Through Our Enemies' Eyes

by Michael Scheuer

  Beyond these businesses, bin Laden is reported to own or control up to eighty companies in Africa, the Far East, South Asia, Europe, and the Middle East from which,17 according to Al-Watan Al-Arabi, “he harvests riches.” In particular, bin Laden’s businesses appear to be flourishing in Islamic countries.18 Al-Sharq Al-Awsat reported in April 1999 that “bin Laden’s business activities, which he conducts under various guises, extend from import-export activities to trading in arms and ammunition from the former Soviet Union markets and to construction and road surfacing for the Taliban and other Asian fundamentalist groups and movements, indeed for some governments.”19 Al-Watan Al-Arabi added to this list, noting that bin Laden also owns real estate and maritime transportation companies.20

  In bin Laden’s business and investment activity—especially since al-Tayyib’s defection—“the name bin Laden does not necessarily figure prominently…. [The companies] are registered in the name of others or are administered by companies that are owned by holding companies registered in countries with poor financial monitoring.” Each company, moreover, was designed to earn enough to cover its expenses and finance al Qaeda activities in the country or region where it is based. Instead of channeling profits to bin Laden’s headquarters, the funds have been used locally, thereby substantially reducing the need for electronic or by-courier financial transfers that might be tracked or interdicted. Multiplying complications for the West in unraveling bin Laden’s front company network is the fact that his associates have added another layer to the maze by establishing their own front companies. Bin Laden’s top U.K.-based advocate Omar al-Bakri, for example, recently told the press that his Al-Muhajoroun organization owns twelve firms in the United Kingdom and frankly admitted that beyond business activities, the “companies are in fact useful as commercial fronts that allow the organization to collect funds and contributions and are political offices for the [Islamic] cell activities.”21

  Another unknown about bin Laden’s personal finances is whether he has used Western banks and financial markets, and, if so, has he been successful? Reports on this aspect of bin Laden’s finances are contradictory but suggest he has used the West’s system. On the one hand, the author of Frontline’s biographical sketch of bin Laden said that early in life bin Laden decided to make sure his finances were always of an “Islamic nature.” “For example,” the author wrote, “he would never invest in [a] non-Islamic country. He would never use [non-Islamic] banks unless it was absolutely necessary. He does not believe in [the] stock market because he thought the investor could not escape interest since his money has to be in a bank and produce some interest. He also is preoccupied with the idea that Jews control banks and stock market[s].”22 In support of this analysis, my own pre–11 September 2001 research found no data showing that any money tied directly to bin Laden had been located, blocked, or seized in the West’s system. The only financial institutions publicly identified as used by bin Laden are all non-Western: the Khartoum-based al-Shimal bank; the Saudi Faisal Islamic Bank; the Islamic Bank in Tirana, Albania; the now-defunct BCCI; and the Dubai Islamic Bank. The latter is the world’s oldest and largest Islamic bank, operates under Islamic law, and is, the Associated Press (AP) reports, “effectively controlled by the United Arab Emirates government.”23 In July 1999 the New York Times claimed bin Laden was funneling money through the Dubai Islamic Bank, a claim supported by “UAE banking sources” who denied knowing if the practice continued. A bit defensively, the sources said, “There is as yet no international resolution banning banks from dealing with bin Laden and that there is no legal reason not to conduct banking transactions for him as these involved legal activities and are not subject to money-laundering laws.”24

  On the other hand, a good deal of information exists suggesting bin Laden uses Western banking and financial systems; this information is backed by the commonsense conclusion that bin Laden—whom Saudi intelligence officials call a “skilled executive”—would not put all his financial eggs in the fragile and, in Western terms, unsophisticated Islamic banking basket.25 The problem is that the data, while plentiful, lack checkable facts; the data are suggestive, not conclusive, and the secretiveness of Western banks offers little hope of comprehensive tracking by analysts of the issue. While it can be confidently assumed that bin Laden must have accounts and investments in Western banks, the statement is only a defensible conjecture.

