NONPROFITS - Islamic American cos. face increased scrutiny

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LATimes

Islamic American Nonprofits Face Increased Scrutiny in U.S.

Charities' financial records are sought to see if any money is funneled to terrorist groups.

By LISA GETTER,CHUCK NEUBAUER and ROBERT J. LOPEZ, Times Staff Writers

From Boston to Burbank, federal authorities are intensifying their scrutiny of Islamic American nonprofits as possible sources of funding for Al Qaeda and other terrorist organizations.

In a recent confidential letter to state charity officials, the U.S. Treasury Department sought financial records on eight Islamic American groups, including some of the largest Muslim charities in the United States.

The inquiry is the first examination of domestic nonprofits to come to light since U.S. authorities launched a global anti-terrorism initiative in response to the Sept. 11 attacks linked to Osama bin Laden's Al Qaeda network.

Treasury has pressured banks across the world to freeze the assets of 66 individuals and organizations with suspected ties to terrorism, including several overseas charities. Bush administration officials now believe that money raised by American charities has also ended up financing Bin Laden's network.

"There's significant fund-raising taking place in the United States right in front of our noses," an administration official said.

Investigators are looking for Al Qaeda connections in a wide range of nonprofits--from a multimillion-dollar relief agency that received money from an alleged Bin Laden front organization to an obscure Islamic center once headed by a man now identified as Bin Laden's chief of logistics.

Evidence appears to be emerging that shows links between Al Qaeda and Hamas, the Palestinian militant group. The Bush administration added Hamas and 21 other terrorist groups to its broad financial dragnet Friday. Charities tied to Hamas have been under investigation in the U.S. for years.

The confidential Treasury letter names two charities that the State Department removed last year from its international aid program. Citing classified evidence, the department refused to explain in detail the reasons for its decision. In letters to the charities, it said only that funding them would be "contrary to the national defense and foreign policy interests of the United States."

The State Department ruling did not prevent the groups from raising money in the U.S. or shipping it overseas. The two charities--the Islamic American Relief Agency in Missouri and the Holy Land Foundation for Relief and Development in Texas--collected nearly $16 million in contributions last year.

Representatives of those and other groups say they do not finance or support terrorism. Some of the officers said they had nothing to hide and welcomed federal scrutiny, while others said the Treasury investigation reeked of "McCarthy-era treatment."

Each of the eight nonprofits under scrutiny has condemned the Sept. 11 attacks. The six that are formally registered as charities are soliciting funds for the victims on their Web sites.

Experts say it will be difficult to determine with certainty whether any of the millions of dollars sent overseas by U.S.-based charities winds up in the hands of terrorists--or if it does, whether the groups had knowledge of its illicit use. Past investigations have yielded little solid evidence.

"Often you'll find there are rotten veins in charities that also do good work," said Daniel Benjamin, who served on the National Security Council in the Clinton administration and is a terrorism expert.

In March, the Justice Department charged seven Iranian immigrants in Los Angeles with funneling more than $1 million to the Moujahedeen Khalq, a group committed to the overthrow of Iran's Islamic government. The U.S. has designated the Moujahedeen Khalq a terrorist organization.

The FBI alleges that most of the money was collected at Los Angeles International Airport in the name of the Committee for Human Rights in Iran. The money was supposedly going to Iranian refugees overseas, but the FBI said it traced the funds to bank accounts in Turkey controlled by the terrorist group. The defendants have pleaded not guilty and are awaiting trial.

Many Islamic charities and religious organizations within the United States contribute to each other. Then the money goes overseas as humanitarian relief, where accountability is scarce.

Most foreign countries, unlike the U.S., do not require nonprofits to file annual statements on their fund-raising and expenditures--although Kuwait recently said it would tighten its regulation of charities to make sure the money does not go to terrorists.

"It's very difficult because there are a mixture of funds," said Oliver "Buck" Revell, a former FBI associate deputy director who now researches terrorist groups. "Some of these organizations are pure fronts, but there are others that are obviously involved in legitimate humanitarian needs."

Legislation Has Been Seldom Used

A 1996 anti-terrorism law made it a crime to support any group designated a terrorist by the U.S., but prosecutions have been rare. Grand juries in Illinois, New York and Texas have spent several years investigating several Islamic nonprofits and their links to Hamas. The only indictments issued so far have been for refusing to testify.

The U.S. government has turned more often to measures that require a lower standard of proof than criminal prosecution, such as the State Department designations and asset seizures by the Treasury Department.

In addition to the two groups already barred from the State Department aid program, the Treasury letter sought information on Islamic Relief Worldwide in Burbank; the Islamic Center in Tucson; Care International Inc. of Boston; and the Global Relief Foundation, Benevolence International Foundation and the Islamic Assn. for Palestine, all based in Illinois.

Treasury officials say they are investigating other groups and individuals who may be added to their list of suspected terrorists, but declined to name them. Treasury is relying on information from the FBI, CIA, State Department and foreign governments, as well as from its own search of bank records, public filings and even Web sites.

