The War In The West

Claudia Rossett has a long article on Fox News (hat tip reader K) describing the possible link between Al-Qaeda and the UN's Oil for Food Program. She focuses on the unusual role of the Malaysian Swiss Gulf and African Chamber (MIGA) in receiving millions of dollars in overpayments from Saddam Hussein in conjunction with the circumstance that its principal corporate officers are on a variety of Al-Qaeda watchlists.

As the Oil-for-Food program actually worked, however, the United Nations let Saddam choose his own business partners. The world body also kept secret the details of those contracts and the identities of the contractors, and it let Saddam graft at least $4.4 billion out of the program through manipulated contract prices, by estimates of the U.S. General Accountability Office.

Saddam's standard scam was to underprice oil sales and overpay for relief supplies, thus generating fat profits for his business partners. Many of those contractors would kick back part of the take to Saddam's regime — or divert it to whatever uses Saddam might fancy. By various accounts, those uses ranged from building palaces to buying arms to supplying Saddam's sadistic son Uday with equipment for torturing Iraqi athletes.

One of the big questions is whether any of the money skimmed from Oil-for-Food also slopped into terrorist-financing ventures such as MIGA.

The circumstantial evidence is pretty damning. Rossett describes MIGA as a "terrorist chamber of commerce". Its founder and president, Ahmed Idris Nasreddin was on a watchlist of suspected Al-Qaeda financiers, as was his business partner Youssef Nada. Another MIGA founder, who remains unindicted still runs the far-flung Hayel Saeed Anam Group of Companies (HSA) which continues to operate worldwide. The HSA was also a large player in the Oil for Food Program and handled at least $400 million in transactions for the former dictator.

The trail peters out behind the wall of confidentiality the United Nations has flung over the Oil for Food documents. But one of Rosett's resource links is to the United States Office of Foreign Assets Control, part of the Department of the Treasury.

The Office of Foreign Assets Control ("OFAC") of the US Department of the Treasury administers and enforces economic and trade sanctions based on US foreign policy and national security goals against targeted foreign countries, terrorists, international narcotics traffickers, and those engaged in activities related to the proliferation of weapons of mass destruction. OFAC acts under Presidential wartime and national emergency powers, as well as authority granted by specific legislation, to impose controls on transactions and freeze foreign assets under US jurisdiction. Many of the sanctions are based on United Nations and other international mandates, are multilateral in scope, and involve close cooperation with allied governments.

Although there is little new detail to be found there, OFAC provides a list of Specially Designated Nationals (a watchlist) available as delimited text files. There are three tables. The parent table, SDN, contains a list of blacklisted organizations, individuals and ships. There is a detail address table called ADD and a table of aliases called ALT which I whacked into SQL Server. These seem to be in the public domain and if anyone is willing to host a download site, I can email him the .BAK files. (Approximately 3 MB in size).

If we breakout the distribution of countries of blacklisted individuals (businessmen) who are on the terrorism watchlist (there are other types of watchlists) we get this (I've ommitted the those with counts smaller than 2).

Country	Number in watchlist
Italy	56
Germany	12
Afghanistan	6
Switzerland	6
Pakistan	5
England	4
Belgium	3
Lebanon	3
Somalia	3
Morocco	2
Syria	2
Gaza (Palestinian Authority)	2

However, if we look at the distribution of countries of blacklisted terrorist-affiliated funding organizations we get a different, but not altogether surprising list:

Country	Number in watchlist		Country	Number in watchlist
Somalia	22		Iraq	2
U.A.E.	19		Lebanon	2
Pakistan	14		Spain	2
U.S.A.	9		Turkey	2
Afghanistan	9		Belgium	2
Bosnia-Herzegovina	6		Azerbaijan	2
Liechtenstein	6		Albania	2
Italy	6		Algeria	2
United Kingdom	6		Austria	2
Yemen	5		Ethiopia	2
Sweden	4		France	2
Switzerland	4		Gaza Strip	2
Bahamas	4		Georgia	2
Bangladesh	3		Germany	2
Canada	3
Netherlands	3
West Bank	3

Though this tells us nothing about MIGA or HSA specifically it provides a suggestive statistical picture of the way in which terrorist funding (at the least the part we know about) may operate. The real surprise for me is how many of the individual terrorist moneymen are associated with Italy, Germany and Switzerland, and I wonder if there is any connection between the frequency distribution and adjacency to the Swiss border. MIGA for example, was according to the Rossett's report headquartered in Lugano, Switzerland. The second list is more suggestive of places that are either world financial centers or places where shell companies can be established without too many questions asked. Because OFAC releases a new list for each year it will be fascinating to do a time-series to see how the shape of the terrorist money funding machine has changed over the last year. Maybe not by much. The topography of the financial system does not change overnight any more than that of the hills.

Armies unconsciously return to same battlefields over the course of centuries because topography compels them to same patch of disputed ground. (Al-Anbar contains not only the Sunni towns but the smuggling routes to Syria. Falluja was a smuggling center. There's a reason people fight in particular places.) For like reason the battle over terrorist finances will probably return to the financial centers, laundering sites and multilateral organizations which are their commanding heights. Like the Ides of March in Julius Caesar, the United Nations Oil For Food Program may have come, but they are not yet gone.