  Realizing the West’s frustration over his well-hidden money, bin Laden has taunted his foes and even hinted at a cyber attack on those who seek to freeze his funds. “God opens ways for those who work for Him,” bin Laden said in late September 2001. “Al Qaeda comprises of such modern and educated youths who are aware of the cracks inside the Western financial system, which are becoming a noose for it and this system could not recuperate in spite of the passage of so many days.”26

  Voluntary Donations

  After such sensational items as a personal billion-dollar fortune, a family company worth many times that amount, and a multinational financial network as intricate as a nation-state’s, the idea that private voluntary donations may be the key—and least detectable and interdictable—source of funding for bin Laden’s organization is a rather dull concept. Still, a betting individual could do far worse than put his money on this horse; charitable contributions are one of the five pillars of Islam, and bin Laden himself has said: “Thank God, our financial situation is all right. The Muslim brothers who support us make us not need anything material.”27 Quoting unnamed U.S. officials, for example, the Washington Post reported in August 1998 that Washington was “trying to overcome bin Laden’s continuing ties to wealthy individuals in Saudi Arabia and the Persian Gulf countries who have donated funds to Islamic social service organizations.”28 Try as Washington might in its new, concerted efforts to close down the financing of al Qaeda, it may well be impossible to “overcome” ties that are now twenty-plus years old and over time appear to have become dominated by bin Laden-like true believers.

  When the ties first developed after the Soviet invasion of Afghanistan, the donors covered the spectrum of wealthy Muslims, from those who were committed Islamists, to those believing they were simply fulfilling a religious duty by helping Afghans defend themselves, to those super rich, often-royal ne’er-do-wells who donated to all “Islamic causes” and did not give a hoot about how the money was spent.

  Who, then, are the donors. “Rich Arabs” or “Rich Muslims” are the standard but unhelpful catch phrases. The hard fact is that the donors are difficult to identify, but they surely represent a cross section of the wealthy in Muslim society worldwide: merchants, bankers, investors, and members of various royal families. “It is not only the bin Laden family that is supporting him,” Sa’d al-Faqih told Frontline. “Bin Laden has never relied on his own money or his family’s money to survive. Many rich Muslims believe that the best way to serve jihad is through him.”29 Adding credence to al-Faqih’s contention is Ahmed Shah Masood’s description of bin Laden as a master at securing funds from others. “When Bin Laden was not so widely known to the world, he did not have much money,” the late leader of the anti-Taliban Northern Alliance told Izvestiya in December 2000.

  He came to our country not as a terrorist or a military man but as a civilian to provide the mujahedin’s Islamic movement with organizational and moral support. He did not have large savings. Even today when he is supplying the Taliban with everything they need, he does not have the flows of finance people ascribe to him. He knows where to find finance and how to persuade interested people to invest in him and his cause. You cannot take that away from bin Laden.30

  Saudi Connection

  As discussed above and will be addressed below, money flowed jihad-ward from the bin Laden family and other wealthy Saudi and Gulf merchant families. The sons of these families fought the Soviets alongside bin Laden and the Afghan mujahedin more than a decade ago and became influential members or managers of family businesses. They can be counted on to financ
e those fighting in God’s name anywhere in the world. As Professor Khalid Duran has said, “In the nineties, sons began to step into the shoes of their mujahedin fathers.”31 In this vein, Sa’id Aburish told Frontline he believed that money for bin Laden “comes from inside Saudi Arabia, from other people who belong to merchant families.”32 Aburish’s view was seconded by U.S. News & World Report, which explained that among bin Laden’s “other benefactors” are “merchants in the Gulf states,” as well as by the New York Times, which said funding for bin Laden comes “from powerful people and financial institutions in Kuwait and Qatar.”33 Like the “Secret Six” who funded John Brown, some members of the Gulf’s economic elite appear to be funding efforts by bin Laden to destroy the status quo in which they have both ruled and prospered.