Israel, Canada, Britain and other countries have found evidence that Islamic charities are funneling money to terrorists.

The Treasury memo about the U.S. nonprofits was sent after Sept. 11 to the National Assn. of State Charity Officials. The association disseminated it to members, who as state charity regulators keep files of nonprofits that often include income tax returns, state incorporation records and audits.

Treasury officials would not say why the eight nonprofits were singled out. But a review of hundreds of pages of tax returns, incorporation documents and court records, as well as interviews with experts and officials from the organizations revealed hints of relationships that may have stirred investigators' suspicions.

The Islamic Center in Tucson was once headed by Wa'el Hamza Jalaidan, who Treasury officials say is now Bin Laden's chief of logistics.

The center was founded in 1971 by students at the University of Arizona. Its new $1.5-million mosque was funded in part by the Saudi government, said Omar Shahin, the center's imam, or spiritual leader.

Jalaidan was president of the Tucson center from 1984-85, state incorporation records show.

"As far as I remember, he never mentioned Osama bin Laden," said Rehmatullah Mir, who served on the center's board with Jalaidan and remains an officer. Mir, who would answer questions from The Times only in writing, said he doesn't know when Jalaidan left Arizona or where he went.

U.S. authorities believe Jalaidan was one of the founders of Al Qaeda, which was created in the late 1980s.

Some other people who would later become Bin Laden's key lieutenants also spent time at the Islamic Center in the 1980s.

Wadih El-Hage, Bin Laden's personal secretary, was a member of the center when he lived in Arizona in the 1980s. Mir said he could "barely recall" El-Hage. Two weeks ago, a federal judge in New York sentenced El-Hage to life in prison for helping plan the 1998 bombings of two U.S. embassies in Africa.

Ghassan Dahduli was another member of the mosque in the 1980s. He studied landscape architecture at the University of Arizona from 1984-87.

More recently, Dahduli was picked up on immigration violations in Texas as part of the large U.S. sweep of suspects after the Sept. 11 attacks. He remains in custody. He was listed in El-Hage's phone book, found by investigations after the 1998 embassy bombings. Dahduli's attorney dismissed the entry as the result of a brief encounter at a Dallas restaurant when El-Hage recognized Dahduli from Arizona.

Shahin said that members of the mosque raised money for Bin Laden in the 1980s when Bin Laden was fighting the Soviets in Afghanistan, a cause supported by the U.S.

"Our government, America, used to support Bin Laden," Shahin said. "Osama bin Laden was made in America. Our government was sponsoring and supporting him. We are following our government."

Shahin, like representatives of the other nonprofits, said he was unaware Treasury was gathering information about the center. "We have no problem supplying what they ask for," he said.

He said the Tucson center has hosted conferences for the Islamic Assn. for Palestine, another group now under Treasury scrutiny. The center has also raised money for Holy Land, the Texas charity barred from the State Department aid program.

Holy Land first attracted federal attention because of a $210,000 contribution it received in 1992 from Mousa Abu Marzook, political leader of Hamas.

Hamas, the Islamic resistance movement in the West Bank and Gaza, was designated by the U.S. as a terrorist organization in 1995.

Marzook, 50, was born in Gaza, studied engineering in the United States and left for Jordan in 1991, when he became active in Hamas. Israeli authorities say he planned and financed suicide bombings and ambushes of Israeli troops. He is now believed to be living in Syria.

Holy Land president Shukri Abu Baker said Marzook made the donation to the charity before he was designated a terrorist by U.S. authorities in 1995. "The foundation cannot police its incoming donations," Baker said. "We can enforce our charitable values on the way it disperses the funds. That's the challenge, in how we disperse the funds."

The charity, which is based in Texas and has branches in New York, Illinois, New Jersey, California and Florida, raised $13 million in 2000. It says that most of its money goes for clothing, food and medicine for Palestinian refugees.

Baker said he gave little weight to the State Department's decision to remove the charity from its aid program. He said it was an attempt by the Clinton administration to curry favor with Israel, which has linked the charity to Hamas. "We are a charity," Baker said. "We're not in a position to fight political wars against anyone."

Families of Attackers Are Provided For

Some of the foundation's money goes to widows and children of Hamas members killed in attacks on Israel. Its lawyer wrote the State Department last year that such aid was provided based on financial need "without any political test" and that the recipients represented a "negligible percentage of those receiving assistance."

Baker said Holy Land has "not been contacted by any government agency, not in the past, not at this point. When people say we've been under investigation, I don't know what they're talking about."

But in a 1999 court filing, the State Department said there was "an ongoing law enforcement investigation" of the charity and its relationship to Hamas. It said that foreign governments were providing U.S. authorities "with specific information about Hamas fund-raising activities in the United States that support terrorism."

Several weeks ago, two FBI agents interviewed Riam Abdelkarim, an Anaheim physician who joined Holy Land's board of directors this year.

He said the two agents wanted to know how long he had been with the organization and what work he had done for it. He said he told the agents he did volunteer medical work, helping needy families on the West Bank and Gaza.

