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THE TERROR TRADE Terrorist organizations are using the commodity markets as a money laundering vehicle, says the Wall Street Journal. Increasingly, according to the report, food and medication aid packages, especially some financed by Islamic charities are vehicles for money laundering, with the proceeds being used to finance terrorist activities. According to the Journal "terrorist supporters, narcotics syndicates and sanctions busters have adopted a new method of sneaking funds past the watchful eye of the law: the global commodity trade. The Journal summarizes the practice, also known as "trade-based money laundering" as follows: "Instead of wiring money directly from one country to another, a would-be money launderer buys foodstuffs like sugar or vegetable oil or other goods. Those goods are far easier to deliver to restricted destinations like Iran and the Palestinian territories because they often look like legitimate aid. When they arrive, local merchants transfer the goods on, or simply sell them for cash. A portion of the proceeds end up with local terrorist groups or criminals." Indeed, although the practice is believed to be widespread, there is no way to quantify how much money is involved. Several interesting facts are known, however, such as the large amount of activity that involves Iran, through the United Arab Emirates and especially Dubai, a country in which the flow of capital is large and in which there are connections to international shipping. According to the Journal: "Much of the money in question is laundered in the United Arab Emirates, the primary conduit for Iranian imports. Trade-based laundering in the Emirate of Dubai also helps finance the booming Afghan-Iran heroin trade, according to U.S., Italian, and U.A.E. law-enforcement officials." In fact, "In February, U.A.E. officials arrested 40 people on charges of commodities-based money laundering for narcotics traffickers. Many of the trades were placed through at least 15 different accounts at Man Financial Inc. in New York, U.S. officials said. The firm wasn't accused of any wrongdoing." The Journal describes an intricate web of activity in Europe, which is alleged to be involved in siphoning off capital from delivered aid to Palenstinians in Gaza. At the center of the allegations is a company called "Abu Aker for Export & Marketing," described as "a commodities firm based in Gaza and headed by Fayez Abu Aker." According to sources described by the Journal, Mr. Abu Aker has delivered commodity shipments to Gaza, from which proceeds have ended up in the pockets of "charities" run by Islamic Jihad. Abu Aker has denied links to terrorist organizations. Conclusion Terrorism is a global entity, which seems to now be quite well integrated into the global economy through seemingly legitimate channels. The web is too large to be fully penetrated. And the extent to which well intentioned money and goods may go to finance some kind of atrocity is unknown. Furthermore, the links between drugs, money laundering, charitable donations, and disorder are not likely to be broken anytime soon.
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