  Tending to confirm these conclusions, the Saudi government in 1999 audited the kingdom’s National Commercial Bank and found that “five of Saudi Arabia’s top businessmen ordered the National Commercial Bank … to transfer personal funds, along with $3 million diverted from a Saudi pension fund, to New York and London banks.” The money went to “the accounts of Islamic charities … that serve as fronts for bin Laden.” According to the media, the five donors are collectively worth over $5 billion, and two prominent Saudi merchant and banking families were involved in the transfers, the al-Amoudis and the bin Mahfouz—the latter family owns a large share in the Saudi banking industry. Interestingly, the son of one of these families, Abdul Rahman Mahfouz, is a director of one of the charities that has fronted for bin Laden; the charity’s assets were frozen by the British government after the 11 September 2001 attacks, and most of the trustees were identified as “members of the wealthy bin Mahfouz family of Saudi Arabia.” Although USA Today, U.S. News & World Report, and Reuters all claimed that the businessmen were paying bin Laden “protection money”—U.S. News said, “Two representatives of wealthy Saudis visited bin Laden in the early summer [of 1998] and paid him not to conduct terrorist operations in Saudi Arabia”—this analysis smacks of Western thinking and Saudi disinformation.34 Closer to the mark is Sa’id Aburish’s claim that “support for bin Laden comes from all levels of society in Saudi Arabia,” including members of the al-Saud family, because there are people across society who believe bin Laden is performing a religious duty they are obligated to support.

  Since the August 1998 U.S. missile raid on bin Laden’s Afghan camps and bin Laden’s November 1998 indictment by a U.S. grand jury, “donations from across the Muslim world have been pouring in [to bin Laden].”35 In July 1999 the AP reported that Saudi authorities had found tens of millions of dollars were being donated to bin Laden until they “uncovered the donations and stopped the transfers. Without Saudi intervention, bin Laden may have received much more said one source.” The AP said that “The sources, who included a Saudi businessman, said Saudi officials questioned several leading entrepreneurs after their names were discovered among those of other Saudi donors. One of those questioned is the Saudi owner of a major advertising firm. He was severely rebuked by Saudi authorities.”36

  Although the practice seems counterintuitive, money is provided to bin Laden by members of the Saudi royal family and by other royal families in the Gulf. “Mr. Bin Laden,” the New York Times reported in early 1999, “receives funding and political support from princes of the Saudi royal family, whose king he has vowed to depose.”37 How to account for behavior that to the West appears shortsighted if not suicidal? At base, the al-Sauds themselves are to blame for creating a society in which their family members would voluntarily contribute to a man determined to eliminate the dynasty. Among members of the al-Saud family, and to a far greater extent in Saudi society as a whole, there is a strengthening belief—particularly as the basing of U.S. forces in the kingdom nears its tenth anniversary—that American pressure has “led King Fahd to act subserviently to U.S. interests and designs by arresting opposition [read religious] leaders and suspending Islamic law.” Many others, including bin Laden, have argued that subservience to U.S. interests is manifest in Riyadh’s production of oil at a rate that keeps world prices at levels the West can tolerate, but starves the kingdom’s treasury and reduces its ability to care for citizens. In this context, Professor Magnus Ranstorp has written, “Bin Laden is part and parcel of a broader effort by a growing internal opposition since 1992 to challenge the Saudi regime’s claim to sacred authority.”38

