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Funding Terror

It’s not all done from caves. In fact, those involved could be living in your neighborhood.

By 3.18.04

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Does the sound bite culture have the heart to fight terrorism? Rachel Ehrenfeld, director of the American Center for Democracy, doesn't pose this question directly in her recent book, Funding Evil: How Terrorism is Financed and How to Stop It (Bonus Books, 266 pages, $24.95), but it is nevertheless at the heart of her proposed solution to the terrorism-funding conundrum.

The media, politicians, and the public have spent the two and a half years focusing on the more visceral elements of the War on Terror. Which caves are we bombing? Who is bombing those caves with us? Should we bomb this cave unilaterally or encourage our reluctant friends and allies to come along? It all fits tidily together for the morning papers and the evening news.

If only it were that simple. Ehrenfeld's book is a portrait of the complexity of just what it is we're up against. It's hard to read Funding Evil without feeling that we have underestimated the seriousness of the threat of global terrorism. The public perception of al Qaeda and like terror groups have thus far consisted of men on dirt floors reading the Koran by candlelight, traditional Islamic scarves wrapped around their heads and AK-47s in their laps. The more realistic picture is far more insidious, widespread, and frighteningly banal.

TERRORISM REQUIRES MANY things: blind adherence to a destructive ideology; disregard for human life; charismatic leadership skills. But above all it takes cash. There is a reason why Osama Bin Laden is the CEO of worldwide jihad: his oversized bank account. Following the example of Bin Laden and the Saudi jihad exporters, terrorists have in effect become an investor class.

They open pizza shops, bakeries, car washes, and other legitimate businesses to raise perfectly clean money and launder the dirty stuff. They found charities, tugging at the heartstrings of good people, and then funnel the cash to radical Islamists. They take advantage of people's addictions and the large profits available in the international drug trade. "We are making these drugs for Satan America and the Jews," states an official Hezbollah fatwa justifying Muslim involvement in the drug trade. "If we cannot kill them with guns, so we will kill them with drugs." Often as not, the drug money helps buys guns and they get to do both.

Ehrenfeld's book details several terrorist fundraising schemes, and hints that there are very probably many, many more we have yet to uncover. Often they are brilliantly simple. For example, one U.S.-based group of Hezbollah supporters smuggled truckloads of cigarettes from North Carolina to Detroit, Michigan, exploiting the 70 cent difference in cigarette taxes between the two states to raise up to $10,000 per trip. Over the course of a year and a half, the group raised an estimated $7.9 million. (The estimated costs for the terrorists to set up the September 11 attacks was $500,000.)

Ehrenfeld also illustrates how popular support for terrorist activities often grows out of the positive activities of terrorists in countries without solid governmental infrastructures. "Unfortunately, alongside genuinely worthy causes such as building hospitals and supplying food, the groups pursue illicit activities such as purchasing weapons, establishing training camps, and paying families of homicide bombers," she writes. "Their dual role possibly serves to legitimize and glorify terrorist activities."

This infiltration of Middle Eastern and African countries, made possible by Western dollars, can quickly translate into real security problems. For example, terrorist-run hospitals in Africa not only are good local PR for the murderers and a solid recruitment tool, but they also make it easier for terrorists to obtain visas for overseas travel.

POST SEPTEMBER 11, THE United States took serious steps to cut down on terrorist funding. The PATRIOT Act gave law enforcement officials many new tools for tracking suspicious financial transactions. The Treasury Department established the multi-agency Operation Green Quest task force, charged with "identifying, disrupting, and dismantling the financial infrastructures and sources of terrorist funding," and they have had some limited successes.

There is much reason to worry, however, as Funding Evil lays out in meticulously well researched detail. The financial arm of the War on Terrorism lacks the romance of military action. We don't embed reporters in the Treasury Department, after all. And who wants to be the un-PC reporter to investigate some poor Muslim immigrant's pizza parlor? It's far more fun, and less ambiguous, to board a donkey and travel to the no man's land between Pakistan and Afghanistan to record the crazed ranting of Muslim militants.

Meanwhile, the terrorists' suave, clean-shaven counterparts are buying up real estate and investing in hedge funds. They walk among us, and they are largely ignored.

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