Western banks continue to handle terrorist groups’ funds, it is claimed.
Al Qaeda has been ‘completely undeterred’ by anti-financing legislation introduced since 9/11, claims an academic, Dr Rohan Gunaratna, in a speech. Western banks continue, unwittingly, to be party to the laundering of the network’s funds and need to take more active steps to identify and halt money-laundering transactions, he warned. Dr Gunaratna, author of Inside Al Qae’da, was speaking at a private seminar for commercial security experts and risk managers, organized by The Risk Advisory Group.
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Economic targets
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During his speech, Dr Gunaratna warned that Al Qaeda’s current strategy continues to focus on economic targets and on broadening the list of target nationalities. The funding for these attacks, commonly believed to be based largely in the Hawala banking system, is also passing through conventional banking channels, despite legislation adopted following 9/11.
He said:
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In the weeks following 9/11, more than $150 million was seized; but only $10m since. It is unrealistic to believe that the money flow has stopped; indeed, intelligence suggests that much money still passes through conventional banking channels. A deliberate decision was taken by Al Qaeda to focus its efforts on economic targets, and we have seen clear results from this strategy in the last six months. Business therefore faces a double-whammy; from Al Qaeda and its constituent groups; the threat of direct action against their interests coupled with the risks of being unwitting partners to its money-laundering activities. Hawala banking remains the channel of choice for Al Qaeda but this is an organisation that never puts all its eggs in one basket. Conventional banks remain at risk and must ensure vigilance.
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What he says
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‘The most difficult issue is that of scale. Many banks have the systems to detect large-scale money-laundering and to stop it. But in Al Qaeda’s war, an operation can be completed successfully for only tens of thousands of pounds. Even an operation the size of 9/11 is estimated to have cost less than $500,000, moved in a series of smaller sums.Detecting these cash flows is clearly more difficult.’ Gunaratna warned that Al Qaeda is as strong as it ever was, although it has been scattered across the globe. It has adapted to these conditions and has adopted a strategy of resilience arising from its lack of central command and control.
He said: ‘During 2003 AQ will become more "bottom up" than even it is now, with local cells inspired, trained, and financed by bin Laden carrying out semi-autonomous actions. Al Qaeda continues to seek to build momentum around a global struggle, where it sets the agenda and others follow.’ The seminar was attended by risk managers and security experts from a range of banks, investment houses and multinationals. Dr Gunaratna is one of a number of people to have input to The Risk Advisory Group’s physical risk assessment business, which is headed by terrorism academic Dr David Claridge.
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About TRAG
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The Risk Advisory Group is an investigations and intelligence consultancy, founded in late 1997. It currently employs 80 staff, at offices in central London and Moscow. The company is chaired by Nigel Turnbull, former finance director of the Rank Group and author of the eponymous report on corporate governance. Chief executive is Bill Waite, a barrister and former Serious Fraud Office prosecutor.
