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A charity's odd ties An Islamic organization in Missouri says it aids the needy; U.S. officials question links to terrorists

BY EDWARD T. POUND AND LISA GRIFFIN

Soon after terrorists carried out their attack on the World Trade Center and the Pentagon on September 11, the Islamic American Relief Agency, in Columbia, Mo., posted an urgent appeal on its Web site: "Please help us to help the victims."

But the charity was not exactly in the good graces of Washington. In December 1999, government officials canceled $4.2 million in grants to the charity for relief projects in northern Mali. No precise explanation was ever given. A U.S. official said only that continuation of the funding "would be contrary to the national defense and foreign policy interests of the United States."

Now, as the Treasury Department steps up its investigation of Islamic charities here and abroad in an effort to choke off funding to terrorist operations, the reasons for scrapping the grants to the Missouri charity are becoming more clear. A former senior American official told U.S. News that intelligence reports indicated that the relief agency had provided funds to affiliated groups in Africa that employed people with suspected ties to terrorist groups, including Osama bin Laden's al Qaeda network. Current American aides say they understood that an officer of the charity had "a strong personal relationship" with a high-level official of the government of Sudan. That government has had close ties to bin Laden and provided him with a safe haven until 1996.

Officials of the Islamic American Relief Agency did not respond to questions about terrorist issues. However, in a letter to a government agency last year protesting the cancellation of its grants, the charity said it was the victim of "unfair allegations" and "secret evidence." In an interview, Mubarak Hamed, who stepped down as the charity's executive director last year, says, "We have no ties to terrorists–never."

U.S. officials are not convinced. U.S. News has learned that the Treasury Department now is studying whether to freeze the assets of the charity. Treasury has frozen the assets of dozens of individuals and organizations in the Bush administration's war against bin Laden. Officials emphasize that no final decision has been made on whether to act against the Missouri charity.

In the future, relief groups like the Islamic charity and other organizations receiving U.S. grants for overseas work may find it more difficult to get government funding. Under pressure from the House Intelligence Committee, the State Department now is developing a plan that would require American intelligence agencies to do background checks on private organizations seeking government funds. Officials say the effort will be aimed at uncovering people who might have ties to terrorist groups. "We have already started this vetting," says a senior government official.

Established in 1985, the Islamic American Relief Agency says it has aided children and refugees in several countries in Africa, Asia, and the Middle East. According to its public tax returns, the charity has worked in Mali, Sudan, Bangladesh, and Pakistan, among other countries. In 1998, the Agency for International Development, or AID, approved $4.2 million in grants for projects in Mali. However, a year later, AID terminated the contract. The charity's tax returns indicate that it received nearly $1.6 million in government funds in 1998 and 1999.

Aiding victims. A review of the charity's activities shows that it once had ties with a man who has been linked to bin Laden's network. Federal prosecutors say Ziyad Khalil supplied a satellite telephone that bin Laden used to plan the deadly bombings of the U.S. embassies in Tanzania and Kenya in 1998. The disclosure came at the New York trial this year of four men convicted in the bombing case. Khalil lived in Columbia, a city of 80,000, during the 1990s and graduated from Columbia College.

According to Aisha Qureshi, a schoolteacher who worked at the Islamic charity's offices, Khalil appeared to have been a fundraiser for the charity; she said she often saw him in the office in 1997. Khalil also worked for a company that leased the charity its Web site domain name. Khalil, who could not be reached for comment, was last known to have lived in Orlando, where he worked for Oracle Corp. His ties to bin Laden first emerged publicly in January 2000, after he was arrested in Jordan. He reportedly began cooperating with the FBI; his whereabouts are unknown.

Through it all, the charity remains flush. The most recent tax returns show it netted nearly $2.9 million in contributions. And, on its Web site, it emphasizes its many accomplishments. "Whenever a man-made or natural tragedy strikes an area," the charity says, it "steps in to provide the basic material necessities to the victims."

-- Anonymous, November 12, 2001