qaeda was based during the first half of the 1990s.  It continues to work closely with Iran to help provide funding and weaponry to Hamas and Somali terror groups like the Shabaab.
  • Syria serves as a weapons pipeline between Iran and the Lebanese terrorist organization Hizbullah.  Syria also supports the activities of Iraqi insurgents, Hamas and Palestinian Islamic Jihad.
  • Iran, however, is the most worrisome state sponsor of terror. Treasury’s former Undersecretary, Stuart Levey, called Iran “Central Banker of Terror.”  Iran sponsors Hamas, Hizbullah, and Palestinian Islamic jihad in the Levant.
  • However, its terror activity also extends to that of al-Qaeda and the Taliban.  Many attacks against US servicemen in Iraq and Afghanistan were sponsored by Iran.  This has not received enough attention.
  • Thanks to new sanctions in place to derail the Iranian nuclear program, the US government is looking at new financial targets to weaken the regime.  These sanctions can also weaken the Iranian regime’s ability to sponsor terrorism.