  Islamic NGOs

  Islamic NGOs have been another source of funding, as well as a fairly easy and secure mechanism for invisibly transferring funds to bin Laden and other Islamist leaders. These organizations proliferated and matured during the Afghan war and are now found in virtually every location in the world where Muslims are at war, suffering, in refugee camps, or where there are populations susceptible for conversion to Islam. Bin Laden has been closely involved with several NGOs and has used his money to support their growth. Most Islamic NGOs are overwhelmingly occupied with humanitarian work; they most often practice the three forms of jihad not associated with the sword: the jihad of the heart, or moral reformation; the jihad of the tongue, or proclaiming God’s word abroad; and the jihad of the hands, or good works in accord with God’s will. “These foundations’ official aims,” Le Figaro explained in September 1998, are “to assist the underprivileged of a country regarded by them as a land of Islam. Present in working-class districts, they build schools, mosques, and water pipes; provide financial assistance for widows, orphans, and the elderly; take charge of the poorest children’s education, and send the most receptive adolescents to Pakistan for ‘religious training.’”39 All are equipped, however, to knowingly or unwittingly assist bin Laden’s movement and other Islamists because they can provide employment, move and distribute funds, and acquire legitimizing documentation, such as identity cards, residency documents, and work permits.

  Disastrously for Western countries, Islamic NGOs are largely immune from Western police action, because they are almost always legally registered, certifiably involved in humanitarian and charitable activities, and affiliated with legitimate religious organizations. The use of Islamic NGOs as conduits for funds and contraband, and as curtains behind which to hide illicit activities, is an excellent example of how bin Laden and other Islamists have manipulated the West’s legal system to their benefit. As Omar Bakri Mohammed, leader of the U.K.-based Al-Mujaharoun organization, recently told Al-Sharq Al-Awsat, “Having lived in the West for many years, we have realized that there are loopholes in the temporal laws that could be exploited in favor of Islam and Muslims.” Bakri told of sending of well-educated Muslim youths from the United Kingdom to the United States for military training because, unlike British laws, “U.S. laws allow the purchase and possession of weapons and shooting practice. This enabled the fundamentalist movement’s sons to learn practical military sciences in special camps in Missouri and Michigan.” In turn, the British press has reported that hundreds of these Muslim youths subsequently travel to Kashmir for more training and combat experience “using holidays from good jobs to fight in what they regard as a holy war.”40

  Bin Laden got in on the ground floor of the development of Islamic NGOs for military-support activities when he joined with Shaykh Abdullah Azzam to found the Makhtab al-Khidimat (MAK)—or Services Office—in Peshawar in the mid-1980s. While the MAK provided relief to Afghan war victims, it also received, organized, and moved into Afghanistan the volunteers, arms, and money flowing to the mujahedin from the Muslim world. In the financial realm, Al-Watan Al-Arabi has said that between 1979 and 1989 about $600 million was sent to bin Laden’s organization through charitable institutions in the Gulf, especially those in Saudi Arabia, Kuwait, Oman, the UAE, Bahrain, and Qatar. Al-Watan Al-Arabi noted that this is not the total amount that went to bin Laden, but “there are no statistics on the amount of money that used to come to him from other Muslim states.” Since the end of the Afghan jihad, the MAK has supported embattled Muslims around the world.41

  Beyond the MAK
, the media report bin Laden also has been well connected to other Islamic NGOs that operated in Afghanistan or have been founded since that jihad. Among these NGOs are Human Concern International (HCI)—which bin Laden helped to found—the Third World Relief Agency (TWRA), the Kuwaiti Society for the Revival of the Islamic Heritage (KSRIH), Mercy International, the Muwaffaq Foundation, and the International Islamic Relief Organization (IIRO). In addition, several of bin Laden’s close associates have worked for one or another of these NGOs. Mohammed Jamal Khalifah, bin Laden’s brother-in-law, for example, once worked for the World Muslim League and then ran an IIRO branch in Manila in the early 1990s that Philippine military authorities have identified as a “conduit of Arab financiers for money to the Abu Sayyaf [terrorist group].” In June 2000, in fact, the chief of Philippine military intelligence said that Islamic NGOs are still being used to fund the Moro insurgency. He also claimed bin Laden had transferred $3 million to the Moro Islamic Liberation Front (MILF) to assist its fight for an independent Islamic state in Mindanao.42