WASHINGTON, March 11 (UPI) -- There is a delicate balance between cracking down on the flow of funds to terrorist groups, and discriminating against Muslim-focused financial institutions and charities, lawmakers cautioned Tuesday. But their efforts to connect Saddam Hussein's regime to financing terrorists directly were in vain.
To be sure, the Bush administration's efforts so far have been relatively successful in freezing financial transactions to terrorist organizations since the Sept. 11 attacks whilst at the same time securing broad support from U.S. Muslims nationwide, according to government officials.
"There has been great cooperation from the Muslim community across the nation" as the government steps up efforts to choke off terrorism by cutting off its financial pipeline, said Alice Fisher, the deputy assistant attorney general of the Department of Justice's criminal division.
She testified before the House financial services committee's director of financial crimes enforcement network James Sloan and Richard Hoglund, the interim director of the Homeland Security Department's office of Customs Investigations under the bureau of immigration and customs enforcement.
Since the terrorist strikes on New York and Washington 18 months ago, the government has stepped up efforts to track down the money trail as a means to stifle terrorist activities, particularly through the Patriot Act to protect the security of the United States.
Treasury's Sloan pointed out that the Act has been especially useful in cracking down on hawalas, which is an informal banking system that keeps little or no records of the transactions, particular to the Islamic world. Whilst hawalas in themselves are often very efficient and used legitimately, many terrorist groups have abused the system's method of not keeping a paper trail of transactions. Indeed, the Justice Department has charged over 20 individuals over the past 18 months for operating the unlicensed money remitting services.
Meanwhile, the Justice Department is pursuing over 70 criminal terrorist financing investigations, and it has charged 61 individuals for supporting terrorist groups including al Qaida and Hamas.
But some committee members, such as Luis Gutierrez, D-Ill., were concerned that prying too closely into the client list of hawalas could put innocent citizens under unnecessary scrutiny, especially since many use the system simply because it has a far lower service charge and is often more efficient in getting money abroad. Gutierrez also pointed out that some hawala customers were illegal immigrants, who do not have access to commercial banks, given that they have no documentation or often cannot provide the minimum balance to keep open an account.
Still, such social concerns were kept on the backburner as most members focused on trying to link terrorist funding to Iraq, in an effort to justify an attack on Iraq. But government officials steered clear of making a direct link between terrorist financing and Iraq's financial support of terrorists, which has yet to be proved, even as the Bush administration prepares for war against Saddam Hussein's regime.
"Saddam Hussein pays the families of suicide bombers in Palestine," who blow themselves up in an attempt to thwart the Israeli government, which the Iraqi ruler subsequently rewards, said Joseph Crowley (D-NY). "That's supporting terrorism," he added.
But the Justice Department's Fisher avoided making any sweeping comments about Iraqi involvement in terrorist financing, pointing out that while there was evidence that illegal funds were going into Iraq, there was no proof of how that money was being spent, or indeed who have been on the receiving end of the money trail.
"Funds are certainly going into Iraq, but we don't know what the funds have been for...we follow the money wherever it's going," Fisher said.
