In the effort against terrorism, President Bush froze the assets of the Holy Land Foundation this week, accusing the U.S. Islamic charity of funding the Palestinian extremist group, Hamas. Analysts say the link between charities and terrorist groups is common.
International money laundering expert Jonathan Winer says it has long been the strategy of extremists to channel money raised for humanitarian purposes into terrorist activities.
He says the Nazis built their organization in the 1930's on international money donated to feed the hungry. He points to Chechnya and Kosovo as more recent examples. "Affluent Muslims all over the world were giving money for those causes," he said. "A lot of that money went to charitable reconstruction, but a lot of that money also went for military resistance, and there were terrorists who were recruited out of Chechnya and Kosovo and a lot of that was funded by charitable donations. That is a terrible problem that governments all over the world have to confront."
Economist Randall Dodd, another money laundering expert, says in the Middle East, where there is no tradition of transparency, it is especially difficult to trace where charitable funds go.
Further compounding the problem, he says, is the fact that terrorists use charitable acts to endear themselves to the local population. "If you went over to Israel/Palestine right now, you would see that the reason Hamas is so powerful is that they are a charitable organization that runs schools and hospitals," he said. "It is sort of the [equivalent of the U.S.] 'faith based initiative' over there. Part of them, though, engage in violent activity."
Mr. Winer points to Northern Ireland as another example. He says the British government complained for years that money raised by Irish Catholics in the United States was supporting acts of terrorism by the Irish Republican Army, or IRA. "We made such terrorist fundraising in the United States illegal, and the fundraising for the IRA has been substantially tanked down as a result," said jonathan Winer. "Anyone who is giving funds to an organization it has reason to believe is funding terrorism is potentially at risk for violating U.S. terrorist finance laws. That was true before September 11 and that is true today."
At a time when so much attention is being given to illicit acts, Mr. Winer says, it is important to stress that most charities use all their donations to fund humanitarian activities. Those who support terrorism, he says, are in the minority.