"They basically said that the perception and the concerns of the intelligence community is that Holy Land was affiliated with terrorists," Abdelkarim said, adding that he thought the charity had done nothing wrong.

Another group with ties to Marzook is the Islamic Assn. for Palestine, which has offices in Illinois and Texas. Marzook was a member of its advisory board and served as chairman from 1988-90, court records state.

The association describes itself as a "not of profit organization dedicated to disseminating information and promoting discussion of the Israeli-Palestine conflict."

Revell, the former FBI official, said that the association distributes videos that show youths slinging weapons in paramilitary training camps, and that its pamphlets contain statements supporting armed jihad against Israel and its supporters.

Rafeeq Jaber, the association's president, blames "Zionist propaganda" for the group's problems.

Jaber acknowledged raising funds to help Marzook fight extradition from the U.S. in 1995 but said he viewed Marzook as a politician, not a terrorist. "There is nothing illegal about being in politics," Jaber said.

He conceded that the group has published Hamas documents, including the charter that calls for a jihad against Jews, but he said that was not the same as endorsing the group.

Dahduli, the Texas man now detained on immigration violations, had been an officer of the association. His attorney, Karen Pennington, said he resigned in January.

Both Dahduli and the Islamic Assn. for Palestine have connections to InfoCom, a Texas Internet company run by Palestinian immigrants. InfoCom's offices were raided by terrorism investigators days before the Sept. 11 attacks. An FBI affidavit citing the basis for the raid has been sealed.

Dahduli worked at InfoCom, though it is not clear in what capacity. He said in a resume posted on the Internet that he did computer work for the firm. But the firm's lawyer said he had been hired as a caterer.

InfoCom manages the Web sites of four of the U.S.-based groups under investigation by the Treasury Department. After the Sept. 5 raid on InfoCom's offices, the Commerce Department suspended the company's export privileges, saying it had illegally sent computer technology to Libya and Sudan.

Marzook's wife, a relative of Holy Land's chairman, Ghasan Elashi, invested $250,000 in InfoCom in 1992. She gets a monthly annuity from the company. Elashi also is an InfoCom vice president. The firm's offices are across the street from Holy Land's.

Arch McColl, InfoCom's lawyer, said the company is "a bunch of nerd-birds who wanted to make some entrepreneurial money." He said he knew of no evidence that InfoCom had funneled money to Hamas.

In Boston, Treasury officials are interested in Care International, which describes itself as a relief organization for "war refugees around the Muslim world."

Care International, which is not related to the Atlanta-based relief and development agency CARE, is listed on state incorporation records the same address as the Al-Kifah Refugee Center, a branch of a Bin Laden charity in Pakistan whose assets were frozen by the Treasury Department in September. The address is a Mail Boxes Etc. box. Care officials say they do not know of a connection between their organization and Al-Kifah.

Care International gave more than $180,000 over the last five years to Global Relief Foundation of Illinois, another charity under scrutiny by Treasury.

Global Relief, which reported $5.2 million in contributions last year, says its money goes for humanitarian efforts in places like Afghanistan and to Palestinian refugees.

"We would just close up shop if we suspected our money would be used for bad things," said Asim Ghafoor, a spokesman for both charities.

Checking Out Any Links to Bin Laden

In Burbank, investigators are looking at Islamic Relief Worldwide, a charity whose British office received $50,000 in 1999 from a Canadian group that the Treasury Department says is a Bin Laden front.

The president of Islamic Relief said he was unaware that the Canadian charity, Human Concern International, had any links to terrorism.

"I would be more concerned if we gave them money," said Ahmad Al-Bendary. "We would never give to any group that has any terrorist connections."

Another of the eight charities under scrutiny--Benevolence International Foundation in Chicago--received $14,000 from the Canadian group last year.

Benevolence said it did not know about the contribution. The group said in a statement that its "humanitarian work throughout the world is transparent and a matter of public record."

Juliette Kayyem, a terrorism expert at Harvard's John F. Kennedy School of Government, said the specter of Sept. 11 will make Islamic charities ask more questions about how their money is used.

She said many Islamic groups have refrained from questioning where their money went once it was sent overseas, for fear that foreign governments might respond by barring them from serving needy people in those countries.

Dr. Ali Zaki said he learned the hard way to ask questions.

The San Francisco doctor said he unwittingly took Ayman Al-Zawahiri, an Egyptian doctor now considered Bin Laden's second-in-command, on a fund-raising tour of California mosques about 10 years ago.

Al-Zawahiri, a physician, said that his name was Abdel Muez and that he was working with the Kuwaiti Red Crescent, the Islamic equivalent of the Red Cross, to help Afghans fighting the Soviets.

Zaki said he didn't learn until the FBI questioned him, years later, that his companion was actually Al-Zawahiri and that the money probably helped fund terrorist activity overseas.

"I'm concerned about the Muslim community at large," Zaki said. "I'm concerned about anyone who donates to good causes."

-- Anonymous, November 03, 2001


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